Ok, this is really about not just pressure tactics, but about EVERYTHING that goes on in buying a car (not MINIs, at least for the moment).

When you go into a dealer with the intention of buying a new car, you start with the information session with a salesman, followed by a test drive. Usually, you follow the salesman inside the dealership and into one of those cubicles with the laminated wood paneling on the walls or a few ugly photos, posters, or calendars hanging around.

Then, they proceed to sell you a car: they work the numbers, make an offer on your trade in, and there is the back and forth of bargaining for a better price etc.

BUT at the same time, another person has walked in with the intentions of buying an identical automobile. But due to the nature of his personality or experience etc is able to secure a much better price from the dealer, a better value on his trade in, and maybe even a few extras like free floor mats and extra keys.

My point is, how is this legal. How can it be that one guy gets a better price than another? It seems to me that this would somehow open the dealer up to all sorts of problems, such as allegations of racism, sexism, whateverism because someone got taken on a bad deal.

Why do consumers tolerate this sort of buying culture with regards to autos? We sure dont accept it in any other market. Imaging buying a TV set this way. having to negociate the price and the terms of purchase. Why dont the dealer's have to stick to a price set by corporate hq?? it seems that this would eliminate all of the headaches for buyers, and force dealers to compete on a different level, such as service.

With computer buying, there is always a manufacturer suggested price. you can go from store to store and the price will always be the same within a range of a couple hundred dollars. So why is it so different for cars?? and how is this legal?

Patrick.

 

You raise a good point. It's an unfair system.

Cars do have a Manufacturers Suggested Retail Price (MSRP), but with the auto world, the emphasis is on "suggested." The buying process with cars has historically been hostile. Some dealer groups (see AutoNation) have made themselves into a near empire by going with "no haggle" pricing, but even that isn't accurate because if you have a trade it, you have to haggle over the value of that.

For things to change, people would have to organize a complaint against a particular dealer. Buyers of comparable vehicles from the same place would have to compare notes and prove that favoritism was shown. It could be difficult to show. It would be in a forum, much like this one, where these issues would be discussed. The tough part would be finding others to compare deals with.

 

A friend in Minneapolis worked out a great way of buying a Subaru. He found out through Consumer Reports exactly what dealers get them for. He called area Subaru dealers describing the exact car with specs he wanted and said he would pay offer a price that he'd calculated at $100 below what they payed. Most said he should come in an talk and various things to get him in their clutches for the usually tricks. He just kept say he was too busy and would only go in to any dealership that would agree to his prices period. Eventually he found one who said yes. After they finished the transaction with no trick add ons or other hitches, he asked how they were able to do it. They said they got a bonus from Subaru if they met a certain quota they were close enough to that made taking the $100 hit worth it. If my next purchase hadn't been a Mini I would have tried that.

 

Its capitalism at its finest. For example, at my work we have wonderful relationship with a ford truck salesman, wonderful guy. If your not paying attention to the deal, he'll nail your *** to the wall. If you are, you get a perfectly fair deal. He even tells people how to do it , when they ask, "how do i get a fair deal". His answer is simple, do your homework and walk away if necessary.

If you go in and the dealer is an ***, walk down the street to the next one. For instance, I was thinking about buying an explorer before I got my mini. I ended up catching the saleman lying to me about the price of explorers and F150's. He tried telling me that a stripped down F150 6 cyl XL would go for about 30 grand. My company had just bought a fully loaded lariat for 26. From the guy in the first paragraph. I laughed in his face. Then proceded to call him a liar in front of all the prospective customers and salesmen. The other funny thing about that guy is he refused to talk directly to me, he only talked at my exgirlfriend. she was like no no he's buying the car.

The moral of the story is don't be stupid, when people are stupid about buying cars they deserve to get hosed.

 

This is one reason why car salesmen are generally held in low esteem.
One way you can be better prepared when going to an auto showroom is to look up several online auto sources for pricing. http://www.Edmunds.com is a good one: you'll understand the 2%-3% built-in markup before the Dealer's Invoice cost.

Another thing to consider is to buy from one of the auto discount places where they quote you a fixed, non-negotiable price and you don't have to deal with the showroom shenanigans.

