Did you recently take on (or consider) a loan of 84 months or longer on a car purchase?
A reporter would like to speak with you about your experience; please reach out to PR@Edmunds.com by 7/25 for details.
A reporter would like to speak with you about your experience; please reach out to PR@Edmunds.com by 7/25 for details.
Options
Purchasing Strategies - Questions & Success Stories
This discussion has been closed.
Comments
There are posts above on this thread about researching prices and negotiating techniques. Your likelihood of being duped should be lower if you do your homework before shopping.
"Maybe in some of the far reaches of the upper Amazon River delta that might work ...."
Well I live in N Y S and thats a few thousand miles from the Amazon River, and it worked here.
*************
"But ..... GMAC is a totally separate entity of GM, they're a lender - not a baby sitter ... that's like someone calling their mortgage lender and saying: .. "I'm not making my mortgage payments til' they repair the air conditioning system of my house..." ..l.o.l.... you might get a sad shoulder to cry on, but you still have to make those payments ...."
Poor comparison. Real estate is a totally different animal. (do you hire a lawyer to "close" on a car). A better comparison would be to holding up a credit card payment on a purchase problem...I know its not exactly the same but a better analogy. Credit card companys promote this feature. Most likey reason the dealer responded to holding up payment (when explained with a letter) is to keep a good working relationship with there lending company. But who knows, all I know it worked for me and i've heard it touted on talk shows where people call in and ask for help.
***************************
Thanks for the feed back though, its appreciated.
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
over 100,000 dollars.
FYI: That's only the W12 engine... The normal V8 is closer to high $70k to $80k.
If they've only got $50,000 in the bank, that's peanuts. If that's their only liquid assets, I'd say they'd be nuts to be making car payments north of $2,000 a month.
At the end of it that car will be out of warranty and totally used up.
Are you serious?? A $100,000 car is "totally used up" after 2 1/2 years?? Man, that would steer me away from Range Rovers in a hurry!
When people drive them like a commuter car they get penalized severly for it with huge dollar per mile deductions.
Here are some used Range Rovers we have sold recently.
These were all 2004's
24,000 miles and sold it for 61,000( Husbands car perfect color combo Silver w/Parchment luxury interior ton of kit items on it.)
24,000 miles and sold it for 59,000(Wifes car Giverny Green with Aspen/aspen interior luxury interior. A truly stunning and rare combo but a little harder to sell because of that also had lots of kit on it.)
14,000 miles and sold it for 58,000(Black with sand interior which is a good combo but car was a little rough because of the black paint. No major flaws but enough to bring the value down. Also did not have luxury interior so a deduction for that)
Now this next one has not been sold yet...
47,000 miles on it with DVD entertainment system and non-luxury interior. We are only asking 47,000 for it and would of course sell it for a bit less. It is silver with charcoal interior which is an good color combo as well and the paint is perfect and the interior is ok. So lets just say someone comes in today and offers me 45,000 for this Range Rover. I would try and bump him but at the end of it all we would probably accept that.
So lets see that extra 23,000 miles devalued the car by 16,000 dollars from the highest price Range Rover I have sold. That comes out to $1.44 a mile. Even if we compare it to the non-luxury range with the rougher paint it gets even worse at $2.53 a mile.
If that Range Rover had just 3,500 more miles on it would be out of warranty and have no value to use the dealership. It would cost too much to certify it for retail sale so it would go straight to auction if it was traded in. Since we knew we would send it straight to auction we would put a much lower trade in value on it as well.
That is exactly what will happen to this Supercharged Range Rover when it comes in. Its residual value on the lease will be much higher then its actual value because it will be out of warranty.
I just looked up the adjusted residual for this particular car and it is about 55,000 dollars. Now I cannot be sure, since I have no similar vehicles to compare it to currently, but I am can be fairly confident that no one will pay more then 55,000 dollars for this car in two and a half years.
...and the original buyers would already have paid $60,000, so assuming you're starting at a flat $100,000, any resale over $40,000 is pretty much gravy, right? Minus whatever it takes you to recondition the car again, maybe $1,000, if that. So if someone DID pay that $55,000 residiual, that would be selling what was originally a $100,000 car for a total of $115,000, is that right?
But if the leasors were buyers, instead, they would still have several more years' use and value of the car, right?
Seems like those folks will have seen $60,000 disappear for the fun of driving the car for 2 1/2 years, and then they'll have to start all over again, with no equity. Doesn't seem a sound decision to me, but it's their money.
If they took out a traditional loan for the same vehicle and decided to trade it in at 50,000 miles there is no way they could get 55,000 dollars for it on a trade side. Range Rovers, along with almost all other European cars, take a huge dip in value after the warranty expires. The leasing residual doesn't effect that real world drop in value.
