leasing basics & benefits -...

© 2012, Hyundai Motor America. All Rights Reserved.

LEASING BASICS & BENEFITS



THE TEN-STEP LEASE PRESENTATION

The Ten-Step Lease Presentation 1. Ask permission to present leasing2. Explain popularity of leasing3. Show savings4. Explain lease-end options5. Explain the right of ownership6. Demonstrate the two ways of

comparing leasing to buying7. List the ways leasing offers value8. Ask which benefit would affect

the customer the most9. Overcome objections10. Summarize


© 2012, Hyundai Motor America. All Rights Reserved.© 2012, Hyundai Motor America. All Rights Reserved.

1. Ask permission to present leasingCustomer chooses a vehicle and is sitting down at the table to review the proposed numbers. Sales Consultant says:

If you don’t mind, I would like to go over the various options available to you.

In addition to purchasing this vehicle in the conventional way by paying cash or financing, I would like to take a few minutes to explain leasing.

Most people don’t understand leasing, or think it is renting.

More and more people, once they understand leasing, prefer it to buying.

May I take just a few minutes? Because I believe you may be an ideal lease candidate.


2. Explain popularity of leasing

Did you know that consumer leasing has more than tripled in the last 20 years? Today, about one out of every five vehicles is leased.


3. Show savingsMany people think leasing is just another way to buy a car, but that is not correct. It is a totally different financial transaction. It is more like an insurance policy. Let me explain:

The residual is the part of the vehicle that you don’t pay for during the lease term. It is your collective savings.

The risk of the residual amount rests with the leasing company. The residual is not the responsibility of the consumer, like it was with the old open-end leases that gave leasing such a bad name.

PURCHASE LEASE$30,000

Pay Cash or Finance All

$30,000Pay $13,500

Residual $16,500


4. Explain lease-end optionsAt the end of the lease you have three options:

Buy it. Complete the sale by paying the residual, which is the part you had not paid for up until that time.

Return it to the lease company, regardless of value.

Buy it and then sell it, or use it as a trade, if the value is higher than the residual.

In understanding the residual, you are able to overcome the big objection that you have no equity at the end of the lease. The equity in a lease is the cash that you save.

You may use the savings to buy the vehicle at the end if you want to. You don’t have to if you don’t want to. The best part is you don’t have to decide until the end of the lease.


5. Explain the right of ownershipToo many people think they have to choose between buying or leasing—that they can only do one but not the other. That is not true.

In leasing, you never give up the right of ownership. All you do is postpone the day you have to make the purchase commitment.

That’s where the residual comes in. It’s the part of the vehicle that you don’t commit to initially. You can postpone that commitment until the end of the lease, at which time you will know if it is a good vehicle.

At the end of the lease, you will also know better what your needs are, because things change.

At the end of the lease you can have the vehicle appraised. If you have a potential profit, complete the sale. If not, return the vehicle and let the leasing company absorb the loss. That’s why leasing is like an insurance policy. It insures the future value of your vehicle. It insures your transportation costs.


6. Demonstrate the two ways of comparing leasing to buyingThere are two ways to compare a lease to a purchase.

In comparing similar terms, a lease payment will be about 40 percent less than a purchase payment. It is because of the effect of the residual.

Or, in comparing similar payments, the term of a lease will be quite a bit shorter.

Leasing helps the consumer avoid the big problem faced by so many consumers: negative equity. In leasing, you have a paid-up contract!

PURCHASE LEASEPayment $500.00 $300.00Term 36 months 36 months

PURCHASE LEASEPayment $300.00 $300.00Term 60 months 36 months


7. List the ways leasing offers valueLeasing is not just another way to buy a vehicle. It is totally different. Leasing offers value in the following ways:

Remember that I mentioned I thought you might be the ideal lease candidate?

It is because of #____________.

1. Lower payment2. More vehicle for the money3. Shorter term to a paid-up contract4. Less maintenance5. Sales tax savings (in 38 states)6. Lower cost of excess mileage

7. No risk of diminished value8. GAP waiver9. Frees up credit10. No trade-in hassle11. Liquidity: you can do better things with your savings12. No risk of vehicle resale value


8. Ask which benefit would affect the customer the mostWhich of the benefits do you think would affect you the most?

#____________.Leasing gives you all the benefits of ownership without the risks!If you decide you still want to own the vehicle at the end of the lease, all you do is pay the residual (which is the part of the vehicle you had not paid for up until that time).


9. Overcome objections “I will have no equity.”

• The equity in a lease is the cash that you save.

“I drive too many miles.”• This is a very common misconception. Actually, the more miles you

drive, the more money you save. The excess mileage charges in a lease are frequently less than the actual depreciation in ownership.

“What about excess wear and tear charges?”• If you owned the vehicle and went to trade it in, in the same condition,

the appraisal would be lower. You can always put yourself in the same position as if you had purchased the vehicle initially by merely paying the residual. Then you would not be charged for excess damage or mileage.


9. Overcome objections “What if I want to break my lease early?”

• The flexibility to break a lease is the same as the flexibility to break a loan. You may sell the vehicle in both cases and if you get less than the payoff you have to make up the difference.

“I’ve been burned before.”

“I’ve heard horror stories about leasing.”• It’s true—there have been abuses in leasing. The old open-end lease is an

example. Or customers were not put in a proper lease—they were put in a lease that was too long or was not for the proper mileage. That won’t happen here because we will tailor the lease specifically to your needs.

A big mistake customers make is to go for the lowest payment. Often that leads to the wrong lease and ultimate dissatisfaction for the customer. Always remember, term and miles are equally important as the payment.


10. SummarizeLeasing is an educational process.

Too many people have leased for the wrong reason: a lower payment.

Too many people have not leased for the wrong reasons: lack of understanding, or they think it is renting.

A J.D. Power and Associates survey showed that 93 percent of the people who leased for the first time were so satisfied that they leased their next vehicle. So the odds are 18 to one that if you lease you will decide you made the right choice.

Leasing offers all the benefits of ownership, but removes the risks of ownership. Leasing also offers many benefits and protections that ownership does not. You give up nothing and gain so much!

The Ten-Step Lease Presentation 1. Ask permission to present leasing2. Explain popularity of leasing3. Show savings4. Explain lease-end options5. Explain the right of ownership6. Demonstrate the two ways of

comparing leasing to buying7. List the ways leasing offers value8. Ask which benefit would affect

the customer the most9. Overcome objections10. Summarize



THE TEN-STEP LEASE PRESENTATION


LEASING BASICS & BENEFITS

leasing basics & benefits -...

Documents