New car dealer pricing

Questions on how we spend our money and our time - consumer goods and services, home and vehicle, leisure and recreational activities
Post Reply
Topic Author
mbres60
Posts: 1091
Joined: Tue Jul 03, 2007 1:47 pm

New car dealer pricing

Post by mbres60 »

Been looking for a new car recently. Not sure what we want so we have made the rounds. When we go to the dealers' websites (and also a couple of dealer's printed out a page from their site about a specific car) they list MSRP and then show the internet discount. Does this mean they don't haggle? We have not talked price yet as we haven't narrowed down what we want. When talking with my sibling who lives in another state it was mentioned that a neighbor bought a new car and was told that the listed internet price was THE price. No haggling. In case it matters these have been mostly Toyota dealer's and a Subaru dealer.

What is your experience?
Jack FFR1846
Posts: 13684
Joined: Tue Dec 31, 2013 7:05 am
Location: 26 miles, 385 yards west of Copley Square

Re: New car dealer pricing

Post by Jack FFR1846 »

Depends on the dealer. If you are trading something in, there's always room for negotiation. I recently purchased a used Subaru from a dealer who has set, no haggle prices for used cars. I still negotiated the price down a bit. It started below market, so I didn't need to bring my bulletproof vest and stun gun. On the trade, I honestly told them at the first offer "I'll sell it myself for that". They did more calling around (too old to sell on their lot) and doubled the offer. I traded at that number.

Some dealers do this for new cars too. But just because there's an "internet price" listed does not mean that you can't do better. Always push for a better price. You can also shop around via email, which on a new car is the way to go. You should be able to get the price negotiated before even setting foot in a dealer's showroom.
Bogle: Smart Beta is stupid
jehovasfitness
Posts: 553
Joined: Mon Jan 22, 2018 2:26 pm

Re: New car dealer pricing

Post by jehovasfitness »

be sure to read the fine print, usually "internet price" doesn't include processing fee as well as destination charge.
tydas
Posts: 43
Joined: Thu May 03, 2018 2:28 pm

Re: New car dealer pricing

Post by tydas »

viewtopic.php?f=11&t=124638&start=150#p3061421

Read that thread, very good information..yes, you can haggle on any car, like others said some dealers will not move, you should be contacting 10 or so dealers in your area to get the best price then go local and see if they will match.
livesoft
Posts: 76590
Joined: Thu Mar 01, 2007 8:00 pm

Re: New car dealer pricing

Post by livesoft »

Every dealer haggles even if they say the don't haggle. Internet prices are just a suggestion. Truecar.com prices are just a suggestion. Costco prices are just a suggestion. edmunds.com and kbb.com are just a suggestion.

There are social media forums where people post what they actually paid for a new car. For instance, most people get at least 15% off MSRP for a Subaru and that include everything but tax, title, and license. It includes junk fees, made-up fees, destination fees, and "I'm a good guy" fees.

When I recently shopped, internet prices were only about 8% off MSRP, so to get down to 15% off, one had to negotiate.
Wiki This signature message sponsored by sscritic: Learn to fish.
bloom2708
Posts: 8759
Joined: Wed Apr 02, 2014 2:08 pm
Location: Fargo, ND

Re: New car dealer pricing

Post by bloom2708 »

You seem to be in the "browsing" stage. I wouldn't worry about final price until you can settle on 1-2 top choices.

Just don't be browsing and wind up driving home a new car on a whim. It happens.

Almost every car has some trade-off when compared to other cars/styles. Determine what is most important and then narrow to a short list that hits most of the boxes.

If you have 3rd row seating and great MPG, you have opposing priorities. Which one wins? Then you have decisions like Prius vs Corolla. Both good MPG. Driving style, features, safety options. If AWD is a must have, then a Subaru Legacy or Forester might bump to the top.

Many dealers say "no haggle", but there is still room for discounts and negotiation. If you have a trade in, that can go up or down. Out the door price will include all the junk fees they add.
"We are here to provoke thoughtfulness, not agree with you." Unknown Boglehead
NotWhoYouThink
Posts: 3365
Joined: Fri Dec 26, 2014 4:19 pm

Re: New car dealer pricing

Post by NotWhoYouThink »

We recently went through the car buying experience. At dinner afterward we laughed about the difference between the salesman and the finance manager. BMW seems to have a dress code for the staff, white dress shirts, black pants and shoes. But you can buy all of that at Kohl's, or you can get your shirts custom tailored, for example. The salesman was an friendly approachable jovial guy, and shopped at Kohl's probably, or someplace like it. We haggled a bit, and settled about where I thought we would. The finance manager was a very intense fellow who possibly spent more on his haircut and skin care than my husband and I together spent on all the clothes we collectively wore that day, or that week. His shirt fit perfectly, and if I knew anything about shoes his would have impressed me. Nice watch, buffed nails. He put on a hard sell for the maintenance package, the extended warranty package (not the one financed by BMW, strangely, but a third party plan) and even a separate "dents and dings" policy so the car stays looking great. If we don't buy it today we can never buy it, this is a one time offer...

