I don't know... I cannot think of one friend, neighbor, or co-worker who ever expressed a concern regarding a $100 price variation on a car purchase. I think the majority of car shoppers are more reasonable than that. However, I don't argue that some dealers see their fair share of grinders who consider the negotiation phase to be serious mano-y-mano competition.
On the other subject, I don't understand why a consumer wouldn't perform pricing research on big-ticket electronics? The internet has so much information, why pay the regular prices charged by Circuit City or Best Buy? In this respect, I agree with you. I have a difficult time understanding why some consumers walk in to these stores and pay full price without flinching, while other consumers will wait in a 300-ft line at 4:00am on Thanksgiving morning to save $75 on a computer!
An appriaiser who provide values low enough to kill deals is not an appraiser for very long.
Besides, assuming both the buyer and seller are acting rationally and ethically what is a better indicator of the value of the transaction than the deal they just agreed to.
Finally for every three comps found that supports value x, three more can easily be found that support value y.
The value is determined by what somebody will pay for something. :shades:
The nature of the animal is that the dealership determines Actual Cash Vale of the trade - not the customer. The customer then decides if he accepts the dealers offer. how else could it work?
the dealer could probably sue you on the contract if he wanted to. But what's the use? No real damage done; he's still got the car and you've still got your money. He could ask for a judgment ordering specific performance, but then again, no big gain for him so not worth the expense, time and risk. Not to mention the bad publicity that could follow.
I think some of the veterans of this board have covered this topic about 6 months ago. :sick:
"There should be set pricing" : there is, it's called MSRP, you don't want to grind, pay the sticker. You don't want to pay any ADM, shop where they sell at sticker. You want to pay less, use whatever method you choose, but don't complain that it took to long, it was too expensive, or whatever else the story may be.
Toyota has Access pricing in BC. All the dealers sell for sticker, and nothing less. Some people love it, and others I ran into won't buy a Toyota because they can't negotiate.
Dealer Auctions are for dealers only, unless it is some mickey mouse operation where "dealers auction" off their wholesale beaters to the public.
And yes, everyone is a better expert about the car biz except us folks who are, or have been in the biz, and the exceptionally few who buy cars regularly enough to know where we're coming from (and who contribute here, thanks ).
Like someone on another board here who mentioned there's no freight or pdi on Hondas, and apparently I am wrong (after 3 years at Honda) because he didn't see it on the invoice.
Whatever..................
Life is too short, you wanna save money buy a bus pass or a bicycle. :P Better yet make your own bicycle so that you won't pay bicycle store markup.
Actually, we get bids from several dealers and or wholesalers on the trade, and the ACV is the highest bid. The pricing on the new car is actually a separate transaction. In most stores, the used car manager doesn't negotiate - he knows what he can put into a car. Now, some slime stores will try and settle for less with the customer to increase profit, but the manager's number is the ACV.
ACV is Actual Cash Value, different from trade allowance.
If Mr. Customer is buying a Grindmobile XL, for $35000 with $5k markup, and his trade's ACV is $10k, then the difference would be $25k. If he wants to "get" $12k for his trade, then that extra $2k come from the $5k gross. The ACV is still $10k even though on paper it's shown as $12k.
"There should be set pricing" : there is, it's called MSRP, you don't want to grind, pay the sticker.
To be honest few things in this world sell for MSRP. Go to Best Buy or some place like that and I guarantee that most of the big ticket items are being sold for less than MSRP.
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
I'm not saying whether things do or do not sell for MSRP I don't disagree with you.
I'm saying if you want a set price, one that stays constant throughout the year, it would be MSRP. Then whatever "coupons (read rebates) are applied at the time. The MSRP is constant though.
Here in GA, we have two weekends yearly where sales tax is suspended on things like school supplies, computers, and other items (not cars, I assure you!!!)...
I am amazed at the number of folks who will line up for HOURS like they were buying tickets to a sold-out Rolling Stones concert, simply to save the 6-7% sales tax...
