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Out The Door (OTD) Pricing questions

mdxnmdxn Posts: 1
When you present a dealer with your absolute lowest OTD price (ha!)--what does that actually include? I need it spelled O-U-T for me: i.e. advertising fees, Title fees? Filing fes? etc etc etc....what? Do I include those all in my OTD price? or is that extra? how do I know what is a "reasonable" advertising fee? etc....Am I just spinning my wheels? Should I just find the Edmunds TMV and subtract $500 or should I spend all this time looking up these tedious details?

Thanks
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Comments

  • vwguildvwguild Posts: 1,620
    It is probably best to concentrate on the price of
    the car that you want, rather than an OTD price.

    Over and above the price of the car there should be the following: Sales Tax, DMV Registration, a
    reasonable($45-$75)Document Fee, and any State
    applied fees. For example, in California we have
    a $5.00 *Tire Fee*, and a $6.00 Smog Fee.

    This is it...no ups & no extras...

    You can find out from your local AAA or DMV what
    should be standard stuff in your state.

    Ad Fees are Regional and can range from 0 to $300+, but
    these are included in the price of the car, and should
    not be added in afterward.
  • Out the door price includes everything, including all fees, sales tax, registration fee, and license fees. Everything.
  • I will have to respectfully disagree with vwguild. While I agree that state tax, registration, reasonable doc fees, and state fees are essentially 'fixed' fees, I would still be concerned with OTD price. This price is like fpereira said, the cost of everything. There are too many confusing things the dealer can add (ie other overhead etc). Do your research, find out your OTD price and stick to your guns. As a consumer, I dont care how the dealer calculates my OTD price, all I care about is my out-of-pocket expense.
  • wrong about the advertising fees. For example, Toyota adds ad fees to the invoice number that you will find on Edmunds. The ad fees are on the actual invoice from Toyota, and they are part of the cost of the vehicle to us. You will also read about the dealer holdback. Usually the holdback is not part of the "on line" invoice prices, but it is part of the car's cost when we buy it. Doc fees are something that I (as a salesman/manager) have no control over. You then have sales tax, tag fee to the DMV, and that is it (at my dealership, anyway).

    I think the bottom line is to compare "out the door" numbers between different dealerships, and if you find one $500 or so cheaper than the other, ask the more expensive one for a breakdown/explanation if you want to give them a crack at your business.

    Ed
  • mvargo1mvargo1 Posts: 298
    Out the Door is just that. It is the price you pay when you drive the car out the door. The out the door price includes all taxes and fees. It is the amount you actually write the check for. If oyu are financing or leasing it includes the total money due at delivery, not just the down payment and what the payment you will actually be making every month.
  • vwguildvwguild Posts: 1,620
    Help me out here!!!!
  • navy4navy4 Posts: 44
    The amount on the check you write or the bottom line on the financing contract. It includes sales tax, delivery and handling (if the dealer has it), and doc fee. At least at the dealer I worked at. All you have to worry with is the license fee, if the dealer doesn't collect it for the state.

    If you are shopping for OTD price. The TMV is only the starting point, you have to add the above fees, which are legit.

    If the OTD price is higher than you like, look somewhere else.
  • mirthmirth Posts: 1,212
    Okay - let's say the dealer has some legit fees, be they advertising or floorspace or port fees or whatever. As a buyer, I want to know what these fees are from the start - I don't want to be blindsided by them after I thought I negotiated the final price. That's just the dealer being sneaky and betting you won't walk away after investing so much time.

    For example, let's say you spend a half hour negotiating and the dealer's final offer is about $100 more than you wanted to pay. But you figure, $100 isn't so big in the scheme of things and it's not *too* bad a price, so you accept. Then, after an additional 30-60 minutes of paperwork stuff, they hit you with an additional $100 processing fee. Suddenly the okay deal is a bad deal. I know a lot of dealers would say that a customer was nickel and diming them over $100, but the fact is that the customer in this situation already went over their budget by $100, so now we're talking $200. So now, if the dealer won't budge on the deal, you have wasted about an hour of your time.

    Sorry to rant, but I've been in this situation before and it just seems like an insult to my intelligence.
  • An OTD price ought to include:

    1) Car Price. If there's an advertising charge on the invoice, then it ought to be included in the sale price of the car. I.E. Say there's a $200 regional advertising charge and you're paying $500 over, then it ought to be, say, $700 over what you see on the net.

    2) Any DMV/Tag/License/etc fees

    3) State sales tax

    4) County surtax if applicable

    5) Any dealer prep fees.

