Did you recently take on (or consider) a loan of 84 months or longer on a car purchase?
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Any Questions for a Car Dealer?
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I certainly wasn't helping customers purchase vehicles 35 years ago with anyone's parents (wasn't even born yet) so I don't know how that involves me, but we each have our own demons. Some have them for contractors, some for furniture stores, some for car people. Part of the job is letting those who have a chip on their shoulder's comments roll off your back. Just part of doing business.
Ken
As most dealers who have tried the "one price" approach have found, people use them as a negotiating tool with dealers who don't use the approach. Some like paying a slightly higher price for the laid back atmosphere, similar to the reasons Saturn buyers like buying there.
Ken
Thanks
Do you have to pay taxes on the whole purchase price or only on the amount you pay for a lease?
Is there a significant difference in price between leases for 12K miles allowance per year and 8K miles per year?
Where and how I can calculate how much I will pay for a lease (programs, web sites, etc..) Any good resources you can recommend on this subject?
Is lease gets calculated based on the purchase price or some other factors (like depreciation)?
Thanks,
Dmitry
They are by far the best choice right now in the SUV market...both have plenty of room for hauling your stuff...both are awd standard....plus they both come stacked with standard features...both have outstanding reliability, resale value, safety features, power, torque, the list goes on.... and I think they are just big enough to fit everyones fancy...in other words...they don't look like tanks! Acura MDX is the upper luxury line of the Honda Pilot so you will get more do-dads....but again....you will not be disappointed by going with either!!! The Pilot is just a hair bigger and wider than the MDX...but I think you will be pleasantly surprised!!
Happy Hunting!!!
As for milage, most leases have a low milage option of 12,000miles/year. There are only a couple leasing companies that I know of that offer a 10,000mile/year option.
The lease gets calculated partially on the purchase price, but also on the residual of the vehicle.
The best bet for information is the forum on this topic here on edmunds.
Ken
Where we differ is you will try different dealers. If/when you find someone who agrees to your price, you close the deal.
I bet we make deals that are within a few dollars of each other.
The common thread is the reserach up front, though.....before you even set foot in the dealership.
Ditto here......My family says I research things to death.....But they all ask my help when looking for a vehicle.
He was always saying that those that say they have money.....DON'T. Those unassuming types are the ones with the biggest bankrolls.....and they'd never consider themselves "rich". Boy, I hope I fall into the latter category..... :shades:
"A spouting whale gets harpooned."
And his son still drives his 1996 truck.
So, off I go to find a year end car deal (December 2004). The new LeSabre's looked good but the prices were still too high (I thought) for a year end deal.
I stopped by our local Carmax to look at Impala's. They had a 2004 Impala with 7,000 miles for $14.995. It was bright fire engine red (Dad would not consider it) but was in perfect "like new" condition. The other Impala's with more mileage, in better colors, were about $1K-$2K more. Across the street at the Chevrolet dealer, their Impala's of the same year and mileage were $17K-$19K. Even if the Chevy dealer would come down to match Carmax, it was a turn off just thinking of the negotiation headache. I would buy from Carmax just because of the very reasonable up front pricing if I was looking for a used car.
As far as I know, I don't think Carmax sells new cars, at least in my area.
We ended up getting my Dad a new 2004 Mercury Grand Marquis GS (last '04 they had). It was very similarly equipped to the 2004 LeSabre and the Mercury was $6,000 cheaper. My Dad is 84 and I thought if he was going to play "bumper cars" again, this one had plenty of metal around it!
Mark
PS. Ditto about the "spouting whale gets harpooned"--- I see it all the time.
They sell both new and used cars. For example, the Laurel MD store sells new toyotas.
I have found that it is not a good place to buy cars, but is a good place to sell cars.
For those of you shopping for a NEW vehicle from the one of following manufacturers...
Toyota, Chrysler, Dodge, Jeep, Nissan, Scion
Go to the carmax web site, search for the model and trim line you want, get their no haggle price and print that page out. Go to your local dealership with that page in your purse or pocket and negotiate your best deal on their vehicle. Do not mention carmax or anything, just negotiate your best deal. After you invest HOURS horsing around with these clowns and you have their best price, pull your printed no haggle price out and see what price is lower. I would bet that the carmax price is lower, many times by a very significant amount.
Try it and report back to us!
