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You are in the Prices Paid - Buying & Leasing Experiences
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Subaru Outback, Wagon, SUV
#2576 of 3458 Subaru of Nashua (NH)
Apr 30, 2010 (8:42 am)
I just bought the 2010 Outback 2.5i Limited w/Moonroof (PZEV) off the lot.
Car came with Trailer Hitch and Wheel Arch Moldings installed. The window sticker said $30,800.
Had the dealer install Splash Guards and Rear Bumper Cover.
Paid $28,120 + $199 Doc Fee.
Very happy with the buying experience, the car, and the price.
Strongly recommend Subaru of Nashua if you're in the Northern Mass / Southern NH area.
#2577 of 3458 Re: Good Deal? [rtmover]
May 01, 2010 (8:17 am)
That doc fee can be a key factor, and it might explain how NE dealers will do deals near their (I think inflated) invoice price. In my NE state I know of two dealer doc fees of $291 and $79 that are with dealers about 40 miles apart.
"bigfrank3" had a very good comment, and I advise anyone in NE to go back and read it. One exception I would note is that Edmonds indicates the dealer holdback is 2%, not 3%. It well could be that other middle men take 1% like Ernie Boch supposedly does, such that it nets out to a basic 2% everywhere. I've heard that there is a distributor in Michigan that has his own power base that might be similar to Ernie Boch, but I don't know if that is true or if it is only rumor.
Something I can add to understanding the situation, is the way salesmen are compensated. I was surprised to learn that SUBARU pays the salesmen a commission, instead of or in addition to, what ever the dealer might pay them. Often the deal is so skinny that the salesman gets nothing from the dealer, and is satisfied with what Subaru pays him. Think about it. A dealer can't possibly sell a car for within $50 of his actual invoice cost (including any incentives, which are rare with Subaru unless they are cleaning out inventory to ready for the new model year) AND pay a salesman a commission, when he has negligible gross profit to work with.
I was wondering if the $360 greater invoice for NE dealers relative to Edmonds was real or BS from the dealer. "bigfrank3" leads me to believe that it really is higher by that amount for NE dealers.
If you are in Vermont, consider crossing the state line to NY to escape the Ernie Boch clutches.
#2578 of 3458 Re: Good Deal? [ridge8]
May 01, 2010 (12:59 pm)
Hi ridge8. Dealers make the majority of their profit on the used cars. The dealer management friends I have, have told me that they couldn't keep the doors open if they only sold new. The new vehicles are really the draw to get the used ones, and obtain them as cheaply as possible.
Having said that, most dealers around here (MA) won't let you get into their holdback. That is really the profit on the new vehicle. It is 3% of the retail price, paid to the dealer the vehicle was originally sent to, the one on the sticker, no matter which dealer actually ends up selling it. That is also why they try to sell you what they have on hand first, they know the holdback will follow without waiting for another dealer to sell "their" car after a swap. I believe the holdback is paid quarterly. Swapping is of course a good second choice as opposed to losing a sale.
Out of that 3% Ernie skims 1%, then holds that out as an incentive for volume sales to both the dealer and the salesman. The salesmen and women I know make peanuts on an individual car sale, and that is ok with them. There is a routine ladder of sales that is there for them and they really need to sell more than 10 a month to make a decent paycheck.
On top of all that are periodic incentives put out there from Ernie, usually for the dealer but occasionally for the salesperson too, through the dealer. During those times it is much easier to buy at invoice or below because they have "other" money available to help them close deals. Most of the incentives are for the dealer to move volume because that helps everyone, the dealer, the salesperson, Ernie, and the buyer. Ernie gives a little but as they say, he makes it up in volume. This doesn't happen when the stock is low, only when things get "crowded". The dealer's bonus is that he then can pay less floorplan interest on the total stock he has. There is a fine line between not having enough stock and having too much.
When I planned to buy (ordered) a 3.6R Outback, the deal I got was below the NE invoice, and in fact below the national invoice, again because of incentives to them not the buyer. When I canceled the Outback and bought a Forester they had in stock I bought below invoice because they gave me the 2% holdback also. As you point out, they can't stay in business that way so there was apparently some incentive going on because of the glut of Foresters sitting on the dealer lots. I walked away happy and so did they.
One can get very good deals in NE, you just have to be aware and work at it a little harder. Trading is the biggest struggle because they want to "steal" your vehicle so they can make big profit to pay the help and the electric bill and other business costs. I have sometimes bought the new vehicle at one dealer and sold my "trade-in" to another because they had a specific need for what I had. This worked out to my advantage even with the sales tax credit we get for the trade.
May 06, 2010 (10:40 am)
If you bought a new Subaru in the past few months, a reporter may want to talk with you. Please email predmunds.com no later than Friday, May 14, 2010 with your daytime contact info and the make/model you traded in.
#2580 of 3458 2008 2.5 limited outback
May 06, 2010 (8:48 pm)
Can anyone tell me if a 08 used 2.5 limited OB selling for 19,000 + ttl with 22,900 mi on it is a good price.This is at a dealer car appears to be clean also a one owner vehicle no accidents.Thanks
#2581 of 3458 Re: 2008 2.5 limited outback 
May 07, 2010 (8:26 am)
For a limited, that sounds fair to me given the car should still be under its 3/36 warranty. New, the car probably sold for approximately $26,000.
