Any Questions for a Car Dealer?

tincup47 · May 2002

But those no haggle dealers have to compete with other dealers of the same brands who do haggle. If that competition was taken away, the prices would go up to MSRP or close to it.

bretfraz · May 2002

Nope. What they do is fine and legal although perhaps not in the best interests of the consumer. A mfr has the right to hold the selling prices of their products. If a dealer ignores the directive the mfr can restrict distribution or use other means to punish the dealer.

Bose (the speaker mfr) does this. So do several car wax/polish companies I know.

All this is protected by the Sherman Act which the Supreme Court has held up in a number of cases. Mfr's are allowed by federal courts to do pretty much whatever they want with their distribution systems. As long as they are selling the same product to all dealers at the same price and are not restraining distribution to favor one dealer or penalize another, what Saturn does is fair and legal.

godeacs · May 2002

valid statement! At least here you have the option of a pleasant buying experience (and paying a tad more) or a lousy buying experience to try and save a few $$$$. To me, the 1st option wins everytime as long as both options exist...lol

afk_x · May 2002

Here is something I know a little bit about.

Saturn strongly encourages its dealers to sell to the end user. You "cannot" sell to brokers.

Saturn does not require its dealers to sell at MSRP. Each dealers sets its own price. What Saturn corp "requires" is once they set their price to stick to it.

Saturn from day one was set up differently that other manufacturers. Each owner controls a marketing area in which they can open as many stores as they want. In this way Saturn dealers are competing less with eachother that other makes and every retailer I know of sells at MSRP.

This doesn't mean there is no negotiation. It just means there is less. Its much more of a "this is what we can do" and there is very little streching. Some people buy Saturns ONLY because of this. Some people will never buy Saturns because of this. My dear old dad is in camp B. He is the type who would buy a Chrystler Minivan because he got a bigger discount rather than buy the Oddessy for less at MSRP.

dusti · May 2002

There's a word for them low-down dealers that practice price gouging, but in the interest of civility I won't mention it here.

Cars should sell like everything else -

For their tag price PERIOD.

The fact that I plan on my next set of wheels
being a Mini Coop has NOTHING to do with it.

what's right's right.

but if I find on test driving the sucker that it's not what it's cracked up to be ...

then all the above is null and void.

mark156 · May 2002

The same cars will never ever sell for "one" price all year long.... cars are like day old bread.... they go down in value as the days and months pass. Whatever the price is in January, it cannot be the same price the following December. (there are rare, rare exceptions of course)

I believe (just an assumption only) that Saturns are totally negotiable when a trade is involved.... they may get MSRP on the Saturn but I bet the trade prices fluctuate greatly when competing with another brand.

Mark

godeacs · May 2002

what "1 price" means (at least at the local dealers) is that everyone pays the same price at that particular time. Of course, that price will fluctuate throughout the year...

landru2 · May 2002

What does "that particular time" mean? That day? That week? That month? Let's say I choose Oct 1 to be the day I lower the price on my remaining convertibles. Would my "one-price" policy still be okay with the guy that paid more on Sept. 15?

masspector · May 2002

Not trying to be sarcastic, but I think the answer to your question lies with every other retail business out there. Other businesses have sales and seasonal price reductions. Your convertible example would be analogous to a swimsuit. I am sure if you go to the mall to buy a swimsuit in May thru August they are regular price. If any are left over by October they are probably 50% on the clearance rack. They person that buys a convertible in the spring or summer is just asking to get soaked.

Another example. If I want the most selection of a winter coat I need to buy one in the fall when all the stores just got their inventory in. I will probably pay full price, but I get what I want. If the coat I have is ok and I can wait til March, I can probably get a much better price on the left over inventory, but I do not have as great of a selection. That is the choice I must make as a consumer: price vs. selection, based on seasonal availability.