I have found that anything you hold on to, loses value, my current vehicles are '96, '96, and '99. All cost in the mid to upper 20's when purchased new, and all about 3-4 K now. So, everything depreciates, no matter what you buy.
Of course, most cars depreciate, but the absolute amount and relative percentage of depreciation varies a lot. Some loose 50% in 2 years; some in 5 years or more. I find it helpful to think of car depreciation in terms of cost per mile, or cost per month. While Edmunds' TCO (True Cost to Own) calculator is far from perfect, it is a reasonable first approximation to estimating these costs.
Do you find it works better to do the "carmax-saturn" approach, or the "persian bazaar" approach, and if you favor one over other, why?
And are there demographics in the USA such that some regions overwhelmingly respond to one approach over the over (does Vegas love bazaars? etc.)?
Oh, by the way, I'm not a dealer and I think my profile shows i'm definitely not a troll.
'11 GMC Sierra 1500; '98 Alfa 156 2.0TS; '08 Maser QP; '67 Coronet R/T; '13 Fiat 500c; '20 S90 T6; '22 MB Sprinter 2500 4x4 diesel; '97 Suzuki R Wagon; '96 Opel Astra; '11 Mini Cooper S
Big groups like Carmax, Auto Nation and United Auto Group are fine, but they are hardly the juggernauts that they claim to be.
They are out performed by the "old fashioned" family dealers in plenty of markets across the country.
Its not always the guy with the lowest price who wins.
We compete w/ a United dealer in our market, they consistently price out below us, yet we out sell them month after month after month.
Why? We offer better service and a more friendly atmosphere.
Mr I hate dealers post is full of holes. No dealer is going to beat anothers price by $3,000. Its simply not necessary. As a dealer you know what your competition is doing, where their pricing is. Most of the time you try to beat a deal by a few hundred or so, that all that is necessary. Leaving more money on the table than you have to is not a good business practice.
If we lose a deal to our United friends its usually no more than $500 or so. Not thousands. On the flip side, we don't charge thousands more either.
Carmax isn't going to give up profit so easily, corporate entities are quite ruthless in that regard.
People feel the need to haggle for cars, even if they say otherwise.
One price stores are used for bargaining purposes. Sure, some people buy there because the experience is generally better, but more buy from negotiating stores.
Dealers are slaves to what works, if one price was better more dealers would adopt it. In fact traditional dealers like having someone come in from a one price store, you know where you have to be to beat the deal.
Just my $.02
To set the record straight, not all manufacturers have holdback. Most European makes don't do holdback..... so the invoice price is it. WYSIWYG. That is a big reason why discounts below invoice just don't happen (generally-speaking) with certain manufacturers. (It may very well be the reason they tend to keep their value pretty well, too.) If those dealers sell "below-invoice," they really will lose money... as opposed to domestics and some asian manufacturers, where they typically have some kickbacks.
keep in mind, that dealers tend to finance their cars, and most of that holdback is eaten up by finance charges while the car is on the lot (another reason why dealers try to put you in a car that they have in stock!)
contrary to popular belief, things arent as cut and dry as people want to make them!
-thene
p.s. - on the carmax thing - if they are selling used cars at $2000 more than the next guy, thats probably why/how they can sell you new cars at a LOWER price! its all a numbers game!
That is probably why a lot of people around here go there to sell their cars (instead of trading them in) before buying a new one. Typically, Carmax will buy a car for more than our local dealers will give as a trade. My buddy traded in a car recently, and the dealer offered him a max of $5500 for it. The salesman suggested to my buddy that he go to Carmax and sell it, because they would probably offer him closer to $6300.
That has been my experience on domestic sedans. "No haggle" means the dealer sets the price. Do you think that they are going to give you their best price?? Not likely.
People not in the car business believe they know exactly what is going on in everyday operations because a friend of a friend once told them something and when someone that does know trys to educate them they are told that they are wrong and misleading.
we are going to get yelled at shortly if this continues.
If we need a separate Carmax discussion, let me know.
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2015 Kia Soul, 2021 Subaru Forester (kirstie_h), 2024 GMC Sierra 1500 (mr. kirstie_h)
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Edit: Ahhh....I'll let Kirstie do the knuckle rapping. :P
Well, to be fair to Carmax, their used cars are about the best reconditioned used vehicles you can find. I think they offer a money-back guarantee on their cars too, but I don't know for how long.
