Exactly. Sometimes cars sell for higher, sometimes lower. Nobody should be bent out of shape if a dealer asks for more than MSRP for a car in high demand.

 

shoulda shopped out of state.

 

Do you remember the first year PT cruisers were sold ,sometimes $15,000.00 mark up and people still bought them .

 

Is it 'fair'? No. Is it the norm in SoCal (and elsewhere)? Yes.
Should you take your money ($3K less of it!) somewhere else? Yes.

If enough people walk away, the ADM will go away.

Note that there are some benefits from buying local - some dealers will only give you a loaner if you purchased the car from them.
Me, I'll keep my money and deal with a loaner when needed. Fortunately my local dealer provides loaners either way.

 

Eric, usually I agree with you but in this case ...

Not to nitpick but what does fair mean here.

You got a willing seller and a willing buyer and a contract signed. As in every business, they exist solely to make money (and that is not being cynical but why companies exist

IMHO, its totally fair and if they could sell for $10K more they would. Whatever the market will bear. But ... as you said, you don't got to buy from them ... walk .... If ppl walked, they couldn't charge the markup. Can't buy a MINI then ... well get them shipped. Ppl have bought cars, all kinds of cars, in other states all the time and shipped to them. As "they" say ... money talks

 

LOL. He said "fair". I'm kidding. I'm really not that rude. But it thought it sounded funny at the time.

Seriously though, $3000 is a pretty high "market adjustment" even for SoCal where everything from antiques to avocados are "adjusted". I don't know if you can effectively get that rolled back, but even if your MINI was made to order and shipped, you can change your mind, not buy it, *and* get your deposit back. (hey- they sell themselves, right?). You can then go to any of the other dealers suggested in this thread, and wait all over again.

I would at least shoot for some freebies. Floor Mats, A hat? Fancy License Plate Fram? All three? FWIW, my MA was so honored that I came back to him to buy a second MINI, he "convinced the dealership" to reduce my markup to "only $1000" *and* I got a free pen! Gee- thanks! I don't wanna know which dealer you went to because then I'd have to tell folks not to shop there.

But, hey- you'll have your MINI soon and will forget all about it. Until someone reminds you.

 

While that may be the case, any business transaction is better served for the seller when payment is made in full. Nearly no risk, profit earned. Any loan, no matter its origin, has risk. Some are riskier= higher interest rates, some not so risky, low interest rates (simplified example I know). Aberrant cases aside, most dealerships should be willing to bend for someone with full payment at the table, and at the least, it is wise business practice to do so. If a dealer is pushing customers towards financing, well, not a place I'd do business personally.

In my humble opinion (IMHO i guess) and speaking specifically about $3000 markups of MINIs, a purchase of this size should be done with a reputable business with ethical practices, not a dealer doing things they can get away with. Hiding behind business terminology to justify raising prices to make even more money doesn't negate the differences between right and wrong. We are after all humans serving humans, not business models serving business models. The MINI market in my opinion does not support justification of such markups, in California or elsewhere.

***on a quick side note, dealerships with their own financing companies or banks do so (ethically speaking) to pick up the profit made on their financing purchases rather than turn it over to another company. Same reason a larger company will purchase distribution assets to get their product to market, it cuts costs and raises profits. A deal between banks and dealerships is symbiotic in nature, another purchase option for dealerships=selling more cars, source of new loans=profits for bank. The idea of kickbacks in this scenario seems implausible.

 

Dubaian,

If you have the time to search older threads on "dealer markup" (going back to 2003) you'll find lots of opinions (don't pay the markup - you're just rewarding bad dealer behavior) and information on just how easy it is to buy from out of state dealers charging MSRP. I'm in CA and purchased my '06 from MINI of Murray in Utah. Many, many others have done similar purchases successfully and enjoyed the drive back home. Don't allow the dealer hype ("there's a limited supply" or "these cars sell themselves") to cloud your decision. A car is a commodity; it can be had for MSRP. I encourage you make some calls to out of state dealers and save considerable $$.

 

My dealer in San Antonio was going to charge me a $2500 markup. I said no way and I'll go elsewhere. After threatened to walk out the manager said he was able to give me a "BMW preferred customer discount" and not charge me a markup. He said of the strings he pulled for me, since they never do this without a markup, I had to put a $1000 deposit instead of $500. Not a problem since it comes of the final price. I knew what he gave me a bunch of BS but sales people take advantage of people who didn't do research. I came in the dealership with my mini configured from the website and said this is what I'm paying!

 

Oh then it should be easy to talk them out of the mark up. They can't say "No" because their motto is "Nick can't say no!"

 

Yep the dealer did this & most importantly you've agreed to it.

I swallowed hard paying MSRP for mine. Over sticker NEVER!

 

You should have gotten a pricing sheet that you signed when you ordered the car which includes the $3000 "market adjustment." Feel like you are being screwed, then consult a lawyer about walking away from the deal.

 

There's a multi-billion dollar industry that says you're mistaken, but that aside, the dealer is not taking any risk if the seller is financing the car through an outside institution. And as I mentioned, the dealer gets full payment whether it comes from your personal account or the bank...so there is no motivation to reward a "cash buyer".