Maybe I should re-think my financing strategy...or else just plan on keeping it for 10 years, by which time residual value won't really matter. I'll have had my fun. ;-)
With my credit union, I am able to purchase almost any car from a dealer (almost all local dealers) at a fixed price over invoice that is usually $100 - $300. Since I don't like to haggle this always seemed like a great deal to me but one thing has me re-thinking this ... incentives.
I notice that one car I'm looking at is offering $1000 or $2000 incentives. What I don't know is who pays the incentive? Is it the manufacturer or the dealer? If it's the manufacturer, then the dealer might be willing to sell you at a price near invoice and then you really get a good deal with the incentives. They keep their profit and you get more money back. But if it's off of their sales price then I fail to see why they would budge much beyond what their cost is.
I like the no pressure feeling of my fleet arrangement, and with a car that is hard to find and selling near MSRP it's probably best. But for a car that isn't overy popular, I begin to wonder if I should just use the TMV and my trade-in value and go in with a fixed price in mind and do this the old fashioned haggling way.
Any words of wisdom?
I think of additional dealer incentives as money coming from the dealer. The dealer lowering the msrp to move more vehilces. I would think anytime a rebate is offered you should be able to get vehilce at invoice minus the rebate.
TMV is the average selling price...so you should try to aim below that. Also, if you don't like haggling...don't. Offer a hundred or two over invoice, tell the salesperson if they accept you will buy. If they don't you will leave.
You should of course go for these incentives. If you know that the automaker is giving an extra $1,000 to move a slow mover, you should take that $1,000 for yourself, whether or not it is factory-to-customer or factory-to-dealer. If Car X can be normally purchased at invoice, and there is a $1,000 dealer incentive, then naturally, your deal should net out at $1,000 under invoice.
Haggling generally yields a better result than does a fixed-price deal...unless you haggle badly and end up shooting yourself in the foot. I'd read back through some of the better suggestions on this thread, including the links to various negotiation tips, and then haggle accordingly. If you have been leaving incentives on the table, then you've been paying more than you have had to.
Well, I got to the lot and fell madly in love with a used Infiniti G35. The saleslady was lovely and helpful, and I knew that I wanted the car. I was upfront with her about my time constraint and said I was sorry, and that I was happy to leave a deposit to show that I wasn't wasting her time. At 3.15, she ensured me that we could complete the transaction by 4pm if I wanted the car. I told her if they could do that, I wouldn't haggle on the price, just get 'er done.
The only minor snag was in the F&I office (of course). When I got there to sign the paperwork, the amount financed was $3500 more than I'd agreed to - he took the liberty of adding every single freakin' optional item they offered: extended warranty, tire warranty, windshield protection, and worst of all, Gap insurance. He didn't even explain them to me, just asked me to sign the finance contract (which, thank goodness, I actually read).
When I told him to take off everything apart from the actual vehicle, he did try to sell me on the extras, but no thanks. I had to call him out on the Gap insurance. Since I put about 30% down on the vehicle, I told him that he must think that either 1) they've sold me the vehicle at a way, way inflated price, or 2) i'm stupid. At that point I didn't care which... just take off the freakin' Gap insurance.
It's not that I don't think some of the products (esp extended warranty) might be valuable; I just didn't appreciate them being added on without any discussion. Plus, trying to slip in Gap insurance, which he KNEW I didn't need, kinda irritated me.
All told, it was a really good experience, and they got me out the door in quick time, which I appreciated. It was nice not to have to deal with it again on Saturday, so I didn't mind a bit paying the asking price. AND, should I get any sort of survey, the salesperson will get perfect marks. A smooth, pleasant transaction completed within about an hour was worth way more to me than a few $$.
I'll post photos of my new ride on my CarSpace page soon!
MODERATOR /ADMINISTRATOR
Find me at kirstie_h@edmunds.com - or send a private message by clicking on my name.
2015 Kia Soul, 2021 Subaru Forester (kirstie_h), 2024 GMC Sierra 1500 (mr. kirstie_h)
Review your vehicle
IMHO, what they tried to pull on you, whether it happenned in the F&I office or not it doesn't matter, is sleazy, and I'm being nice.
.
On a scale of 1-10, I would give them a 5, but that's just me.
.
Glad you like the car, my buddy has a G35 coupe.....nice wheels.
The second part to this question is, can we trust the numbers here with respect to invoice, or do we really know invoice for sure? If the salesman tells me his invoice and adds 2%, and those numbers are off slightly from Edmunds, who do I believe? Are we really sure we have accurate information on invoice prices?
If we have good information on invoice prices then I suppose the first question is really what's important since it sets a resonable goal. On the surface, paying 2% over invoice sounds very reasonable to me but all the other stories I've read the past few months jumble in my head and make me wonder.
