Mazda CX-7 Prices Paid and Buying Experiences

Replying to: des5 (Dec 09, 2008 8:12 am)

Just got a letter from the dealer I bought from and it says: Up to 7500 off '08 CX-7, up to 9000 off CX-7 before loyalty.
 
Yeah, not to rain on the parade, but I think the key words here are "up to". I received similar promos from various dealers when I was buying, only to find out the max discount was only applicable on a) loaded vehicles b) certain colors or c) 1 unit only, "and it just sold" -- ended up finding a dealer offering $7K off on ALL 08 CX-7's and pulled the trigger.

Replies to this message:
• supershawn (Dec 09, 2008 11:16 am)
  • stadler311 (Jan 06, 2009 2:07 pm)
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• des5 (Dec 09, 2008 1:34 pm)
  • jeffb1 (Dec 09, 2008 1:59 pm)

Replying to: derrickson (Dec 09, 2008 8:26 am)

unless there is a dealer here from a region that has something special going on, incentives on 2008's are long over. What you are seeing is the final last incentive that the dealers were allowed to "buy out" and take off the floorplan. They own them. The price we discussed a few pages back is what it is- there's no more dealer support. You can keep kicking the dead horse, but you are just going to lose out on any inventory that gets sold while you sit on it. Now, MAC may have a financial incentive for fin/lease, but that's different. Personally, I am happy with that residual/MF we got a few months ago. An 08 Sport with a few extras out the door for basically the mid 200's? And property tax is included (NC law)? Probably best bang for the buck I have gotten on a new vehicle. Especially in this economy, it was better to take that lease deal than to buy out the lease right away. Come to think of it, the only better bang for the buck deal I can recall ven seeing was back in the early 90's when Ford was trying to beat Honda for car of the year (sales). the incentives were sick. We could give away a Ford Fiesta with every Taurus purchase and still make a little $$. Plus, the sales guys got spins....that's a while ago but it was like $100-250 on each of the first 5 of the month, then like $500-750 on the rest.Geez, when I think back to those days, I wonder how the big three could ever be in the mess they are in right now? (sad sarcasm) This is the first time I have not had a single American vehicle in the garage.....we're Japanese (obviously), German, and an Italian (don't worry, the Italian one only has two wheels- I like to drive my vehicles most of the time and work on them some of the time, not the other way around Although, they do say Ducati has been "turning riders into mechanics for 100 years now").
 
Back to the point- find the 2008 you want, get the invoice, and work from what we discussed a few pages back. You are not going to get any more off unless the dealer takes money out of his pocket and gives it to you for a loss or you have a trade and you can get him to step up (but again, not in this market). Or, wait 10.5 months and do this all over again....and hope there is a bank left to finance it.
 
-

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• stadler311 (Jan 06, 2009 2:07 pm)
  • jeffb1 (Jan 06, 2009 3:45 pm)
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Replying to: derrickson (Dec 09, 2008 8:26 am)

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• jeffb1 (Dec 09, 2008 1:59 pm)

Replying to: des5 (Dec 09, 2008 1:34 pm)

Replying to: derrickson (Dec 07, 2008 4:04 pm)

Sorry I missed this earlier.....at least a late response is better than none
 
I spent quite a lot of time around dealerships and my family still owns multiple (I think 22, depends on if you do physical location or brand). Anyway, I am the black sheep that didn't stay in the family business. I am still very much a car and motorcycle (just about anything that's loud, fast or goes boom, and doesn't require swinging, balls, etc).
 
What has happened is the dealer support on 2008's is gone. Zip. Nada. Vamanos. Outta there. When I got my wife's 08 Sport (you can probably search the for the post to get the date), dealer support had just been cut. Dealers at that time (at least the smart ones) "bought" the vehicles (when a dealer does this, its not really "buying" the vehicle, he is just paying the floorplanned amount and collecting all available incentives). This becomes his new "net net" (absolute bottom line, what the owes on it himself at that time). My wifes had just been "bought" by the dealer the day before, and it scored me not only all his incentives but the Mazda loyalty I otherwise wouldn't have been eligible for. I also got a third incentive I did not know about. All my pricing is disclosed in another (earlier) post and another member here was called and verified and may have bought one himself.
 
