Any Questions for a Car Dealer?

highender · May 2004

I heard that BMWs dealers have no holdback on the cars....that invoice is true price the dealer paid for the car. I find that hard to believe...

I thought besides the dealer holdback, there are factory incentives, and other secret promotions and deals that no business will reveal.

Can any of you help ? I am interested in a 325i...and have been getting $500 above invoice. I think it is possible to get invoice.

what do you think ?

butchbr73 · May 2004

"But yet no one will give me a straight answer on HOW I ripped her off."

well... to be honest, you haven't been all that straightforward. The deal just doesnt include the new car, what about the trade-in, etc were still awaiting that info, which you wont come forward with. Hmm... I wonder why.

Ill quote Isell here keep your day job!

bowke28 · May 2004

seem to have a day job. i havent seen more than a half-hour gap in his posts other than overnight.

719b · May 2004

bill, i don't think you ripped anyone off. you went with good intentions and got her a deal you thought was good and she is happy with.
what everyone seems to be saying is anyone that did a little research could have done the same or better. after all, your $100 birdie raised the selling price to your friend by $100.
if everything you say is accurate, she got a fair deal. if bottom line is her or your main concern, you could have done better.

stickguy · May 2004

If you think you can get invoice (or hope to get it) there is a simple way to find out. Go to the dealer, pick out the car, and offer them $x, will do the deal on the spot. You will have your answer right away (either a handshake and contract or the door hitting your butt on the way out).

bowke28 · May 2004

all kidding and ribbing aside, our point is that you are trying to start a business with the end result being that you can get a buyer the best price possible.

our concern is that, if you cant even do it for your friend, then how can you (or your customers) expect to do it in your business?

you need a track record to sell to people, and this isnt a good start.

mishellz · May 2004

Well bill100 and isellhondas, let me tell you what happened with the ding. After I left work yesterday I got a message from Brian, my car salesman, and he said it shouldn't be a problem. So then I went there and showed it to him and since I couldn't leave work, he came to my work this morning and picked up my car for me. Drove it to get the ding fixed, got me my inspection sticker, and then drove my car right back to my work. And let me tell ya, the work is beautiful-looks just like new, wait a minute it is new!!! So I worried for a no reason at all, and Brian will get straight A's on his report!! Thanks you guys!

bobst · May 2004

If you are willing to pay invoice for the BMW, then try offering that amount and see if they accept.

That is the only way to find out for certain.

See, life is so simple.

highender · May 2004

LOL....

true, and thanks stickguy...

I am just collecting info ...and want to go in with as much info as possible . don't want them to break out laughing in my face...:-)

recently Mercedes had a factory incentive , where all small MB were having 2000 off... so for a MSRP 31,000 car, my friend and I got it for $27,100....plus t&l&r.

I'm hoping for a similar deal with BMW....praying really... :-)

highender · May 2004

yeah....

with the recent MB experience, I think I could do a little better...

right now the cheapest offer I got from dealer is $500 above invoice...

I'm going in tomorrow to see..... :-)

bowke28 · May 2004

why are you afraid of being laughed at?

the worst thing that could happen is they laugh...then say what they WILL do...and you buy the darned thing.

i would rather be laughed at than leave money on the table.

kyfdx · May 2004

See the bottom of this page...

http://www.edmunds.com/advice/incentives/holdback/index.html

isellhondas · May 2004

What a dealer happened to pay for a car has no bearing on what he may be willing to sell it for.

If it's a slow market and he's sitting on a lot of inventory he may be willing to take a otherwise unacceptable deal.

If it's a hot market and it's a hard to keep in stock car, he will hold out for it's market value.

Just like houses and anything else.

Holdback has nothing to do with market values.

bowke28 · May 2004

read that before. its quite slanted...sounds like someone from "nightline" wrote it...but at least they advised not to mess with it as a negotiating tactic.

kyfdx · May 2004

Yeah... I wasn't espousing the point of view... just the info that BMW doesn't have holdback, since we don't seem to have any BMW dealership people on board.

regards,
kyfdx

icedog97 · May 2004

I think I know what the answers to these questions are going into the asking, but I'm interested to hear what others have to say.

We own a 2002 Isuzu Axiom which we purchased at a fairly high price (compared to what some others got the same vehicle for) and which included an extended warranty (I wish I knew then what I know now). Anyway, as it stands, with the warranty included, we owe about $23.5K on a vehicle that is getting a trade-in of about 13K...OUCH! In general, we are happy with the vehicle and it has been problem free.

