Did you recently take on (or consider) a loan of 84 months or longer on a car purchase?
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Any Questions for a Car Dealer?
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We don't use all the options but it's good for followup and continual data maintanence on prospects and past clients.
January is usually pretty quiet but I've had good Januarys too.
A guy who I know works in a nearby Ford dealer. I went to visit him awhile back and noticed they had a "Tower".
I don't think I would like working in a store like that. A couple of stern faced managers sat there looking over everything. If a car pulled on the lot one of them would make sure a "liner" was right on top of them.
As a customer, I wouldn't like that either.
For a while back a yr or two a couple of stores here were going 24/7!!!!!!
We passed our longtime competitor 4 yrs ago and since then he has fired,
- 2 GM's;
- nearly his whole sales force.
Then reduced the payplan and now is open every Sunday.
He demanded his deposit back and since bought a 650i at another dealership (out of state) who he claimed didn't require an Arbitration Agreement.
My question is, does this law vary state to state (I'm in Alabama) or is it a dealership policy. I didn't ask many question, I just know you can't buy a car here without signing one.
Just kind of curious if any of you other guys have Arbitration Agreements on the back of your buyer's orders.
Thanks!
bmw3434
I need some recommendations to people who provide this service (I know there are a bunch of them) and some idea of cost. Thanks so much.
We work very hard but still manage to do it on a 5 day work week and NEVER will be open on Sunday and are open from 9-6 only.
If you have 96 hard working people you can run a large dealership like a mom and pop organization!
I was intending actually to compare your more reasonable operating conditions to those here in HR which seem to be approaching 'sweatshop' conditions.
I'm certain that your store is an excellent place to work and I was using it as a positive comparison. Enjoy your Holidays and the time off.
You store sounds like ours. Largest in the state for the 26 years we have been in business. Same number of salespeople. We are open on Sundays. The competition started this years ago and we had to follow just like any retail business. I schedule myself off on sundays but end up coming in sometimes for appointments.
I don't see that as being much different than if you invoke LEMON LAW procedures. You still sit in front of an impartial 3rd party who will make a ruling on your claim.
I usually see these "arbitration" type statements/agreements as a quicker way of getting a resolution as opposed to going through city/state courts for Lemon Law.
All that said, I've signed arbitration agreememnts, but have never had to test them. Maybe someone can tell me the downside of these agreements.
Mark
I would like to hear a little bit about different pay plans that you guys have and one kind of store you work at.
Our store is pretty low volume and high end with our new side only being Land Rovers. Our used side is land rover and lexus so still fairly high end as well. A very good month for us would be combined new and used 20 cars a month. The average is probably closer to 15 combined.
Our pay plan is structured like this.
New Cars
2 Percent pack of the invoice on the gross of a LR3
3 percent pack of the invoice on the gross of a Range Rover Sport or Range Rover
We get 15% of what is left over for the first 5 cars then 18% retroactive at 6 and 7. Anything 8 or up it goes to 22% retroactive. We have a 300 dollar bonus for 7 new cars and a 400 dollar bonus for 12 new cars.
The problem is that the pack is so high, espesialy on the Range Rovers, that if we give up any kind of discount we are stuck at a mini of 75 dollars. Range Rovers usually go for close to sticker anyway but even a $2000 discount pretty much wipes out our comission.
Used cars
20% of the gross with a flat pack of $300.
500 dollar bonus for 5 used cars sold in a month.
We could make money on this end but we just don't have the volume to do it. We don't do enough new car volume to get enough good trades to make that work and the auction cars they buy just cost too much money. A minimum of 1200 dollars comes out of the gross of every Land Rover just to certify it and in some cases it can be as high as 3000 dollars if it needs brakes and tires.
Very open and non-threatening to everyone.
We have 1.5% of MSRP tacked onto Invoice ... plus $135 pack ... plus $11 dealerups ... and mats are typically $113 (I never make anyone pay for mats on the 3's, or any other BMW they don't come with.)