Most of the American manufacturers work this way (for now, I expect drastic changes). New model year comes out, dealer "buys" the cars (they are floorplanned- like one big car loan but for all the cars and worked a little differently). Usually, there is little to no incentive on the new year's models. Especially if it is a new model or an easy sell. If it's got a decent mark-up or slow (even in just that region), there may be a small incentive. Incentives then change throughout the year depending on sales. High gas prices? SUV's have $10k customer cash. Like I said in an earlier example, when Ford was close to the unbeatable Honda for highest volume selling car of the year in the early 90's, the incentives were so high we could give a free Fiesta with each Taurus purchase and still make some cash. Advertising- I just don't understand the human mind sometimes.
 
Anyway, from when the new models come out until early spring, the dealer pays invoice (all dealers have the same invoice price, any dealer that says he gets his cheaper because he buys in volume is flat out lying). Whenever he sells a vehicle, he reports the sale, it comes off the floorplan, and the manufacturer pays him ~3% for advertising, interest, lot fees, etc. There may be other incentives that come and go depending on how a model is moving. Once people start thinking next model year, that ~3% goes to ~5% and incentives usually go up a bit. This is hen you see the "end of year clearance deals". These deals usually do rise a bit (again, depending on sales volume), but the time comes (usually around Aug) that dealer support is cut for the previous model year. No more rebates, incentives, nothing. if it's sitting on your lot, you not only owe net (straight invoice), but all the floorplan interest, the space it took up, lot fees (cleaning, charging the battery, etc). 120 days is usually the magic number, no one wants a car over 120 days (too many reasons to list here).
 
So, (ramble mode off), how come, when there are 2009's on the lot, are you only seeing deals that are more expensive than what we got a few months ago? Simple- the dealer gambled and did not 'buyout" the vehicle and he can't go lower without literally paying out of pocket. Let's just say I may have seen a 1989 rust/gold colored Chevy Celebrity EuroSport (stop drooling ) sitting on the lot, brand new, in 1991.Dealer owed invoice. Period. It ended up finally going to a "strange" gentleman who had an older Celebrity to trade, was upset they didn't make it any longer, and a dealer several hundred miles away saw it on our inventory sheet (through the DX program). He drove the several hundred miles to see it, fell in love (musty smell -the car, not him- and all), and bought it. the dealer sold it for about 50% of invoice (told you dad), but made up for way too much of it on the back end (yes, he really could sell refrigerators to Eskimos- poor guy is probably still making payments). Money was lost, but it could have been worse. The car had a $2500 cash bounty (dealer sanctioned of course) for like a year. And yes, the new owner got a full new car warranty (the good 5/50 before GM went 3/36) that started when he took ownership.
 
So, where did the 2k go on the 2008's? Mazda isn't offering support on the 2008's any more- at least not what they were. If the dealer didn't act on it, he owes what he owes. MAC might do a 0% or lease deal, but that's we said buy now! (do;t forget, you are losing residual/MF too if you are a lease guy).
 
Hope that helps.

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• derrickson (Dec 10, 2008 9:04 am)
  • jeffb1 (Dec 10, 2008 9:28 am)
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  • fonefixer (Dec 11, 2008 3:59 pm)

Replying to: supershawn (Dec 09, 2008 4:46 pm)

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• jeffb1 (Dec 10, 2008 9:28 am)
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• fonefixer (Dec 11, 2008 3:59 pm)

Replying to: derrickson (Dec 10, 2008 9:04 am)

Yeah, Shawn, thx for the info -- i actually understood most of it
 
I'm curious -- once the dealer has 'bought' the car, and there are no more incentives or money coming from mazda, it seems like he'd be even more motivated to move it since every day is another day of carrying costs out of his pocket and there's no hope of getting any support from mazda. What happens when he gets to the point where he realizes he's not going to get enough cash for the vehicle to cover what he's got in it? Does he take the car to wholesale auction or something, or does he redouble efforts to sell it, even below his cost, just to get rid of it?
 
BTW, after I made my "$7k off msrp" offer to the dealer yesterday, i've had no email response at all. c'est la vie, i suppose...
 