So the moral of the story is: Do your research on the car price, and haggle as best you can on the drive away price. But the guy you are haggling with is small potatoes at that place. Don't let your guard down, the real negotiation is about to start. Financing and warranty are where they make their money, and the professional you meet with about that topic is not nearly as warm and fuzzy as the sales staff. Decide in advance whether you want any extended warranty, but I wouldn't advise it.

Then go out for a nice dinner.
criticalmass
Posts: 1933
Joined: Wed Feb 12, 2014 10:58 pm

Re: New car dealer pricing

Post by criticalmass »

NotWhoYouThink wrote: Thu Jun 28, 2018 10:32 am We recently went through the car buying experience. At dinner afterward we laughed about the difference between the salesman and the finance manager. BMW seems to have a dress code for the staff, white dress shirts, black pants and shoes. But you can buy all of that at Kohl's, or you can get your shirts custom tailored, for example. The salesman was an friendly approachable jovial guy, and shopped at Kohl's probably, or someplace like it. We haggled a bit, and settled about where I thought we would. The finance manager was a very intense fellow who possibly spent more on his haircut and skin care than my husband and I together spent on all the clothes we collectively wore that day, or that week. His shirt fit perfectly, and if I knew anything about shoes his would have impressed me. Nice watch, buffed nails. He put on a hard sell for the maintenance package, the extended warranty package (not the one financed by BMW, strangely, but a third party plan) and even a separate "dents and dings" policy so the car stays looking great. If we don't buy it today we can never buy it, this is a one time offer...

So the moral of the story is: Do your research on the car price, and haggle as best you can on the drive away price. But the guy you are haggling with is small potatoes at that place. Don't let your guard down, the real negotiation is about to start. Financing and warranty are where they make their money, and the professional you meet with about that topic is not nearly as warm and fuzzy as the sales staff. Decide in advance whether you want any extended warranty, but I wouldn't advise it.

Then go out for a nice dinner.
Even if you want a factory service contract, don't bother buying it when you buy the car. You have at least 3 years to make that decision, and 365 days to get the best price (after 365 days, many manufacturers increase the price they charge dealers by $100-200). Finally, you can shop for that factory service contract from any dealer in the nation, and many dealers offer the contracts at far less than your local dealer will sell you one for. (Hint: use Internet).

Finally, after you decide on a car and options, send request for prices to several dealers. Ask them for out the door price, including all fees, tax, and title/registration charges. Then you can quickly see the best deal, and even ask them to beat another offer. That method will save you much more than gimmicks, special discounts, buying services, etc.

If you really must finance, work with a local credit union that has good rates. Only use the dealer to finance if there is some special 0 or very low interest offered. Sometimes the manufacturer incentive is low rate OR $xxxx dollars off car. Many credit unions specialize in very low rates for new cars. Pick your favorite, and take the manufacturer price incentive instead.
NotWhoYouThink
Posts: 3365
Joined: Fri Dec 26, 2014 4:19 pm

Re: New car dealer pricing

Post by NotWhoYouThink »

Why include tax/title/registration? At least in my state, those costs are set by the state and city/county, not by the dealer, and not paid at the dealership. Also the sales tax will be reduced based on the value of the trade in (or insurance settlement for a totaled car, in our case).

Anyway, throwing things into the negotiation that the dealer doesn't control the price of seems counterproductive. You have to budget for those costs, of course, but I'd rather strip the negotiation down to the bare bones. The drive-away cost to negotiate includes stunningly creative dealer charges, but not the money that goes directly to the state.
livesoft
Posts: 76590
Joined: Thu Mar 01, 2007 8:00 pm

Re: New car dealer pricing

Post by livesoft »

NotWhoYouThink wrote: Thu Jun 28, 2018 11:10 am Why include tax/title/registration? At least in my state, those costs are set by the state and city/county, not by the dealer, and not paid at the dealership. Also the sales tax will be reduced based on the value of the trade in (or insurance settlement for a totaled car, in our case).

Anyway, throwing things into the negotiation that the dealer doesn't control the price of seems counterproductive. You have to budget for those costs, of course, but I'd rather strip the negotiation down to the bare bones. The drive-away cost to negotiate includes stunningly creative dealer charges, but not the money that goes directly to the state.
The salesperson, you, and everybody else at the dealer knows the actual numbers for tax, title, license, inspection, registration, so there is no reason to ignore them. If your brain needs to have them separate, keep them separate. If your brain needs to have them together, then insist on having them together. The salesperson can give you the numbers anyways if you insist. They may balk because it makes the vehicle appear more expensive, but it really is your money.
Last edited by livesoft on Thu Jun 28, 2018 11:16 am, edited 1 time in total.
Wiki This signature message sponsored by sscritic: Learn to fish.
User avatar
Stinky
Posts: 7850
Joined: Mon Jun 12, 2017 11:38 am
Location: Sweet Home Alabama

Re: New car dealer pricing

Post by Stinky »

I had a very good car buying experience using the Costco car buying service for a new Toyota Avalon, and I believe that I got a superior price with a minimal amount of stress and haggling.