 

I used to work at a Saturn dealer (I wasn't a saleperson, I don't think that I could ever be one). But they are the only dealership that I know of where the cars all have set prices. (It may not be like this anymore as I worked there 4 years ago). But you could go to any dealership and look at the same car and they all had to sell it at the same price. The salespeoples comissions were also the same for any car they sold, no matter what the price. I guess in the sense this is a good thing if you aren't good at price haggling. But I guess they could always get you on things like floor mats and such...

 

I've found that if youdo your research and know what the model your interested is going for, and are willing to walk if the dealer is trying to jerk you around, you'll do well.

I did a lot of research before I bought my last two GMCs back in '97. (Both vehicles now gone). One came from a dealer in Florida and another from a dealer in Virginia.

I actually walked out of the dealership in Florida becuase I didn't like what they were telling me. They called me an hour later (the sales guy knew that my current vehicle was in service while we spoke and got my cell phone number from the service writer) and offered me the deal I wanted as we pulled into Universal Studios. We picked up the car that night.

The General Manager of the dealership in VA wrote my deal himself. That's becuase thanks the the GMC website I knew what they had in stock and what they were expeciting to receive before their salesguy. He didn't like that...

 

Being on the other side of the fence, let me tell you what it's like to be a motoring advisor. Please don't take offense. It's not you I'm talking about. MSRP is fair. The guys on the left coast would kill to buy a MINI at only MSRP. Besides the dealer paying the people to work there, he's got some other costs. Parts is #1. You have to have it, to install it. The average dealer will stock 500,000-1,000,000 in parts alone. Warehouse those cars.. most dealers have 30-100 cars in stock they are financing every month until they sell. Average delaership employs 30-50 people. They need to eat too. Edmunds currently recommends 1-2% above MSRP for MINIs. Nice resale value down the road too. Trade ins... another drama. We love cars we can re-sell, not RECYCLE. You want 2,000 for a car I wouldn't put my future-ex-sister-in-law in. My wholesaler wants 200 to dispose of your cherished auto. Financing...we've all heard about 0% financing. It costs somebody money to borrow, it's not free. So, you've now heard from the other side....the evil enemy....Me. I sleep well at night, being honest and forthright. Sometimes brutally honest. Don't trade it, donate it!

 

It all boils down to knowledge. The knowledgable purchaser (dealer costs, wholesale value of trade, interest rates, "demand" for the particular model sought) is going into the transaction with a good idea of what to expect, and what to pay. The ignorant purchaser OTOH is going to be at a distinct disadvantage in the transaction. But think about it for a minute. next to a home, automobiles are probably the single largest ticket item most of us buy. It is something that most will finance, for as long as 72 months, so if you don't spend time studying and planning this major purchase, and you get screwed out of a few $K, well tough. Think of the dealer / purchaser relationship as adversarial, one is trying to maximize his gain, the other minimize his pain. Be on your toes at all times.

 

>>Being on the other side of the fence, let me tell you what it's like to be a motoring advisor. Please don't take offense. It's not you I'm talking about. MSRP is fair. The guys on the left coast would kill to buy a MINI at only MSRP. Besides the dealer paying the people to work there, he's got some other costs. Parts is #1. You have to have it, to install it. The average dealer will stock 500,000-1,000,000 in parts alone. Warehouse those cars.. most dealers have 30-100 cars in stock they are financing every month until they sell. Average delaership employs 30-50 people. They need to eat too. Edmunds currently recommends 1-2% above MSRP for MINIs. Nice resale value down the road too. Trade ins... another drama. We love cars we can re-sell, not RECYCLE. You want 2,000 for a car I wouldn't put my future-ex-sister-in-law in. My wholesaler wants 200 to dispose of your cherished auto. Financing...we've all heard about 0% financing. It costs somebody money to borrow, it's not free. So, you've now heard from the other side....the evil enemy....Me. I sleep well at night, being honest and forthright. Sometimes brutally honest. Don't trade it, donate it!