I know that there are certain cars, IE convertibles in the summer, and 4x4's in the winter that have somewhat of a season in cars sales. However I am sure that for most people whether they buy a sedan or minivan in summer or winter does not matter. If I buy a retail item and 6 months later the price drops (think of all those people that had to have an Xbox or PS2 for christmas), then thats tough. This happens all the time in retail. If you are lucky the price will drop in 30 to 60 days and you can get a refund of the difference, but 3 to 6 months later is asking too much.

masspector · May 2002

If a car dealership goes out of business, what happens to the inventory that they have on their lot? Does the manufacturer take it back to sell to other dealerships? I have never seen a 50% off, Going Out of Business sale at a car dealer. Thanks guys.

bretfraz · May 2002

The finance company who provides the floorplanning money for the dealer gets posession of the cars. I'd also assume they'd sell them at auction or offer them to other dealers. I think it's fairly common for one dealer to buy a chunk of another dealer's inventory.

audia8q · May 2002

new cars generally go to area dealers or back to the mfg. The dealer is on the hook for the used cars. They usually go to auction to the highest bidder.

In our area recently a Lincoln/merc dealer was able to pick up the ford franchise. Ford made the deal if they dropped L/M they could have ford....All the area L/M dealers plucked their inventory and the balance went back to L/M.

Rich

masspector · May 2002

When the other LM dealers got cars from this lot, what do they normally pay, the exact invoice price that the losing dealer paid?

Why didn't they just have a Ford LM dealership all together?

Bret brings up a good point. If the manufacturer gets the new cars back do they pay the floorplan finance company?

Thanks

audia8q · May 2002

We paid exactly the same price as if the car came directly from the factory.

Many mfg. are trying to reduce the number of dealers and this is one way it works out for everyone.

Rich

landru2 · May 2002

My question to godeacs was to raise the question, if I say I'm a one-price dealer, under what circumstances am I allowed to change my pricing?

By the sound of your response it's okay to change pricing based on seasonal concerns.

But what about if I have 4 cars in stock and in one week sell 3 of them. I can't get any more for 2 months. Am I allowed to sell the last car for more than the first 3 sold for? Or I have a 2 cars of one model for weeks and then get a shipment of 10. Can I charge less now that I have 10 in stock?

Let's say that for whatever reason, last month's sales were down. Am I allowed to hold a "sale" this month and lower prices to boost my numbers?

Or let's say I've got 2 identical cars in stock, except that one has been in stock for 200 days and one has been in stock for 10 days. Is it okay if I sell the 200 day unit for less than the 10 day unit?

Every one of these situations has someone paying less for the same car than someone else; sometimes on the same day.

These questions are rhetorical but I hope I've illustrated that determining selling price is not quite so black and white as expecting that everyone should pay the same price when buying the same car.

(Of course, if you really believe that a dealership selling cars is the same as Best Buy selling a stereo then we may as well just agree to disagree.)

godeacs · May 2002

I meant that they change their prices occassionally, not regularly. They told me they keep tabs on their competition so that seems to be the basis for price changes. For example, 6 months later I could have gotten the same car for $800 less. Was I upset? No, because my trade in value would have dropped also and the time to unload my other car was then (beginning of model year). 2 weeks later and I would have been quite upset...lol

BTW, you raise some interesting thoughts about the timing, etc. Guess a customer wouldn't know unless they went to the lot everyday for a week or two and kept tabs.

mustangron · May 2002

Ordered a 2002 Tahoe Z71 from local dealer. He gave it to me for invoice plus adv, ttl, and other small Texas costs. Came to 35,834 invoice. His wholesale on the thing was 34,200 before his quarterly bonus and end of year stuff, so he made at least 1,600 on it gross. I really don't care. I had a good negotiation over the phone after researching the web and other dealers. I stated my out the door price and got it. I also ordered the vehicle. Now I see other dealers in the area giving their end of year vehicles away at the same price, so I feel I got a great deal at the time. I got no pressure from F&I when I went to close the deal and had no excessive doc fees, dealer prep, etc that I see on the chat rooms all the time. I had credit union financing and had 13K to put down so it is affordable. I think alot of the inconsiderate salespeople stuff comes from consumers not willing to give a business man a fair profit and by being uninformed and not having the available means to afford and put a down payment on a vehicle they need or want. I am paying $446/month for 5 years with early payoff allowed. I will never be upside down on a vehicle cause I don't try to get what I can't afford. People need to try to save some bucks, get at least good credit and then do research and stop trying to blame all others for their inability to negotiate a fair deal. Just my 10 cents. Not ot say there aren't bad sales people, but I just see the other side also. Believe me I am an Air Force enlisted guy on my way to Alaska and not a salesman. Thank You Al Atkins at All American Cheverolet in San Angelo Texas. And for all the grinders. I know you could have got a better deal, but I dont care.

