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Ebone4rock
SFN Regular
USA
894 Posts |
 Posted - 07/22/2011 : 04:25:36 [Permalink]
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Originally posted by Dave W.
| But holy cow, I just went and found a local dealer selling a year-old Honda Fit with 19K miles on it for an asking price of more than the MSRP of the 2012 new version with comparable trim. If that's the kind of crap I'm going to see with used cars in general, I may as well buy new. |
I forgot to mention this recent trend. Fuel efficient vehicles have extremely high value right now. Take for example my 2008 Chevy HHR. Bought it in 2009 for $11,000. Comparable cars with comparable mileage are selling right now (in my area) for $13,000 - $13,500. I am going to list mine this weekend for $12,500 but will take $11,500. I am still having a hard time registering in my head that I can actually MAKE money on a car!
You are right Dave, new might be the way to go. |
Haole with heart, thats all I'll ever be. I'm not a part of the North Shore society. Stuck on the shoulder, that's where you'll find me. Digging for scraps with the kooks in line. -Offspring |
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Dave W.
Info Junkie
USA
26022 Posts |
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Ebone4rock
SFN Regular
USA
894 Posts |
Posted - 07/22/2011 : 09:01:35 [Permalink]
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Originally posted by Dave W.
So what's the deal with the "Internet Price" thingies? Are those generally no-negotiation prices?
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Internet prices are generally supposed to be the rock bottom price but never be afraid to negotiate. |
Haole with heart, thats all I'll ever be. I'm not a part of the North Shore society. Stuck on the shoulder, that's where you'll find me. Digging for scraps with the kooks in line. -Offspring |
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bngbuck
SFN Addict
USA
2437 Posts |
Posted - 07/22/2011 : 11:56:29 [Permalink]
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Dave.....
| So what's the deal with the "Internet Price" thingies? Are those generally no-negotiation prices? |
I'm sorry to have bothered you with so many things that you already knew. You asked the above question, implying that you don't already know the answer.
The answer to your question is there is no such thing as a no-negotiation price on a new or used car anywhere unless you are what Dude calls a "retard". Take the price you are first given on or off the Internet anywhere and you just asked to be screwed royally. Buy any car, any place in a one or two day emergency and you will be screwed -probably less by a individual citizen than a dealer. This is true of Dave Smith of which I have real inside knowledge, as well as every other dealer in the business, although DS is one of a very few actual discounters in the entire country..
A dealership needs to sell nearly a thousand cars a month before they can afford to sell under an average of 2K per car deal bottom (profit).There are very few of these. The typical successful car dealer sells 150-200 cars average a month. I am sure you know this, but others may not.
I'm sure you already know that many "individuals" are dealerships selling new and used cars illegally from placing owner want ads. MSO's have been changed on new cars to titles in an "individual"'s (actually a dishonest dealer) name to hide the chicanery. Title forging is a major industry in the US. Hundreds of new and used car dealers in the US are closed every year for selling stolen cars, many from "homes" owned by a dealership. Many hundreds more get away with it every day. Beware any price that doesn't include at least a high 3-digit profit to the seller.
If you have been really lucky In Las Vegas on the Wheel of Fortune (click, click, click...) or slot machines, maybe Crappus, the God of Gambling, will favor you with a good deal and good car on a hurried purchase.
With time for due diligence, anyone can usually make a purchase from an honest individual and pay far less than the same car from a dealer -new or used. With lots of luck, one may do it in a day or two.
| If you buy new in a hurry from a non-discount dealer, you will pay about two thousand bucks profit to whatever dealer you buy from. There are about twenty exceptions to this (in the US, most of them are in California, one is my wife's employer in Idaho, as I said before.) There is no new car discounter in the DC Beltway area. Michigan and California are the best states in which to buy a new car. |
As you know, there are huge discrepancies in the actual cost that different dealers pay for the cars they sell. In general, the bigger the dealer, the lower their cost of vehicles (new and used) Not necessarily the lowest retail price however. All have an ironclad deal bottom. It differs greatly from one dealer to another.
| If you buy used without due diligence because of no time to adequately check the seller and shop the deal, you will pay much more than you have to. You must be certain of a valid title |
Again, I apologize for burdening you with a lot of information that you already know, but perhaps some other members or lurkers can benefit from some of what I have written here. Much of it is not common knowledge.
You need to move to Manhattan!
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Dave W.
Info Junkie
USA
26022 Posts |
Posted - 07/22/2011 : 12:48:22 [Permalink]
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Originally posted by bngbuck
I'm sorry to have bothered you with so many things that you already knew. |
Can't just have a conversation, can you?
