Last post on Oct 31, 2013 at 1:29 PM
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Car Buying, Car Financing, Car Leasing
#21 of 39 Re: How could it be worse? [tommister2]
Apr 03, 2013 (9:12 am)
I know the dealers get kickbacks from the manufacturers based on sales volumes (extra allocations, cash bonuses quarterly, etc.). If they are willing to sell below invoice they must get more money some other way.
Yes, but those like you said, have more to do with performance bonuses than the dealer cost of car. They don't occur all the time and are variable.
Just like if your salary is $xxxxx per year, an occasional performance or Christmas bonus that may or may not happen still doesn't change your salary figure. It's just a bonus.
If you go to your bank and ask for a loan, they will want to know what your guaranteed salary is, not what your occasional bonuses may be.
So true cost may be the invoice, however the dealer may receive bonus money from the manufacturer for performance and they can allocate it as they wish - to employee bonuses, facility upgrades, or to lower their cost on cars, but it doesn't mean they will give it away to customers.
#22 of 39 Re: How could it be worse? [boomchek]
Apr 03, 2013 (11:30 am)
Right, I understand that they can use it any way they like. Some dealers will not sell below invoice and some will. It is their choice. I wonder if the ones that sell below invoice without too much of a fight know they are getting a bonus, or maybe they figure they will get it from the next buyer? Or they hope to get something from the buyer in F&I...
#23 of 39 Re: How could it be worse? [tommister2]
Apr 03, 2013 (11:35 am)
From personal experience of working in the car sales business for about 10 years, the ones that sell the cars way below invoice, or cheaper than other regional dealers, tend to also sell fewer cars, and tend to either close down or change ownership often because they lose money on a regular basis.
When I worked at Chrysler, each month we had sales figures of all local Chrysler stores, and their average profit per car. The dealers that made the least also sold the least (they lacked sales process and HAD to give their cars away in order to try and stay afloat). They ended up closing down, being bought out by bigger franchises and turned profitable, or changed brands completely.
#24 of 39 Re: How Would You Improve the Car-Buying Experience? [sandman_6472]
Apr 04, 2013 (3:06 am)
Your welcome, my observation was for readers who might not have gleaned the obvious. Most lenders do not require a credit score of much more than 720 for the best rates. A score of 720 is very good but not stellar.
Rather than pay cash, it is often better to let the dealer finance the sale. Allowing the dealer to think it made a bit of profit on the financing might result in that dealer selling the vehicle for a lower price. Since there are no pre-payment penalties for most auto loans, especially for someone with a stellar credit score, the loan can always be paid off immediately.
#28 of 39 Scarff up a low stress deal on a Subaru
by Stever@Edmunds HOST
Sep 25, 2013 (1:22 pm)
"All vehicles in the Scarff inventory have a large "Bottom Line Price" tag hanging from the rearview mirror. This offer applies not only to new cars, but to pre-owned and certified pre-owned vehicles, as well.
The store nearly doubled its market share after implementing the sales strategy. In addition to the uptick in sales, the level of stress was reduced for both the buyer and the dealership's employees. With less stress on the employees, staff turnover was reduced. Scarff has been able to retain a long-term, experienced sales team. Scarff says this is one of the reasons his dealership was rated the number one dealer in customer satisfaction in his area by Subaru of America, five years running."
Washington Subaru Dealer Takes Haggling Out of Car Buying With Bottom Line Pricing
#29 of 39 Re: Scarff up a low stress deal on a Subaru [Stever@Edmunds]
Sep 25, 2013 (2:22 pm)
Interesting...my grandpa and uncle (I think) bought a few cars from that group over the years.
#30 of 39 Re: Scarff up a low stress deal on a Subaru [fintail]
by Stever@Edmunds HOST
Sep 25, 2013 (2:30 pm)
I wonder if Fitzmall gets the same award back East; they're no haggle.