Not that I am against saving money, but if they advertised a statewide "7% off sale", nobody would even breathe hard over a price reduction of 7%, yet tell them the sales tax is suspended and they line up for hours...........
I don't get it...These are probably the same folks who, when they gross $40K yearly, and get a tax refund of $165.00, go out and tell everybody that "they didn't pay any income tax this year"...:):):)
But if there was a "set" price below MSRP, would you want to negotiate that? Of course you would? By the way, a study a number of years ago proved that one price stores had higher grosses than traditional stores,
I'm saying if you want a set price, one that stays constant throughout the year, it would be MSRP.
No not always remember that the 'S' is "suggested" you could always set the constant price at any price you want. Say the MSRP is $21K you could always price it at a constant $20K and sell it for that all year long (less any coupons or rebates applied at that time).
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
But the manufacturers set the MSRP not the dealers, not the buyers, not the dealership owners, not the banks.
MSRP is constant throughout the year. Yes dealers may sell for more, buyers may buy for less, but MSRP still remains constant.
If you pay $1k under MSRP, well that is not the MSRP anymore. That is a negotiated price. Because a buyer paid MSRP, that doesn't mean that the manufacturer will reduce all of it's prices on that model to that negotiated price. MSRP will still stay.
But the manufacturers set the MSRP not the dealers, not the buyers, not the dealership owners, not the banks.
Again the 'S' in MSRP is "suggested"" the dealer sets the actual price and they can set it to whatever they want.
If you pay $1k under MSRP, well that is not the MSRP anymore.
Again its the suggested retail price. No matter what it sells for what the manufacturer suggests the retail price should be is the MSRP. It has no bearing on reality.
I am not to sure on why that concept is difficult.
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
We are on a different subject here. I am talking about MSRP not final selling price.
I perfectly understand what you are saying, that the selling price varies and is different from MSRP.
HOWEVER
MSRP, even though it may be suggested by the manufacturer, stays constant. It is a constant figure that does not change.
Hence you see MSRP on factory windows stickers, and you see MSRP in Road and Track Buyer's Guide, and you see MSRP in automotive reviews, and MSRP is used to calculate lease residuals.
Whether or not MSRP has no bearing on reality is a different issue. The issue is that if you don't want to haggle, and don't know what to pay for a car, you can walk in, and on 99% of the cars out there pay whatever the manufacturer suggested you should pay.
The dealer can set whatever price it may want to set, but the suggested price from the manufacturer does not change.
"To be honest few things in this world sell for MSRP. Go to Best Buy or some place like that and I guarantee that most of the big ticket items are being sold for less than MSRP."
I tend to disagree. I find the title "Best Buy" to be an oxymoron. Unless they have the item specifically price-reduced for a sale, Best Buy's prices are at MSRP. For example, compare their prices on Sony products with Sony's own web site at sonystyle.com. I found the same thing true for other televisions and audio equipment when I was shopping around on the internet (both in 2001 and 2006).
Many big-ticket electronics manufacturers place price controls on their products. For some of these products, all "authorized" dealers are required to charge the same price -- typically at MSRP. Some other manufacturers might allow discounts, but do not allow the discounted prices to be clearly advertised. And if you buy from an unauthorized dealer, the manufacturer may not honor the warranty.
MSRP, even though it may be suggested by the manufacturer, stays constant. It is a constant figure that does not change.
My point is that you can have a constant set price and not have it as MSRP. If you are talking about a constant price industry wide its not going to happen, nor does it happen with any other product.
Whether or not MSRP has no bearing on reality is a different issue. The issue is that if you don't want to haggle, and don't know what to pay for a car, you can walk in, and on 99% of the cars out there pay whatever the manufacturer suggested you should pay.
Well the dealership could just set a price and accept no other price but that price. And that price can be whatever they want.
My whole point is that a dealership could set up a system where they have one constant price that does not have to be MSRP.
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
I find the title "Best Buy" to be an oxymoron. Unless they have the item specifically price-reduced for a sale, Best Buy's prices are at MSRP.
