Dismiss Notice

STYLE. COMMUNITY. GREAT CLOTHING.

Bored of counting likes on social networks? At Styleforum, you’ll find rousing discussions that go beyond strings of emojis.

Click Here to join Styleforum's thousands of style enthusiasts today!

Making a Car Dealership an Offer

Discussion in 'Fine Living, Home, Design & Auto' started by kjamesuvic, Apr 7, 2013.

  1. kjamesuvic

    kjamesuvic Well-Known Member

    Messages:
    88
    Likes Received:
    0
    Joined:
    Oct 20, 2010
    I'm in the process of buying my first car. I've narrowed it down to a few cars in the $10000 range. My question is: What kind of offer should I be making if I'm buying from a dealership? 10% below asking? 15%? 20%? And are there any other specific things I should ask for? I've heard asking for a full tank of gas and new tires are among the biggest.

    If it makes any difference, I'm looking to pay for the car in full.
     


  2. Kai

    Kai Senior member

    Messages:
    3,207
    Likes Received:
    800
    Joined:
    Aug 16, 2003
    Go to Edmonds.com and find out what the dealer invoice is. That's what you should be paying for the car. (The dealer makes money off of the various incentives they get, so paying invoice still gets them a profit.)
     


  3. upthewazzu

    upthewazzu Senior member

    Messages:
    420
    Likes Received:
    85
    Joined:
    Jan 15, 2012
    Location:
    Pullman, WA
    If he's looking for a car in the $10,000 range it isn't new, so it won't have an invoice price.
     


  4. Huntsman

    Huntsman Senior member

    Messages:
    7,735
    Likes Received:
    469
    Joined:
    Jul 3, 2004
    When I was shopping, I autotrader'd every car within a 300mi radius of my home, graphed mileage v. price (noting irregularities that would affect that relationship), and did a linear regression. I added in the NADA and KBB values at several points for kicks. This gave me exceptional insight into the asking price market, which I used when evaluating cars. I eventually bought a car that was like 10% below my curve, and I asked for 12% off asking, got 6% off.

    That doesn't directly answer your question, but the insight gained from the excercise really helped me evaluate and negotiate.

    ~ H
     


  5. Cary Grant

    Cary Grant Senior member

    Messages:
    9,673
    Likes Received:
    406
    Joined:
    Sep 8, 2008
    Location:
    Knee deep in curds
    A Hunstman's MIT-level data indicated :D you'll be lucky if you get a small single-digit discount off the sticker. Markups are not very large, especially on used cars. I just bought one and the price was very fair for the mileage etc. They weren't willing to budge at all. But they did improve their offer on my trade a bit.
     
    Last edited: Apr 8, 2013


  6. Douglas

    Douglas Stupid ass member

    Messages:
    14,658
    Likes Received:
    2,291
    Joined:
    Aug 17, 2007
    Location:
    Purseforum
    Not a direct answer to your question, but related to what you're doing:

    Remember that buying a car is not a single negotiation over the price - there are typically three or four negotiations as part of the process. Negotiating the price of the car is just the first one. Trade-in value and financing are other areas where the dealership makes money, and will try to get their best deal there too. And once you get into the closing room, and you're sighing a sigh of relief that it's all over, the F&I guy will try to use his tricks to put one over on you somewhere or upsell you various options like tires for life, etc. You have to be prepared for all of them.

    Not sure if trade-in is one you need to concern yourself with, but never let them know you'll be paying cash until after you've settled the price of the vehicle. They'll be less willing to deal if they know in advance they won't get a cut of the financing.
     


  7. Rumpelstiltskin

    Rumpelstiltskin Senior member

    Messages:
    3,275
    Likes Received:
    1,326
    Joined:
    Jan 14, 2013
    Location:
    Washington, DC
    Actually dealerships make a huge profit on used cars, much more than they get from new cars. They beat people over the on the trade and then mark up the retail price. Check the difference between the trade value and the retail value of any car on NADA's site.
     
    Last edited: Apr 8, 2013


  8. GreenFrog

    GreenFrog Senior member

    Messages:
    14,237
    Likes Received:
    3,079
    Joined:
    Oct 20, 2008
    Yup. Dealership offered me 8k for my car and I'm able to sell it for 14k+ on the private market.
     