masspector · May 2002

Thanks for your reply. You bring up some good points. I am not trying to be argumentative with you. You are correct we may have to just agree to disagree. I am trying to learn somethings here, and alot of your post on TH have been entertaining and informative. I am not in the car business and do not profess to be an expert in how to run a dealership by any means. I am just trying to let you guys know where a consumer is coming from when they are frustrated with the car buying system.

What I do not understand is why the car business would be so different from other retail sales? I understand that cars are expensive items, but so are watches, furs, and 70" TV's. You can apply all of your questions above to other retail outlets. Just insert $10,000 plasma tv for car. Yet I do not have doc fees and ad fees at retail outlets and I do not have to negotiate a price.

Is it because of the way the cars are bought from the manufacturer IE you have to finance their purchase? Is it the manufacturer allocation system? These are the kinds of questions that would be helpful for me to understand to get a better grasp on the car business and be a more informed consumer. Consumers did not set up the dealer/manufacturer system we have, however we have to deal with it everytime we go to buy a car. And if polls are any indication, people rate the enjoyment of buying a car just a litle bit above getting a double root canal. I am sure Best Buy has the same situation with a TV thats been there for 100 days and another just came in yesterday. But the one that has been there 100 days is no cheaper than the one that just came in. Is this because of the amount of floor space this items take up as opposed to cars?

Like I said above, I just do not understand why cars are SO different from other retail. You said above "(Of course, if you really believe that a dealership selling cars is the same as Best Buy selling a stereo then we may as well just agree to disagree.) "

--------------------------------------------------------------------------------
Maybe you could point out some of the differences to me that I do not understand. I am only refering to the new car sales. I understand that used cars, parts and service are a whole different ball of wax.

Thanks again

mustangron · May 2002

I've got a new Tahoe Z71 with leather seats. What is the best stuff to use to maintain the seats?

blackcurrant · May 2002

I'm considering buying one for my highway commute on rt 395 from NE CT to Hudson, Ma.

It has 113k miles. I haven't driven it yet so i can't comment on how it feels. Would you advise me of any costly pitfalls common to these cars. The seller says the ac blows hot and the bose stereo is dead. Otherwise, everything works, it has a brake upgrade (?), and it's well preserved/maintained.

How much life can be expected out of the V8 with auto and Quattro?

Thanks!

Mike

steine13 · May 2002

"How much life can be expected out of the V8 with auto and Quattro?"
The auto is weak, unless it's different from the regular ones...
The quattro is fairly stout.
The V8 is an oddball engine, but I think the whole thing will last almost indefinitely...
... as long as you're willing to fork out beacoup $$$ to keep it on the road.
See my rant over on RWTIV.

But I've wanted to ask for a while: Rich -- what's up with the Audi A8q handle?

-Mathias

tronsr1 · May 2002

LEXOL...sold at almost all auto parts stores, walmart, K Mart, etc.

bretfraz · May 2002

I agree, Lexol is excellent. And easy to find. I also like 303 Aerospace protectant, Eagle One leather cleaner and conditioner, and Pinnacle's leather care products. I've used all of these with very good results.

landru2 · May 2002

If you were buying a $10,000 plasma TV, you wouldn't negotiate the price? Saying you don't have to is like saying you'd pay MSRP for a car - you wouldn't have to negotiate then either. If you don't WANT to negotiate price on a $10,000 TV, that's up to you.