I appreciated your earlier advice, I wasn't berating you for telling me anything I already knew, I was agreeing with you.
I appreciate your latest advice, even though it seems mostly to be about the dishonesty in used car sales.
Seeing as how I'm not going to travel hundreds of miles to get a better deal (much less move to a different state), how can I use the knowledge that I'll be providing some dealer a $2,000 profit? Is it my job, as a car buyer, to minimize a dealership's profit margin?
Why the hell do we do this negotiation crap for cars, when we don't do it at Best Buy or even our local supermarket? |
- Dave W. (Private Msg, EMail)
Evidently, I rock!
Why not question something for a change?
Visit Dave's Psoriasis Info, too. |
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Kil
Evil Skeptic
USA
13477 Posts |
Posted - 07/22/2011 : 13:57:23 [Permalink]
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Dave:
Is it my job, as a car buyer, to minimize a dealership's profit margin? |
Yes. It is. Remember that the negotiation will not end until they have reached a point where they just can't sell the car because they won't be making enough on it. They will never give the car away. They will make a profit that they can live with.
I didn't read this thread but a couple of things to think about that may already have been mentioned. Don't buy any extras! It's rare that you will ever get out of the extended warranty what you will pay for it. Your car will come with a warranty and you can consider an extended warranty after your warranty period is up. They will also offer you finish protection. That's just bullshit. don't buy it. Any doofus can put a silicone wax job on their car.
If you know the exact features you want and the model car you want to buy, you can get a read out from CU that includes what the extras cost the dealer, delivery cost and everything. You can figure out from that what a fair profit for them is and then stick to it.
If they ask you how much you want to pay each month, tell them you want to pay nothing. Don't negotiate by way of monthly payments. Best case is to get pre-approved from a good leander (low interest) and not play that game.
But really, the very very main thing is that they will have a bottom line. You can sit there all day. If they don't kick you out, then they haven't reached their bottom line yet. |
Uncertainty may make you uncomfortable. Certainty makes you ridiculous.
Why not question something for a change?
Genetic Literacy Project |
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Dave W.
Info Junkie
USA
26022 Posts |
Posted - 07/22/2011 : 14:25:19 [Permalink]
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Earlier today, I secured my financing.
Looking at dealers' web sites, I found depressingly few of the car(s) that I would want are in inventory at the moment. This gives the dealers the upper hand, as I just can't go to some other dealer if I decide on a particular car. If the car(s) I wanted were more common, then I could hit up a dozen dealerships looking for the best deal. As things stand, my second-choice car is available at only three local dealers, and one of them isn't even the color I'd want.
On the other hand, it's been suggested that the heat wave will help me, as the salespeople might be willing to drop the price if I don't make them go out to show me the car one more time. |
- Dave W. (Private Msg, EMail)
Evidently, I rock!
Why not question something for a change?
Visit Dave's Psoriasis Info, too. |
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bngbuck
SFN Addict
USA
2437 Posts |
Posted - 07/23/2011 : 03:10:04 [Permalink]
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Dave.....
| Can't just have a conversation, can you? |
Yes.| I appreciated your earlier advice, I wasn't berating you for telling me anything I already knew, I was agreeing with you. |
You answered at least three of my suggestions with commment indicating you already knew what I was telling you. Thanks for appreciating some of it. It took me many years inside car dealerships of others and my own to learn this tough, cutthroat, screw the grapes (prospective naîve buyers) business. What you don't know about car dealing can cost you a bundle.| I appreciate your latest advice, even though it seems mostly to be about the dishonesty in used car sales. |
Read it again. Both used and new car sales. And how to avoid getting screwed and pay the lowest price possible.| how can I use the knowledge that I'll be providing some dealer a $2,000 profit? |
Christ, Dave, that $2000 is an AVERAGE across the many thousand dealers in the United States. Some make far more than 2K. Some make far less. It actually works out to a pretty good bell curve. Also averaged over cars priced from $8000 up to $100,000. Your job, if you have a grain of sense, is to learn as much as you can about how to buy a new or used car. Nobody is born with this knowledge and damn few go to any trouble to acquire it. That is why almost all car dealers that stay in business for 3 or 4 years become millionaires - many, multimillionaires!| Why the hell do we do this negotiation crap for cars, when we don't do it at Best Buy or even our local supermarket? |
Because hundreds of years ago years ago horse breeders and sellers learned that they could sell inferior animals to stupid people as easy as good healthy animals. Horses morphed into Autos, bur the shady ethics remained. In commerce, almost all large ticket items are sold on a negotiated price. Look at real estate. Nobody pays the asking price on any kind of real estate. Those with the most knowledge of what they are selling can make a far greater profit by tricking the mostly gullible public any way they can - and believe me there are many ways. Google "Horse Trading" and read for yourself.