If you're a Costco member, check out their car buying service. If you're not, it may be worth a one-year membership for this purpose alone.
It's a GREAT day to be alive! - Travis Tritt
User avatar
dm200
Posts: 23148
Joined: Mon Feb 26, 2007 2:21 pm
Location: Washington DC area

Re: New car dealer pricing

Post by dm200 »

In the Baltimore/Washington area - this is great ubs4cars
Housedoc
Posts: 740
Joined: Thu May 24, 2018 4:25 pm
Location: Alabama

Re: New car dealer pricing

Post by Housedoc »

Use Costco services website to get invoice pricing for base car and every option. Print it out once you decide on model you want. Great bargaining tool. Costco buying a deal also. Used it on laat purchase.
livesoft
Posts: 76590
Joined: Thu Mar 01, 2007 8:00 pm

Re: New car dealer pricing

Post by livesoft »

Housedoc wrote: Thu Jun 28, 2018 11:18 am Use Costco services website to get invoice pricing for base car and every option. Print it out once you decide on model you want. Great bargaining tool. Costco buying a deal also. Used it on laat purchase.
nadaguides.com will give one invoice pricing for base car and every option. And you don't have to give any of your info. nadaguides.com also shows what people have paid recently although I suppose even that one has to take with a grain of salt.

If I had used costco, I would have paid thousands of dollars more for my recent purchase.
Wiki This signature message sponsored by sscritic: Learn to fish.
neilpilot
Posts: 3781
Joined: Fri Dec 04, 2015 1:46 pm
Location: Memphis area

Re: New car dealer pricing

Post by neilpilot »

livesoft wrote: Thu Jun 28, 2018 11:21 am
Housedoc wrote: Thu Jun 28, 2018 11:18 am Use Costco services website to get invoice pricing for base car and every option. Print it out once you decide on model you want. Great bargaining tool. Costco buying a deal also. Used it on laat purchase.
nadaguides.com will give one invoice pricing for base car and every option. And you don't have to give any of your info. nadaguides.com also shows what people have paid recently although I suppose even that one has to take with a grain of salt.

If I had used costco, I would have paid thousands of dollars more for my recent purchase.
^^
KyleAAA
Posts: 8833
Joined: Wed Jul 01, 2009 5:35 pm
Contact:

Re: New car dealer pricing

Post by KyleAAA »

There are some dealers who don't haggle (Carmax is a famous example) but most will, even if they say they won't. Or maybe the internet price actually is their lowest price, in which case they won't. Impossible to know without talking to them, which is what they want.
User avatar
Alexa9
Posts: 1872
Joined: Tue Aug 30, 2016 9:41 am

Re: New car dealer pricing

Post by Alexa9 »

Tell several dealers the most you'll pay OTD and that you're in no hurry. One of them will eventually bite.
There are several ways to get a better price whether it's last year's model, end of the year, end of the month, unpopular car, unpopular color, etc.
livesoft
Posts: 76590
Joined: Thu Mar 01, 2007 8:00 pm

Re: New car dealer pricing

Post by livesoft »

Once again, at least with new cars and with Social Media one can find out what people have been paying. If one hasn't looked that up, then one will not know what a good price really is.
Wiki This signature message sponsored by sscritic: Learn to fish.
GT99
Posts: 473
Joined: Wed Jun 20, 2018 5:26 pm

Re: New car dealer pricing

Post by GT99 »

NotWhoYouThink wrote: Thu Jun 28, 2018 10:32 am ...He put on a hard sell for the maintenance package, the extended warranty package (not the one financed by BMW, strangely, but a third party plan) and even a separate "dents and dings" policy so the car stays looking great. If we don't buy it today we can never buy it, this is a one time offer...
To this point, the answer to every single thing they try to sell you after you've agreed to a price on the car is "No." They are great at selling this stuff...because it's all big profit margin stuff for them. There are absolutely no add-ons they are going to sell you that are a good buy. Just say no.
NotWhoYouThink
Posts: 3365
Joined: Fri Dec 26, 2014 4:19 pm

Re: New car dealer pricing

Post by NotWhoYouThink »

Oh, I'm very good at saying no. But it helps to be prepared. A family member caved recently, and the extended warranty was rolled into the financing, and it was a mess. In Missouri once you've signed the contract you can't change your mind on buying the car, but you can change your mind on the warranty. But you have to get your refund from the warranty company, not the car dealer. Again, a mess. But we just bought a car and then had a nice dinner.

Both this and the previous car purchase the options presented were a little warranty, a medium warranty, and a big all encompassing warranty. Nowhere on the sheet was the option to pay the negotiated price and go home presented, we had to go through the pageantry of hearing the other options first before the finance guy reluctantly and with great warnings of our future regret relented and just let us buy the car. Aggravating, but it must be profitable for them.
Last edited by NotWhoYouThink on Thu Jun 28, 2018 12:18 pm, edited 1 time in total.
GT99
Posts: 473
Joined: Wed Jun 20, 2018 5:26 pm

Re: New car dealer pricing

Post by GT99 »

livesoft wrote: Thu Jun 28, 2018 10:00 am Every dealer haggles even if they say the don't haggle. Internet prices are just a suggestion. Truecar.com prices are just a suggestion. Costco prices are just a suggestion. edmunds.com and kbb.com are just a suggestion.