Depends upon the car. A very hot car such as a Prius -- not even close. A typical car without incentives -- quite possibly, but it will vary. A car with additional factory-to-customer and/or factory-to-dealer incentives? Almost certainly yes.
But it seems like I hear stories where people say the get below invoice. On the surface this sounds insane sine that implies the dealer is losing money.
Read back through this discussion, and you will see that a dealer's net effective purchase price is actually below invoice, when holdback, incentives, etc. are taken into account. So it is possible for a dealer to sell a car at an amount somewhat below invoice, and still make enough to do the deal.
Are we really sure we have accurate information on invoice prices?
Edmunds and Kelley Blue Book invoices should generally be accurate to the dollar. I check both to make sure that they match, but each of them get their information from the manufacturers, so it is absolutely believable credible info, and you should not buy a new car without first referring to it.
On the surface, paying 2% over invoice sounds very reasonable to me but all the other stories I've read the past few months jumble in my head and make me wonder.
You can often pay less than that. Again, read back through this discussion for tips on negotiation, etc., and you'll see that deals at invoice, somewhat below invoice, or perhaps a bit above invoiceare achievable in many situations...if you know how to negotiate.
1. Biggest one - definition of "under invoice". Not so trivial, becasue system is designed to make you believe one thing, while something else may be happening. For instance, in some states dealer's fees, like doc, delivery, etc. (do not confuse with destination, which is a manufacturer's item) are not capped or regulated in any way and dealers charge anything, namely $499, $599, $699. So when you take that Corrolla at invoice or below, add "customary" $699 charged at all Tampa Bay dealers, it suddenly is not at invoice anymore, is it? It is still a good price, just not under invoice, yet gives "bragging rights" for the customer and advertising pitch to the dealer.
2. There is some "post-sale" money dealers receive from manufacturers for various reasons, some to offset true costs (holdback), some to reward certain conduct or achievements (CSI money, volume bonuses), some to increase pricing power (cash incentives). Which means in streak of great luck and good preparation (more of course the latter) you might just purchase that 500th vehicle of the month, which will make them eligible for that desired 20 grand bonus (or whatever), i.e. to push it they may just offer you sale truly for less than usual.
3. You might find yourself liking this 2005 leftover that nobody else wants. It collects dust, takes space and nobody even remembers how it got here. There are often the "leftover" incentives, which will make them wiling to sell it for really less then one might expect. Just like Best Buy sells that outgoing camera model at 40% discount, a dealer may sell you a car at 20% off the sticker, cause sticker is no longer relevant to anything when it comes to that vehicle.
4. NEVER BELIEVE (or "take with a grain of salt") stories of people unless you can see paperwork, or have opportunity to ask more questions. Just an example: Fellow claims he got this Camry for $1599, say MSRP is $20845 - you think "wow". Well, he "forgot" to tell you that his trade "stolen" (say by $2000?), he also purchased a nice $699 Toyoguard package (worthless junk add-on package courtesy of SET), nicely priced set of gold accents and window tinting, extended warranty (say didn't gouge him on it, but he changes cars every three years). Not to mention said $699 dealer's fee and his financing was 7.5% (with 720 FICO). Lets just add that his combined trade and cash was 20% down, yet he purchased GAP. But boy, did he get this car under invoice or what?
There was a discussion on another forum who is a bigger liar - sales people or buyers. Hard to call - probably equally. Buyers don't lie only to saleman - they also lie to each other - some to make themselves look better, some just because they are too stupid to realize what had just happened.
My advice to you - do you homework, but just don't drive yourself crazy that Jonses across the street or guy in the next cubicle got/could have got it for less. Maybe yes, maybe not - you'll never really know. If you are comfortable with your efforts and the results, it is all that counts.
2018 430i Gran Coupe
The frustrating part for me is that even doing my homework isn't necessarily enough. Knowing the invoice is great but then trying to figure out what to expect as "reasonable" is quite another thing. The 2% sounds reasonable but as others have posted there are conditions where the dealer still "wins" when sold below invoice. To make it worse, I don't think buyers can possibly know those conditions. I had a neighbor just buy a new truck and the salesman worked him over so much about a warranty that he ended up selling it for something like $60. The key obviously was the dealership stood to benefit greatly from that warranty to the point where they reworked the sale to make sure it went thru.
I suppose I could use the TMV to get a good start and put my trust in this site. However, it's kind of sad when you get a dealer who is giving you what appears to be a good price up front and you feel like you HAVE to negotiate with them because they obviously have something up their sleeve. It's part of the reason why I don't like buying cars all that much. Oh well.