I find that Best buy and other places usually advertise the MSRP as the regular price and the current selling price. The current selling price is usually less than the MSRP. While Best Buy may not be the best price it usually is lower than MSRP.
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
Higher gross means they made more profit per car sale. The overall dealer profit has too many variables to determine total profitability, or to even make it a desired component of the study. The other profit centers (service and parts), Overhead, utilities, etc. All it studied was the dollar profit per unit sale transaction.
My point being is just because you make more per individual sale does not mean that you make more overall in the sales department. Tell me would you rather sell 50 cars making $100 profit each or 100 cars making $75 profit each?
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
My point being is just because you make more per individual sale does not mean that you make more overall in the sales department. Tell me would you rather sell 50 cars making $100 profit each or 100 cars making $75 profit each?
Neither
J/K I know you are just using those figures to make a point.
Had a lady who came in yesterday and the desk worked the whole deal before I ever saw it. Quoted her payment and rate before it ever got to my office. Well low and behold she did not qualify for the rate they quoted. So they cut the deal $600 to get to a payment with out asking me if there are any other avenues.
After they were all done and had completely cut me out of the deal the lady says "What about a Service Contract? I can't afford to drive a car with out one"
We do direct lending with her Credit Union and I was able to send her through the Credit Union with a Service Contract and get her payment $5 a month lower then it was without the Service Contract the way the desk structured the deal. Needless to say they were mad they gave up $600 gross when they didn't have to.
Had another guy Tuesday and this one just blows me away.
The Sales Person gives this guy a OTD price on a $55K F-350. Guy goes to his CU and shows up the next day with check in hand. never got to talk to him. We are sitting there visiting and I ask him what his rate was. He tells me it is 5.25%, and goes on to say that the sale person said we can't touch that. I then ask how long the loan is and he says 36 months. UUUUUUUUUUUUURRRRRRRRRRRRGGGGGGGGGGGG, :mad: :mad: , I could have got this guy 3.9 on 36 months plus given him an additional $1000 rebate for financing with Ford Motor Credit. Ended up costing the customer a total of $1942 in rebates and finance charges and me a loan to go against my penetration at FMCC. :mad: :mad:
Man I am glad may is over, I have been scratching and fighting for every deal I have got. Usually may is one of my better months but this one sucked.
BTW I did offer the financing package to the guy and showed him the $$'s it would save him but he said the Credit Union has always been good to him over the years and used to lend him money when no one alse would so he would stay with them, but would be sure to check with me next time.
snake - the reason why their prices are less than MSRP is because they have to compete with the stores that still negotiate - so asking MSRP wouldn't work. who would go to a ford store asking MSRP non-negotiable, when they could go down the street and haggle a bit and get a good deal?
however, if ALL stores went to a one price model, then there would be no reason to reduce the MSRP price, because there is no fear of being undercut by the store down the street.
Snake, I never said the one price stores were at MSRP. I said the study showed that the stores that practiced a one price approach made a higher gross profit per sale (based only on the individual car sale). However, most one price stores have gone back to negotiating because other stores would capture people who shopped. There are too many variables in market, seasonal, product, geographical, competitive, and numerous other conditions that are continuously changing to make a one price store really work.
Shoot, I always tip waiters and waitresses generously unless the service was mediocre, then it's only the standard 15%. Most people probably don't know they don't even make minimum wage and that the majority of their pay is in tips. I'm also very polite with them. Never offend people who handle your food.
I generally only flip my screen around to show people what we have in the carI have had people tell me that they know computers and I can put whatever I want into that screen.
The problem with showing a invoice print-out or the computer monitor showing costs, is that for the average consumer they cannot differentiate those that are legitimate invoice prices from the manufacturers/seller and those that are inflated "costs" by the dealership...especially when dealing with preowned vehicles.
