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Old 10-23-2011, 05:44 PM   #6
Scooby Specialist
Member#: 98702
Join Date: Oct 2005
Chapter/Region: MAIC
Location: Baltimore City, MD
2016 Jeep Patriot


Do dealerships have as much incentive to sell a car to someone who lives far away (and will likely not use their service dept) as someone local? I mean, are all sales created equal?
In regards to used cars... the further away from me you live the less I'm going to budge on the price. There's a 99% chance you found the car on the internet and the only reason you're calling me from so far away is because it is a really good price. Great example... guy calls me from New Hampshire on a used car I have, tells ME how rare they are especially with the miles mine has, and then demands a discount. What sense would it make to do that? He's calling me from New Hampshire. Unfortunately there are a lot of cards that you as a buyer are forced to put on the table. Location is one. Whether or not you visit the service department in the future isn't really a concern of mine.

On new cars I know you're just price shopping and it won't make much sense for you to drive 200 miles to save $200, so I'm going to let you out with a price I feel is appropriate and let it go from that. It's a 50/50 shot on my end - I'm not going to invest a ton of time in you being so far away.

What do you really do when you are negotiating and say "I have to go talk to my manager about this?"

Go have a smoke and a wank? Get some coffee? Make fun of the customer with the other salesmen?
We're truly asking the manager, and then making fun of you. No salesperson has ultimate authority on price, but some have more input than others. It depends on the showroom. I have more leeway where I am than most. And yes, we're making fun of you. If you're a woman we're evaluating you and figuring out if we would or wouldn't. Sorry folks, that's genetics (and high school humor) at work.

What's the best way to beat the dealer down on a price? I know playing the waiting game usually works for the buyer, anything to speed it up?
Don't. Car salespeople are human too. Even the dickheads still have bills to pay and families to feed. The cooler and more upfront you are about the situation the better things will turn out for you. If this level of interaction isn't returned, find another dealer that will.

There are a few things to understand about price. On new cars, just do your research. Edmund's TMV is a great way to find out what people are really paying for the car. Know invoice price, know what incentives are available, and make an up-front, respectable offer. Lowballing with ridiculous offers and demanding the dealer take a huge loss on a new car will get you laughed out of a showroom faster than a fat kid showing up at cheerleading practice. It's disrespectful and it wastes time. Start at a REASONABLE offer and work from there. And don't ask for our "best price." This will also make us point and laugh at you because you obviously have no idea how to buy a car. The salesperson will come out with an initial "pencil" and you should ignore it and retort with the number you calculated before you came in. The salesperson will simply say yes, or no. If no, they'll counter-offer.

At the end of the day we know you're going to take the lowest offer you get to the closest dealer from where you live, so the only thing we have to gain by blowing out a car is to ruin the deal for another guy.

On used cars, just wait. The longer a car sits the lower the price gets. The larger the dealer-group is the more aggressive the discount vs. time line seems to be. Increased inventory carries increased liability. Used cars are not floorplanned (paid for with a loan with interest). It is tying up cash the dealership could otherwise be using. If you see a car you like, research the market price. Again, Autotrader and Edmunds are your best tool. Find the next closest match in age, mileage, and options, and make an offer of about 1% under that. Don't focus on how much of a discount from starting price you get, focus on how good of a deal you're getting for that vehicle compared to the market.

There is no way of knowing how much a dealer paid or has in a used car. Sorry, there just isn't. In fact right now most dealers are going to lose money on a used car - it's just the way the market is. For every 5 used cars I've sold, 3 are losers and 2 make a DECENT amount of money.

Here's a few extras most people don't know or I'd like to mention:

- Car salespeople don't make a lot of money. Seriously, they don't. Most work 45-55 hours a week and are lucky to bring in 35-45k/year BEFORE taxes/insurance/401k. I'm bucking the trend but just slightly due to the company and brand. This job has horrible hours and most times if you're talking to a salesman it's at a time when his family and/or friends are free and would rather be spending time with them. If it was a fantastic job there would be lines out the door at dealerships and stacks of resumes to sort through instead of a constant revolving door and empty desks. That brings me to my next point.

- Be nice. We're people too. Being a dick will only make us want to screw you over more. Don't lie either. We know more about buying cars than you do. Nothing will change this. Be honest and make us want to help you. You'll end up happier in the long run.

- Most cars only make $500-3000 each for the DEALERSHIP. Think about that. There is anywhere from 3-7% average markup in a car. Salespeople are usually paid 15-25% of this profit AFTER a ton of fees such as soft and hard packs, gas, cleanup, accessories, and floor mats are deducted from that profit amount.

- Your trade is NEVER worth what you think it is. We're really NOT beating your head in with trade numbers. We may hold back $500-2000, but remember the salesperson is only getting a fraction of that. Modifications REDUCE your trade value exponentially, they do NOT increase its value. Sell your car to Carmax if you can. I'd rather not deal with the extra paperwork.

- Car dealerships are not run by UNICEF. They are businesses and are designed to make money. They are not NON-PROFIT! This is how the world works and stop getting angry when you find out that they make money. I concede that there are right and wrong ways to make money, but we are providing a product and service and as long as we don't set you on fire, have sex with your wife and run over your dog, you still get a new car and have made out pretty good on the deal. Don't go in to a dealership with the goal of trying to get the dealer to lose as much money as possible and I PROMISE you'll be treated fairly and have a good experience.

That's all I have for now. Any other questions? This is fun!

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