Their business model allows for lower profit but higher volume, kind of like WalMart.
Original financing was: All current Rebates by Saturn and 4.9% $306 per month
New financing: 0.9% and no rebates $305 per month.
We had a trade-in value of $3500 and financed for 60 months.
As this option was not offered, if it a better deal? The price of the second car was a couple hundred dollars more which I plan to ask why.
Note: The Dealer gave us free mudflaps and a cargo mat for our time.
I have a feeling I may have paid for these extras with the finance change.
I much prefer the set-price approach although unfortunately my dealership does not use this business model. As a salesperson I like it because I can develop a better relationship with my customer and the customer already knows what to expect when it's time to buy the car. Setting the price forces the dealership to price their cars low enough to be competitive but also keeps the prices high enough so people like me get paid.
Yes, a dealership *can* make more money following the haggling approach, but as consumers educate (and MISeducate) themselves on pricing, this approach has become increasingly frustrating and fruitless.
However, and I think this is hilarious, there are a handful of customers who get very upset at the notion of no-haggle pricing because they think they're getting a bad deal unless they haggle. LOL.
To answer your second question, is one approach more sucessful than the other in different geographic areas....I would say the answer is no.
You're spending more money on the car and less money on the interest on the loan. You should be happy!
People feel the need to haggle for cars, even if they say otherwise.
Maybe yes, maybe no. It probably depends on many factors. In used car market people need to haggle because very often asking prices are simply outrageous with haggling "built in". Otherwise, it would not be worth to look at this 3-year old Corrolla with 12K sticker. This way you have self-propelling scheme: high asking price-people haggle-dealers need to mark up asking price to give themselves room. Plus, of course, a whale (i.e. college girl, single mother, foreign student, etc.) may show up and take it. Why let go such a chance?
In new car market the nominal margins are much smaller, competition is high and most people know what to expect within probably a thousand bucks. Thus, the real game is really somewhere else: fees, trade, financing, add-ons. Current overemphasis on the nominal price gives dealers opportunity to obscure this fact from the customers and let them concentrate on those 200 bucks they will "save" after 3 hours of intense negotiations. After that they are already so commited and invested in the car, tired and disgusted of the plase that they will get convinced to lease out their mothers just to get out. Then real stuff comes in: APR, junk service plan/rustproofing/paint sealing/insurance etc.
The current system serves the dealers, not the customers: dealers/salespeople do it every day and know every aspect of the process, are trained to separate us customers from our money in the most efficient way. We, on the other hand, do it once per several years with no special training. We may think we want the current system, but it is like Microsoft Windows - we simply don't know any better. So the best of us learn how to do it, the rest just tries to survive. We know something is wrong, but cannot really pinpoint what - even when we get illuminated, it is hard to go against the rest...
2018 430i Gran Coupe
.....huh? Not sure I'd call it a much better deal.
....let me think about this one. I assume you mean to say you are spending the same amount "monthly" on the car. Lets call them Scenerio #1 and Scenerio #2. More money or less money, we can discuss that b/c in the scenerio #2, you paid more for the car (we can only assume its the exact same car, as well??)
On the lower interest rate loan, you have less interest per payment and more principal, therefore the principal amount to begin with is bigger.
.....Question, what is the amount financed on each scenerio? Scenerio #2 will be much higher than scenerio #1.
To really get into it, need to know some figures. Price of car, length of loan, total loan balance (principal amount of loan), what the rebates were, are all the other numbers consistent (tax, title, doc fees, trade-in, etc...).... you may be better of in scenerio #1 with an alternate source of financing... should be able to pick up somewhere around the low 4's at credit unions.
....make any sense?
My wife would rather pay the extra $1 then have the dealer make a bigger profit.
Note: She barely got approved for 4.9%.......how did she get 0.9%?
Dealerships make a killing selling this garbage. Throw in tinting and aftermarket alarm and stereo installs, DVD players, these are cash cows.
Just to give you folks an idea, at my dealership I get all that stuff at cost (if I wanted it, and I don't). Cost for paint sealant and undercoating package to customer: $265. My cost: $58.
Furthermore, 90% of the aftermarket warranties sold at dealerships are junk. Exceptions: manufacturer's warranties or Carmax's extended warranties. Demand "named exclusion" warranties, if they don't have those kind of warranties, refuse to buy it.
Note: Vehicle A and B are exactly the same.