There are social media forums where people post what they actually paid for a new car. For instance, most people get at least 15% off MSRP for a Subaru and that include everything but tax, title, and license. It includes junk fees, made-up fees, destination fees, and "I'm a good guy" fees.

When I recently shopped, internet prices were only about 8% off MSRP, so to get down to 15% off, one had to negotiate.
Truecar and Costco give you a good starting point for negotiation - if you don't want to deal with negotiating, you can take that price and know you're not getting completey ripped off. Or you can negotiate down from there. We paid about $2000 less than Truecar quoted for our Honda Pilot. When I contacted a more convenient dealer to see if they would match it, I was told they couldn't come close, so I knew I had a good price. Final price we paid was just shy of 15% off of MSRP.
livesoft
Posts: 76590
Joined: Thu Mar 01, 2007 8:00 pm

Re: New car dealer pricing

Post by livesoft »

GT99 wrote: Thu Jun 28, 2018 12:18 pm Truecar and Costco give you a good starting point for negotiation - if you don't want to deal with negotiating, you can take that price and know you're not getting completey ripped off. Or you can negotiate down from there. We paid about $2000 less than Truecar quoted for our Honda Pilot. When I contacted a more convenient dealer to see if they would match it, I was told they couldn't come close, so I knew I had a good price. Final price we paid was just shy of 15% off of MSRP.
Hmmm, I would say paying $2000 more than one needs to is a pretty good definition of getting completely ripped off.
Wiki This signature message sponsored by sscritic: Learn to fish.
boogiehead
Posts: 234
Joined: Wed Sep 27, 2017 11:45 pm

Re: New car dealer pricing

Post by boogiehead »

livesoft wrote: Thu Jun 28, 2018 12:20 pm
GT99 wrote: Thu Jun 28, 2018 12:18 pm Truecar and Costco give you a good starting point for negotiation - if you don't want to deal with negotiating, you can take that price and know you're not getting completey ripped off. Or you can negotiate down from there. We paid about $2000 less than Truecar quoted for our Honda Pilot. When I contacted a more convenient dealer to see if they would match it, I was told they couldn't come close, so I knew I had a good price. Final price we paid was just shy of 15% off of MSRP.
Hmmm, I would say paying $2000 more than one needs to is a pretty good definition of getting completely ripped off.
And keep in mind websites like Truecar, Edmunds, KBB, are just forms of advertisements for the manufacturer so I would only take their suggested "great deal" price with a grain of salt and look to aim lower.
Topic Author
mbres60
Posts: 1091
Joined: Tue Jul 03, 2007 1:47 pm

Re: New car dealer pricing

Post by mbres60 »

Thanks for many good suggestions. We still have to make up our mind which car. Our problem is the seats, to us, are hard and on long drives can envision sore bottoms ;(

One question I have... We have been to four Toyota dealerships to talk about the cars and in some cases test drove some. After doing that... how does one then go through the internet dept and emailing when you have already dealt with a salesperson?
livesoft
Posts: 76590
Joined: Thu Mar 01, 2007 8:00 pm

Re: New car dealer pricing

Post by livesoft »

mbres60 wrote: Thu Jun 28, 2018 12:37 pmOne question I have... We have been to four Toyota dealerships to talk about the cars and in some cases test drove some. After doing that... how does one then go through the internet dept and emailing when you have already dealt with a salesperson?
Use their web site and contact them. There is really no problem stating, "I saw Mary Salesrep earlier this month, but now ...."

If they want to sell you a car, then it won't matter in the end because everything will go through the Sales Manager anyways. Let them deal with whoever gets credit. In other words: It's not your problem.
Wiki This signature message sponsored by sscritic: Learn to fish.
neilpilot
Posts: 3781
Joined: Fri Dec 04, 2015 1:46 pm
Location: Memphis area

Re: New car dealer pricing

Post by neilpilot »

mbres60 wrote: Thu Jun 28, 2018 12:37 pm Thanks for many good suggestions. We still have to make up our mind which car. Our problem is the seats, to us, are hard and on long drives can envision sore bottoms ;(

One question I have... We have been to four Toyota dealerships to talk about the cars and in some cases test drove some. After doing that... how does one then go through the internet dept and emailing when you have already dealt with a salesperson?
Look at each 4 dealer's inventory and select a car that meets your specs (hopefully they will all be similar). Then email each asking for their best out-the-door price. Try to avoid any phone or in person contact, and do it all via email until you have the offer you want in hand. When I did this I DID NOT INCLUDE MY PHONE NUMBER. You may decide to use a different name or no name, if you want to exclude any previous contact. If you already gave the dealer(s) your email address, you may need to use a different email address for these requests. Expect the "bidding" to go for 2 rounds. This works best if you are looking for a no finance, no trade deal.

