Got a Quick Question for a Car Dealer?

Thinking about it, we probably should be happy so many people purchase so many things in the F&I office at inflated prices. I suppose that allows those of us who say no to the F&I offerings achieve a better price on the vehicles we purchase. If dealers did not make so much back end profit, they might not be so willing to discount the front end selling price.

#3036 of 3219 Affiliate/Friends & Family Discounts by maracle

Dec 01, 2012 (11:06 pm)

I've just started car shopping and I'm curious about how discount programs for friends/family/business partners work. I work for a very large company that has deals set up for us on a lot of car brands. I went to look at a Dodge Dart today, which could be covered under Affiliate Rewards (1% discount off factory invoice).

If I assume the Edmunds True Market Value is accurate, it says I should expect to pay about 1.9% above invoice.

1) Does Chrysler give an additional payment to the dealer when they sell me a vehicle under this program to help them recover some lost profit? Or is a few low/no profit sales part of doing business (of course there is still financing, dealer options, service, repairs, etc for them down the line).

2) What about the salesperson? The guy who helped me out today seemed great. If I end up buying from him I would hope he earns a commission on the sale.

I figure it's always good to understand people's financial motives in situations like this!

Thanks

Replies to this message:

robr2 (Dec 02, 2012 10:39 am)

#3037 of 3219 commision by jproc

Dec 01, 2012 (11:49 pm)

salesman always earn some money on a sale-how much depends on the total profit to the dealership-but the dealership will pay something to their employee

#3038 of 3219 Re: Affiliate/Friends & Family Discounts [maracle] by robr2

Dec 02, 2012 (10:39 am)

Replying to: maracle (Dec 01, 2012 11:06 pm)

I bought an Explorer last year using the program they offer for shareholders. It was simple and painless. I found the car I wanted, called and asked if they would do X plan on it and arranged to buy it.

The dealer is paid a fixed amount by Ford to process the sale. There's little time spent by the dealer and salesperson in negotiating. The sales counts towards their allocation. Other manufacturers do the same thing.

If you are going to use one of these programs, you really should be up front about it and let the salesperson know. It's not fair to him/her to spend 4 hours with you on what might be a $50 commission.

#3039 of 3219 Re: Trade in ? [jproc] by verdugo

Dec 05, 2012 (2:29 pm)

Replying to: jproc (Nov 19, 2012 5:14 pm)

Wonder what state he is refering to?

Little late to the party, but he could've been talking about CA.

If the new car is 20k and you get 2k for your trade in, you pay sales tax on 20k

If the new car is 22k and you get 4k for your trade in, you pay sales tax on 22k.

#3042 of 3219 Owe $16k on vehicle; need cheaper wheels; help! by brokedood

Dec 09, 2012 (6:42 pm)

Since I purchased this car I lost my job and now have a job that pays less. I need to downsize my car. I have a 2009 Lexus RX with 57k miles. Like the title says I still owe 16k on it, payments of $390/mo until mid 2016. The car is at least very reliable and I don't want to give that aspect up, but I realize there are many cheaper brands and vehicles I can buy that are reliable. I've read about trading in cars when you still owe money on them, but I still don't understand if I can come away in a better position than I am currently in. Basically, can I get a cheap new car or reliable used car and come out owing either 1) zero or 2) something minimal like $100/mo? Please explain how the transaction would work like I am a 6 year old.

Replies to this message:

stickguy (Dec 09, 2012 8:10 pm)

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