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Comments
Would you take it figuring that any sale is better then no sale?
I might agree to sell for less if I know that lower price is "still fair" and that a guy a 100 miles away is selling the same vehicle in like condition for the same amount.
I agree customers shouldn't "shop" another dealer's number with a dealer. The dealer should just offer a good price to begin with, and if they don't, go buy from the one that gave an honest price to start with and buy from them!
Reward the dealer that is willing to give a good price "in the first place." You can make them compete by getting multiple quotes, but you shouldn't give away which number they have to beat (and beat by how much???).
On the other hand, if everyone's price is virtually identical, collusion could be a factor, and all bets are out the window and everything is fair game at that point.
I don't know why some areas are so much harder on price than others but I can see it around here. Asking prices seem a bit better north or south of here. I suspect some of it is perceived as a captive market and some is just general demographics.
In a perfect world your method sounds good but, believe me, the "good price in the first place" will get shopped every time.
I have had people drive 100 miles to "save" 50.00!
Now that's the kinda thing that doesn't make sense, not even in a 3 cylinder Geo Metro!
Of course, during my first ever new car buying experience, when I told a salesman what my Credit Unions "deal" was at another dealership (since the dealership closest to where I lived wasn't in the "network" of my credit union) I visited the closest dealership first; they said they'd match it, when I said that wasn't good enough, that they had to beat it for quoting me such a high price in the first place, they said how does 1 dollar sound?
I should of walked out right then and there. Why would I sell out the other deal for $1?
Maybe they were unhappy about some other aspect of your interaction. I would drive 50 miles to buy from someone I felt comfortable with rather than someone I did not feel comfortable with. It's not always all about price.
I'll get a shopper that I know has spent hours at another store driving cars and grinding a price only to end up at our store.
I've made many an easy sale because I've saved some "thrifty" shopper 100.00.
I don't feel good about those deals.
I respect shoppers who are trying to just get a good deal. I have zero respect for the people who will grind every last penny out of a deal and could care less about a salesperson who treated them well and spent hours with them.
So Isell ,you should not be complaining about folks driving to your place to save a "lousy" "measly" 100 bucks.You are snatching another salesman`s share when he did all the legwork. So it cuts both ways. You win some,you lose some!! Well I guess that`s how it goes in the car biz!! Tough market !
The car dealers created this demon and they have to live or die by this demon !!! :shades:
Until I got into this business, I had NO IDEA what some people will put themselves through in their zeal to pay the least possible.
Problem comes with trade ins and I guess more than 50% have negative equity. I never could fathom that. If you have negative equity,why buy a new car again??? Just beats me. And they run all over town if someone reduces their monthly payment by 20 dollars not knowing that they got a lower trim or one with less features.. IMO such folks deserve to be clubbed !! And I would not blame salesmen for trying to club these cheapo grinders. And as you always say they give the worst CSI survey.. So go ahead and club them .Hopefully they will learn for the next car purchase
I wouldn't bother and obviously most people in the area wouldn't either or the local dealership prices would come down.
The most famous collusion case I know of was the Westinghouse and GE collusion over turbines.
link title
http://en.wikipedia.org/wiki/Collusion#Examples
You might get more of a discount in LA because there is more inventory sitting on the ground, more competition, and more buyers.
That's like blaming a small town dealership for not discounting their inventory when they don't have to. With no competition around why would they? You want to save a few bucks then set aside a few hours on your day off, some gas money, and make the effort to drive to the nearest city centre. Nothing comes for free.
2016 Audi A7 3.0T S Line, 2021 Subaru WRX
They had some kind of code book they used in dead drops to shuttle information back and forth between the companies.
I also live in very densely populated area, 20 miles west of Washington DC in VA. Basicly, from where I am to the Chesapeake bay is one huge metro area that includes Washington DC and Baltimore. On weekends it takes me an hour to drive to downtown Baltimore. There are hundreds of car dealers in 6o mile radious.
When I shop for a car over email, Marryland dealers always give better quotes than local ones, because they know that price is the only way for them in get me to drive an hour to their store and pass twenty other stores that sell same brand. I bet that if I lived in MD, VA dealers would give me better quotes.
Yeah, nobody evades paying tax either because the penalties for that are just too high.