On the first page of Edmunds.com is a link for incentives. It's always worth checking although they don't always get them all.
I think I told the story here once before about a customer of mine who bought their car elsewhere because they could do $300 under rather than the $200 over invoice I could manage. I got a look at their paperwork when they brought it in for service. They had their trade stolen to the tune of $3000 or so, were paying 8.5 % interest (I think they were around 670 fico - I could have got them 4.9%), got taken for wheel locks, pin striping, mop and glow, etc. to the tune of $1600 and paid a $499 doc fee (ours was $45). But hey! They got it for $300 under invoice!
Sadly, this wasn't an isolated case. The dealership I worked for was so honest it hurt - no $200 wheel locks (I usually threw them in for free from our parts dept.), no added points on the interest rate, no silly doc fees or ADMs. Back in 2003 when G35 Coupes were the hot thing we werre selling them at sticker while every other dealer in the area was ADM'ing them for $3000 to $6000. Despite all this we would still loose more customers than I would like to count to the places like the one who sold the car with all the extras. Sadly, people would rather go to places like that for whatever reason.
You stayed a lot calmer than I would have about the F&I shenanigans. Did they really think you wouldn't notice an extra $3500??? :confuse:
Looks like the ladies have been on a Nissan/Infiniti buying spree - I bought a new 2005 Nissan 350Z Touring Roadster this weekend, in Screaming Mid-life Crisis Red - er, the manufacturer calls it "Redline," but we all know the REAL truth! ;-)
My buying strategy, which I'll try to patent a la the Bobst method, I'll call "serendipity" or "strike while the iron is hot." Price obtained was a whopping 17% off original sticker, and ties in to what Socal said about buying a leftover 2005 that the dealer just wants to sell.
What happened was this: while I'd been eagerly anticipating the arrival of the new Volvo C70, I also had been researching a few other convertibles, just to be familiar with what's out there.
Well, last week I took my Maxima in to the dealer for an oil change. Leaving the service area, I noticed a new, black on black, 350Z GT Roadster on the showroom floor. I've been a Nissan buyer for the better part of 26 years, and had some fond memories of the original Z car from back in my checkered youth. As I thought of those long-ago summer nights and the pleasures thereof, a smile may have crossed my face...which probably caught the salesman's attention, as he started to approach me as I was circling the car.
Hmm, I thought, well, what could be the harm, maybe go for a spin in one of these while the guys do the work on the Max?
Salesman approached me and I said "I'm just getting my car serviced." "Oh," he says, "all right" and starts to back away.
"But," I say, "do you happen to have a demo Z to drive, or any other colors besides this one?"
"Oh, no demos, but we have a red Touring model I can show you."
"Fine, sounds good."
We walked out front, and there, parked smack in the highlighted position in front of the dealership, was a red on charcoal leather, 2005 Touring Roadster, with an orange hang-tag saying "Original price $40,600" or some such number, "Selling price $34,500."
"So, what's the story on this?"
Well, turns out it came into the dealer in early December of last year, as the very last of the 2005s. Not a good time to sell a convertible fitted with HP, don't even think of driving me on the snow, tires. Come late winter and early spring, of course the 2006s are arriving and that's what the buyers were jumping on. Gotta have the latest and greatest, and all. So for whatever reason, this handsome, charming, well-dressed, AT, alloy-wheeled studmuffin was something of a wallflower at the ball, quickly passing the prime of life while waiting for a partner.
Salesguy does a quick walk-around, notes the basic features, and I say I'd like to take it for a test-drive.
Off we go - and whee, what a ride! Most fun I've had in a car in years!! Handling was sharp, turbulence in cabin was under control, acceleration was aces. This blind date was turning out to be pretty seductive!
Not being the kind of girl to seal the deal on the first date, I said I had some other cars to see too, and would be in touch. By that time my Max was finished, so off I go.
By great good fortune, the new Volvo came in the very next day, and the salesguy called me to offer a test drive. I was there in 10 minutes. And - beautiful car, lots of gadgets, would certainly impress the neighbors and the family, but just did not make my heart race. And it would cost $43,850, including $250 advertising, plus $300 doc fee. No question I'd have to finance part of that one. Hmmm...
I then went to a Toyota dealership to test the Solara. Hated it - lousy visibility out the back, a fiddly boot cover, and it didn't help matters that the AC started blowing hot air at the end of the drive! Scratch the Toyota, not a contender.
Next day, back to the Nissan dealer. I wanted a longer test drive now, including on the Beltway, to see if I felt comfortable in the car with the big trucks whooshing past and all. Off we go. Felt steady, secure, comfortable and composed in the presence of the large brutes, while losing none of its initial charm. Passed the final driving test! Back at the lot, it also passed the suitcase test - I had brought my typical weekend bags and they fit easily in the trunk, which actually had about as much usable room as the Volvo did, to my surprise.