  9. Cary Grant

    Cary Grant Senior member

    Messages:
    9,673
    Likes Received:
    406
    Joined:
    Sep 8, 2008
    Location:
    Knee deep in curds
    

    Huge? No.

    Relatively more? Yes... at least on lower priced new cars... I asked and my sales person showed me the record of what they gave om the trade in I bought. Their profit was not "huge".
     
    Last edited: Apr 8, 2013


  10. SkinnyGoomba

    SkinnyGoomba Senior member

    Messages:
    12,676
    Likes Received:
    1,723
    Joined:
    Jan 3, 2008
    Location:
    Princeton, NJ
    Last car I bough I went in with a car in mind, found it, drove it and wrote down my offer to them with what I would pay for it. They hemmed and hawed but eventually caved and gave it to me at that price.

    I took all of the negotiation out of it by simply saying, I enjoy this car, I want to own it and I will pay this amount of money for it, if you can do than we have a deal. It worked better for me than trying to feel out where the low end price was.

    If you do this however you have to aim at a real price, super low ball and they will not take you seriously.
     


  11. Rumpelstiltskin

    Rumpelstiltskin Senior member

    Messages:
    3,275
    Likes Received:
    1,326
    Joined:
    Jan 14, 2013
    Location:
    Washington, DC
    I used to think the same thing until a buddy of mine who sold cars for many years made it clear in no uncertain terms that profits on used cars are much higher than on new cars. WIth the advent of the web and google, consumers can quickly and easily nail down the true numbers that dealers pay for their vehicles and if you take a look the profit margin is rather small. Dealers rely on volume to maintain decent levels of new car sales profits. When it comes to used cars, there are no hard numbers because everything is arbitrary. Vehicle service history, vehicle visual condition, vehicle mechanical condition, vehicle mileage, warranty information, CPO qualified, etc. will all affect the price.

    Let's look at Froggy's example

    Let's say they would spend about $1k detailing and getting the car up to snuff. Then they would have turned around and priced it at $17.5k but under "strong" negotiations would have let it walk off the lot for $15k. That's anywhere from a $7k to a $9.5k profit on a single vehicle. Top salesmen will sell 8/9 cars a week and the average dealership might have 2 strong salesmen. You do the math.
     
    Last edited: Apr 9, 2013


  12. Cary Grant

    Cary Grant Senior member

    Messages:
    9,673
    Likes Received:
    406
    Joined:
    Sep 8, 2008
    Location:
    Knee deep in curds
    I did he math. Just bought a car. Looked at probably 30 and ran across only 2 that were remotely overpriced for a dealer. Private sales will always be much higher, especially for more rare vehicles like an M5.
    Double as you cite is atypical. Not "never" but atypical.
    And while % markup may be higher, it's net dollars that matter. 10% on a 20k used Audi means far les to them than 10% on a new S8. Yeah, I knw, duh.
     


  13. kjamesuvic

    kjamesuvic Well-Known Member

    Messages:
    88
    Likes Received:
    0
    Joined:
    Oct 20, 2010
    

    Unfortunately I'm in Canada. Edmunds is a US based site.


    This is an interesting approach. Did you account for previous claims, damage, collisions, etc.?


    Since I am going to pay cash, would you recommend buying privately as opposed to from a dealership?

    And a question to all: Say I'm buying a car for $10000. If I'm paying cash to a dealer, what would be the all in price of the car after taxes and everything else? Are there hidden charges or something I should be mindful of?
     


  14. Rambo

    Rambo Senior member

    Messages:
    27,312
    Likes Received:
    1,617
    Joined:
    Oct 3, 2007
    Location:
    I'M IN MIAMI, BITCH
    

    There shouldn't be. Although, I'm not sure if Canada charges any sort of fees outside of tax and tag.

    If you're paying cash, DEFINITELY go private. You'll get way more bang for your buck, and have much more negotiating power. Just make sure to get the car checked out ahead of time.
     


  15. Piobaire

    Piobaire Not left of center?

    Messages:
    50,670
    Likes Received:
    13,814
    Joined:
    Dec 5, 2006
    Location:
    In My Douchemobile
    

    OJFC.

    unhaggle.com and carcostcanada.com. Ten seconds to Google those.

    And the cost of paying cash or financing 10k will still have the EXACT SAME taxes, etc. How you pay the sales price does not matter one single bit. As to the all in price that will vary by province at the very least.

    A fool and his money.
     


Share This Page

Styleforum is proudly sponsored by