I did this last when I bought a car for my daughter, and it worked well. From 7 dealers, was able to get 2 very competitive offers and then selected the winner based on their actual stock available.
sixty40
Posts: 306
Joined: Sat Dec 06, 2014 11:53 am

Re: New car dealer pricing

Post by sixty40 »

The last 3 cars I have purchased have been through the dealer website. My experience has been the dealers seem to be more firm in their internet pricing, especially if they have "special" internet pricing. Been able to get about $700 off the internet price on a $34k car. Bought a used car recently for $16k and basically paid the internet price.

Do the research, determine what you want to pay, and see if you can find it or if the dealer can match it. This has worked for me, but I do not really like to haggle, just want to pay what I determine is a fair price, not trying to squeeze out the last dollar.

Also do get the "out-the-door" price with breakdown of all fees, taxes, etc. from the dealer before you go to the dealer. It helps in knowing exactly how much you will pay.
nbseer
Posts: 219
Joined: Wed Jan 01, 2014 10:00 am
Location: New Jersey

Re: New car dealer pricing

Post by nbseer »

My 18 year old Mazda Protege died. I went to a local Mazda dealer and was prepared to check out Carmax nearby for 2015 used Mazda3's with 25,000-40,000 miles, convinced that buying a new car was financially dumb with instant depreciation, etc.

Apparently I lucked out, as Mazda was shaving $2,500 off the price of new vehicles for previous Mazda owners. Wound up paying about $1,200 more for a brand new car than for a 3year old vehicle.. sorta a no brainer.

Look around at dealer incentives, cash back, etc. This could be a good time to buy new instead of settling for used.
alwi228
Posts: 16
Joined: Sun Dec 18, 2016 2:06 pm

Re: New car dealer pricing

Post by alwi228 »

The dealer pricing on the internet is almost ALWAYS (when they finally get you to walk into the dealership doors) only for people who qualify for every single rebate (there is literally one from Chrysler right now ONLY for people that have a 620 credit score or LOWER lol). That being said....they can put those rebates in all day for people who don't actually qualify. My advice has been really choose a car and choose the trim that has all the options you want. (by this I mean, a highly optioned lesser trim will be harder to find, and usually worse on resale, than the bump up in trim that has these things standard, and some options you probably dont care for). Then cars.com that exact car and trim level, click on an area you are willing to reasonably drive to (mine is usually 150 miles) and sort by cheapest (things to watch out for this would be really making sure it has the options you want, like if its a truck, make sure you've selected 4wd if you want it), and extreme outliers price wise. Then sort by distance. I talk to the three closest dealers and eventually, they'll match the price. If you have a trade in, shop that around too! My latest trade after finding the truck I wanted, was given a value of 22k. I told them the dealer on the other side of the city offered 27k...they said ok, big shift and I never actually talked to the dealer across the street. KBB has a range of trade in values, they will always tell you those values are entirely too high, but if you stand your ground and tell them thats how they sell their car to you, they will match it. My jeep was listed on their website for 28,500 with new tires, 1500 more then what they paid me for it. All they care about is financing so the trade can very much so be on the high end of KBB's value. Good luck! (Last note, ive never bought a car in a pinch before so this may not be as fun if that's your situation. My wife's car took 3 months and mine was about 6 weeks, but I love the hunt :sharebeer )
alwi228
Posts: 16
Joined: Sun Dec 18, 2016 2:06 pm

Re: New car dealer pricing

Post by alwi228 »

And great post about the difference between sales guy and the manager. The sales guy is for the most part, unaware of the finances of the dealership. The sales manager/finance manager are absolute sharks and incredible at playing stupid. The truck I just bought took 45 minutes (and I LOVE buying cars and read for months before I go in) after we agreed on the price, just to talk about what the paperwork would finally reflect. They went in and out of the room out of "confusion" 3 times each trying to clear things up. They only want to work in monthly payments, and will do ANYTHING they can do avoid talking overall prices. After that 45 minutes in the finance guys office, the paperwork was wrong 3 times in their favor...what are the odds. Stay vigilant!
mega317
Posts: 4585
Joined: Tue Apr 19, 2016 10:55 am

Re: New car dealer pricing

Post by mega317 »

I'm all for haggling and do it myself, but just another viewpoint: To save a few thousand on a once-every-5-or-10 years purchase (if not less frequently) it is totally reasonable to not want to spend the time and aggravation. There are much faster and easier ways to make a few k in 10 years (credit card sign up bonuses, for example) that people who spend weeks negotiating their cars don't do. It is certainly about testosterone for many.
https://www.bogleheads.org/forum/viewtopic.php?t=6212
livesoft
Posts: 76590
Joined: Thu Mar 01, 2007 8:00 pm

Re: New car dealer pricing

Post by livesoft »

^Yes, I don't see why it would take more than a couple hours and certainly not weeks.

I did a test drive and said something like, "OK, you know the deal where I e-mail a bunch of dealers and get y'all to compete on price. I can forego that if you give me the price I want. I checked on the internet what great deals are, so give me a great deal and I will buy right now." It helped me that the dealer had not sold a single car yet that week.

Did I get the lowest possible price? I doubt it.

If you don't know what a great deal is though, then you are kinda flailing in the dark.
Wiki This signature message sponsored by sscritic: Learn to fish.
smitcat
Posts: 7915
Joined: Mon Nov 07, 2016 10:51 am

Re: New car dealer pricing

Post by smitcat »

livesoft wrote: Thu Jun 28, 2018 2:33 pm ^Yes, I don't see why it would take more than a couple hours and certainly not weeks.

