Eastern Michigan University students are being given an offer on a new lease from Spirit Ford in Dundee, Michigan.
The process is just as easy as it sounds. Anyone with an EMU ID will be able to take advantage of $250-500 in tuition or book assistance as a cash back system. Along with that, they would receive a low monthly payment for their car or lease.
“It's just an opportunity to put a unique incentive that no one else is really doing, and aim it at college students in order to help them short term with the cash flow that college students typically need,” David Hardcastle said. “And long term, [to] put them long term in a new Ford product, in a way that helps them establish credit.”
David Hardcastle is an EMU alumnus that graduated with a BBA from the College of Business in 2007 and received an MBA in 2009 that now works at the Dundee Ford dealership. He says he got the idea for this program directed at Eastern students when Ford's corporate management pushed dealerships across the country to buy more and more vehicles.
“Everybody's kind of heavy right now because they really wanted us to take a lot of inventory,” Hardcastle said.
Ford was trying to make 2015 a record sales year. Big car companies do not sell to consumers directly, they sell to dealerships, which buy in bulk, and then sell to the consumers. But due to the large amount of pressure that’s being pushed onto dealerships, the company ended up sending more cars to the dealership than were actually purchased. This overstock made Hardcastle’s idea plausible.
Ford has a number of programs to give college students with not very much credit Tier 1 financing for leases. The lower the tier, the lower the interest.
Hardcastle did say that he is still working out the fine details of this program. However, he tried to paint a picture of how this program would work by putting together an example; someone with tier 1 credit could obtain a 36 month lease on a Ford Escape for $285 a month with 10, 500 miles per year, or someone with tier 2 credit could get that same lease for $354 a month.
In an email, Hardcastle said, “This is pricing available to anyone, most dealerships’ advertized price is A/Z pricing.” AZ pricing is a type of financing used by Ford.
If a credit system like this one sounds familiar, it might be because the housing bubble that crashed on campus in 2008 operated on a no credit system very similar to this. Hardcastle explained a little more on how these systems work.
“[With] leases it's all about keeping your monthly payment,” he said. “It's not like a purchase where you're just wrapping it into your loan. It's basically just us giving cash back on a lease. It's us giving away part of our profit on the deal, in order to give that money back to students, to help them with some of those short term costs.”