    I.E. "This car is $20,565, OTD it's $22,107.45

    Or whatever. It ought to be the amount of the check you have to write.

    Bill
  • I think the price of the car (not the OTD) is irrelevant(sp?). When I bought my car, I offered an OTD price. The dealer accepted. When I got the 'Buyers Order' it showed the price of the car + addtl dealer markup + appearance package. They even showed a dealer processing fee in another column. I think all us consumers can look at those extra columns and say they scream overhead costs. But you know what, I didnt care how the dealer calculated his totals on the Buyers Order. I did my research, I knew my OTD and the bottom line was all I cared about. The 'total amount due' equaled my OTD offer. My point is that the dealer can calculate that 'car price' to be whatever he wants. Just worry about your OTD total.

    brentwoodvolvo: Ok, I'll bite, what kind of dealer prep charges are you referring to? (#5 above)
  • mirthmirth Posts: 1,212
    The $300 can of Scotch Guard. ;-) (Sorry, couldn't resist.)
  • haha

    Nah, I mean like doc fees.. dealer fees..whatever they call them.

    Bill
  • rroyce10rroyce10 Posts: 9,359
    ..... On these OTD prices, just make sure that your "point of of payment" includes ..The taxes (if applicable), ..The DMV, Lemon law, tire and battery tax..etc.

    After reading dozens of posts on this subject, I feel the biggest "miss-understanding" is when a consumer wants to be at .. let's say, $300 a month -- they have done their homework, studied the options etc, etc, .. let's say, in the consumers mind, they need to be at $15,000 TBF(to be financed).. that's the "point of payment".

    What sometimes happens is, the dealer backs out the taxes and (real) fee's and such, and he is below cost -- that's the rub..! -- the buyer feels that $15,000 is the bottom line and the dealer is at $16,100 TBF, now the payment is, let's say $320...I think this cause's the biggest problem..A OTD price is meaningless unless it's in the "Strike Zone" of the payment you are trying to accomplish ...

    Just about everyone is a payment buyer, whether you make $18,000 a yr or $800,000 a yr .. Save a lot of time and anxiety and just make sure that your OTD price, includes your "point of payment" .. it's very hard for a dealer to eat the Tax, The wax and the Roof racks.. :)

    I hope this makes sense..

    Terry.
  • I caught something that I am seeing more and more of. "Should I just find TMV and subtract $500?" 3 Months ago you could close a deal quickly by charging TMV. Now you must beat TMV in order to make the customer feel special.
  • just add the holdback back into their invoice? I don't see it like Edmunds does. It is NOT a negotiating tool. It is a stumbling block. I just looked up a Sequoia Limited that we have here on the lot and compared it with the Edmunds invoice, MSRP, and TMV. We're about a grand off, which is made up when you add in the holdback, but it is a pain to have to explain it five times a day. They contradict themselves further when they say to give the dealer a "fair" profit of 5% over invoice. This doesn't add up to TMV at all.

    Ed
  • I have negotiated on holdback exactly once in the last 3 years. I know exactly what you are talking about. As soon as some ediot starts using holdback as his negotiating tool the end is near for him. I know most people will read this the wrong way but I don't get paid on holdback so I refuse to discuss it. The customer that brings up holdback and thinks he is being coy would be shocked at what is going thru my mind as he rambles on about my built in profit. All of the discussions that have been had on this subjuct in this forum have lead to exactly nothing in my mind.
  • cfg1cfg1 Posts: 85
    Isellp - please check out the GMS topic in Finance.
  • I never considered OTD before yesterday. Years ago I, too, was a payment shopper. Since I learned how to do a basic payment calculation (give or take depending on my APR), I went to sales price. I was shopping price on a 2002 Civic LX coupe with manual transmission. I had one dealer quote $13,969. Another dealer quoted $14,379 assuring me this was only $300 over his cost because he had to make a little something. I said his price was not bad, but another dealer beat his price by over $400--so were they losing $100 on the deal? He told me to watch out for low quotes to get you in the door and then they hit you with big fees when you get to F&I. He gave me my total drive off cost and suggested I get the other dealer's OTD for a true comparison. I never looked at it that way before. The point is, I don't care what the add on fees are, if the OTD is high, I go to the lower dealer.
  • The dealer that was $400 cheaper on its selling price was $200 higher on its drive off price!
  • vwguildvwguild Posts: 1,620
    Let me have another go at this...You have to negotiate The Price Of the Car...State or Local
    sales tax will vary obviously upon where one lives...DMV has to be paid, and this too will vary
    based upon where you live...Everybody with me so far? Document Fees should vary once again, but
    they are normally in the $45-$75 range...Ad Fees,
    the real ones that is, should be included in The
    Price Of The Car...Dealer Prep, Arctic Environmental Pkgs., Tire Preservatives, Carpet
    Preservatives, and Key hole scratch protection should not be considered as even negotiable, and
    are therefore, not part of the OTD price...