Now, negotiations. I offered $32,000. (Had checked newspaper ads and on-line resources, and knew anything less than $34 would be a great deal.) Sales guy, sad-faced: "We really can't sell this for any less than what we're asking, it's already $7,000 below sticker right now."
"Well, why don't you present the offer to your manager and see what he says."
Sigh. "Oh, well, all right."
He's gone for a couple minutes. I wait patiently for a bit, then fish my car keys out of my purse as if I'm about to give up and leave. Salesguy trots back. "33,500 is the lowest he can go, and he'll throw in 8 free tires, two complete sets of replacement tires."
"Hmm, give me a minute." Pause. Silence. I excuse myself to go get a drink of water. Take a minute to think, in the hallway away from the salesman and his manager. I knew this was a screaming deal not likely to be found anywhere else nearby, as I'd checked other Nissan inventories before I went back to the store. There was a new white 2005 40 miles away, with an asking price $3,000 higher. Probably more trouble than it would be worth to chase that down. A new 2006, configured exactly like this car, with the AT, alloy wheels, mats and whatnot, would list at $41,375.
And, you know, the red...
Came back to the table. "Okay, let's do it."
Deal was written up and I drove off a very short time later. No shenanigans with the F&I guy; he offered a long-term warranty but I said I didn't know how long I'd be keeping the car, so no thanks. Charged $199 doc fee, about par for the course for this area.
I don't know if they made much money on this purchase or not; they will definitely make money on the service end as in order to collect my 8 tires, I have to have ALL recommended service done at the dealer. That's ok with me, we've been going there for 6 years with the Maxima and we like them fine, never a problem.
And I spent the day today taking a beautiful drive along the Potomac river, with an ear-to-ear grin on my face, breeze through my hair, sun shining down on one happy Z-car and its new dance partner. ;-)
On your purchasing strategy. It didn't appear you had one.
I understand needing a vehilce now and recall you writing you didn't particularlly care for "haggleing". But,I have a hard time understaning why a host of a web site that is dedicated to saving the consumer money, and giving purchasing infomormation, would leave what is probably a good chunk of money on the table.
Rule #1) don't be in a hurry to buy. Rule #2)Don't let the dealer know you "love" the car. Rule #3)Don't let dealer know your time limitations/pressure. Rule 4)Don't pay asking price.
I'm not trying to rain on your parade. You're happy with the deal so that's all that matters. But, for newbie Edmunds members out there...that is generally not the way to go about purchasing a vehicle(if one is interested in saving money)
It sounds like the F&I guy assumed that since you were paying asking price you weren't knowledgeable, and that he would be a slease and sneak those other add on's past you.
Anyhow, good luck on your G35.
I just helped a close family member purchase a new car and I have no doubt that we left "a good chunk of money on the table." There is no requirement to be nor is there a magic ability to be a total grinder when one hosts message boards here. I and my relative got a deal that was acceptable to all three of us. I am certain that we all could have sat around the table a lot longer and haggled and carried on and all left the table with a very bitter taste in our mouth instead of leaving feeling good about it, as we did.
That kind of grinding is just not for me. It may be for you, but it's not for me. And the fact that I'm a host here doesn't mean it should have to be for me any more than it has to be for anyone else who hangs around here.
I'm surprised when people make judgements about how people should behave based on what they do for a living. Seems to me that we are all who we are, and the fact that we choose to do something in particular for a living does not, should not, cannot, define us to the point where we are unable to make personal choices without being criticized - the same way people who aren't in the same specific line of work are entitled to do.
I wrote that Kirstie does not like to haggle. She got the vehicle she wanted and was happy with the price...that was all that mattered. I wished her well on her G35.
That said, I was curious as to why she didn't try to use some of the information provided here at Edmunds and her own personal knowledge to secure a better deal. I would ask the same thing of an investment advisor or banker on why they keep all their money in a saving account that is only drawing 1.8% interest. I am not making any judgements pat.
There was nothing in my post that suggested being a "total grinder". You should know that it doesn't take being a "grinder" to get a good price on a vehilce. Offering $750 over Edmunds TMV would have gotten her that vehilce just as quickly...with no haggling or bad taste in the mouth required. Both parties would have been happy, and Kirstie would have driven home with a grand or more still in her checking account.
Believing that people have fewer choices on how to behave in their personal lives based on what they do for a living is not fair and makes no sense. That's my main point.
I just, in my usual style, used a whole bunch of words to say that! :shades:
By reading the contract, she discovered the F&I tricks, and she stated that was to the tune of some $3500. Her time in the finance office reading the contract thoroughly was well-spent; bargaining with the salesman might or might not have netted her much of a return. Possibly a few hundred dollars. Probably not anywhere near as much as she discovered in the finance office. So she prevented the greater hurt by saving her energy enough to catch that.
