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Dealer's Tricks - bait & switch, etc.
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Selling a car at invoice does "not" make a dealer money usually unless there is some kind of rebate.
The kind of cars that are sold at invoice are usually the dregs in the marketplace.
It's the prevaling MARKET that determines price.
that being said, anyone have any insight as to how luxury car prices are holding up? also, it seems a lot of the stories i hear about intense haggling back and forth and customer manipulation/games seem to be hondas/toyotas/american cars. do the luxury dealers discount much? do the salespeople engage in the same tactics (not all, of course).
What items are on your Toyota invoices that aren't on the Toyota ones you can pull up here
on Edmunds?
Erik
If the dealers wanted to keep the auto manufacturers in business it would be a two way street on dealing!!!!!!!!!!!!!! Why is it only one way and the customer needs to buy, buy buy!!!!!!!!!!!!!!!!!!!!!!!
As to who makes the first offer, I always do and I go with invoice unless there is a rebate etc then invoice less rebate.
it), or the one the dealer has? They can be many hundreds of dollars apart.
Erik
Jim
All this being as it is,why are car dealers viewed as crooks?Why do people obsess over a 5% to 10% price difference on a $20,000 car.It's like driving on E to save $.05 a gallon on gas.Any other thing we buy we expect the seller to try and make as much as he can,if a car dealer does this it is a "dirty trick".
Sorry, they brought it upon themselves and they need to solve their own problem and not look to the generostiy, good will, or anything else from the buying public to solve it for them.
Yes, furniture has a huge markup, 100% in cases but a slow moving inventory and/or almost no inventory on hand to sell, must order and wait 3 months. Plus, people normally do not purchase furniture often, are not familiar with prices, don't wish to buy direct from NC, do not need to get it serviced every 3 months and not know if they are being treated fairly. Howevert, in my ara the largest furniture store has a "unique"sale every weekend. Do you honestly think that
someone will walk into that store on Wed and pay asking price when they know a sale is coming Fri. The price on the piece of furninture on Wed is becoming useless due to sleazy adverstising, constant sales etc. Plus, get teh price and NC and negotiate with your local soter.
Okay, back to autos
I think you can get to their info via agstar.com , which is a leasing company.
twist
Just recently I helped a friend buy a new Mazda Protege. He paid cash. He will be working overseas (in fact he's left already) and the car will be shipped to him. He didn't want to pay for insurance to cover the period in between when he bought the car and when it would be shipped (less than a month - none of the insurance companies would write a policy for less than six months). So he never got local tags on it; the dealer filled out a form to get temp. tags but wouldn't process it without proof of insurance. The dealer allowed him to drive it for a day or two with the dealer tags, just to make sure everything was fine, and after that he left it parked in the back of the dealer's lot. Once the shipping company picks it up the insurance is covered under their handling and marine insurance.
Now comes the sticky part. The dealer gave him the manufacturer's Certificate of Origin, and of course he has the bill of sale showing that it's paid in full, but he never got a title. The dealer refuses to process it through the DMV since he doesn't have insurance. Why are the two issues related, shouldn't the dealer have processed the title for him, regardless of whether he got insurance or not? He will probably be selling the car when he leaves his tour of duty overseas. Can that even be done without a title? What would happen if he decides to bring it back to the U.S. with him - can he get it titled back here when the car is a couple years old?
If any of you sales types can shed any light on this, I'd appreciate it. Thanks.
As you said in a later post, the market determines the value. And I won't even think of mentioning a number until the dealer tells me what they want for it TODAY. Then I can decide. If I decide not to buy at that price, well, they can name another if they care to. If not, I drove in and I can drive out.
The dealer doesn't make a profit selling at invoice? Subaru has a 3% holdback. It looks like the dealer can make $720 on a $24000 invoice sale.
The cars sold at invoice at the dregs of the lot? I don't think an '02 Forester S Premium w/leather falls into that group. You may not think highly of the Forester, but I do and I've only had it since 9/1.
If I just simply had to make an offer(say, on a dare), it would be under invoice. The answer to "How much would you like to pay for this car?" is always $1.00.
I've never seen that my job as a buyer includes telling the dealer how much money I have in my pocket or what I'm willing to spend. They're selling cars and they get to tell me how much they want.
The tactic that I have found most useful is tell the salesperson where I have looked out of town, in town and on the 'net. But I won't say what the prices were. They should know, right?
John
P.S. - I'm trying to find someone to teach me to play poker. Anybody know a little game I can get into?
But I am unsure in CA...
On anothernote, shipping that MB to PR was cheaper than shipping it to, say, Nashville!