An example would be a recent post in "Buying Tips" you responded to. The poster bought a new Tahoe. He was shown the invoice that showed LAM group contribution $500 and LAM dealer contribution $500 on the Tahoe he bought. The poster paid these fees thinking at the time they were part of the invoice price. He then posted on Edmunds if these were legitimate fees or if he had been "ripped off". Well, we all know some dealerships that have a $499 dealers fee. While legitimate to the dealership, these type of fees or costs are often seen as inflated add-ons to the cost of a car to many buyers.
So no, I wouldn't say a salesman is lying over an invoice statement shown to me. I would just say he has "costs" on the statement that can either be negotiated, or ignored.
Anybody out there know what a LAM group contribution fee is? I'd say 99% of us don't... which proves my point now don't it.
I agree 100%... this is a story from the front line!!! Every now and again you have a customer who is a $500 or more dollar blow. They decide to close the deal at the same time someone who is paying a $3000 profit or more. You put the person paying more thru the box first and the person waiting gets all upset that they have to wait and don't understand!!! Great point!!! :shades:
Finished with 23 cars last month.... I need a vaca...
The thing I love about this forum is all the buyers think they know the car biz becuase they bought a car below invoice, they don't budge on their numbers, there is always a hidden something about the deal where the dealer is making thousands, They actually know what there trade is worth, The list goes on.
This is one of the only sales businesses where you meet people of all demographics, people that make $15,000/year to $500,000 per year. Being able to deal with all those different people is a lot of fun and thats one of the reasons I work in this business. I do think it's very entertaining how people think they got this business all figured out, but don't have a clue of what goes on. the good thing is most of the shoppers on this forum are about 10% of the real world shoppers. If those 10% gained momentum and every one was a educated buyer paying below invoice. That would be fine because i'm sure the auto business will stay alive. Maybe it will become one of those one price stores like best buy, sears, etc. etc.
But my gut feeling tells me that won't happen.
best of luck to everyone in June....
and most of all thank you for reading! :shades: :P
"However, most one price stores have gone back to negotiating because other stores would capture people who shopped. There are too many variables in market, seasonal, product, geographical, competitive, and numerous other conditions that are continuously changing to make a one price store really work."
lrguy: As a customer, I agree with you 100%! I would like to expand on this further.
First of all, I don't want to be put in any situation that encourages me to pay the same price as my neighbor, who typically performs < 5 minutes of research for each of his purchases. In contrast, I am the anal retentive researcher who usually knows more about the car than the average salesman. If I do my homework and am willing to take some time for courteous negotiations, I believe I should have the opportunity to be rewarded for my efforts (as compared to my neighbor).
Also, there are all the factors you mentioned. Just imagine how frequenty the pricing would need to be adjusted at higher-volume stores when a new model is introduced (ie, Camry, Altima, Fusion, etc) It might sell at MSRP for the first month or so, but then the market value would begin to drop on a consistent basis, possibly every 2-3 weeks, as inventory increases and demand drops. And for older, less popular models, isn't it common for the manufacturer to tinker with sales incentives on a monthly basis?
For cars produced and sold in lower volumes, on average, consider how pricing might be affected as inventory significantly flunctuates on a monthly basis. For these types of cars, there are several minor characteristics, such as the exterior color (popular vs unpopular), which will affect the market value.
I could have got this guy 3.9 on 36 months plus given him an additional $1000 rebate for financing with Ford Motor Credit. Ended up costing the customer a total of $1942 in rebates and finance charges and me a loan to go against my penetration at FMCC.
Wow, I think some people are just freaked by the F&I guy. I don't understand, there is a dude at the dealer whose job it is to get you money to pay for the car, has access to like 15 lenders and a good idea of who will work bet for a particular situation, and BOOM, people go around him and don't let him quote anything. I'm not saying I am always going to go with what the dealer finds me, but heck at least let them have a shot at it, its not like that costs you anything.
My apologies for the long paragraph. I have been attempting to edit my previous post, to break it up into 3 separate paragraphs -- but to no avail. The result is always the same! My 3 paragraphs are combined into 1 paragraph, as if my key is ignored.
you went into a jewelry store to purchase a diamond or some south sea pearls?
heh heh. diamonds and pearls are not commodity items, but they are lux. purchases. noone expects to pay the price on the invoice tag, and it's highly likely you won't know what you're looking at unless you're a qualified gemologist, even after doing lots of research.
vehicles are lux but also commodity items. the pricing of them should really be "standardized". they are not homes, nor diamonds or pearls.