We noticed some of the good/great deals on new cars and we started to wonder if there was any way we could afford a new car by using the Ax as the trade in. My first question is, how is the final amount to finance on a new car calculated when you have a trade-in like ours? I figured it was:
A + B + C = D
A = NEW CAR SALES PRICE - OLD CAR TRADE IN VALUE
B = SALES TAX ON (A)
C = what's owed on OLD Car

So, if we found a car that was $20K and we got $14K for ours, it would look something like this:
A = 20 -14 = 6K
B = $420 (PA sales tax)
C = $23.5K
D = about $30K

If that's right, then we are in pretty bad shape...which is what I figure.

So that brings me to my other questions. I realize that a lot of cars depreciate like crazy when you drive them off the lot, and that it takes a while to get EVEN, so to speak, but with the Axiom being such a tough car to sell, shouldn't dealers be more willing to cut the prices on the few 2004's that are remaining?

My last question...given all of this, is it worth it to pay 23.5K over the next 60 months for a car currently worth about 13-14K, or would it be better off to but a newer $20K car with a better residual and pay $30K for it?

I get the feeling we are going to be keeping our Axiom, but insight and suggestions are welcome and appreciated...

THANKS!

kyfdx · May 2004

you already know the answer.. The only way out of an upside down situation is to keep making the payments.. At least you like the car.

qbrozen · May 2004

you are $10K upside down (but you knew that), so I think the answer is pretty obvious that you keep it. Burying yourself in a new car is not the answer. No matter how little it depreciates, if you try to roll $10K on top of the buy price, you won't break even for a LOOONNG time. Much longer than if you just keep the vehicle you are in. You like it, so just keep paying it off.

jasmith52 · May 2004

Axiom Guy:

Well assuming that you have gap insurance you could always go find a 'Road Hog' to crash into.

This will give a whole new meaning to being upside-down in your car.

Make sure that your vehicle gets totaled and keep the injuries and deaths under 3 or 4 people.

I have always wanted to crash into a 'Road Hog' just to get even - but never had the nerve.

One extention of this method is to claim soft tissue (like a bad neck) injuries to get a little extra cash.

- Enjoy the new car !

flange4155 · May 2004

Well, just so my friend with the Axiom doesn't feel bad, I'm in almost the same position with a 2001 Dodge Durango with almost the same numbers, except mine is on a lease. Does this change the situation? I got it on a 5 year lease and it's on its 3rd year. Thought I might flip it it early, but the trade-in value is 13K and my pay-off amount is 23K. The car is in great condition, we like it and we're well within the mileage limit (44K miles). Just wanted to upgrade a bit.

I'm assuming my best bet is to stick it out until the end of the lease and start from there? I know getting a 5-year lease was a bone-head move, but I thought I could take advantage of lower payments and flip it early...lessons learned.

Any advice?

mirth · May 2004

Enjoy your Axiom for another 3-4 years. If you want to dump it now, basically add $10K to the price of any new car. No magic bullet.

flange4155 · May 2004

Well, just so my friend with the Axiom doesn't feel bad, I'm in almost the same position with a 2001 Dodge Durango with almost the same numbers, except mine is on a lease. Does this change the situation? I got it on a 5 year lease and it's on its 3rd year. Thought I might flip it it early, but the trade-in value is 13K and my pay-off amount is 23K. The car is in great condition, we like it and we're well within the mileage limit (44K miles). Just wanted to upgrade a bit.

I'm assuming my best bet is to stick it out until the end of the lease and start from there? I know getting a 5-year lease was a bone-head move, but I thought I could take advantage of lower payments and flip it early...lessons learned.

Any advice?

JPham · May 2004

How can you be upside-down on a lease? You don't own it so you can't "flip" it even if you wanted to.

kyfdx · May 2004

Technically, you are never upside down on a lease, if you complete the contract terms.. But, if you want out early...

And you can flip it.. All you have to do is pay the difference between the payoff and trade-in, or roll that amount into another loan.

