Edmunds dealer partner, Bayway Leasing, is now offering transparent lease deals via these forums. Click here to see the latest vehicles!
Besides TMV what other online resource can I use to determine a fair price?
surferdudehb
Member Posts: 42
I'm looking at this 2103 SE Camry with 33k miles listed $16968 at a Toyota dealer. TMV is showing $17385 (certified).
So the dealer's price is actually lower than TMV's. How else can I get the dealer to lower the asking price?
So the dealer's price is actually lower than TMV's. How else can I get the dealer to lower the asking price?
0
Comments
Besides Kelley, NADA and the other "book" prices, there's the buying services. Ours is Price Promise and you can get deals via Costco, AAA and lots of other places. Best deals tend to be those you hammer out yourself - the buying services tend to whack the hassle more than the price.
Dealers can sell lower than TMV or invoice because they get bonuses and spiffs from the manufacturers. And there's holdback for most makes. Getting that info is difficult and often the owner doesn't really know what the car cost until they close the books for the month or quarter. Best bet is to buy at the end of the month, quarter or at year end and hope the dealer needs to make another sale to make a bonus number.
But I develop my own pricing goal as my starting point.
Take Invoice
Reduce by hold back, available on Edmunds.
Reduce by all incentives, both to customer and to the dealer. Edmunds also has this but there are other sources on line.
So, if invoice is $20,000, hold back is 2 percent of MSRP in this example $500, and there is a dealer incentive of $1,000, my price will be $18,500 plus a small profit of 2-3 percent.
It is never possible to determine what a dealer actually pays for a vehicle, there are too many hidden incentives. But they always pay less than invoice. Both dealers and manufacturers know how buyers use invoice so they have some hidden amounts which reduce the actual cost to the dealer. These days invoice is more for the buyer than for anyone else. Just another selling tactic.
I also check the various prices paid discussions to see if people are paying less than my price. If they are paying less, there is likely a dealer incentive which is hidden. If they are, I reduce my price, by the difference between the invoice and the average of the prices paid.
I then add 2-3 percent to my price goal for profit. This is a low price but not so low as to be ridiculous, but low enough to start negotiations.
Contrary to many "experts," when I visit the dealer I tell the sales person my price. This usually does a few things.
First, it allows you to control the negotiations. Sales people will dispute this. They always believe they control the negotiations. They do not. You have the money and they want your money. Therefore, you control the negotiations. There is always another dealer and they know it. The last thing the want to see is your back as you leave the building as a "be back."
Second, it informs the sales person I have knowledge. One thing sales people do not like to deal with is a knowledgeable customer. That eliminates many of their games. If they cannot play their games, they have nothing to do.
Third, it almost always gets the sales manager involved. In any dealership, sales people can only negotiate so far. Any real negotiations are done by the sales manager, either with you or in the back ground, the guy in the tower. So it is best to get to the sales manager as quickly as possible.
Recognize, the price I compute is not the price I expect to pay. I will probably pay a bit more. However, this short computation provides me sufficient knowledge to allow me to control negotiations and to end up with a comfortable price.
The worst thing any buyer can do is enter an auto dealership with no knowledge of prices. That is a sure fire way to get a really bad deal.
And this line by @ken117 sums it up very well - "You have the money and they want your money. Therefore, you control the negotiations."
Feet make a great negotiating tool.