Try putting (br) where you want to hit Enter, but don't use the parens, use < and >. It should work because when I put it in this post to show you what to try, I got a Return with no display of the br! :P
And for older, less popular models, isn't it common for the manufacturer to tinker with sales incentives on a monthly basis? Great and true post. I can't speak for the manufacturers who are desperate, but about the only time we get dealer cash on a vehicle is as the end of the model year approaches. Lease incentives, etc, are usually done on a quarterly basis - no week to week or month to month tinkering.
Wow, I think some people are just freaked by the F&I guy.
Haha, you got that right.
I've never particularly enjoyed my experience in that office. On the RARE occasion that s/he can't beat my bank's rate, this is actually an ideal situation. You show up to buy the car with check in hand, and it's very easy to decline the add-ons. This is how we bought my wife's van, and the F&I guy was kind of dejected that the sales office gave us a OTD price to make the check for without a chance to sell us anything additional (sorry, Joel. )
Most of the time, however, the F&I guy CAN beat my bank's rate. So we sit in there for an interminable amount of time while I'm told how stupid I am for refusing the non-manufacturer brand extended warranty or a $500 "protection package".
I have a long-held belief that the finance people give me a lowball rate just for an opportunity to have a real crack at upselling me. On some level this makes me feel bad for them because I know they make -0- on the deal, but what can you do.
I've never particularly enjoyed my experience in that office. On the RARE occasion that s/he can't beat my bank's rate, this is actually an ideal situation. You show up to buy the car with check in hand, and it's very easy to decline the add-ons. This is how we bought my wife's van, and the F&I guy was kind of dejected that the sales office gave us a OTD price to make the check for without a chance to sell us anything additional (sorry, Joel. )
Thats OK, I get a little personal satisfaction when people think they have out smarted me when in fact I know that they are going to pay a couple thousand more dollars in interest at there bank.
Not the case in the story I told though. He was truly a nice guy who thought to much of the folks at his CU to back out on the deal he made with them. Wish there were more people like that were true to there word like him around.
Comments
On the other subject, I don't understand why a consumer wouldn't perform pricing research on big-ticket electronics? The internet has so much information, why pay the regular prices charged by Circuit City or Best Buy? In this respect, I agree with you. I have a difficult time understanding why some consumers walk in to these stores and pay full price without flinching, while other consumers will wait in a 300-ft line at 4:00am on Thanksgiving morning to save $75 on a computer!
Besides, assuming both the buyer and seller are acting rationally and ethically what is a better indicator of the value of the transaction than the deal they just agreed to.
Finally for every three comps found that supports value x, three more can easily be found that support value y.
The value is determined by what somebody will pay for something. :shades:
Change "actual cash value" to "what they are willing to pay" and I will agree with you.
The customer then decides if he accepts the dealers offer.
In short both are playing the part of appraiser If they can come up with a compromise then a deal is done.
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
There is NO cooling off period in Cali but you can sign all you want
You don't roll the car over the curb, you don't "burn gas" .. you don't "own" it yet!
"There should be set pricing" : there is, it's called MSRP, you don't want to grind, pay the sticker. You don't want to pay any ADM, shop where they sell at sticker. You want to pay less, use whatever method you choose, but don't complain that it took to long, it was too expensive, or whatever else the story may be.
Toyota has Access pricing in BC. All the dealers sell for sticker, and nothing less. Some people love it, and others I ran into won't buy a Toyota because they can't negotiate.
Dealer Auctions are for dealers only, unless it is some mickey mouse operation where "dealers auction" off their wholesale beaters to the public.