On an average car costing a dealer $15000 from the manufacturer, Dealer A will retail it at about $17000 after asking $20000. Dealer B will retail the same car for $20000 after asking $24000, and Dealer C will retail it for $16000 after asking $19000. Somewhere there will be a dealer that will sell it for less than what it cost him because he has had it in stock far too long or he has too many of them. If you don't shop every dealer you can reasonably get to, and go in not knowing about what the dealer cost was, you will very likely pay well over a $2000 profit to the dealer.
Take your time, research the cost of the car and equipment, and negotiate hard and you can likely pay the dealer well under that $2000 average. If your rust bucket won't run, rent a car for a week or two to give yourself time to properly research the car you want and shop it wisely. The rental cost will be a small fraction of what you'll save by arming yourself with knowledge before getting in the ring with some damn clever salesmen that have heard and seen everything that can be known about those that buy cars.
Good that you got your financing. Do not let the dealer know that you have financing. Let him check your credit (if it is pretty good) and let him bust his ass trying to get you to let him finance it for you. It is most important to get a price for the fully equipped car before ever talking about how to pay for it! The dealer makes a big hunk of his profit off of financing the car for you. He does not want you to get your own financing. Get a price firm while he still thinks he can finance it for you.
If you let him know that you have your own financing and are going to pay him cash for the car; he will quote a much higher price than if he thinks you are going to use his financing.
All the salesman will want to talk about is payments. Tell him you will get into that phase of the negotiation after you know what the bottom line price he will sell the car for. Lie if you need to (he is undoubtedly lying to you) but try to make him think he is going to get the financing until you get a price nailed down. When it comes to closing, tell him you will pay cash. He may refuse to sell it to you at the agreed price without financing it, but chances are he will still make the deal. If he wants to up the price because you are not going to use the financing, tell him you are going to complain to the state MVD, and you will probably bully him into honoring his financed price and take the cash.
There is much much more, but these together with my earlier comments are the basics. Neither you or me or anybody can outwit a car dealer on his own game - any more than you can cheat in Vegas. But you can truly get a real good deal instead of getting fucked over if you go in having really shopped and negotiated with several dealers. Remember that every dealer is different and operates under different financial constraints than any other dealer. Every car has a good spread on the price it will sell for. Smart people get the low end of the spread. Most people pay way, way too much. A good tricky salesman can easily make $200K in comissions in a year! And any good dealership should clear over two million a year. That's your money that's making them rich. |
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Dr. Mabuse
Septic Fiend
Sweden
9688 Posts |
Posted - 07/23/2011 : 06:49:21 [Permalink]
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Once your purchased your car, there are modifications you can do to reduce highway fuel consumption. About a year ago I read a web-page about modifying the aerodynamics of a Prius which increased the milage by 10%.
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Dr. Mabuse - "When the going gets tough, the tough get Duct-tape..."
Dr. Mabuse whisper.mp3
"Equivocation is not just a job, for a creationist it's a way of life..." Dr. Mabuse
Support American Troops in Iraq:
Send them unarmed civilians for target practice..
Collateralmurder. |
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Dave W.
Info Junkie
USA
26022 Posts |
Posted - 07/23/2011 : 13:40:14 [Permalink]
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Originally posted by bngbuck
Dave.....| Can't just have a conversation, can you? |
Yes. |
The evidence suggests otherwise.| I appreciated your earlier advice, I wasn't berating you for telling me anything I already knew, I was agreeing with you. |
You answered at least three of my suggestions with commment indicating you already knew what I was telling you. |
Yes, I indicated agreement with what you were saying. How that warrants a passive-aggressive response like "I'm sorry to have bothered you with so many things that you already knew," I don't know.| Thanks for appreciating some of it. |
No, I appreciated all of it, and I appreciate the time it took you to write it all out. Are you pissed off that I didn't provide an explicit "thank you?"| It took me many years inside car dealerships of others and my own to learn this tough, cutthroat, screw the grapes (prospective naîve buyers) business. What you don't know about car dealing can cost you a bundle. |
I understand that, also. I've learned a lot in this thread.| Read it again. Both used and new car sales. And how to avoid getting screwed and pay the lowest price possible. |
How can I protect myself from a new car dealer selling me a stolen car?| how can I use the knowledge that I'll be providing some dealer a $2,000 profit? |
Christ, Dave, that $2000 is an AVERAGE across the many thousand dealers in the United States. Some make far more than 2K. Some make far less. It actually works out to a pretty good bell curve. Also averaged over cars priced from $8000 up to $100,000. |
Geez, Bill, it was just an example number.| Your job, if you have a grain of sense, is to learn as much as you can about how to buy a new or used car. Nobody is born with this knowledge and damn few go to any trouble to acquire it. That is why almost all car dealers that stay in business for 3 or 4 years become millionaires - many, multimillionaires! |
I'm not going to begrudge anyone for making a profit, or even becoming a multimillionaire. I only have a problem with that if it's earned through dishonesty. Which is what you're telling me is happening.