Let's say you were buying 2 plasma TV's. Why you wouldn't negotiate $20,000 worth of TV's but feel compelled to negotiate a $20,000 car is something only you could answer for yourself.

jonbgood · May 2002

Looked at an '01 Millenia base car today. Dealer ran carfax for me and it showed it spent its first 22k miles as a rental. Car looked exceptional and ran great and tight. Final price was $18.2k. Should I be nervous buying a rental car? What is the consensus, generally speaking, on rental vs. lease vs. private party one owner? Thanks in advance for your expertise.

protege_fan · May 2002

I just read this article on rental cars...

http://www.msnbc.com/news/756397.asp?0bl=-0

isellhondas · May 2002

Are ex-rentals. These aren't bad cars and are a LOT of car for the money as a used car.

They were a dismal failure as new cars...they just didn't sell.

Nothing really wrong with them but they never sold well at all.

And, no..I wouldn't be afraid of an ex rental, provided it's had a good inspection.

jonbgood · May 2002

What would you consider a "good inspection". And is the inspection as necessary with a car that has 2yrs and over 25k left on the mfg. warranty? Is buying from a reliable dealer good enough protection? And the obvious question I have is a new deal (with $5k dealer cash in play) a better option?

im_brentwood · May 2002

Just check it over for paintwork... Make sure its' clean..etc. I mean, if a couple of things are broken, it is under warranty.

Now, this is a 2001 with 25K? For $18,200?

Good price too! Those are doing, right now, an easy $16,500-17K+ across the block (Depends on the color) so you figure they have at least $17,200+ in it.

I'd say pull the trigger if it checks out. Nice cars, but staggering depreciation. A side not.. $5K in dealer cash is the norm on these... which is what I always find interesting whenever carbuyingtips.com comes up. He brags that he got $4,500 off MSRP on his Millenia S

Bill

jonbgood · May 2002

You pegged it. Sales person said she had spent all day away from her kids on Memorial day and had not sold a thing. She also knew I was considering new with the $5k dealer cash. She asked the mgr. for rock bottom out the door price. He showed me inventory sheet with their cost at $17,700. He had to make at least $500 he said. Car is two toned (white over sand at the bottom) Has 23K miles. Still thinking about new vs. used. (Actually trying to talk myself out of Acura TL that I can't afford!)

jonbgood · May 2002

Is there any place online that gives standard residual values for new automobiles? I've been unsucessful so far trying to find this info.

beachnut · May 2002

I got a great deal on it too! Do like brentwoodvolvo said and check the paint over real good. I thought I did, but after the deal was done and I was picking up the van, I noticed a rather large scratch on the roof. I was certain I would be told "too bad", but they took care of it a very professional manner.

tiredofmanual · May 2002

It was a 1988 Oldsmobile Cutlass Station wagon. they bought it in 1989 with about 15,000 miles on it. They sold it 2 years ago with around 180,000 miles on it, and spent about $1000 in repairs over the entire time. We beat the crap out of that car, and the engine purred the whole time. With 3 kids in college, it was WAY overloaded twice a year, but never complained. I wonder if the person who bought it got as much use out of it as we did.

im_brentwood · May 2002

Yeah... That is a cheap deal. Its' still smarter, I think, than a new one...

Look what ya'd lose in a year, eh?

As far as residual values.. no *_accurate_* site that I know of.

here's what I meant about paintwork:

http://www.directautogroupllc.com/paintwork.html

Bill

jonbgood · May 2002

Better than a new Millenia for $21,756? Thats $300 over invoice when you take into account full $5k of dealer cash. I've seen them for even less than this on the Millenia board. The '01 has 23k of rental miles for $3600 less. IMO, doesn't seem like that big of a discount compared to other 1st yr. hits I read about. What am I missing? Also, take into account, I'd like to drive the car for 150k miles. ("Sure" my wife says) Would that influence your decision to buy new over used?

jonbgood · May 2002

great link on detecting paint work. Thanks for that Brentwoodvolvo.

im_brentwood · May 2002

A new one is that cheap?

Really? For $3,600 I'd probably go new.