And yes, everyone is a better expert about the car biz except us folks who are, or have been in the biz, and the exceptionally few who buy cars regularly enough to know where we're coming from (and who contribute here, thanks
Like someone on another board here who mentioned there's no freight or pdi on Hondas, and apparently I am wrong (after 3 years at Honda) because he didn't see it on the invoice.
Whatever..................
Life is too short, you wanna save money buy a bus pass or a bicycle. :P Better yet make your own bicycle so that you won't pay bicycle store markup.
2016 Audi A7 3.0T S Line, 2021 Subaru WRX
ACV is Actual Cash Value, different from trade allowance.
If Mr. Customer is buying a Grindmobile XL, for $35000 with $5k markup, and his trade's ACV is $10k, then the difference would be $25k. If he wants to "get" $12k for his trade, then that extra $2k come from the $5k gross. The ACV is still $10k even though on paper it's shown as $12k.
2016 Audi A7 3.0T S Line, 2021 Subaru WRX
To be honest few things in this world sell for MSRP. Go to Best Buy or some place like that and I guarantee that most of the big ticket items are being sold for less than MSRP.
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
I'm saying if you want a set price, one that stays constant throughout the year, it would be MSRP. Then whatever "coupons (read rebates) are applied at the time. The MSRP is constant though.
2016 Audi A7 3.0T S Line, 2021 Subaru WRX
I am amazed at the number of folks who will line up for HOURS like they were buying tickets to a sold-out Rolling Stones concert, simply to save the 6-7% sales tax...
Not that I am against saving money, but if they advertised a statewide "7% off sale", nobody would even breathe hard over a price reduction of 7%, yet tell them the sales tax is suspended and they line up for hours...........
I don't get it...These are probably the same folks who, when they gross $40K yearly, and get a tax refund of $165.00, go out and tell everybody that "they didn't pay any income tax this year"...:):):)
No not always remember that the 'S' is "suggested" you could always set the constant price at any price you want. Say the MSRP is $21K you could always price it at a constant $20K and sell it for that all year long (less any coupons or rebates applied at that time).
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
MSRP is constant throughout the year. Yes dealers may sell for more, buyers may buy for less, but MSRP still remains constant.
If you pay $1k under MSRP, well that is not the MSRP anymore. That is a negotiated price. Because a buyer paid MSRP, that doesn't mean that the manufacturer will reduce all of it's prices on that model to that negotiated price. MSRP will still stay.
2016 Audi A7 3.0T S Line, 2021 Subaru WRX
Again the 'S' in MSRP is "suggested"" the dealer sets the actual price and they can set it to whatever they want.
If you pay $1k under MSRP, well that is not the MSRP anymore.
Again its the suggested retail price. No matter what it sells for what the manufacturer suggests the retail price should be is the MSRP. It has no bearing on reality.
I am not to sure on why that concept is difficult.
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
I perfectly understand what you are saying, that the selling price varies and is different from MSRP.
HOWEVER
MSRP, even though it may be suggested by the manufacturer, stays constant. It is a constant figure that does not change.
Hence you see MSRP on factory windows stickers, and you see MSRP in Road and Track Buyer's Guide, and you see MSRP in automotive reviews, and MSRP is used to calculate lease residuals.
Whether or not MSRP has no bearing on reality is a different issue. The issue is that if you don't want to haggle, and don't know what to pay for a car, you can walk in, and on 99% of the cars out there pay whatever the manufacturer suggested you should pay.
The dealer can set whatever price it may want to set, but the suggested price from the manufacturer does not change.
2016 Audi A7 3.0T S Line, 2021 Subaru WRX
I tend to disagree. I find the title "Best Buy" to be an oxymoron. Unless they have the item specifically price-reduced for a sale, Best Buy's prices are at MSRP. For example, compare their prices on Sony products with Sony's own web site at sonystyle.com. I found the same thing true for other televisions and audio equipment when I was shopping around on the internet (both in 2001 and 2006).
Many big-ticket electronics manufacturers place price controls on their products. For some of these products, all "authorized" dealers are required to charge the same price -- typically at MSRP. Some other manufacturers might allow discounts, but do not allow the discounted prices to be clearly advertised. And if you buy from an unauthorized dealer, the manufacturer may not honor the warranty.