So say the MSRP of a car is $15,000, and the dealer invoice is $14,500 (these are typical from what I've seen on KBB and Edmunds). I still don't have a clue as to what the dealer actually paid for the car, or how low the dealer would be willing to sell. If I make an offer that's far too low, they're going to think I'm not at all serious. If I start above their minimum, I short myself. How does anyone figure it out without years of experience, which I don't have time to accrue? |
- Dave W. (Private Msg, EMail)
Evidently, I rock!
Why not question something for a change?
Visit Dave's Psoriasis Info, too. |
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Dave W.
Info Junkie
USA
26022 Posts |
Posted - 07/23/2011 : 14:00:41 [Permalink]
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Another question: is it almost always preferable to order the exact car I want through a dealer, or just to buy one from a dealer's current inventory?
If the former, then I should get a rental car and then do most of the negotiations with dealers via email or the phone. None of the dealers I'd be willing to travel to right now has the model/trim/color package I've settled on (the cars I really, really want are either too expensive or not right for me), so I'd only be making further concessions by limiting myself to what they have on their lots right now. |
- Dave W. (Private Msg, EMail)
Evidently, I rock!
Why not question something for a change?
Visit Dave's Psoriasis Info, too. |
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Kil
Evil Skeptic
USA
13477 Posts |
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Cuneiformist
The Imperfectionist
USA
4955 Posts |
Posted - 07/23/2011 : 14:34:42 [Permalink]
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I just sold my 14 year old Honda Civic-- a great car, but I don't drive much and the Misses has a nice car so it's good. However, in the near future-- maybe a year or so out, depending on what life brings-- I'll have to get a new one. And I have to say: NONE of what I've read here has me looking forward to going through with all of this.
I sold my car to Carmax, who paid slightly more then Blue Book for it-- that, despite my AC not working, the clutch being original (on 130k), and the breaks needing a little work. Overall, I think I did OK. I like their "no haggle" concept when it comes to buying car from them, though, and am inclined to go back when it's time to buy again.
What's your opinion of Carmax, bngbuck? |
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Dave W.
Info Junkie
USA
26022 Posts |
Posted - 07/23/2011 : 18:23:25 [Permalink]
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| Oh, I just grokked this. The New Car Price Report isn't really what I want, it's the free "Build & Buy Car-Buying Service," which is like Lending Tree for cars. Not car loans, but the cars themselves. CU will send my specs to area dealers, who will know they've got to compete with each other for my business, and I'll get quotes (which I can then compare to the $14 report, too). That's awesome. |
- Dave W. (Private Msg, EMail)
Evidently, I rock!
Why not question something for a change?
Visit Dave's Psoriasis Info, too. |
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Dave W.
Info Junkie
USA
26022 Posts |
Posted - 07/24/2011 : 22:01:56 [Permalink]
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The deed is done. Given the scarcity of the cars I was interested in, the manufacturer's prohibition of specific orders and the low manufacturer incentives for the cars, I quickly realized that the money I might save doing "hard" negotiations with dealers would be eaten up in rental-car fees, the time off work I would need to take, and the expense of driving to another state.
It's a nice car, not great, but the paint is an awesome color, the radio works well and it's easy to make it hit 99.9 MPG. I'm sure I didn't pay the least I could, but I did pay less than invoice.
Now, I've just gotta do the math to figure out whether Hyundai's "Tires for Life" deal is worth it. I have 5,000 miles before I need to decide, though. |
- Dave W. (Private Msg, EMail)
Evidently, I rock!
Why not question something for a change?
Visit Dave's Psoriasis Info, too. |
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New car time
