My dealer experience today

The point of a power seat isn't because people are too lazy to move the seat manually; well most of the time. It's that you get a lot more adjustment out of it and wider range of people can find a position they like. Look at how popular the seat riser mod is here. A power seat eliminates the need for that.

 

Sorry man. While I understand that you don't like/want power seats, your arguments against them are just getting sillier and sillier.

 

It is actually quite a crazy -- and fascinating -- business. One I would not want to be a part of but interesting nonetheless.

In fact, many dealers lose money on new car sales but they make it back on incentives from the manufacture. This is a whole new world and not like the dealer model we all know several years ago. Here's an interesting take -- backed by a few facts and comments from dealers:

As one Florida dealer explained to Automotive News, “We are forced to put current customers into new vehicles much faster than normal. We lose $2,000 or $3,000 per vehicle to do it, but we need to hit our objectives to get our $100,000 bonus.”


Link:
https://www.forbes.com/sites/jeremy...itable-for-most-auto-dealers/?sh=73b313047b14

 

Reread your example again, and ask yourself if you believe everything a car saleperson says (especially to a public information distributor)... and even if you do, ask yourself how a dealership is "losing money" in this scenario.

Making money is a science in car sales, just as it is in insurance or any other large industry. They design and redesign their entire industry to wring as much money from a sale as possible, and very few individuals even realize the scale of manipulation they are experiencing when purchasing a new car. Most people walk into a dealership and extend their hand to be shaken, noticing the sincere smile and friendly twinkle in the eye of the person that they meet. Right away the dealership's intent is to make you feel a friendly vibe, to trust. Dealerships don't sell a car if they aren't making money. The amount of money they make on a sale often depends on how the customer perceives that sincere smile and friendly twinkle.

But every step of the way through the process has its own money pits designed to make the dealership money. Every step.

 

This. Don't buy a car right now if you can help it. And don't trust the dealer websites. Last time I checked mine had 20 or so tacomas on the site--none in the lot. If they don't have local pictures of it, assume it's not there.

And a dealer isn't going to negotiate on a Tacoma when he's got 3 on the lot and probably stay there less than a day or two.

 

They are all legitimate complaints. Ask anyone in the standing desk industry... No seats are the future.

 

All of the dealers that I called in Wa, Ore and Idaho (7-10 total) are doing something similar but closer to 5-7k in an aftermarket upcharge.

 

1) "bare bones" doesn't mean what it used to mean. Today's "bare bones" has cruise, air, power evertything, all the safety equipment, etc. Bare bones used to mean rubber floors, vynl, manual transmission, no power steering, no air....and you know what? I'd STILL take a lot of that.

2) 32k for a 25k msrp truck? OUCH.

 

That makes sense. In my particular example (my 2010) I have a bench seat, so limited adjustment in the first place.

I do agree too the ability to fine tune it helps. Plus if it's a frequently shared vehicle and there's a memory option it saves fiddling with.

 

That last sentence. Just good business sense regardless of the item. Why should they?

My bare bones 2010 single cab had no intermittent wipers at purchase. LOL

 

You got me there. I got that in my 2019 SR. Ridiculous. I just use rain x now.

 

I believe -- and there is plenty of anecdotal evidence to suggest -- that a great many car dealers actually lose money on total new car sales in order to move the kinds of volume that earns them bonus payments from dealers. And those bonus payments can be substantial. I am not saying that they are losing money on the whole business in that scenario -- they are making it on the back end. Which has been validated by numerous sources.

I agree with you that the entire car manufacturer / car dealer industry exists to wring as much money out of every sale as possible. As long as people are not doing anything illegally, I have no issues with that and applaud them for doing so. That is their business. But that motive is exactly what drives them to lose money on car sales so they can make it up on the back end. Dealers understand there is a difference between top line revenue and bottom line revenue and profitability and they are the absolute masters of that "science."

You keep saying that dealerships make money selling new cars. I totally agree. But there are different ways to do that and the best way, at least up until the pandemic, was to push high volume sales with low or no margins (if they hook a fish that is naive that is icing on the cake and the simple take more margin than they expected). In the example from the article that I linked, one dealer actually made 100K in incentive payments from the manufacturer. You would have to sell a ton of new cars to make that amount -- when you factor in all of your sales, general and administrative overhead and other expenses.

In any case, the point may be moot. In the current environment we are in, with limited supply, they can make it up on the top line ... and they are:
https://www.roadandtrack.com/news/a...lerships-had-their-most-profitable-year-ever/

In any case, probably way off topic, but still a pretty interesting / fascinating discussion. At least for me.

 

Offer to pay cash and actually mean it. That is how I bought my wife's Tacoma. Sales guy hated me for lowballing him but he got his end of the month sale for doing next to nothing.

 

True , but if you know their tricks one can walk away ok. Example. get a good price on a new Tacoma you like , do not do trade in , and once in that paper work room decline all extra fees + service plans (extended warranties, GAP....) . This is especially true for Tacoma's because used they don't depreciate that much.

 

Wow! That's in Pro price territory.

 

This is the flip side of the big $$ people have been getting on Carvana for their used Tacomas. Best to hold on to the vehicle (and the house) you have now until the madness calms down.

 

Shop your financing and know what you can get before going to the dealer, let them try to beat it with in house financing. They make money off of financing and if they can beat it, you both win.

If you have a trade watch the numbers of the vehicle you are purchasing and make sure they're just not moving money from one to the other. Know what you want out of your trade and don't budge. Also, negotiate the price of the new vehicle first and tell them your not sure if you'll be using a trade. Having a trade is good because if gives them the opportunity to make a profit there if they don't on the new vehicle.

Ignore everything they try to add on through financing... except if you want an extended warranty. Buying it through the dealer is the best place to get it and this is the best time as you can also negotiate the price of that warranty. Lots of reasons and articles on this as to why, I won't go into them here other than to say it's the difference of them fighting to get things covered vs a 3rd party fighting not to get it covered. They make money on warranty work as well.

Cash doesn't talk. Read that again. Cash down doesn't matter nearly as much as it use to. They make more money on every dollar financed vs what you pay them in cash. They will negotiate more on the overall total price if you are financing something versus paying in all cash.

Be willing and prepared to walk if you aren't getting the number you want.

 

I just got offered $40,109 for my 2020 offroad dcsb 6 speed manual with 30k miles on it from driveway.com

So retail would put that about $44k-$45k

 

This isnt a thing. Dealers do not care if you pay cash. In fact it is a negative thing.

 

Exactly, they want to make money on the financing the more cash you put down is money they're losing and will be less willing to negotiate in other areas.