My wife does not have great credit (615) so a credit union could not help her.
She is happy with the monthly payment, loves the car and I do not want her buying a new car a negative experience.
But I don't want the dealer making more money after a less then average experience.
You get quickly over the price (OK, salesman throws in "free" oil change or pin stripe), politely decline rest of the junk add-ons and in couple of hours (or less) are on your way home. Like I just bought my washer and dryer in the local store. The research would be limited to checking the papers/internet, asking the friends about the showroom and phone call to the place if they have what you want. Oh, of course a test drive or two... I know, I know, nothing can be that simple, especially if thousands of grand are in the game, but you get what I mean.
Again my point - all those shouts that it "would be boring" and stuff are ususally from people who profit on current system, i.e. dealers and small percentage of customers who do not mind this kind of environment. Others just play the game not to lose.
2018 430i Gran Coupe
dino, the people who say "it would be boring" are people who need to find new hobbies in life!
The people who really profit off of this old-school haggling system are the sleazy General Managers and their sales managers, usually former greasy car salesman. These guys make a *lot* of money.
thenebean....I've always been of the mind that I want a relationship with the dealership I buy from. Personally, I've always found that I can strike as good as, or better deal with the "family store". Plus, I like the fact that when/if there's an issue, I'm not dealing with a corporate bureaucracy.....as I would if I were to buy from someplace like a CARMAX. Add to that, I do believe that given the chance, the local stores ususally will give me "freebies" along the way with my ownership experience every once in a while. That ranges from a free oil change or tire rotation, to free car washes/details, to fruit baskets or cookies on my birthday.
Call me "kooky" but I like that sort of treatment. And "NO", I don't think I pay more for that when I buy.
If there is a warranty issue, you can take it to ANY AUTHORIZED DEALER for warranty work...period. The selling dealer may claim you may get treated better if you buy from them and that is BS. This is called discrimination and it is ILLEGAL. They have no idea where you came from, etc. So, if you buy it from another state and move, the local dealer will not provide good server to you? That is bullpuckey. Dealers use this is another one of there negotiating tools and it doesn't hold water. If you believe it, I feel sorry for you.
As far as freebies go, there is no free lunhc for anything. I will wish you a Happy Birthday for free...matter of fact Happy Belated Birthday. :P
Wouldn't you rather pay a bit more to have peace of mind from what you buy? Then again, does Safety really sell in America?
Hope they saved what they got from me years ago 'cause they ain't getting any more.
basscadet & others, thanks for feedback!
Wrt add-on extras, I've no problem with them if they have good value for the money. But stuff like "fabric protector" that has a 2 page warranty dissavowing virtually anything that can stain the fabric is worthless.
Incidently, on C&D mag site, they describe the differences between how men and woman preceive and buy cars. For the dealers here, have you found this to be true?
I plan car purchases at least 6 mo - a year in advance. I have started the process a little early as upcomming trips require wintertime driving, and would like AWD. The Audi A3, a seemingly nice car that is still being introduced into this country seems to fill the bill when it gets AWD, which won't be until next year.
But one thing that is critical is Seat comfort and cabin space, as the trips can take 8 - 11 hours each.
So, to decide if I should even start planning for this car, is it unfair to a __dealer__ if I visit, sit in the car to see if it is reasonably comfortable, then get a brochure and take the salesperson's card for future reference. That's all - no drives, no license swipes, no credit checks, etc.
Of course the option is to wait for a car show, but at those Audi has a tendency to seal its cars up and not allow anyone to sit in them or really see what is inside.
YOU HAVE GOT TO BE KIDDING ME!!!!
TELL THEM TO GO TO THE NEAREST DRUG STORE AND BUY A $4.00 KITE AND GO AND FLY IT!!!
If you go into the dealer thinking it's an adversarial relationship, then you'll reap what you sow.
Bottom line is this...they should have brought that up during the deal process and if they didn't shame on them...if you tried to take that car back because you decided you no longer wanted it...what do you think they would say?
They will not do a thing to you...and cannot....buyer beware....and trust me, they are not going to get into a legal fight over something as small as this....all they are doing is hoping you will come in and give them money....
Next time they call and bother you....tell them to call 1-800-waaaaaaaaaaaa
As they would say to you...a deal is a deal....someone made a mistake at the dealership and now should eat that mistake...I can't believe they are even bothering you about this....who are we talking about anyway???