I did a test drive and said something like, "OK, you know the deal where I e-mail a bunch of dealers and get y'all to compete on price. I can forego that if you give me the price I want. I checked on the internet what great deals are, so give me a great deal and I will buy right now." It helped me that the dealer had not sold a single car yet that week.

Did I get the lowest possible price? I doubt it.

If you don't know what a great deal is though, then you are kinda flailing in the dark.
I agree - it only takes a couple of hours to save a few thousand in many cases. I never did the email trick but knowing the 'real' price on what you are looking at is really important. Costco pricing was not nearly the lowest on the last 2 cars we bought - it was a reasonable starting point.
MSRP vs real sales price varies between makes and even models so you need to do a little homework to save that 2-$3K.
User avatar
Abe
Posts: 2264
Joined: Fri Sep 18, 2009 5:24 pm
Location: Earth in the Milky Way Galaxy

Re: New car dealer pricing

Post by Abe »

I recently bought a Toyota Camry. I went to a local Toyota dealer and picked out the car I wanted and did a test drive. The price they quoted me was pretty good but still more than I wanted to pay. About a week later my wife and I went to a Honda dealer in another town, and we had a bad experience with the salesman. He told me I would fall in love with the car he was going to show me. I told him I might fall in love with a woman, but I didn't fall in love with cars. I guess he got mad after I said that because he left us waiting in the lot while he supposedly went inside to get the keys. After a long wait, he didn't show up so we went down the street to a Toyota dealership and found the same car we had looked at the first Toyota dealership we went too. The salesman there quoted a price which was a couple of thousand less than the first Toyota salesman quoted us, a little over 18% discount from MSRP price. I didn't really want to go through the emailing 10 dealerships thing, so I wrote him a check and we went on our way. I figured the price he quoted me was good enough. Later I told my wife that was the first time I ever had a Honda salesman sell me a Toyota.
Slow and steady wins the race.
AZAttorney11
Posts: 828
Joined: Wed Jan 21, 2015 12:12 pm

Re: New car dealer pricing

Post by AZAttorney11 »

I recently bought a vehicle with a MSRP of $46,250 for $32,200 by buying a model that would soon be "dated" by a redesign in 2019. Luckily, I did not like the redesign in 2019 and actually preferred the 2018 model (and it was the fifth year of production for that particular model, so hopefully the factory built a vehicle that will be highly reliable and long-lasting). I played the email game with about 15 dealers. About seven played back. I never gave them my phone number nor did I engage them in the "what price I was willing to pay" or "what monthly payment can you afford" or "what's your budget" shenanigans. I located the exact vehicle I wanted, provided them with the VIN, and asked them for their lowest out the door price with all taxes and fees. Of the seven that decided to play, about three of them followed my instructions and were serious sellers. I then leveraged the power of the free market and competition for dollars by engaging in four rounds of negotiations, keeping all of the numbers / quotes to myself and maximizing information asymmetry. No trade in, no financing, etc. The transaction was focused on the lowest out the door price for a specific make and model by VIN (or an identical vehicle with a different VIN) and there were no opportunities for the dealer to make money through a poor valuation on a trade, financing ripoff, extended warranty, service plan, etc. The price I paid was the price I was quoted to the penny. The entire process probably took a couple of weeks. In this day and age, I think that's the closest one get to true price discovery. The numbers from NADA, Truecar, etc. were garbage. I paid thousands less by spending a couple of hours sending a few short emails.
User avatar
lthenderson
Posts: 5990
Joined: Tue Feb 21, 2012 12:43 pm
Location: Iowa

Re: New car dealer pricing

Post by lthenderson »

alwi228 wrote: Thu Jun 28, 2018 1:50 pm And great post about the difference between sales guy and the manager. The sales guy is for the most part, unaware of the finances of the dealership. The sales manager/finance manager are absolute sharks and incredible at playing stupid. The truck I just bought took 45 minutes (and I LOVE buying cars and read for months before I go in) after we agreed on the price, just to talk about what the paperwork would finally reflect. They went in and out of the room out of "confusion" 3 times each trying to clear things up. They only want to work in monthly payments, and will do ANYTHING they can do avoid talking overall prices. After that 45 minutes in the finance guys office, the paperwork was wrong 3 times in their favor...what are the odds. Stay vigilant!
I would suggest you find a different dealership to do business with. It has never taken me more than an hour from the time I get out of my old car to purchase a new car at my local dealership. It takes me much longer to research stuff ahead of time over the internet. I bought my mom a vehicle earlier this summer in less than 30 minutes over lunch.
Topic Author
mbres60
Posts: 1091
Joined: Tue Jul 03, 2007 1:47 pm

Re: New car dealer pricing

Post by mbres60 »