And I guarantee BMW FS provides incentives to dealers...

 

Couldn't the OP have bought his Mini from an East coast dealer, gotten it a whole lot quicker, and then had it shipped cross-country? I don't know how much it costs to truck a Mini across the US, but it can't be $3k, can it?

My PA dealer required $1000 down, but made it very clear that was a deposit that goes towards the cost of my car (flat MSRP right off the website). And I got them to inch up another $500 on my trade-in as well. Plus, while they offered me financing through BMW, the finance manager had no problem steering me over to Chase Auto Financing instead because it saved me 1/2% or something. I'm sure Chase has an arrangement with the dealership, but I benefitted so what do I care?

 

Cash means nothing to a dealer. They get their money either way. There's actually more risk with them taking your $30K cash in that someone could come in right behind you and rob them.

Any mark up is too much and cash means nothing.

 

/thread

 

You are correct not only does BMW FS, so does Chase, BofA and others. The dealership gets the money at a "buy rate" which is then marked up. This mark up is where they make back end profit and how the finance dept gets paid.

If you get financing from an outside source not through the dealership then the deal is considered cash.

 

I guess my "IMHO" is too idealistic. On the one side you'd like such things to be simple, but on the other side is reality... too many fingers in the dough.

 

If they told you that everyone charges $3K over MSRP they lied to you. I would find another dealer (an MSRP dealer) and get a quote from them for the same package (there's no committment tied to a quote). I'd then take that quote to my dealer and simply state that apparently they were mistaken, you did find a dealer in the area that doesn't charge a mark-up.

Just know that you can cancel. Also know that you can get your deposit back (California is good that way).

On their side is the fact that your car will be here soon and they know you're excited about getting it. They know that you won't want to start over from scratch. They will balk. They'll say a deal is a deal. They'll say lots of things that will make you feel you should stay with the agreed upon price. Just know that you can cancel. It might be uncomfortable but you can cancel. At that point in time you'll have to decide to either take a hard line, or go along with the original deal. Whatever that decision is, come to terms with it, accept it, and forget about it (no looking back wishing you had done it differently).

If it were me, I'd cancel in a heartbeat now that I know the truth of it. I'd go buy the car from the MSRP dealership. But that's just me. I'm the kind of guy that would begrudge the whole experience for years to come. It would eat at me. Some folks can just shuck it off. I'm not one of those. Maybe you are.

 

I will reject the car and just reorder with another dealer for MSRP...$3K is a lot of markup. I got mine $350 under MSRP, but will not be getting it until late July. Anyway Mini's policy is full refund of your deposit if you do not like the car. Unless you do not mind giving away $3K....It's all relative.

 

MINI Center is 2500 now??? Wow-a couple of weeks ago the cars only had 1500 on their windshields. buhbye...

When you were down there-did they say they had a bunch of inventory too? (something ironic about that...) They bragged about 150 car stock, and how "they're sure they have something close to what I wanted to order".

 

Dubaian, just to add to the chorus: It sounds like you are getting ripped off. 3,000 dollars is a LOT of money to hand over to your dealer for no reason at all. That is your hard earned money, try to keep it yours! Unless you are rich, and 3K is chump change, then you have two options:

1) Simply tell your dealer you've thought it over, and you'll pay MSRP and no more. Tell him to lower the price to MSRP or you walk. In California, they CANNOT keep your deposit. If he says No, take your business elsewhere.

2) If you are rich, then say nothing and hand an extra 3K over to your dealership. I doubt you are this rich because you posted about this extra 3K to begin with.

I'd take option 1. If he says no, then walk. I wouldn't care about waiting another 2 months for another Mini-order. 3K is a lot of money, at least to me.

Side note: We live in a supply-demand economy, from everything I've read, Mini's can be had at MSRP with nearly no negotiating necessary. Seems your dealer figured you to be someone they could take an extra 3k from. I'd be mad as heck, and back out of that deal FAST!

 

You should be purchasing your mini for 5% off of the final (all add on's added in) MSRP price. Most cars are 10 to 20% off, but the mini's are 5%. Pay anything over that and you are foolish and being ripped off.

 

Have you actually bought a 2007 Mini at 5% off MSRP? Even with the base model at $20k, that would be $1000 off. I could be wrong, but so far from what I read online, I have not seen anyone gotten anything off MSRP other than a free set of mats.

 

Need, I agree. I researched Mini pricing in Northern California in some detail for some length of time before I bought. No way to get 5% off MSRP and especially not 5% of MSRP+extras. Supply-and-Demand, baby... They do have a reasonable amount of buyers for the available production slots.

Birdman, Californians are crazy, and everything here is overpriced. Just check out the housing prices... BUT everything posted here on NAM from March to May says the going rate is about MSRP. +/- 350 or so.... Did you buy an 07 for 5% less than MSRP? If so, great- I hand it to you, you are the master negotiator!

Dubaian- Again, MSRP+3K is a ripoff. MSRP is going rate in today's Supply-Demand balance.