So I'm talking to one of my contacts today and a customer who recently ordered a 2024 3LT loaded Z51 coupe calls to cancel and the order is already sitting at 3000 status. For those that don't know, there is an inside way of pulling the car back but it knocks you down the list about 3 weeks usually. It gets me thinking, how do we soften the blow? What makes a person lose his $2500 deposit due to the price increase? So again, lets look at the numbers!
How many of you know that GM recently lowered the finance rate on Corvette's to 6.99% which is lower than prime and 1-2% less than it was a month ago. On a 100k loan that's going to save you over $4100 in interest over 7 years by just being 1% lower.
Now let's look at the price increase of 12K on a Stingray. How much did you put down, was it $2,000 or $2500? My thought is that money's been gone for 2 years and you don't even miss it by now so for argument's sake lets call it a 10K price increase. (For Cam and all the others waiting to order an E-Ray that ship has sailed. GM moved the production date back until after the strike date which is at least October 23rd, there won't be any allocations for E-Ray's until after the strike date so next Thursday is out for getting any allocations.) The math for E-Ray works here at a 10K price increase. Let's break it down and use $10,000 price increase after your deposit. At the current 6.99% the extra cost on a 84 month term loan is an extra $23.44/week. That's it.
You saved $11.39/week by having a 6.99% finance rate compared to a 7.99% finance rate and the net cost of the extra $10,000 is $23.44/week.
For those putting 100K down on the car if you finance the balance with GM it's going to cost you $34.83/week for each $10,000 you finance. These loans are open and can be paid off at any time. For me in the past, when I'm buying out a lease or financing a lease buyout I usually pay the tax to get it out of the equation. Here the luxury tax in Ontario adds 20% and this was here before the price increase, so for us that adds an extra $2400 on the $12,000 price increase + HST of 13% on the $14,400 = $1872 giving us a total price increase of $16,272. Works out to $56.67/week. So, if we all just sit down and crunch the numbers, I think most of will realize that we can handle it by paying off a little more tax in the beginning finance the difference below prime for a difference of $25 buck a week. For the E-Ray folks the price increase with both taxes works out to $47.23/week. If you pay the $3560 in extra taxes on the price increase and just finance the price increase, it costs $34.83/week extra.
For our friends in Alberta, your numbers are better and for BC folks, find a friend in Alberta and get a P.O. Box there because I feel sorry for you guys. If you've saved over months or years for this car are you going to bail over less than $25/week? I don't think so!!
Scott
