Car, again

[thistlechaser]

I really want to get this whole buying a new car thing over with. It's been dragging on and on, and it's literally keeping me up at nights. I want to make an offer today, but I'm running into the same problem has been stopping me all along.

Kelly Blue Book (and other pricing sites for new cars) says this for the car I want:

MSRP $24,960
Fair Purchase Price $23,490
Dealer Invoice $23,508

The dealer is quoting me: $22,788

The price is lower than the dealer invoice. Which seems odd, since then they're not making money?

So my question is, since his quote is lower than the invoice price and the suggested fair offer price:
[Poll #1906584]

I could pay his offered price on the condition that they throw in floormats for free. ($100 and change value.)

Comments

[tersa.livejournal.com]

How I would do it is to offer a price lower than what he's offering and see if he's willing to budge off it.

You did your homework. You know how much the car 'should' cost. That serves as your frame of reference to know whether or not you're being overcharged.

But it isn't your job to make the dealer money. If they're giving you an offer under the Fair Purchase Price or Dealer's Invoice, then they have their Reasons (tm). Haggling is expected in deals like this, and the buyer should always be countering with something lower than what the dealer is asking, because the dealer's first quote is the starting high point.

The key is to listen to and interpret how the dealer responds to you countering with a lower offer. If they move off that initial asking price, then they may be willing to go lower.

However, it may be that the /seller/ is offering a less than Invoice price as a 'take it or leave it' because he wants to move it. If he doesn't budge, since you did your research, I'd say go ahead and accept it, because it is lower than the Dealer's Invoice. (And you can still ask for the floormats at that point.)

[thistle-chaser.livejournal.com]

Whew! Good thoughts, thanks. I'm going to try to get this done today, so stay tuned! :P

[loup_noir]

Let's try this again. Stupid satellite.

If I were you, all of my flags would be waving. Dealers make money on cars, not give them away as charities.

Do you have the specs on the specific car? Have you run the VIN through some website (sorry, I can't remember what it's called, but it's to help buyers avoid lemons)? Has it been in any accidents (bent the frame, perhaps?)? Have you inspected the interior? What is the deal with this?

Now, good deals do happen. When we ditched the van and bought the Toyota truck, we lucked out and got exactly what I wanted, with low miles, and for a good price; however, the market was such that no one was moving newish cars at the time. They're selling them now, so why is the price lower?

[thistle-chaser.livejournal.com]

Yeah, that's why it was confusing me, too. This is a major Toyota dealership, I'm offering on a generic "Prius 2" car, not any one specific car. The dealership has the best Yelp rating in this area. So I just don't get how they can be offering as a starting point a price where they seem to be losing money. And people might haggle them down further?

Maybe I'm misunderstanding "Dealer Invoice". *googles*

Dealer Invoice
The dealer invoice is the price the manufacturer bills the dealer for the vehicles they purchase, plus any options equipped. This is in essence the dealer's cost, and is not generally shared with the customer.

So I really don't get it...

[tersa.livejournal.com]

Reading through loupnoir's comment: you haven't indicated in any of your posts whether this is a new-new car (as opposed to 'new to you') or used (or nused).

Countering loupnoir, if it's new-new (very low mileage), then I would be less suspicious as if it was "nused" and you're getting that lowballing.

[isiscolo.livejournal.com]

I think that there are often factory-to-dealer incentives/rebates which lower the dealer's actual cost. http://money.cnn.com/magazines/moneymag/money101/lesson17/index7.htm and http://money.cnn.com/magazines/moneymag/money101/lesson17/index8.htm suggest there might be $500-$750 (or more?) of rebate that effectively lowers the dealer cost.

The dealers make their money on all the add-ons (like floormats :-) so I expect they don't mind making only a hundred bucks or so (after rebate) on the actual car.

But you know, if you're happy with the price, why not just buy it?

Disclaimer: I have never bought a new vehicle, only used ones.

[thistle-chaser.livejournal.com]

New-new, not new-to-me!

[thistle-chaser.livejournal.com]

Ahhh! That makes sense. I think their offered price is fair? (What do I know about car prices, but it is lower than the price KBB listed as "fair", so...) So if he rejects my offer, I'll likely just pay the sticker price (and try once more to get the floormats for free).