We get 25% of whatever is left over plus 6% of backend. Sell 1-8, it's 25% ... 9-12 it's 27.5% ... 13-16 it's 30% and anything more than that it's 35%.
On our used cars it's $667 pack, plus certification ($850-$1450), plus whatever costs in the shop. Percentages work the same.
Overall, we have a very good chance at making a good living.
That is 20 cars a month for the whole store not just one salesman too. I think the average is a little less then 20 a month too. I mean we have had the random 30 something car month but 15 or under has happend too.
Your pay structure is much better I think with less pack and higher precentages overall. If they reduced the packs some we would be ok I think. It just pisses me off when I sell a $84,000 dollar range rover for full MSRP and the dealership makes about $10,000 on the front and back, a little over $7,000 on the front and $2,500 or so on the back for the lease, before even considering our business builder money as well. After all of that I make less then 600 dollars.
Hondas didn't used to come with mats until a few years ago. I made the people pay for them and most were happy to do so. If they didn't want to pay for them, I yanked them out unless it was a very good deal. Finally Honda got smart, raised the price a hundred bucks and included the mats which was a smart move.
british rover, I would fall asleep in your store. We average 20 plus cars per salesperson.
Cost equals:
Invoice +
+ New Car $450 pack or Used Car $300 pack
+ cleanup, reconditioning
25% on margin on every vehicle;
30% retro when 11 units are reached;
This means that in order for the deal not to be a mini the margin has to be at least $1000.
+$500 @ 15 units - but CSI must be above natl avg
+$500 @ 20 units - but CSI .....
$50 mini which goes to $100 @ 11 units.
Back End is 2.1% with no adjustments.
$15 spiff for any accessory sold.
$25 spiff for every 100% score on SCI.
+Normal weekend spiffs
+Normal monthly bonus'
Christmas:
1st yr $300
2nd yr $500
3rd yr $1000
4th yr $1500
5th yr+ $2500
The result is that all vehicles under $20K are minis. Nearly all Camrys are minis. Any ad vehicle is a mini. Any friend or friend of the management is a mini. Any serious buyer who comes in and says 'I will buy this vehicle in stock now at $300 over invoice' is written up without question and is a mini.
The money is in used obviously and special situations like the Prius and new launches; Sienna, Avalon, Tacoma.
Customers get free oil/filters/inspections for life and small perks so some of that cost is taken from the margin as well.
Our payplan is as follows It might be off a little I dont have it in front of me
$300 Mini + $100 for $1500 front end gross, 200 for $2500 front end gross, $250 for $3000 and $400 for $4000 front end gross.
Plus %5 of back end
Then on your 3rd car you get $100 volume bonus on 4th car $150 5th car $200 6th car $350 for 7th car. But we split our months in half 1-15th and 16th-31st.
You can sell 4 cars a pay period and if you make a little gross, you can have a pretty nice check.
We dont have a pack per-se but our detail and pdi is part of cost of doing business so if we sell a car for 300 over invoice, we lose about 50 bucks.....
If you sell a CVT A4 with premium/sunroof at sticker you might hit first level bonus. In some cases you miss it by 10 bucks or so.
Thanks to those who responded to my request for CRM Tools, I'm looking at them along with Auto Revenue.
You seriously should take a hard look at Autobase. We've used them since 1997 and they have been foolproof.
I'm asking because I've always thought it would be interesting to sell cars because I've always been a huge car enthusiast. I basically eat, sleep and breathe cars. I'm just not the typical pushy sales type, although I've met very successful salespeople who weren't typical either. There's a lot to be said for "soft selling".
Anyway, I'm just wondering. I've been seeing your posts for months now and you seem atypical as far as car salesmen go.
How much, if any, liability does a dealer have if there is undisclosed damage? How much is covered under the company extended warranty?