Both of you are in a good situation, in that you don't HAVE to get rid of your present car, and you are happy with it... Just ride it out..

regards,
kyfdx

bowke28 · May 2004

you are paying for the vehicle the right way, IMO, but i live by these parameters:

if you cant afford the payment on a lease of 3 years or less, you cant afford the car.

many lenders offer 39 month leases, and thats ok...but any longer is just plain evil.

greeniis · May 2004

What happens when a salesperson tells you something and once inside the sales manager tells you the sales person was wrong, about rebate and saying you could get that car at certain payments. Should the dealer stand behind what salespeople tell customers?

bowke28 · May 2004

but if its not in writing, they are not legally obligated to.

also, if a salesperson quotes someone a payment or rate (which is a cardinal sin), they could be wrong based on the BUYER's credit. is it the salesman's fault then?

greeniis · May 2004

The dealership knew us. We just purchased a truck a month before. I went on their web site and picked out a car I was interested in. I sent them the make,model,year,mileage and payoff of my trade in. They called me and told me they could put me in a new Escape for 358. to 370.00 a month. We get down there and nothing is as the sales person told me.

JPham · May 2004

By "flipping" I meant selling the car out right.

jasmith52 · May 2004

Greeneyes:

You've left off some detail. Did you go right down or did you wait a month ?? Was it an honest mistake or were you being hustled ?? Were you upside down (owe more than it's worth) in your trade ?? Were there problems mechanical or other with your trade ?? How's your credit ??

If you were being hustled then refuse to do business with these characters.

And no, a salesmans promise is not a binding contract.

Other than that I'll just say be more sceptical in the future of promises that may be made by someone who can never actually set the price of a deal.

kyfdx · May 2004

I understand.. you can usually sell it outright as well. You just have to make up the difference. There are some banks that won't let you do this, or try to discourage it. AHFC comes to mind. They will let you trade it in to a dealer, or buy it, but they won't let you do a sale to a third party.

Others will let you do whatever you want, as long as they get their payoff amount.

regards,
kyfdx

sv651 · May 2004

Just received a flyer w/ today's newspaper, describing a program that claims to give buyers up to $10,000 in cash, over and above any dealer & manufacturer rebates and incentives.

The reward comes in the form of a "mail-in, time deferred cashable reward", whatever that means.

Is this type of promotion even worth investigating?

Other details:
Pontiac-Buick-GMC dealer
Being test-marketed in Seattle, San Diego, Ft. Worth, Dayton, Lakeland (FL), & Laconia (NH)

Many thanks!

qbrozen · May 2004

"time deferred" sounds to me like a loan that's going to sit there and fester for a little while before demanding (big) payments.

icedog97 · May 2004

I appreciate all of the feedback with my post "Help with big loan on poor resale Axiom"...

I felt a little comfort in knowing that some others are in the same boat.

Looks like we'll be in the Ax for a few more years.

BTW...the Axiom is a good vehicle. I guess it's looks either appeal to you or you hate it (which in part explains the tough sell and not so hot resale value). I think that the truck is a little confusing to most people...it has the "look" of the luxury suv (albeit a distinctive look) but is based on a truck frame...which means even in comfort mode (suspension is adjustable) it doesn't quite compete with the luxury suvs as far as smoothness. I think the Goodyear Integrity tires that come stock on the vehicle have something to do with that too...they are not quite up the task on the Axiom...

Anyway, thanks again!

bill100 · May 2004

If I can remember right I believe what I was told some time ago by a finance guy it is simply like a US savings bond. He said it will mature over so many months or years. I can't remember if they tried to say it was free if you bought the car or you had to pay something or it.

Don't hold me to that though.

Bill

bill100 · May 2004

You said...What happens when a salesperson tells you something and once inside the sales manager tells you the sales person was wrong, about rebate and saying you could get that car at certain payments. Should the dealer stand behind what salespeople tell customers?

I feel he should. But then again I agree with jasmith52 that you left some info out. Bottom line is the salesman verbal words are not binding and 9 times out of 10 he is going to deny that he said such things to his manager. So what I TRY to do and yes it works sometimes I always negotiate the deal using the internet sales manager using email. If he quotes me a price or offers me other goodies well then now I have proof that he did just that because I will bring in the email to show his manager. Sometimes they stick to their promise sometimes they back out even after you showed them his salesmans own typed words. If they back out well then you don't want to do business with them anyways. Find another dealer.

Bill

driftracer · May 2004

It's a load of bull...

bill100 · May 2004

Was I close to the truth? If not how does it work. And why is it a load of bull? Does it cost the consumer more money? I would like to learn more myself about this so called National Cash Reward Program.

grandtotal · May 2004

"mail-in, time deferred cashable reward"

You're too polite, it's a scam.

bill100 · May 2004

I wondered if it was. How does it scam people? Can you go more into detail?