In my case, it took no more than five minutes - less time than it took to write the novella above, for which I apologize! - to get a substantial amount of money off an already low price. I couldn't imagine not testing the market a little bit to see what's possible.
Kristie, for her own reasons, didn't feel that was necessary in her purchase, and if she's happy with both the car and the deal, then all's well. I give her kudos for doing her shopping and making a decision very quickly rather than succumbing to paralysis by analysis, which can slow down a lot of people who think they're "good researchers," when what they really are is procrastinating about making a decision.
Not that I've ever done that, of course.
One thing I've tried to impart throughout this thread is that negotiation is fun, easy (if you do your homework and keep your wits about you), and not all that time-consuming. While I don't advocate naming the first (or even necessarily the second) offer, a passing reference to lower price sources (i.e. wholesale book) would have been a good place to start. For many, the cost of a few hours of babysitting or daycare would be well spent. (It was wise for Kristie to not bring her kid to the dealership, that's for sure.)
Her time in the finance office reading the contract thoroughly was well-spent
In my experience, a well-managed negotiation will actually reduce or eliminate F&I shenanigans, because that negotiation process educates the seller that the snow job tactics aren't going to work in this case, so there's not much point in them trying. It's not necessary to get in their face about it, but it is quite easy to manage the F&I process and trim the fat from the deal.
I prefer to invest my time with the sales manager and salesperson, with whom the tenor of my negotiation will generally lead to a fairly straightforward closing. Again, lead the salespeople to their point of no return, and they will be damn sure to close that deal, come hell or high water, at your low price.
I would fit into the group who finds negotiation painful and unrewarding and seeks ways to avoid or minimize it when possible. There is a definite price that I am more than willing to pay to avoid negotiating for a car, especially when it involves sitting in a dealership and working with a salesman or manager who (may be decent people) but aren't exactly who you'd pick to talk to under any other circumstances.
I am happy with my deal. Very happy. This site is dedicated to providing consumers with information; what each individual chooses to do with that information is up to him/her. For some, that means the ability to negotiate a rock-bottom price. For others, it means knowing how to spot a good deal (I paid below TMV), get a car that meets your needs (for me: reliability, fun to drive, certain options), and recognize some of the F&I shenanigans that go on.
I was successful in using this site to accomplish all of the above. Did I get the rock-bottom price? Probably not. But that was never my goal, nor is it the goal of this site to ensure that consumers get the absolute lowest price. It's all about helping the consumer have a pleasant purchasing & ownership experience, with which he or she is personally satisfied.
Negotiating a lower price would've meant extending the purchase process an additional day - Saturday, of all days, when it would've been crowded and have taken twice as long. It would have necessitated an additional trip to the dealership, which is 20 miles from my house. It would have meant extending my rental car til Monday, which I didn't want to do because (a) I needed to work on Monday, and (b) It would've cost me additional money.
I walked away very happy with my overall experience (save the F&I issue, which I resolved in 2 minutes), love the car, and am satisfied that the vehicle purchase price represents good value for me.
I can only hope that this site and our very helpful members provide information that can help ALL of our consumers walk away this satisfied with their deals, whatever that may mean to them personally.
MODERATOR /ADMINISTRATOR
Find me at kirstie_h@edmunds.com - or send a private message by clicking on my name.
2015 Kia Soul, 2021 Subaru Forester (kirstie_h), 2024 GMC Sierra 1500 (mr. kirstie_h)
Review your vehicle
That is just evidence that there is still the "OLD SKOOL" mentality of F&I product presentation. What is the system now, which is the most effective, and most non-confrontational, is the MENU selling. At our store, we present the amount financed and offer a choice of products that will fit the clients needs, from a big bundle (ext service contract, credit life,lo-jack, Gap, and tire-wheel protection) to the smallest(Gap, wheel and tire) and bundles in between. Some people, mix and match products or purchase nothing, and we do not shove the client in a corner, Because F&I experience is a big part of our CSI.
If you purchased GAP insurance even putting 30% would not of been stupid, If you live in a area that a risk of flood, tornadoes, Auto Theft and you have a high deductible, its not a bad Idea. For example, lets say, the total policy is 325 dollars and you have a 1000 deductable, and something happens, you deductable is covered. But if you live and work in suburbia and you have a low deductable its not something you should or need to purchase.
But, if F&I offers products, its not shananigans, or hooey booey, they are doing their job, and that is how they make a living.