#2582 of 3458 Re: 2008 2.5 limited outback 
May 08, 2010 (4:33 am)
That's about 27% less than new, so an appropriate price for the low miles.
#2583 of 3458 Re: 2008 2.5 limited outback 
May 08, 2010 (8:48 am)
It is a nice price
6 mo ago I paid 17,900 on 07 OB Ltd with 30k mi.
#2584 of 3458 Re: Good Deal? [bigfrank3]
May 12, 2010 (1:46 pm)
Interested in your thoughts
How do you know what the invoice price is (was) for either the Outback that you ordered, or for the Forester ?
That is my basic quandry.
Is there reason to doubt Edmonds ? (good reason or otherwise)
There is the $360 invoice price difference between Edmonds and what a NE dealer tells me.
Also, Edmonds does say that the holdback is 2%. I can't argue that either way, and don't mean to. One possible way to reconcile the 2% with your 3% figure could be that there are Ernie type guys in the middle between SOA and all dealers everywhere in the country, and that they all take 1% of the holdback resulting in the Edmonds 2% number.
I'd like to think that Edmonds has credibility, but you may have information to the contrary.
Another puzzlement : If I order a car (I did), does that order go to SOA or does the order depend on Ernie being willing to include the ordered car in one of his deliveries to the dealer? I was told that dealers have no choice on what Ernie delivers to them, but that an order that is a valid customer order gets treated differently. That supposedly is the only way a dealer can specify even the color of a car to be delivered (a valid customer order). The dealer liked my order because it is a color that they can sell easily and one that they don't get very often. They said, if I wanted to cancel it would be no problem for them because they could easily sell the car that I ordered.
#2585 of 3458 Re: Good Deal? [ridge8]
May 12, 2010 (4:09 pm)
I have found that dealers are usually willing to show you the invoice paperwork to get "all the cards" on the table, then tell you what they need to get for the sale. I have bought more than 50 vehicles in my life and can't remember any dealer not willing to show me the invoice. My usual Subaru dealer does that all the time. I have bought many cars with the dealer handing me their price book so I can choose options and come up with my own price based on what I want to spend. We would usually agree on something like a hundred over invoice for an ordered vehicle, then I would "build" the vehicle from their price list.
In the case of the Outback I ordered, I wanted to test the waters with other dealers for deal comparison. I solicited (Internet) about 6 of them and asked for a price, itemized with the options I wanted. 1 didn't answer me, 1 played games, but 4 seemed sincere. Of those 4, 3 did exactly what I asked and itemized everything from invoice and options, up to the total and what they would sell it for. Those 3 showed me the exact same prices for invoice and options, and with 2 the deal was excellent and below cost. Those prices were exactly the same as what my usual dealer showed me. All the invoices were exactly $360 more than Edmunds listed.
I find Edmunds useful but not always exact. An example of this is that here in the SoNE area we cannot buy the packages of options they list, only separately. Almost every car brand has a 3% holdback and my management friends at my usual dealership have assured me that Subaru is the same, but they only get 2% of it, Ernie gets the rest. Don't know why Edmunds lists 2%. Use Edmunds as a guideline but be careful of details. A dealer that won't show you the actual invoices on their vehicles is playing games. Years back I even ran into a dealer that typed up their own invoice to show to customers, and it packed in an extra $400 profit. When I called them on it they then produced the real invoice. They actually offered me a job, saying I knew too much about the business to be sitting on "that" side of the table. I declined. My philosophy is that I want to buy a new vehicle at somewhere between invoice and $300 over, I don't ask for any of their holdback so they can stay in business. But, if they offer me some of it I gladly take it.
If you order a vehicle in the SoNE area it automatically comes out of what Ernie has already ordered out of his 6 month "order allocation" from SOA, assuming he ordered one exactly like it. If it is not on the "list" you cannot get it. What DOES happen though is that vehicle gets assigned a "sold tag" and gets moved up in the order sequence at SOA. Sold vehicles get built before vehicles just for stock. It still may take a while because of everyone else's "sold" vehicles as well as what SOA is currently set up to manufacture (model, options, color, etc.). When your vehicle is guaranteed to be built it will get a VON (vehicle order number) and that will be passed to the dealer. When it is actually being built it will get the VIN.
Dealers generally have no say in what Ernie sends them for stock, but he bases it on volume. Dealers like to "move" vehicles because that means Ernie will give them more to have on the lot for the next allocation. Low volume dealers have the least stock and therefore choice to the customer. All dealer stock in the SoNE area is fair game for each other so it is almost like 1 big car lot, just spread out. Because some stock is like gold compared to others some dealers will play games so another dealer cannot take a particular vehicle. They may say it is under agreement, or try to get a hundred or 2 from the dealer for their trouble. Of course, that cost gets passed on to the customer.
My dealer did the same as yours, ordered my vehicle and told me I didn't have to take it if it took too long. They knew it would be a long time because it was a 3.6R Premium. After 3 months and fearing the steering wheel shimmy I had experienced and read about, with no apparent clear fix, I chose to go with another Forester instead. By my Outback being a "sold" vehicle it gave them another car for stock or dealing with others. When it finally came in (about 4 months) they easily swapped it to another dealer who had a buyer for the rare 3.6. Everyone ended up happy.
Hope this is helpful. Good luck!