Bill
To buy a car with a minimal hassle, I think the buyer should make the first offer. If it is turned down, the buyer should increase the offer, and keep increasing it until the sales person accepts.
The tricky part is that the buyer only knows his offer has been declined when he leaves the store and drives away. On more than one occasion, we made an offer to buy a car, the offer was declined, we got up to leave, and the offer was quickly accepted. Therefore, you only get to make one offer when you visit a car dealer. You won't know it has been refused until you leave and the sales person is not hanging onto your bumper.
My system works well if you live in an area like ours where there are a lot of dealers and they all sell the same cars. We drive from dealer to dealer and make offers until one is accepted. It usually takes three or four visits, and since we enjoy driving around and looking at cars and meeting the sales people, it works for us.
One evening we were going out to dinner and we quickly stopped at two dealers and made offers to buy cars, but both were declined. A couple days later, we increased the offer $100, called another dealer, and they accepted. We went to the dealer, gave them a check, and drove the car home. It was an out-the-door offer, so there was no hassle with 'dealer processing fees' or anything like that. Buying cars is a lot of fun.
See you later,
Bob
We're in VA, not CA - right hand side of the map!
That 700.00 holdback "profit" earned by the Subaru dealer will be mostly eaten up by overhead.
Bobst...welcome back! Stick around this time!
That is one of the main issues with buying a car. A sales person can be the nicest person in the world and treat their customers with respect, but they still work for the dealership, which is trying to make as much money on each car as possible. There is nothing wrong with that by the way
Since prices are negotiable, no matter how nice a person is, the sales person and the customer will be on opposite sides. Hence the unwillingness to share information, etc.
Just my two cents.
Jackie
Ed
Further, being the cynic I am I am seriously beginning to feel that dealer invoices are being intentionally marked up by either the dealer or manufacturer to show a higher cost for the vehicle. It is an easy way for dealer to make more money, why not simply have the manufacturer say it costs more, then get the kickback based on volume at year end!
Better to just figure out your reasonable number beforehand, offer it up front to the salesman (say, on the back of a card with your name and phone number) while telling him you don't want to waste his time or yours, and be prepared to move on out if your offer is turned down.
i.e. Hey Bob, the invoice I got for that car at Zeke's clearance house was $29,975!
Well Joe, if you go to Muldoon's buying service their invoice is $29,775!
Hey thanks Joe, I'll go there and make the dealer honor that one!
Say you sell 10 of a particular car within a few days, all for roughly the same price, plus or minus $500.00. Somewhere in the middle, a customer comes in and offers a price for about $1,000.00 more than you have been selling them.
Given the industry, how many dealerships are going to say no and/or counter offer for less money?
That was my point. If the offer is to little, the dealership says no because of market value, but if the offer is to high, they just sign the papers and count the money.
Please note that I am not saying the dealership should point out to the customer that their offer is to high or they shouldn't make the sale. I am giving an example of how the relationship is one sided which is WHY customers distrust dealerships.
So that is why I brought up the market value. It's only used when necessary to encourage the consumer to pay more money.
Jackie
"MSRP and Dealer Invoice are shown here to help you make an informed price
comparison. Most online shoppers expect to see this information, and we're happy to
provide it, but please be aware that only the CarsDirect.com price represents your
actual price for the vehicle at CarsDirect.com.
MSRP (Manufacturer's Suggested Retail Price) is the price that the manufacturer
recommends for the vehicle. Dealer Invoice is the published price of the vehicle to the
dealer.
For many models on our site, the Dealer Invoice price shown includes the
published invoice price from the manufacturer plus an estimate of additional
fees charged by the manufacturer to the dealer including advertising fees, fuel
charges, etc.
For this model, we have added $403.62 to the published manufacturer's invoice
price. This amount represents an estimate of advertising fees, fuel charges,
etc.*
CarsDirect.com includes as much pricing detail as possible in order to help you make
an informed decision, so we've tried to show a Dealer Invoice price that is as close as
possible to the price shown on an actual dealer's invoice. If you notice a difference
between the dealer invoice price on our site and those on other sites, it is because
those sites do not include the advertising fee.
Please note that the Dealer Invoice price may or may not bear any relation to a
dealer's actual cost for the vehicle. In some cases, a dealer's cost for a vehicle may be
significantly less than the invoice price originally paid for the vehicle. Any difference
between invoice price and final cost may be caused by a multitude of factors including
factory refunds, rebates, allowances, or incentives which the manufacturer or
distributor may provide to the dealer and other items which may be included in the
invoice price, such as advertising assessments.
* The estimate of the additional fee information on the CarsDirect.com site is based
upon information received from the nearest priority dealer partner to your area. This
information can sometimes vary by dealer within the same geographic area, and is
meant as only an estimate."