Offering the products is just fine, but adding them in automatically in an attempt to "look out for my best interests" did rock me. I already have someone who does that for me. She's the one who's making the payments
MODERATOR /ADMINISTRATOR
Find me at kirstie_h@edmunds.com - or send a private message by clicking on my name.
2015 Kia Soul, 2021 Subaru Forester (kirstie_h), 2024 GMC Sierra 1500 (mr. kirstie_h)
Review your vehicle
Please, oh please tell me you got up and walked away.
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
For example, one time a sales person told us the car keys could only be used to open the doors. We would have to pay extra if we wanted keys that could be used to start the engine.
We still bought the car for the OTD price we had offered, but we made sure the keys could be used to drive the car. In addition, it was fun to fill out the CSI survey and give them zeros in several categories.
Bingo. I don't go to a car dealership to have a social hour (or four), but to make a purchase. I'm not a social worker or Buddhist monk, so I don't particularly care if the salesman has achieved self-actualization or discovered his inner peace by completing my transaction.
Let's just face facts -- car sales is not a business built on honesty and kinship. The dealer's potential opportunities for profit from a full-price sale, combined with a stolen trade, costly financing and lots of F&I add-ons, make it very tempting for the sales team to go for the gold by layering in as many areas for profit as possible. That's just how it is, the sales team members are on the payroll in order to make their employer a profit, and you can't fault them for trying.
People make a mistake by shopping with the objective of having a supremely happy experience, but I wouldn't advise that goal anymore than I would go to the gas station to achieve a "win-win" when all I want is a tank of fuel. Just accept it for what it is, get out there and go save yourself some money. You can use the cash that you save and your interesting war stories to help you to find your happy place, if you must.
You should walk away so they don't cheat you. You don't have to buy an extended warranty to purchase a car.
For example, one time a sales person told us the car keys could only be used to open the doors. We would have to pay extra if we wanted keys that could be used to start the engine.
Did you tell them the money you would be using could only be used on a monopoly game board and he would have to give you something extra to get the money that he could spend elsewhere?
Again I would have walked.
There is trying to cheat you and then there is insulting ones intelligence.
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
While I will agree with that to a point there are limits and signs for other issues. A dealership that will go so far as to tell you you have to pay extra for the keys that will actually start the engine is not above more serious infractions. Dealerships that will do that will also fix a totaled out car and sell as new, switch parts on cars and claim it as a repair and charge you for a new part and other like activities (yes these things actually happened at a dealer near Chicago).
Its one thing for a dealer to try to get you to buy as much as possible, but there are limits. When they cross that line it is time to move on.
but I wouldn't advise that goal anymore than I would go to the gas station to have a "win-win" when all I want is a tank of fuel.
That would be a win-win situation. You have your tank of gas (which is a win for you), they exchanged their 15 gallons of gas for your $234,974,985.98 (a win for them), and everyone is happy. Lets face it in an open economy no transaction would be done if all parties involved didn't think they were coming out ahead.
And before anyone comments the $234,974,985.98 was just a comment of the ever higher gas prices.
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
Sounds as if I need to relocate, your prices are a lot better than ours...
KDH Spyder was claiming Toyota was all serious about that "new quality" with Scion experience. I bet if you complained to them, they might not be so pleased with those guys...
2018 430i Gran Coupe
I would agree with you if there was only one way to make a sale. I would say there are many ways to try and sell something to a customer or negotiate a sales price that are not shady, pushy, rude, or ugly. Past history of car sales isn't an excuse for poor behavior and neither is having to make a living by selling cars. I always seemed odd to me that when we pay a lot of money for good meal or hotel we expect a certain amount of superior service for the cost, yet when it comes to throwing tens of thousands of dollars for a car it seems like it's ok for someone to try and cheat and berate us just because it's the nature of the beast.
I'm no bobst, but once it comes time to negotiate price, it shouldn't take more than a few minutes. Took me just five minutes, if that, in my recent purchase to get a whole lot knocked off the price.
That's not even counting the 8 tires that the dealer is also including. I don't count that because I only get it by taking my car there to be serviced. Although I would do that anyway (further proof of how service supports sales and vice versa), clearly they'll be making a profit off me in that area for years to come. But at least that's pay as you go and doesn't come out of my bank account yet.
Anyway, if a dealer is taking more than 15 minutes, maximum, to hit a price, it's time to leave. They don't really want your business, might as well be on your way and find someone else.
Regarding doing business with sleazy dealers, I just won't. While I'm not looking for a new best friend, I want to treat the sales person decently and honestly and want him or her to treat me the same way. And beyond the salesperson (who may or may not be there next month), I look a LOT to the reputation of the dealer if I'm thinking of having my car serviced there.
As someone upstream said, a dealership that plays games on the sales side is also going to play games on the service side. I want to support the good guys, and not fool around with the ones who try to work me over or make life difficult.