Abe wrote: Thu Jun 28, 2018 3:31 pm I recently bought a Toyota Camry. I went to a local Toyota dealer and picked out the car I wanted and did a test drive. The price they quoted me was pretty good but still more than I wanted to pay. About a week later my wife and I went to a Honda dealer in another town, and we had a bad experience with the salesman. He told me I would fall in love with the car he was going to show me. I told him I might fall in love with a woman, but I didn't fall in love with cars. I guess he got mad after I said that because he left us waiting in the lot while he supposedly went inside to get the keys. After a long wait, he didn't show up so we went down the street to a Toyota dealership and found the same car we had looked at the first Toyota dealership we went too. The salesman there quoted a price which was a couple of thousand less than the first Toyota salesman quoted us, a little over 18% discount from MSRP price. I didn't really want to go through the emailing 10 dealerships thing, so I wrote him a check and we went on our way. I figured the price he quoted me was good enough. Later I told my wife that was the first time I ever had a Honda salesman sell me a Toyota.
Wow. Nice Story! I am guessing you got a discount off MSRP of anywhere from about $4600- $5000. That is much more than the few websites I looked at that gave an internet discount. They listed about $1800-$2100.
GT99
Posts: 473
Joined: Wed Jun 20, 2018 5:26 pm

Re: New car dealer pricing

Post by GT99 »

livesoft wrote: Thu Jun 28, 2018 12:20 pm
GT99 wrote: Thu Jun 28, 2018 12:18 pm Truecar and Costco give you a good starting point for negotiation - if you don't want to deal with negotiating, you can take that price and know you're not getting completey ripped off. Or you can negotiate down from there. We paid about $2000 less than Truecar quoted for our Honda Pilot. When I contacted a more convenient dealer to see if they would match it, I was told they couldn't come close, so I knew I had a good price. Final price we paid was just shy of 15% off of MSRP.
Hmmm, I would say paying $2000 more than one needs to is a pretty good definition of getting completely ripped off.
Ha - maybe a poor choice of words, but depends on your frame of reference. I think the majority of buyers probably pay more than the Truecar price (there are still a LOT of suckers out there), so paying that price is probably better than average, which is what I meant (most folks are more ripped off). And getting that price required casting a wide net - the three closest dealers to me were all much closer to the truecar price and wouldn't come lower.
AZAttorney11
Posts: 828
Joined: Wed Jan 21, 2015 12:12 pm

Re: New car dealer pricing

Post by AZAttorney11 »

^ It all depends on the make and model. In my experience, the Truecar price was absurdly inaccurate. Thousands more could be saved by further negotiations.
Topic Author
mbres60
Posts: 1091
Joined: Tue Jul 03, 2007 1:47 pm

Re: New car dealer pricing

Post by mbres60 »

Lots of good info here. Thanks! Didn't realize that TrueCar pricing was that much off. Isn't it supposed to be what people in the area really paid?
livesoft
Posts: 76590
Joined: Thu Mar 01, 2007 8:00 pm

Re: New car dealer pricing

Post by livesoft »

mbres60 wrote: Thu Jun 28, 2018 5:16 pm Lots of good info here. Thanks! Didn't realize that TrueCar pricing was that much off. Isn't it supposed to be what people in the area really paid?
You will have to check for yourself. You can pm me a VIN number and I can find out for you what others have paid. You can find out as well with a little Google Fu.
Wiki This signature message sponsored by sscritic: Learn to fish.
theplayer11
Posts: 1576
Joined: Tue Jul 22, 2014 8:55 pm

Re: New car dealer pricing

Post by theplayer11 »

AZAttorney11 wrote: Thu Jun 28, 2018 3:44 pm I recently bought a vehicle with a MSRP of $46,250 for $32,200 by buying a model that would soon be "dated" by a redesign in 2019. Luckily, I did not like the redesign in 2019 and actually preferred the 2018 model (and it was the fifth year of production for that particular model, so hopefully the factory built a vehicle that will be highly reliable and long-lasting). I played the email game with about 15 dealers. About seven played back. I never gave them my phone number nor did I engage them in the "what price I was willing to pay" or "what monthly payment can you afford" or "what's your budget" shenanigans. I located the exact vehicle I wanted, provided them with the VIN, and asked them for their lowest out the door price with all taxes and fees. Of the seven that decided to play, about three of them followed my instructions and were serious sellers. I then leveraged the power of the free market and competition for dollars by engaging in four rounds of negotiations, keeping all of the numbers / quotes to myself and maximizing information asymmetry. No trade in, no financing, etc. The transaction was focused on the lowest out the door price for a specific make and model by VIN (or an identical vehicle with a different VIN) and there were no opportunities for the dealer to make money through a poor valuation on a trade, financing ripoff, extended warranty, service plan, etc. The price I paid was the price I was quoted to the penny. The entire process probably took a couple of weeks. In this day and age, I think that's the closest one get to true price discovery. The numbers from NADA, Truecar, etc. were garbage. I paid thousands less by spending a couple of hours sending a few short emails.
a few weeks is too long though, the car could have easily been sold during that time
alex11
Posts: 118
Joined: Wed Jul 28, 2010 5:25 pm

Re: New car dealer pricing

Post by alex11 »

Just recently purchased a new vehicle, after a few months of negotiating, and from what I gathered, their OUT THE DOOR price was slightly lower than the listed internet price.
AZAttorney11
Posts: 828
Joined: Wed Jan 21, 2015 12:12 pm