Bill

Kirstie_H · May 2002

A major national publication is looking for a consumer who is buying or just bought a vehicle and has considered a Ford, but is worried about their recent quality lapses. If you are have a story to share, please send your phone number and some basic information about your experience no later than Wednesday, May 29 to katiebw@aol.com or jfallon@edmunds.com.

audia8q · May 2002

Look out for electrical problems....Also no A/C is a huge deduct. It's not cheap to fix.
Engine and Quattro are rather reliable, with little to worry about. Have the tranny completely checked. They are very very expensive if they go.

Also the Bose is no bargain to fix/replace either.

I love the car but if and when they break it requires a bucket of cash.

Rich

porknbeans · May 2002

After you've agreed to a price on a car and you start talking about the trade in value of yours does the cleanliness of what you're presenting play any part in it. I've had dealers tell me in the past that they see used cars all the time and that there is no reason for you to detail it. They know how much the car is worth clean or dirty. Is this a line to get the value of your car down or is it legit?

abtseller · May 2002

the better the appraisal will be. Of course, if the car is an auction only item, appearance won't do much, but if the trade in is likely to be retailed on the lot, you should do everything you can to get it ready for retail road. The less money the dealer has to spend on it to get it ready, the more he's likely to pay you for it.

Ed

jonbgood · May 2002

to disclose to a dealer or an individual, that the car in question has been wrecked? My buddy asked me that the other day. His car had front end damage - no frame damage or mechanical damage- just replaced parts and paint. If the dealer or individual doesn't ask - should he disclose? Could an individual come back later and have any recourse if its not disclosed and later paint starts peeling or something? How reliable is something like carfax in detecting this? Thanks.

abtseller · May 2002

of personal responsibility and integrity. Our appraisal forms have a block on there that asks if the car has ever been damaged. If they say no, and then sign it, we could theoretically go after the customer in court.

Of course, if I as a dealer asked the same question, the fur would really fly, wouldn't it?

Carfax isn't the gospel, but more and more accident reports are showing up on their records, so they are improving. Any appraiser worth his salary will be able to tell if a car has had paintwork, and if they don't catch it, then your friend could probably get away with it.

Ed

im_brentwood · May 2002

Carfax depends on the state...

NJ? Maybe.

GA? Nope.

FL? Tap someone in a parking lot, and if you call the cops, it'll show as an accident.

As far as disclosure... that's a personal call. I usually disclose paintwork personally.

Bill

beachnut · May 2002

... if you can get the cops to show up, lol! And don't try to call after the fact. Had a lady at FHP tell me that even tho I was the one who got tapped in the rear, that I could be cited for leaving the scene of an accident! Nevermind the fact that the guy drove off at warp factor nine. Our hard earned tax dollars at work ...

stevestein · May 2002

I had a new car keyed when it was parked, and had to have the front fender and 2 door panels repainted. Fortunately it was a lease, and I didn't have a problem at turn-in. If I had owned the car and was trading it in, would it help to have a copy of the insurance claim, police report or other documents to show the dealer?
What about providing the info to carfax?
I'm curiuous if proof matters, or a blanket assumption is made that paint=collision and you take the $ hit.

lonesomeduv · May 2002

Short of acts resulting in bodily harm, keying a car has got to be the absolute sorriest most pathetic crime I can think of. What does the slimeball get out of it? Nothing. At least if you rob a 7-11 you get $20 and a six-pack, maybe a box of diapers for the kid. But keying a car -what's in it for the crook? You just cost somebody hundreds of dollars in deductibles and diminished residual value, many hours of hassle and headache, and in all likelihood a car that will never be the same again. Hell, I'd rather have a tire slashed than have my car keyed (and I've had both, so I know).

triphung · May 2002

I found these fees listed in a Toyota invoice but don't know what it means. Could anyone please help.
T.D.A. $345
M.A.F. $375
1% Finance Reserve MSRP $307

yaman · May 2002

we bought a toyota -2 years ago.At that time there was an advertising fee of around 350ish.So i would guess one of the fees mentioned in your post is that.However, we didn't pay any other fees.We live in the Northeast maybe other sections of the country have different types of fees

masspector · May 2002

With Toyota fees. Oh what a feeling.

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