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Sedans Midsize Sedans 2.0
13327 messages, Last post on Dec 03, 2009 at 6:45 AM
You are in the Sedans Forum. Your Hosts are pat & karens
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Replying to: imidazol97 (Jun 30, 2008 4:53 am) They simply chose to finance it with vehicle sales as opposed to making it an arbitrary fee or negotiating it individually with each dealer. Now if you want to talk about deceptive fees - look no further than the infamous "documentation fee" - that's 100% profit AND it's added AFTER the sale price has been negotiated. |
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Replying to: bhmr59 (Jun 29, 2008 11:02 am) Today, dealers blow out inventory ( many deals at invoice or below) because if that dealer meets or exceeds their sales objective set by the manufacturer, they get bonus money which can total tens of thousands of dollars. If a dealer does not hit their objective, they get nothing. So, you can see why it would make sense for dealers to occasionally go a thousand or two below invoice. The temporary loss is far out weighed by the potential gain. |
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Replying to: imidazol97 (Jun 30, 2008 4:53 am) FYI, it is not the dealers that add the advertising fee's to the invoice. It's the manufacturer. You are very wrong if you think it is built in profit for the dealer. The dealer makes NOTHING off of it. |
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Replying to: bhmr59 (Jun 29, 2008 7:16 pm) I never heard of Edmunds before I started accessing the internet and even then I didn't access Edmunds or sites like it right away. So I don't think it's been that long since the "average person" began using that data to their advantage. If you're talking decades how many is that? I guess at the most not even two full decades. I certainly wasn't on the internet twenty years ago. Anyway, nobody said that the invoice is the bottom line for the dealers. Most of us are pretty aware of holdbacks, dealer incentives, volume discounts, etc. etc. Most of these extra incentive from the manufacturer are based on volume so it is up to the dealer to determine what strategy to employ. High volume low margins, low volume high margins or somewhere in between. As I said in a recent post, Autonation, about 600 dealerships and the largest dealer group in the US, makes twice as much gross profit on repairs/part than it does from new car sales. Nobody is saying dealers don't make a "good buck" (whatever that is) from new car sales but just that it is not their largest source of profit. I could discuss this more but I think we're edging towards getting a slap on the wrist from our hosts for straying off topic. There probably is a forum to discuss items like this but I'm not sure what it would be called. Cheers.
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Replying to: bhmr59 (Jun 29, 2008 7:16 pm) The invoice is real. The dealer really pays what the invoice states, less hold back. The dealer does not get hold back if the car has been in inventory over 90 days, in most cases. The hold back was designed to pay for interest payed by the dealer on floor plans. Hold back is not always profit. Where dealers make their money on new car sales is the "bonus" money they make from reaching a sales objective set by the manufacturer, which is a lot of money. That is why dealers can profit from selling cars below invoice. Now, that is a gamble. If the dealer does not reach his objective, he makes NOTHING, and all those below invoice deals really really hurt, and the month becomes a loss. Like it or not, the car business is, yes, a BUSINESS. Every business is in business to MAKE MONEY. Last I checked, we are a capitalist society. Am I right? If a dealer is showing you a good deal, and you are saving money, you should be happy right? Why is it always about what the dealer makes? I have never understood that. Why do so many care? Only if there were web sites that showed what mortgage brokers really made, or how real estate agents get paid, broken down to the last penny. Those people make HUNDREDS OF THOUSANDS ON US!!!! How about "lawyers.com" and we can see how badly lawyers makes STUPID money on the needy, yet, no one knows how much they really make at our expense. Car dealers make not even 1% of that, and yet we all like to bash car dealers. Makes no sense.
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Replying to: aviboy97 (Jun 30, 2008 6:30 am) Please read my posts more carefully in the future. I did NOT say that it's extra profit. I did say it should be a part of the gross profit for the dealer. If you buy a mattress from a mattress factory type store, do they add an advertising fee onto the purchase contract? No they include it in the price they ask/negotiate as part of their expenses. Back to midsized sedans.
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Replying to: imidazol97 (Jun 30, 2008 6:44 am) Car dealers don't add an advertising fee, either. It's part of the ACTUAL dealer invoice and MSRP. It's NOT a fee that's added to a purchase contract. The problem is that the online dealer invoices provided by Edmunds, KBB, etc. don't include this fee. In other words, the Edmunds/KBB dealer invoices are not accurate. |
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I felt the need to make a post somewhere. Back in 2002 I opted away from Ford and toward Toyota. I was tired of numerous trips to the Ford dealership for odd little problems, whether covered under warranty or not. From a dollars perspective, the Fords were cheaper up front. Again the constant trips to the dealer just were a nusisance and at the time I could afford the extra $$$$ for a new Camry. Well, I had NO trips to the dealer other than oil changes and fluid changes for the first 6 years. This year though the camry started to show some wear. Some sort of mechanism in my door that would not allow the keyles entry to work...$425. A sensor...$130 and now a valve job....$1700. Suffice to say I am thankfull I spent the $630 for the 7/75K extended warranty. These repairs have cost me nothing. Of course most would have skipped the valve job, I guess its normal over time for a puff of blew smoke out the tailpipe......but I was disapointed on a Toyota with only 65K miles. Yes the car has been maintained. I also think these valve issues are related to Toyotas much like Chryslers (at least the older ones). Our 95 Rav had the same problem. I never had that problem on our old Topaz and Mystique. For what its worth.... |
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Replying to: m6user (Jun 30, 2008 6:33 am) There's a link on Edmunds.com re Edmund's 40th anniversary--not all of those years on the Internet, of course. (Congrats, Edmunds!) I started using their pricing books long ago--as far back as the '70s. I never actually bought one, though--I used the books at libraries or stole a quick look at the grocery store.  It was good info then, and even better now since it's so widely available to everyone and updated much more frequently than the books could ever be. I recall these books weren't very small, nor very large--I would call them mid-sized. (Sorry, very weak attempt to get back on topic.)
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Replying to: imidazol97 (Jun 30, 2008 6:44 am) I know, in Mazda's case, that is what happens. It is already billed to the invoice, and is included (just like destination fee) on the price you see on the window sticker.
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