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Why does the car buying system have to be like a high stakes poker game? It's a completely adversarial system and there's no reason it has to be. Why do we need salesmen? Why do we need high pressure sales tactics? Why can't it be like going into Costco and buying a television? Why does it have to be that one customer can walk in and pay thousands less than the one previous?
The whole system seems flawed to me and it seems downright silly to me that to purchase a new automobile I am the one who must jump through hoops of fire, deal with a rogue's gallery of supervillains (like F&I Man- if I want the extended warranty, I'll ask! and Sales Manager...no one gets out alive), worry that the dealership is padding the interest rate, read all fine print to ensure the salesman didn't forge my signature to add a year to my finance contract, and after all that, wonder if I got screwed on the trade-in, or conversely, if I got too much for the trade-in, and got screwed on the new one. One of the joys of life, getting a new car, is ruined by having to swim in the shark tank.
(Scion doesn't seem so bad. Dealers aren't allowed to come off MSRP from what I hear and the MSRPs aren't outrageous for what the cars are. I imagine you can leave the showroom fairly unscathed as long as you can resist the charms of Dealer-Installed Options Woman.)
It's a system designed to maximize profits for the manufacturer (and to an extent, the dealer) and screw the customer all at the same time.
The dealer buys their inventory from the manufacturer. The manufacturer doesn't care one bit whether you haggle for a week straight or pay sticker and walk out. And if you're getting screwed, that just means you suck at haggling.
Because manufacturers and dealers refuse to set a price and stick with it. People want to haggle.
Yep.
I sold cars for a few years in the LA area during the credit boom, and while I certainly encountered some really a-hole, pushy salesmen and sketchy managers/F&I guys, but what I ultimately learned was...
The public wants it worse than the salesmen do.
Seriously. I decided to work purely on a platform of honesty and ease. I could "hammer" people when I wanted, but it was too much work for everyone involved, and I just plain don't like being pushy. What happened was that I had these people who would come in; I'd be up front and honest with them and do what I could to get them at their price. Then, they'd leave, go to a different dealer, and they'd meet some sleazoid guy who would shove them in the car and turn up the heat. They'd buy it. I'd call them the next day to follow up and they'd tell me they bought the same car for five bucks less a month. I'd tell them that I was sorry that I couldn't earn their business, and ask them how the other salesman treated them. They'd tell me the guy was a prick. I'd tell them that I was going to send along some business cards to them and that if they knew of any friends or family members who were shopping, that they could send them to someone honest who wasn't going to stare down the wife's shirt/stare down her shirt/treat them like they were stupid.
It worked. I had an excellent referral clientele.
Nowadays, anyone can print off all the invoice paperwork off of Edmunds and Cars.com and KBB and walk in and "know the real price." Then, they want another $1000 off that. People are so concerned with making sure that the dealer and the salesman don't make a damn dollar off the sale that they don't even know what they want anymore.
Do the car dealerships do anything to alleviate it? No. But neither does the buying public.
Why does the car buying system have to be like a high stakes poker game? It's a completely adversarial system and there's no reason it has to be. Why do we need salesmen? Why do we need high pressure sales tactics? Why can't it be like going into Costco and buying a television? .,,,,
My last two trucks I did purchase thru CostCo. I was given a price thousands under the sticker and given a 7 year 100,000 mile warranty for free. I drove to the dealership and was driving home within the same hour.
If you think buying a car is adversarial, wait till you purchase a home.
But you can have a haggle-free experience if you want it. All you have to do is pay sticker. What's a "haggle-free" experience worth to you?
That is probably the only way to make it "haggle-free" but you will be overpaying. The MSRP is always thousands too high. Why they do that, I don't know, but it seems they could do it better and with a less sleazy feeling.
Everyone (well almost everyone) knows the MSRP is too high. But that hasn't changed for decades so it doesn't mean the "system" is broke. That's the way the system is.
There are three dealers of a American brand car in my area. The one in my town is known to be a sleaze bag, I won't ever buy there. 40+ open complaints with the BBB. The other two are far more ethical. All three do fine, but which one is the biggest of the three? You got it, the sleazebag one. So people are doing it too themselves, all they had to do is type in their name in google and see what comes up.
That is probably the only way to make it "haggle-free" but you will be overpaying. The MSRP is always thousands too high. Why they do that, I don't know, but it seems they could do it better and with a less sleazy feeling.
It costs Coca-Cola way less than a penny to make that 20oz you just paid a buck seventy-five for.
It's the nature of commerce. I think that people are much more conscious of the issues buying a car because a) it's thousands of dollars rather than a buck, even if the markup is less percentage-wise, and b) car salesmen have a worse rep than Coca-Cola.
Location: East of Seattle since 1992, 615' Elevation, Zone 8b - originally from SF Bay Area
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It's because of the big-ticket nature of the purchase, like a house. Some of the bigger SUVs these days cost as much as a house did in the 70s.
I personally enjoy buying cars, and often go with friends to help and watch the fun. as long as the buyer doesn't fall in love with a car, there's always another dealer that will do a little better. Also helps to know when in the month/year to go when they are more desperate for a sale.
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