Im not really talking about MINIs, Im talking about the fact that prices are set, but they can vary from one customer to the next. It seems almost discriminatory. The guy that doesnt speak english well and that has less disposable income ends up getting screwed out of a few thousand dollars extra through no fault of his own. This doesnt seem right to me. I dont have a problem with price fluctuating with demand, but I feel that prices should be fixed nationwide (or region wide?) depending on the demand, not the skills of a customer to be able to negotiate.

Patrick

 

>>Im not really talking about MINIs, Im talking about the fact that prices are set, but they can vary from one customer to the next. It seems almost discriminatory. The guy that doesnt speak english well and that has less disposable income ends up getting screwed out of a few thousand dollars extra through no fault of his own. This doesnt seem right to me. I dont have a problem with price fluctuating with demand, but I feel that prices should be fixed nationwide (or region wide?) depending on the demand, not the skills of a customer to be able to negotiate.
>>
>>Patrick

If problems exist such as language difficulties, feelings of discomfort, or even gender discrimination when dealing with a car salesman, I recommend that the purchaser retain an agent to negotiate with the dealer (this can be a gratuitous agent like a friend, relative, spouse or significant other). Still, having an agent is not an excuse to abdicate the responsibility of proper investigation and preparation. Remember the Boy Scout motto: "Be Prepared" , as well as one of our favorite Latin phrases: "Caveat Emptor" (Buyer Beware).

_________________
BLUBELLE - 2003 MCS IB /W Premium, Sport, Cold pkgs, Lapis blue interior, Magnecor wires, Alta Pulley, Moss Skid Plate, Chrome Trim Interior

 

We work very hard with language challenged people. In the old days, you could get away with being rough with the customer. We really strive to make the relationship more than a business transaction. This is a major investment, and everyone does get treated fairly. Look at the dealer feedback section. Most people are very happy with the dealerships they deal with. CSI(consumer satisfaction index) is very important not only to the motoring advisor, but to the dealer and company too. We are all looking to get the best score. You are the judge of our score. Our store average for CSI is above 95% for the year. You don't do that by accident. As far as paying different amounts, we don't gouge, and we don't discount. Why should the auto industry be the only place to discount goods/services? I can't recall the last time I got a discount on food, clothing, or even gasoline. Why should the consumer expect a discount, or knowing the invoice amount from the manufacturer decide they should pay less than the MSRP? The computer has brought more conversation into our lives, more education, and maybe too much information.

 

Too much information never hurt. A well educated and informed purchaser is always at an advantage. The same thing happens with leases. Contrary to how they make it sound, leases are negotiable. Any person who takes the time to understand how a lease price is constructed and is able to use it when making the deal is at an advantage.


I learned some principle in economics one... Forgot what it was called.. The example given was that, how can the post office send a letter across the country for XX pennies. Because they actually make the money on the higher ticket items like packages

For every purchaser that got gouged, there's one that masterfully negotiated a good deal.

 

Patrick, we wouldn't want price-fixing. Cars are priced based on MSRP, sure. But when you factor in supply and demand, that puts another spin on it. For those models not moving, deep-discounting does come into play, and sometimes dealerships must sell cars way below MSRP to move them. Buying at the end of the month is always a good idea; many dealerships have selling quotas and may strike a much better deal for a buyer then than, say, mid-month. And for the in-demand vehicles, buyers are willing to pay premiums to get the car they want.

Except for purchasing my 2 MINIs, which was a unique and positive experience in every way for me, I always enjoyed the haggling/bargaining process. I did all my research and homework, walked into dealerships generally better-informed about the models I was interested in than the salesperson, and if I didn't get the deal I wanted, I learned to walk away. Walking away is a powerful buying strategy, and it never failed to serve me well in the final negotiations.

Of course, with the MINI's limited production and waiting lists, these techniques are irrelevant, pretty much. I did establish a good relationship with my Motoring Advisors and when I decided to buy my second MINI, the S, I was given preference because I was return business...and because I liked them and treated them politely and nicely. I know you don't mean this discussion to be about purchasing the MINI, but I wanted to give props to my dealership, Long Beach MINI, in SoCal. It's been a pleasure for me every step of the way to deal with them.

Good discussion.



Clo/Wanda