Note the words "published invoice price from the manufacturer". This is apparently what
all the web sites show (including Chrome CarBook), and is also apparently a subset
of the "real" dealer invoice. So far, it appears that carsdirect.com has the most accurate
invoice information; unfortunately, their price info is not itemized, as on other sites.
Erik
Customers claim market value all the time to get more for their trade (I see these for sale everywhere for $xxxxx) or to lower the price of the new one (So-So Motors sells them for only $xxxxx). The problem is that most customers don't know the market at all when they try to make these claims. It is the customer's responsibility to educate themselves about the market.
Example: from what I hear, a Mazda invoice will show the "regular" invoice price, a "S plan" invoice price for buyers who work for a Mazda/Ford supplier or cooperating organization (such as Purdue University or the Experimental Aircraft Association) that is 1.5 percent below the "regular" invoice price, and a Ford/Mazda employee price that is 4 percent below the "regular" invoice price.
twist
Funny thing was, the next week, they had my car on the lot with a big, colorful sale price of $9,600.00 which was $500 over NADA's highest retail.
I called the dealership and pointed out how much lower the KBB retail on the car was than their asking price. They told me "no one around here uses Kelly, only NADA". So, my experience was that this dealership chose whatever values worked in their favor, just as I would have done, only I lucked up, what is actually used in this area was the higher price, so I was able to get them to compromise. I did find it funny, though that KBB is usually so much higher than NADA, but for my car it wasn't.
: 0
Mackabee
I wish I knew where NADA gets their "Trade-In" numbers from!
Bill
But..let me pose a question to you. No flame here, just a question because I'm sincerely curious.
Suppose you advertised your car for sale in the newspaper. It's in nice condition and you think it should sell fairly quickly.
You've looked at pricing through various sources and figure it's worth say, 8500.00.
You decide that your bottom line would be 8000.00.
Knowing how people like to haggle, you stick it n the paper for 8750.00.
First day of the ad a person comes to look at it.
They drive it around the block and say "I'll take it" Whip out 8750.00 and hand it to you.
Would you, as a seller suggest to the buyer that they should offer less?
For example, if a 97 Taurus drives onto the lot and the store already has 6 of them for sale then the price offered for the 7th will likely be less than any book number. On the other hand, if they don't have any and the last one just sold for a good price then it is likely that the store will pay more for it. Local supply and demand.
A Taurus is a great example of a used car that few people want. The rental car companies dump them en masse into the market on a monthly basis.
The 98 Taurus that "books" for 11,000 is lucky to find a taker at 7500.00! This can be VERY dificult to explain to the person who has one to trade in. After all, they did their "research" and they "know" what it's worth.
As a used car, a Taurus, providing a person likes them can be a whole lot of car for very little money. Lots of other cars fit into this catagory as well.
Waddayamean, my Hyundai Excel is only worth $1200?!?! The book says $4500 and it's only got 99,892 miles on it!
But you got $7000 for it, and they are into it for more than that. Also they probably won't get $9600 for it.
My 2 cents.
But if a car wholesales for $7,000 then $9,000+ is what it will most likely sell for retail.
The difference between new and used cars is that used cars are generally sold at a profit.
Not to sound smart, but the "fair offer of $500 over invoice" generally is a gross profit and a net loss.
When I owned interests in new car franchises, it generally cost something like $1,200 or so in overhead to sell a car. And that did not include floorplanning.
Bill
Okay - I'll admit it so you can all have a good laugh - it was a "loaded '99 Cavalier" - but it was really in good condition and had been a problem free car. I needed bigger. I waited too late, and missed the "students needing cars" time of year, too.
I didn't dare take it to other dealerships where they had the exact same car as mine on the used car lot, color and all. I knew they would not want two.
Either way, both myself and the dealer came out happy - and I got a good tax break. I figure if they did not want the car they would not have put it on their lot at all.
The only thing that got me was how they told me two different things - "Kelly is standard", then "no one uses Kelly". How can we consumers be educated if everytime we learn something, we go into a dealership and are made to feel sort of stupid for our efforts? (negotiating from invoice price is another thorn in my side)
If we are to negotiate with dealers at all, we HAVE to have something to go by - and these guide books are all we have. I did look and see that most dealerships in my area had cars like mine advertised at $8500.00 or so.
I agree the Taurus is a nice car - I traded my Cavalier for a program '01. I do feel I got a larger, nicer, safer car for the money - and knowing the depreciation I plan on keeping it for my son when he goes off to college in 4 years.
But there's a reason that when you drive by a typical new car store that they have their USED cars out front!