Seems to me she should have had the car inspected before purchase; the selling dealer might not have known about damage unless they were the repair facility for the accident damage.
2014 Malibu 2LT, 2015 Cruze 2LT,
We always ask the one trading it in to warranty that it has never been in an accident. If it has and any good U/C Mgr can tell then we bring that up, depreciate the value and then sent it to auction. It's not retailed. Carfax is not infallible either. It's just one more tool.
Accidents and extended warranty are separate issues.
In the case of this Rav4, the damage couldn't have been too bad since she knew nothing about it until she went to sell it.
"Frame Damage" can mean a lot of different things. a bent front core support that had to be replaced is "frame" damage. Body shops straighten frames everyday and there are no ill effects to this unless the work wasn't properly done. Most modern cars don't even have "frames" like we used to think of.
I don't think Click and Clack know what they are talking about here since I don't think the dealer has any liability UNLESS they knew the car had sustained major damage and failed to disclose it. An extended warranty has nothing to do with this since that applies to mechanical problems.
To sell a car at any dealer-only auction, you have to disclose frame damage. If it's found later, the selling dealer has to take the car back. And he better have a good story to tell, or he won't be invited back to the magic kingdom.
As soon as there is "frame damage", the car is worth ~40% less, as per Terry. It Is A BIG DEAL.
Body shops straighten frames everyday and there are no ill effects to this unless the work wasn't properly done.
That is not true.
Most modern cars don't even have "frames" like we used to think of.
That is immaterial.
It's the dealer's business to know what he's selling, they are the professionals. Yes, the customer should have it checked out, but if they don't, the dealer is still responsible.
I have a lot of empathy for car dealers and salespeople, seeing what they have to deal with everyday. But in this case, there is no gray area... selling a frame-damaged car without disclosure, whether out of ignorance or out of greed, is fraud.
Oh yeah, and I hope everyone had a Merry Christmas!
-Mathias
If the car was a trade-in that was properly repaired, it could have been near impossible to determine.
If we KNOW there was prior damage, we either disclose it, or we dump the car at the auction, disclosing to them what we know.
As far as your 40% figure, that depends on the car and the age of the car.
Or should I just ask for a price including everything but sales tax?
And would the sales tax be calculated on the pre-TTL price or on the "title" and "license" portions as well?
They we look at the car, see the repair, pull up the carfax and voila!
I had a guy get all upset when I showed him the carfax on his trade and showed him the repaired area. He owned the car from new and according to the carfax the repair occured a year after he bought it.
We've had the same and these arent the people we'd like to do business with.
People in the business know how superstious we can be, Saturday rituals, Lucky shirts, shoes or pens. Pennies on the Lot. What car sales superstitions do you have?
For example I had A GSM that played LoverBoy Greatests hits all day on Saturday because one Saturday we had a 20 car day when we played that CD . As for me I have a lucky wholesaler who whenever he hangs out at our store I sell 3 cars plus on Saturdays.
And Iam sure there are wierder ones out there...... :P
They gave an initial estimated delivery date but said they'll have a firmer date in a couple of weeks when they receive a printout from the manufacturer that updates the status of all vehicles being ordered by the dealership. Expected delivery date is 8-9 weeks in this case.
Used pac is $500
New pac is $400 Civic, $600 Accord, $800 to $1000 on Trucks
Mini is $150
Commission after pac:
1-9 units : 30%
10-14 units: 35%
15-20 units: 40%
21 plus units: 45%
Plus business office spiffs, plus monthly spiffs, plus bonus $500 if total gross on all deals is $15000 or higher.
2016 Audi A7 3.0T S Line, 2021 Subaru WRX
Why would you do such a thing? I am certain that the store is very reputable and will honor your 'agreement' but why not spell out what it is you want. This is just good business.
This type of grey transaction doesnt help anyone. The factory ships almost what you want, you get upset, the dealer gets to hold onto another piece of inventory ( hopefully it's not too weird ). Bad practices on both your parts.