Kirstie chose not to provide any information or details on the price she paid. Much less that she got it on sale. So, when she wrote of paying asking price to get the deal done quickly, then writing, "...so I didn't mind a bit paying asking price", I made the logical assumption that she didn't get the once in a lifetime deal.
Typically dealerships mark-up their vehilces 15-30% over what they got them for in trade-in correct? She bought a 2003 Infiniti G35. So, using Edmunds TMV guide,if the trade in value of that 2003 G35 was $17,594, the dealer retail price would be $20,677 TMV. $20,677 being what the average person paid for their G35 at retail dealerships. Meaning the dealership probably listed that G35 to around $23,500. If someone paid $20,500 for the above G35, then that means dealership made a gross profit of around $3,000.
Take out $500 for a dealer wash and wax/ oil change fee and you got $2,500 left on the table. Right...a dealership wouldn't accept such a low profit margin on a sale right?
So, take off another grand and you have $1,500 on the table. How long would it have taken to negotiate that $1,500 down? Probably not long...as Socal4 and bianca have suggested.
But as I said before, Kirstie got the car she "loved" and was happy with the price. So, it sounds like a "sucess" story for her.
Well, I don't want to pick a fight here (especially I'm not from the industry), but economy 101 teaches that cost here would not be just the acquisition price of the vehicle. Gross profit, defined (I think) as a revenue less direct cost would be here Sale minus trade value paid minus bunch of direct costs, like inspection, reconditioning, financing, etc. They can go low or high depending on the condition difference and length of stay on the lot. And I even combine dealer and salesman together as one entity (i.e. commission could be considered for customer's sake as part of the profit rather than part of the cost, which of course would not be the case if you were the one who actually owns the said business). Said $3000 could be called "revenue differential", but calling it gross profit is a bit misleading as it suggests it's a close figure to whatever.
I don't want to suggests that the profits are too low or anything like that. For my part, could not care less if they (dealers) actually make money or not - I would rather get all those things for free, if I could (why not?). Just from the purely logical point of view, all costs need to be acknowledged, not only the acquisition.
2018 430i Gran Coupe
I wouldn't walk over getting a key that opened the door, but wouldn't start the engine. But, I would seriously consider walking over the $3,500 sleazy manuveur the F&I guy tried to pull on Kirstie.
I would have said to the F&I jerk, " hey bud, while you're in their taking off that $3,500...how about throwing in free lifetime oil changes, lifetime tires, a spare set of floormats...and, oh yeah... a pack of Juicy Fruit gum" :surprise:
Kirstie, I think you should speak with the general manager over the unethical behavior of the F&I guy, if you haven't already done so. It could keep some people, who sign contracts without looking at them, from being screwed out of a lot of money. A report to the BBB may also be in order.
I think that this misses the point. My approach is far more zen than that:
-The system is what it is. I didn't invent it, and I don't control it.
-The system is the way it is for a reason -- because it generally benefits the dealers who created it. Those customers who refuse to game or understand the system will pay more than they otherwise would have, so naturally, most dealers will want to keep it this way.
-The system is easily tamed. Rather than fight it head-on and become frustrated, sidestep and outflank the system, and you will do very well.
I can understand the desire to vent, but I don't comprehend the refusal by some consumers to accept things as they are and turn them to their advantage. We all know the Serenity Prayer ("God grant me the serenity to accept the things I cannot change, the courage to change the things I can, and the wisdom to know the difference."),and it applies here.
Business is a game -- you can either work the rulebook to your favor, or fight against the rules even though you are powerless to change them. No reason to hate things as they are when you can get what you want very easily by working them to your benefit, and have a few laughs in the process.
It is funny, though - I remember repeatedly seeing Consumer Reports rating Japanese Three (Nissan, Toyota, Honda) as lowest purchasing process experience (do not confuse with product itself). It's kind of counterintuitive, but when you look closer, it's not a big surpise: superior product in high demand, low "nominal" profit margins (invoice-retail spread), volume-oriented sales system, all create a perfect breeding ground for "sleazy" behaviors. I suspect many of them (dealers, salesmen, F&I) see it as a mere survival strategy in this enviornment, which is of course not excuse, but may give some insight into the thinking process.
I only wonder where are the manufacturers - they must be getting comlaints from customers all the time. Is it that they don't care, or they think it's all made up, or they feel powerless to change it. Dealer is an independent business, so no direct string pulling is possible, but I can't believe Toyota has not enough mussle to really straighen these guys up.
2018 430i Gran Coupe
Don't quote me on this but I think there is a lot of legality on what the manufacturer can do with regards to the dealer. Much the same as Levi's has limited say in how Sears sells their jeans.
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D