Thx!
jeff

Replies to this message:
• supershawn (Dec 11, 2008 6:21 pm)
  • fonefixer (Dec 14, 2008 11:10 am)
    • supershawn (Dec 14, 2008 6:52 pm)

Replying to: derrickson (Dec 10, 2008 9:04 am)

Replying to: jeffb1 (Dec 10, 2008 9:28 am)

My best "guess", and that's all I can give on this one, is that many dealers simply could not "buy" the cars off the floorplan. Sales are bad. And they have been bad. To "buy" a car off floorplan means the dealer had to pay that $18-22k out of pocket. Some dealers simply couldn't do it. If they couldn't pay it, they lost the incentives. They have the cars at invoice plus whatever interest they've floorplanned over their life on the lot. Getting that extra 2-3K is going to take a DeLorean, some plutonium, and enough roadway to hit 88mph
 
Things are bad, guys. They were bad a few years ago when I was more involved in my families dealerships. I can only imagine what's going to go down over the next few months. We already say Chrysler try to be saved by Daimler-Benz, only to have them say "I give up" in like two years. GM is ready to ditch Hummer, Saturn, Saab, and Pontiac in order to get bail-out cash (but keep Buick, whose average owner is 102- sorry, but c'mon. It's bad enough they killed Olds just as they had a decent product). I can only wonder what would have happened if the big three had (and I know this is a sore spot for an GM die-hard's here) taken an approach like Ferdinand Piech did with VW/Audi/Etc. Instead of building cars that competed against each other, they could have shared more technology and stopped duplication. Seriously, if GMC and GM Trucks weren't what they are, I don't think the F-150 would have been the best selling truck all these years.
 
A little more rambling on the way it works (worked)....While the cars are on "floorplan" (floorplan, again, is basically where one [hopefully only one, but that's another story] bank, be it a local bank, MAC, FMC, GMAC, ETC, "owns" all the dealers cars on the lot. There are different benefits with different banks, there's some forgiving in tough times, etc), the dealer is paying a type of prorated interest based on the invoice of the car. For example, when the car comes off the line and gets loaded to be delivered, the bank holding the floorplan is notified and sent a copy of the invoice. The invoice cost is added to the floorplan amount the dealer is paying on. When a vehicle gets sold, he reports it as sold and the bank holding the floorplan expects a check for that invoice amount. So, basically, the dealer really doesn't "buy" the cars that sit on the lot. they are financed (sometimes even used inventory can be floorplanned). The longer the car sits on the lot, the more floorplanning for that vehicle costs, and the less of that incentive money (like the initial 3% I mentioned) the dealer is going to get.
 
As times started getting tough (and this goes back to the 90's), the goal was to keep new inventory on the lot as short as possible to keep floorplan costs down, etc, that's why you started seeing all the "1$ over invoice deals". You really are/were paying $1 over what the dealer paid- invoice, but, he got some back in incentives after it was sold. The faster the inventory moved, the more of that incentive money he got. Consumers were getting smart, the internet made getting invoice price (as well as dealer incentives) easier, so many dealers just threw up their hands and sold new inventory for basically cost.
 
Now, some of us live in states that allow those ridiculous "doc fees". Most dealers here in NC charge about $499. These are 100% BS. The costs of the DMV processing is minimal at best, this is a way to recoup some of the money when selling at cost. I'm not a jerk, but I usually ask the dealer to admit the fee is bogus as a mater of principle. I say I know he needs to make a profit, but just be honest about it. Not every state allows this (I know my families dealerships are forbidden from doc fees- except actual cost which is documented on the buyers order AND sales contract, guaranteed trade-in values, and a bunch of the other marketing shenanigans).
 
Anyway, it just became easier to sell the car for invoice (well, a $1 over), get the incentive money, and try to steal the trade. The "program car", aka "off-lease", in all reality "Previous Avis/National/Enterprise rental bought at a dealer auction" and educated consumer "killed" the new car market.
 
Sadly, this is not just the big three. If you look at sales internationally, they are dying as well. BMW just reported it's biggest sales drop ever.
 
Even the racing series are losing out...look at all the manufacturers that are dropping...Honda is out of F1 (been there since the 60's), Audi's out of LeMan's.....
 
Scary, stuff.
 
Ok, hopefully I answered your question (and then some ).

Replies to this message:
• fonefixer (Dec 14, 2008 11:10 am)
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