    Only The Price Of The Car, and appropriate Taxes,
    Title, & License make up the OTD Price. And of these, only The Price Of The Car is negotiable...
  • pepper50pepper50 Posts: 195
    What "documents" are included in these "document fees?" Title application fee should be included in the TT&L fee, so what other documents is it referring to in this additional charge?
    Also, what are realistic dealer prep fees? All they have to do is be sure the fluids are full, the plastic wrap is taken off the seats, a visual inspection, and carwash.
    Thanks.
  • rroyce10rroyce10 Posts: 9,359
    ........ When you get the OTD price ... is it going to be in your payment range ....?

    What most consumers forget about is that 1 little thing -- payment..!

    90% of all consumers are payment buyers -- If the OTD price is exactly what they want --- can they afford the payment ....

    If you haggle yourself silly ... and get what you want --- make sure you figured in the most important factor ......... your monthly payment..!

    Terry.
  • vwguildvwguild Posts: 1,620
    The Pre-Delivery Inspection, for VW, is paid
    for by VW...There should be no *Dealer Prep*
    Charges...

    Doc Fees typically refer to the processing of the
    actual paper for DMV...not the DMV Fees themselves...so that when you leave in your new
    car, all that you have to do is wait for the plates to arrive at your house...
  • pepper50pepper50 Posts: 195
    Thanks, VWguild, for your statement about document fees. Why is that not covered in the T,T,&L fee? Here in Texas, it's just a one-page form to register with DMV and pay the tax. Another page for title application I suppose. The customer could actually take both pages to the tax office themselves. In fact, I did it myself when I bought a van a decade ago. So assuming all that is covered in the T,T,&L fee, I don't understand what the additional "documents fee" would cover. Or is the document fee the fee for them to carry the two pages to the tax office and bring back the license plates?
  • vwguildvwguild Posts: 1,620
    Do you know Claude Pepper???

    Actually it is to process the HUNDREDS of DMV
    papers that go through in a month...There are
    people in Los Angeles that would pay you $500
    to got to the DMV for them...:)
  • eric102eric102 Posts: 122
    I have never paid a document fee on any of the cars I have bought (about 20), or any other fees. I always keep it simple, negotiate the price of the car from invoice (usually $100 to $200 over)plus tax and license, thats it, no screwing around. I let the dealer know up front thats how I want to do it, and its usually no problem. If it is, then I go down the street to the next dealer. Thats how its written up on the contract also, just the price of the car plus tax and license.

    Eric
  • vwguildvwguild Posts: 1,620
    I have no problem with that...
  • abtsellerabtseller Posts: 291
    our doc fee is $189. The general line is that is pays the clerks to process paperwork. Whatever. The important thing from my perspective is this...I have no authority to negotiate it from the deal. Neither does the New or Used car manager, neither does the General Manager. The owner is it, and he says don't ask. Fair enough? Luckily, our doc fee is less than most of our competition, and our pricing is aggressive enough to beat most of them anyway, so it rarely makes a difference. If I lose a deal over a $200 doc fee, I either wasn't doing my job properly in the rest of the process, or come survey time, I probably didn't want it anyway.

    Ed
  • postoakpostoak Posts: 537
    However, it can be divided into 3 components:

    1) Dealer charges
    2) State sales tax on dealer charges
    3) Title and license charges

    2 and 3 are set by the government. You need to find out what they are before going to the dealer, otherwise, I fear (but don't know if this is possible) that they might try to add some dealer profit into 3.

    For example, suppose title fee is 15.00 and license fee is 80.00. Can the dealer charge more than $95.00 for "title and license"? I suspect they can.
  • jspata4ajspata4a Posts: 2
    ok, i'm reading a lot about getting the car of my choice (2003 Honda Accord EX-L) for $200 over invoice - but what i want to know - how do i compute all the other costs? or in other words, the final OTD price? is this just Tax, Tag, Title? and what do those run? at the end of the day - will the OTD price (including everything) roughly be equal to the MSRP price? please fill me in - this will be the first tiem i've bought a car by myself and want to get the best deal i can. im payign cash - if that matters. lemme know!
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