I'm not saying dealers do collude, just that the reason you gave does not render it impossible.
So,Calif has got to be the WORST at this but there are other marketplaces that have been ruined.
In my neck of the woods, people can drive to a different county and save **some** sales tax but not 2-3%.
The stores with the lower tax rate make a BIG deal out of this too.
I recently adjusted the price on a car I was selling by about 100.00 to match the tax rate.
The second question: we have a dent in the front bumper and now they think it may cost more than the alloted $500 per incident to fix. What is the best way to handle this? We are willing to pay the price they are offering, willing to add on the remaining lease payments to get the new car now, etc. But having to pay out of pocket to fix the dent (no cracking of paint) seems too much. There isn't another scratch on the car. The inside isn't pristine, just average for a family van. Not great, not terrible. We are way under mileage allowance (at 26,000 miles after almost 3 years with an allowance of 36,000).
We don't want to be jerks but don't want to be taken advantage of, either. Dealers, please help! I want your opinions! Thank you!
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
Over 2% difference, but not 3% at this time. Chris is dangerous.
Body work always ends up costing more thatn I think it will.
Same in Colorado .. doesn't matter where you buy the car, you are charged sales tax based on your home address.
For example, the sales tax for my community (state + county + town + special tax districts) is 7.5%. There are other places where there is no county, town or special district sales tax, so the overall tax rate is much lower.
Washington was trying to do that with everything that gets sold in the state, not just cars. Officials were complaining that towns that have almost nothing but businesses were getting more than their share of tax revenue while those places that were more residential were getting much less. It didn't pass.
Interesting enough, when I bought a car in Oregon (no tax) and went to register it here (where they also collect sales tax) they charged me the rate of the town I registered it in rather than where I lived. That was surprising. It wasn't intentional, I just went to the closest place to where I worked. I ended up saving a few hundred.
Ain't that the truth. My son was involved in an accident in my car, someone drove into the back of him while he was waiting at a drive through. He called and i went to help him out. I looked at the damage and didn't think it was worth calling the police over (nobody hurt, I estimated less than $1000 to fix). The other party insisted that the police be called (she was at fault and knew it, but yet she wanted the police called). Anyway to cut a long story short the damage to my car turned out to be over $6000.
No way, Honda would not negotiate for nothing. I would have the damage fixed by a cheap body shop, rather than have Honda "estimate" how much it might cost. You know their estimate will be on the high side.
Question to the OP, why are you rolling $1300 in negative equity? Why aren’t waiting to the end of the lease? You are replacing it with a lease on identical vehicle that will cost you more! Just wait until the end of your current lease, and then get the new one. You won’t have the negative equity and your new lease payment will be lower. Also, there might be some factory to dealer incentives when you get closer to the end of the model year.
exb0 already said one of them... why are you looking to do it now? What is this special promo you speak of?
If the promo is the trunk money on the Ody, you aren't taking good advantage of it by getting "just below invoice." You should be more like $1k under invoice.
'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
The penalties may be high, but the chances of getting caught are almost nil, and the chances of being prosecuted successfully even less so. Therefore, the stakes are high, but the odds are a long shot that you'll ever be punished. Therefore, it's not much of a risk at all for dealers to do what they are doing; that's colluding.
That might make sense in a really small town. But although LA is larger, San Diego is a super large city as well, it is by no means a "small town." There is no logical reason for SD dealers to be greedier than LA dealers except to take advantage of a perceived captive market and monopoly for some dealers. There are some auto brands that are poorly represented with limited competition in SD county in CA.
But in the end, there is competition, you just have to maybe go up to 100 miles away for it. I'll gladly let another dealer steal sales from my local greedy people. I've already done it once.
Solution; don't tell them where you live until you get their number.
When this happens, they lose thier quailty salespeople who can't make it on all mini commissions. They hire whatever they can find and have constant turnover.
You probably wouldn't want to deal with some of these sleaseballs.
Then they are forced to resort to playing the dirty tricks that everyone hates.
But it's all about PRICE, right?
Imagine your frustration after you drive 100 miles and they tell you that there is $400 bogus fee that you didn't know about. "But Mr. Andres, you already drove here and you are still saving $100, just sign here please."