My point is that you can have a constant set price and not have it as MSRP. If you are talking about a constant price industry wide its not going to happen, nor does it happen with any other product.
Whether or not MSRP has no bearing on reality is a different issue. The issue is that if you don't want to haggle, and don't know what to pay for a car, you can walk in, and on 99% of the cars out there pay whatever the manufacturer suggested you should pay.
Well the dealership could just set a price and accept no other price but that price. And that price can be whatever they want.
My whole point is that a dealership could set up a system where they have one constant price that does not have to be MSRP.
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
I find that Best buy and other places usually advertise the MSRP as the regular price and the current selling price. The current selling price is usually less than the MSRP. While Best Buy may not be the best price it usually is lower than MSRP.
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
Technically they could do that but the chances of having a store with prices that don't match the factory window stickers are pretty rare.
2016 Audi A7 3.0T S Line, 2021 Subaru WRX
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
I know of two around here that do that. One price shopping at prices that are not MSRP.
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
Neither
J/K I know you are just using those figures to make a point.
Had a lady who came in yesterday and the desk worked the whole deal before I ever saw it. Quoted her payment and rate before it ever got to my office. Well low and behold she did not qualify for the rate they quoted. So they cut the deal $600 to get to a payment with out asking me if there are any other avenues.
After they were all done and had completely cut me out of the deal the lady says "What about a Service Contract? I can't afford to drive a car with out one"
We do direct lending with her Credit Union and I was able to send her through the Credit Union with a Service Contract and get her payment $5 a month lower then it was without the Service Contract the way the desk structured the deal. Needless to say they were mad they gave up $600 gross when they didn't have to.
Had another guy Tuesday and this one just blows me away.
The Sales Person gives this guy a OTD price on a $55K F-350. Guy goes to his CU and shows up the next day with check in hand. never got to talk to him. We are sitting there visiting and I ask him what his rate was. He tells me it is 5.25%, and goes on to say that the sale person said we can't touch that. I then ask how long the loan is and he says 36 months. UUUUUUUUUUUUURRRRRRRRRRRRGGGGGGGGGGGG, :mad: :mad: , I could have got this guy 3.9 on 36 months plus given him an additional $1000 rebate for financing with Ford Motor Credit. Ended up costing the customer a total of $1942 in rebates and finance charges and me a loan to go against my penetration at FMCC. :mad: :mad:
Man I am glad may is over, I have been scratching and fighting for every deal I have got. Usually may is one of my better months but this one sucked.
BTW I did offer the financing package to the guy and showed him the $$'s it would save him but he said the Credit Union has always been good to him over the years and used to lend him money when no one alse would so he would stay with them, but would be sure to check with me next time.
however, if ALL stores went to a one price model, then there would be no reason to reduce the MSRP price, because there is no fear of being undercut by the store down the street.
-thene
Amen Brother
The problem with showing a invoice print-out or the computer monitor showing costs, is that for the average consumer they cannot differentiate those that are legitimate invoice prices from the manufacturers/seller and those that are inflated "costs" by the dealership...especially when dealing with preowned vehicles.
An example would be a recent post in "Buying Tips" you responded to. The poster bought a new Tahoe. He was shown the invoice that showed LAM group contribution $500 and LAM dealer contribution $500 on the Tahoe he bought. The poster paid these fees thinking at the time they were part of the invoice price. He then posted on Edmunds if these were legitimate fees or if he had been "ripped off". Well, we all know some dealerships that have a $499 dealers fee. While legitimate to the dealership, these type of fees or costs are often seen as inflated add-ons to the cost of a car to many buyers.
So no, I wouldn't say a salesman is lying over an invoice statement shown to me. I would just say he has "costs" on the statement that can either be negotiated, or ignored.
Anybody out there know what a LAM group contribution fee is?
I'd say 99% of us don't... which proves my point now don't it.