Re: New car dealer pricing

Post by AZAttorney11 »

theplayer11 wrote: Thu Jun 28, 2018 6:05 pm
AZAttorney11 wrote: Thu Jun 28, 2018 3:44 pm I recently bought a vehicle with a MSRP of $46,250 for $32,200 by buying a model that would soon be "dated" by a redesign in 2019. Luckily, I did not like the redesign in 2019 and actually preferred the 2018 model (and it was the fifth year of production for that particular model, so hopefully the factory built a vehicle that will be highly reliable and long-lasting). I played the email game with about 15 dealers. About seven played back. I never gave them my phone number nor did I engage them in the "what price I was willing to pay" or "what monthly payment can you afford" or "what's your budget" shenanigans. I located the exact vehicle I wanted, provided them with the VIN, and asked them for their lowest out the door price with all taxes and fees. Of the seven that decided to play, about three of them followed my instructions and were serious sellers. I then leveraged the power of the free market and competition for dollars by engaging in four rounds of negotiations, keeping all of the numbers / quotes to myself and maximizing information asymmetry. No trade in, no financing, etc. The transaction was focused on the lowest out the door price for a specific make and model by VIN (or an identical vehicle with a different VIN) and there were no opportunities for the dealer to make money through a poor valuation on a trade, financing ripoff, extended warranty, service plan, etc. The price I paid was the price I was quoted to the penny. The entire process probably took a couple of weeks. In this day and age, I think that's the closest one get to true price discovery. The numbers from NADA, Truecar, etc. were garbage. I paid thousands less by spending a couple of hours sending a few short emails.
a few weeks is too long though, the car could have easily been sold during that time
Funny you say that. That exact situation played out in my case. The original vehicle I wanted was sold, but another one was delivered a few days later. I didn’t “need” a car and was fine waiting for the price to be right. It worked out okay for me.
test123
Posts: 77
Joined: Mon Feb 22, 2016 9:35 am

Re: New car dealer pricing

Post by test123 »

I've done this method for last 5 cars (including a 2018 Civic I purchased just 10 days ago) and am confident it results in lowest price with minimal time/effort. Don't use this method if you want to overpay. :happy My goals are to make it fast for both parties AND to get the lowest possible price thru multiple "bids" (reverse auction).

Steps: 1. narrow down brand, model, trim level. 2. print out list of all dealers for that brand in 90 minuite radius. For my honda there werer about twenty. 3. call each dealer and ask for a new car sales person. My pitch is: I'm absolutley buying a new civic tomorrow, I want to make this as fast for both of us as possible; I'm shopping by phone with about 20 dealers, I'd like to give you my specs and ask you to call me back with your bottom line, out the door price. After i get all my prices I'm going to buy the car fror the dealer with the lowest price. Sudden death pricing--best price wins--no haggleing, no back and forth, etc. I ask if they're interersted. In about 1/4 of the calls--they are squirley and try to get you to come in. I stand my ground and again ask if they are interested in participating. In the end, 100% particiapte. 4. I'm very clear on my specs: new 2018 civic LX, any color with beige interior; sale -not lease; must be in-stock (pick-up tomorrow); no trade-in (see below), not eligble for any fancy disounts (recent grad, military, etc.),I'll be taking advantage of the factory financing and I have outstanding credit. I reiterate that I'm looking for their accuate, bottom line, out the door price including doc, destination, tax, plate transfer, etc. 5. when they call back, I write down the price, reiterate the specs, confirm they have the vehicle in-stock, reitertate this is out the door privce (tax, etc) and does NOT include any speculative incentives (receent grad, etc.0). 5. I call back to the low price dealer and ask them to write up a sales sorder/quote with stock #/VIN, and text me a photo --i tell them i will call back and put down a large depost on a credit card and make an appointment to take delivery of the car tomorrow (or the next day). 6. if it checks out, I put down the deposit and schedule an appointment to take deluivery.

FYI-- for the recent Civic deal, there was a price spread of about $2400 across the 20 quotes. KBB and edmunds suggested that the best / fair out the door price was $19,800-- I paid $19,300. 5 quotes werer clustered within $100 of the KBB fair price (suggesting that dealers pay attention to that) and 3 quotes werer within $100 of the low price. Most of the "internet ' department quotes were on the very high end.

I did the entire phone shopping process (including the final details with the winning dealer) pafter work and it took less than 3 hours. I picked the car up the next day and all went well. As I mentioned--this is perhaps the 5th car I've bought that way and have had similiar, good results.

Regarding trade in--i did NOT have a trade in on this transaction. But when i do, i negotiate the out the door price as noted above and then I introduce the trade-in after we have a firm deal. This allows you to isolate the true cost of the new car and the true cost of the trade in. Usually, I'll call the day I'm planning to take delivery and tell the sale sperson I changed my mind and will have a trade in and ask what time their used car appraiser will be in. Never had a hassle about that. I will generaly stop at Carmax and get a price quote and do a bit of reserach on KBB to see what the wholesale value is.
Post Reply