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Originally Posted by stevnmd
Gezon Motors, I know your income is dependant on sales price above invoice, and I wish you the best of luck in your career.
For everyone else:
First, always know invoice price. Be aware, invoice is not REALLY the price that a dealer necessarily pays for a vehicle. Based on volume, customer satisfaction, sales manager's personal relationship with the district sales manager of the manufacturer, floor plan, etc., pricing is negotiable. Never assume that you'll going to get a vehicle BELOW invoice though. Unless you're buying a Honda Accord or Toyota Camry, it probably isn't going to happen without some connections... Also, the dealer is making money with holdback, too. Nissan's is 2% of invoice, plus an additional 1% floorplan allowance.
There are plenty of sites to find invoice price out on. Also, a lot of manufacturer's sites are low listing it, too!
Take invoice and then add whatever you think is FAIR markup on the truck. IMHO $500 is MORE than enough. I usually shoot for $100 and negotiate from there. I refuse, and I mean absolutely REFUSE to pay more than $300 over invoice on a new vehicle. I haven't NOT bought a vehicle yet that I didn't want new.
Make an offer. The worst they can say is no. If they do, call another, and another, and another, and another dealer... If they ALL say no, make a different offer. Maybe $500 over, but a bed extender or whatever you deem acceptable.
A dealer could CARE LESS if you have cash or not. Period... As a matter of fact, they would MUCH rather you finance the vehicle than pay cash.
A common misconception about buying ANY vehicle from a dealership is that if you say it's a "cash" deal, the dealership is somehow going to think you're a God, must be loaded, and royally kiss your a$$. The opposite is true.
Unless you go to your bank, credit union, or whatever and get financing that was arranged by YOU not your dealer, you're dealer's making money off your financing unless you MAKE ABSOLUTELY CERTAIN that they are not.
Dealers have relationships with banks or manufactures finance companies. Most of the time they will get a commission on the sale of the financing. It's usually between $50 - $100. THEN, they ALSO usually get a BIG commission based on the interest rate they get you to agree to. Never, and I mean NEVER accept the rate that the dealer's finance guy first states you got approved for from the bank. The ONLY exception to this is when the manufacture is running very low interest rates as an incentive. The dealership is adding to the interest rate that the bank approved you for. It is up to your state's laws that will dictate just HOW MUCH they can tack on to the rate. NMAC may approve you for 4.5%, yet your dealer will tell you that you were approved for 5.9%. Guess who gets the additional interest? Yup, YOUR DEALER. There's some formula that's used to determine just how much the bank gives them, but they make commission.
With the truck I just bought, for instance... I was told that I was approved through Nissan for 5.9%, which was their tier 1 rate (best) on the Titans right now due to no financing specials currently being run. I told them that I needed the "buy rate". They were not happy that I even understood that term, the sales manager got a little irritated, but I ended up with 4.04%. Umm, that makes a big difference...
Many of you guys make it too difficult to buy a vehicle. Sheesh. Just set a price you're willing to pay and tell the dealer what that price is. If they say no, try someone else... Don't make it harder than it is... Haggling back and forth with a sales manager is just ridiculous. Agree on a price. If you want an extended warranty, tell them you want it AT COST, but AFTER you get the vehicle price set. If they tell you that they don't make money on extended warranties, call their bluff, don't be afraid to tell them you know otherwise, and ask to see the finance guy's price sheet for the DEALER from the warranty provider. They'll more than likely say, "Well, we never do this, but we'll lose some money on it." Or, some BS like that... If you can't get it at cost, tack $100 on as profit. They either take the $100 or nothing... Their choice..
Also, if you are trading a vehicle in, before you even START to talk about the price of a new vehicle ask them for "ACV" of your trade. That's Actual Cash Value. THAT is the figure you can shop around for. Be prepared, it'll be a slap in the face, but like with everything else, it's NEGOTIABLE! The dealer originally told me ACV of my '02 Pathfinder was $16,900. I walked out of there with an ACV of $18,500.
*EDIT*
Oh, and one more thing... For the best price, buy from inventory and buy the last day or two of the month. That's not an old wive's tale. The last day of the month the dealership needs to file his sales report with the regional sales manager of the manufacturer... If they're behind on sales they're looking to move more units in a hurry... Plus, they're about to make another month's payment on the truck if they don't move it...
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