? can someone translate this
The thing I love about this forum is all the buyers think they know the car biz becuase they bought a car below invoice, they don't budge on their numbers, there is always a hidden something about the deal where the dealer is making thousands, They actually know what there trade is worth, The list goes on.
This is one of the only sales businesses where you meet people of all demographics, people that make $15,000/year to $500,000 per year. Being able to deal with all those different people is a lot of fun and thats one of the reasons I work in this business. I do think it's very entertaining how people think they got this business all figured out, but don't have a clue of what goes on. the good thing is most of the shoppers on this forum are about 10% of the real world shoppers. If those 10% gained momentum and every one was a educated buyer paying below invoice. That would be fine because i'm sure the auto business will stay alive. Maybe it will become one of those one price stores like best buy, sears, etc. etc.
But my gut feeling tells me that won't happen.
best of luck to everyone in June....
and most of all thank you for reading! :shades: :P
lrguy: As a customer, I agree with you 100%! I would like to expand on this further.
First of all, I don't want to be put in any situation that encourages me to pay the same price as my neighbor, who typically performs < 5 minutes of research for each of his purchases. In contrast, I am the anal retentive researcher who usually knows more about the car than the average salesman. If I do my homework and am willing to take some time for courteous negotiations, I believe I should have the opportunity to be rewarded for my efforts (as compared to my neighbor).
Also, there are all the factors you mentioned. Just imagine how frequenty the pricing would need to be adjusted at higher-volume stores when a new model is introduced (ie, Camry, Altima, Fusion, etc) It might sell at MSRP for the first month or so, but then the market value would begin to drop on a consistent basis, possibly every 2-3 weeks, as inventory increases and demand drops. And for older, less popular models, isn't it common for the manufacturer to tinker with sales incentives on a monthly basis?
For cars produced and sold in lower volumes, on average, consider how pricing might be affected as inventory significantly flunctuates on a monthly basis. For these types of cars, there are several minor characteristics, such as the exterior color (popular vs unpopular), which will affect the market value.
Wow, I think some people are just freaked by the F&I guy. I don't understand, there is a dude at the dealer whose job it is to get you money to pay for the car, has access to like 15 lenders and a good idea of who will work bet for a particular situation, and BOOM, people go around him and don't let him quote anything.
I'm not saying I am always going to go with what the dealer finds me, but heck at least let them have a shot at it, its not like that costs you anything.
heh heh. diamonds and pearls are not commodity items, but they are lux. purchases. noone expects to pay the price on the invoice tag, and it's highly likely you won't know what you're looking at unless you're a qualified gemologist, even after doing lots of research.
vehicles are lux but also commodity items. the pricing of them should really be "standardized". they are not homes, nor diamonds or pearls.
Great and true post. I can't speak for the manufacturers who are desperate, but about the only time we get dealer cash on a vehicle is as the end of the model year approaches. Lease incentives, etc, are usually done on a quarterly basis - no week to week or month to month tinkering.
Haha, you got that right.
I've never particularly enjoyed my experience in that office. On the RARE occasion that s/he can't beat my bank's rate, this is actually an ideal situation. You show up to buy the car with check in hand, and it's very easy to decline the add-ons. This is how we bought my wife's van, and the F&I guy was kind of dejected that the sales office gave us a OTD price to make the check for without a chance to sell us anything additional (sorry, Joel.
Most of the time, however, the F&I guy CAN beat my bank's rate. So we sit in there for an interminable amount of time while I'm told how stupid I am for refusing the non-manufacturer brand extended warranty or a $500 "protection package".
I have a long-held belief that the finance people give me a lowball rate just for an opportunity to have a real crack at upselling me. On some level this makes me feel bad for them because I know they make -0- on the deal, but what can you do.
Thats OK, I get a little personal satisfaction when people think they have out smarted me when in fact I know that they are going to pay a couple thousand more dollars in interest at there bank.
Not the case in the story I told though. He was truly a nice guy who thought to much of the folks at his CU to back out on the deal he made with them. Wish there were more people like that were true to there word like him around.