Thanks Bill

stickguy · May 2004

You are at the absolutely worst point to trade. You took the huge hit already, and are about to enter the "cheap years", in that depreciation over the next couple of years will be very low.

I don't have Mathias' crystal ball this week, but if a 2002 is down to 12-13K already, it could easily be worth 8-10K in 2 years, if you keep the miles down and condition up. You are also getting close to retail road prices, and it is always easier to sell cheaper cars.

Anything you buy new will probably depreciate more in the next few years, so you will just keep digging a bigger hole.

IMHO, instead of digging up many thousands of $$$ to throw into a trade, pay off the loan on the Isuzu faster (assuming you don't have a super low interest rate). You would be surprised what an extra 100-150 a month added to the payment will take off the loan term, if you can do prepaid principal.

And get better tires if they aren't up to the task, thus removing another justification to trade.

rroyce10 · May 2004

.. ** but if a 2002 is down to 12-13K already, it could easily be worth 8-10K in 2 years, if you keep the miles down and condition up **

Stickguy is all over this one .. even though the Axioms haven't set any record breaking sales or love affairs, that doesn't make them a bad vehicle .. every vehicle hit's a certain level of depreciation, then they kind of "hover" for a few years .. he's right, I would keep it for a few, get some equity piled in it, then send it down Retail Rd to maximize the value of the vehicle .. that doesn't mean having it for a bumper car and using the interior for the Soccer team ............

Terry.

driftracer · May 2004

was talking to sv651 -

sv651 - remember, there's no such thing as a free lunch, and many "screamer ad" dealerships sell 800 cars a month with no regard for CSI, go through salespeople like cordwood, and fire managers once a month - you really think they care about your perceptions of the honesty of their ad for this $10,000 payout?

They've got an 800 lb gorilla-type lawyer who'll rattle your cage if you talk about suing.

I've heard this ad in my area, too, and it comes from the same dealer who promises you "no credit check" and "$8,000 cash for your trade (or your first two payments, whichever is less...).

Again, there's no free lunch -

bill100 · May 2004

I know you wasn't talking to me. I was asking you a question. Just curious how this $10,000 proposal works and why people feel like its a scam. Just trying to learn more about it.

Bill

butchbr73 · May 2004

but...."I know you wasn't talking to me"

that sentence is incorrect in so many ways.... what was that claim about "education"?

back to the topic... I think Drift has answered the question rather straightforward. What's the old saying.... if it looks too good to be true, it probably is. You'll pay for it one way or the other.

driftracer · May 2004

(quoted from DeNiro in "Taxi Driver"..)

butchbr73 · May 2004

no. Good movie though.

weaselinsuit · May 2004

Actually, technically, if a salesman gives you a price and you accept, it's a binding contract, absent any statutory provisions to the contrary that specifically apply to car sales. You have offer, acceptance, binding contract.

Oral contracts are just as binding as those in writing, in fact the writing is actually just evidence of the contract that was reached orally.

Where it get's sticky is the authority of the salesman to bind the dealer. Unless there are clear indications to the contrary, i.e. posted signs, a warning from the salesman himself "We might be able to do it for that price but I'll have to check with the manager", the salesman would likely be found to have "ostensible" or "apparent" authority. In other words, even if he or she doesn't have authority but presents themselves as appearing to have it (to the extent that a reasonable person would believe they have authority, and trust me, this will be construed against the dealer, i.e. the big bad guy), they can bind the dealer.

Of course, theory and practical reality are two completely different enchiladas. Good luck suing and trying to enforce the contract unless you've taped the conversation or have Desmond Tutu (or insert your own reasonable facsimile of a paragon of truth here) as your witness. Then as alluded to above, you get to deal with the dealer's pet gorilla aka lawyer. The cost of upholding the deal will likely far outweigh the amount that you would save.

Bottom line, take your business elsewhere.....and in the future wear a wire

bill100 · May 2004

Back to the insults! Anyways Butch I know its probably to good to be true. I just wanted to know how the program is suppose to work. Can you explain it so others on this board might have a better clue as to why they would not want to invest their time into it.

Bill

tornado25 · May 2004

"...excuse me here.... but...."I know you wasn't talking to me"...that sentence is incorrect in so many ways.... what was that claim about "education"?"

Well, now you know why I've decided to just sit back and watch this guy. It's just not worth it.

Any Questions for a Car Dealer?

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