Quote:
Originally Posted by jimbethesda
Nope. The margins are so high, there is room to reduce it. Your notion that BMW sells it at a loss if you are a good negotiator, is wrong.
But, yeah, if it gives you peace of mind, go for it. No objections here. Just don't think you're smarter than BMW and can buy it at a loss.
|
There is one thing in my thinking, that you’re missing here. I’ve said it above, inherently, but admittedly wasn’t clear enough. I’m saying that factoring in the comfort one can get from a hedge such as this, together with negotiating the price, can make buying an ESC a positive expected value transaction for a given buyer.
We are sort of saying the same thing. If I ascribed $0 value to my comfort of knowing that repairs on my G8x will be covered with no deductible for the next 7/75k, then yes, perhaps even at the very low price I paid for the ESC, the actuarially-priced number would still beat me. But I don’t ascribe $0 to that comfort. So for me, I firmly believe I made the right decision.