BTW, have you bought a car in LA, or you just have a few quotes and you are thinking that you can get one cheaper?
I would tell my local dealer.." Can you match this or should I drive 100 miles?
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
Turnover is a problem. I find salesman to be in large part useless and of no value and no knowledge of their product anyway.
The only good salesman is one who is a veteran and therefore been doing it a long time. They might know the product inside and out but the young one's never do. I think the CARMAX model would work for new cars, as long as the company could maintain a lean bottom line and overhead so that the prices could be more competitive than Carmax's.
The documentation fee was reasonably low and their were no bogus fees added. In fact, I think the salesman gave me a free soon to be married wedding present and threw in the LoJack which I opted not to pay extra for but it was already installed.
I did discuss ahead of time in some rougher terms the bottom line and the out the door price and to make sure there were no hidden fees or charges that would make their quote less competitive than others. It was a no NONSENSE deal. If a dealer made me drive 100 miles and took away 80% of my incentive when I got there, I'd quickly turn around and pay the competitor $10,000 more before I'd buy from that dealer ever!
He said it just didn't make sense for them to sell cars for less than he originally quoted. So I guess his theory was if you can't make $400 over invoice, why make anything at all? If he'd of agreed to split the $400 and come down $200, I'd of never bothered reasearching LA dealers and I'd of placed an order from Ingoldstad right then and there at that dealer (they didn't have the color/options I wanted in stock).
HIs quote was for a BASE model stripper A3 with DSG. I asked what it would be for a Sportpackage add, and he gave me a number that was like $500 over what that option should cost as an add-on. I asked what was going on, and he said his original quote was in error. I asked if he could honor that original quote and only charge me what the option should cost in addition to that quote, and he said no, that it was an honest mistake (I don't believe that, it certainly got me to talk to him first and foremost). I then said would he split the difference of that mistake and he said no.
So then I call Downtown LA Audi because they don't have to make a trade for the A3 I wanted, and he asked me how much I wanted to pay, I said every dollar over invoice causes me excruciating pain to pay, and he said how about invoice if you buy before March 31? Done deal.
True. But, seems that could be countered by showing the salesmanager that the car is "fetching" $7k more than auction prices when it's sold at retail value. I don't know what percent of dealership cars ever make it to auction, but it would seem the cost of sending and selling a car at auction would be a minimal expense when total used car sales are factored in.
Also, Edmunds supposedly uses real trade-in values to calculate their TMV's. But, dealerships don't pay Edmunds TMV, they pay auction/wholesale value... something's wrong with that picture. :confuse:
Recent example from 3 weeks ago ... 2007 Camry Hybrid 50th anniversary edition - totally clean still under warranty 32k miles (loaded - leather, nav, satellite, power driver/pass seat). Dealer asking $22,999. Edmunds TMV shows private party of $20,779, trade-in of $18,779. Bought it for $17,290 + TTL (I include the "doc" fee in the sale price of the car), or about $1500 under Edmunds "trade-in" value. My guess he got the car for $15.5k on a trade, had another $500 in recondition, flooring, etc. maybe $16k in the car. Carmax had a similar car, asking $22k, the Toyota dealer had an "internet special" price for similar car $19.9k firm.
Good example. But, what are you using to guess the dealership has $15.5k in the car. A certain percentage below Edmunds trade-in value?
It was from a non-Toyota dealership. I also like to cross-shop the used car against another make's dealership as they can't CPO the car and are more likely to deal on it.
Another good tip. I had a dealership offer to drop $1,700 off the price of a CPO Toyota Sienna when I thought their price too high... of course they dropped the certification as well. Don't know if that is something dealerships usually do in negotiations. :confuse:
So basically an offer of Edmunds trade-in value should get you a car from a dealership with very little hassle.
That has not been my experience. Perhaps it's just the luck of the draw and I've been lucky - or you have been unlucky.
In any case, I don't think it's particularly convincing or enlightened to make these unjustified and sweeping generalizations especially when they are based on a necessarily tiny sample size. I suggest that we return to discussing the profit question and drop the smear campaign.
tidester, host
SUVs and Smart Shopper
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
A store trying to make some kind of a profit and a cheap customer trying to wring every last dollar out of the deal.
Only in the car business.