Starting new car negotation and TrueCar

[Southern man]

I picked a dealer, found the car I wanted in his inventory, looked at pictures of his sales staff on his web site, picked out the salesman I wanted to deal with. I called him, told him what I wanted to buy and asked him to email me his offer. He did and I felt it was a fair offer. He asked me to email him a description of my trade in. I sent him several pictures of it and a description.
He made a conditional offer on my trade. I replied with a counter offer and payment condition($5000 on AMX card) . He said ok if trade in looked good. I went to the dealership the next day and left with a 2017 Acura RDX.

[iamweasel]

A note on TrueCar:

The Truth About TrueCar Savings

[justanokie]

Originally Posted by iamweasel

Getting a price $5K less from one dealer versus 7 others is very unusual unless you're talking about some high dollar car. There may have been some other factors in-play for this one dealer to yield that type of pricing. This is certainly not a normal situation. On a typical $20-$30K car I would say all eight dealers would have been within a few hundred to maybe close to $1,000 difference at the most.

This is exactly what I am talking about. You couldn't be more wrong. Don't get hung up on the 5K. Its all about percentages. You should be able to get at significantly below any truecar price for most cars.

Originally Posted by iamweasel

Maybe the car was aged inventory for them and the dealer has written it down some already, maybe the dealer was on the cusp of hitting the next tier on a stairstep program so they were willing to give one away, maybe there was some pending curtailments coming their way, etc.

I do know that they were trying to sell as many as possible. They were working deals with nearby dealers to soak up their inventory. Mine rolled off the truck that morning. I watched it. Still had the plastic on it and they had to "program" it before it could be driven regularly. I learned they come with only a basic "valet" type of programming and the initial firmware still has to be uploaded. At least thats what was explained to me.

Originally Posted by iamweasel

Here is what I'd be curious to know on your vehicle:

1) What date was it built?
2) What date did you buy it?
3) General ballpark on MSRP of it? (Are we talking a $20K car, $50K car, etc.)
4) Make and model of the car

Those pieces of info might give me a clue as to what may have happened in your case.

Not sure about build date.

last week of June 2014, I don't know when VW comes out with their new models but I am thinking that the TDI Passats run much later than most other mfrs do.

MSRP was about 34.5K if I remember right. I know for a fact that I couldn't get a single dealer in 2 different metro areas down below 33K and change. Thats the price TrueCar gave me..and my credit union.

I drove away with that car out the door total price of 28K

VW Passat TDI SEL Premium

Originally Posted by iamweasel

A note on TrueCar:

The Truth About TrueCar Savings

Its actually worse than that. This started long before Truecar. Back before the internet was widely used, you had to pay to get the real dealer numbers or do business with a bank that would give them to you. So few people actually used this that the dealers didn't really mind the info being out there. When the internet came along the info was suddenly available to the masses. Over time the dealer "invoice" price and "msrp" gap closed from 10-15% down to 3%. Now you would expect a business like a car dealer with so much overhead to be aiming for 15% to stay alive and actually make money. So how is it they can operate on such a razor thin margin....thinner than practically any other brick and mortar business in the world. Of course the answer is that the "invoice' price is far above what the dealer is actually paying.

The way the get around this is with sales quotas and customer feedback scores and many other similar things. This is why some dealers are practically begging you not to submit your feedback review unless your giving them a perfect score. If you arent they want you to contact them and they will do whatever they can to fix that and get a perfect score. Because anything less could be costing them a lot of bonus money back from the MFR.

Same thing applies to quotas.

You have to go find that dealer that is in a position where they will give you a steep discount to gain much more.

Larger dealers that trying to meet volume quotas are ideal candidates to watch for a super deal.

Now you may not be able to find the best deal immediately but if you take some time and spend a few weeks or months looking, you can greatly improve your chances of finding the car you want, at a price significantly below what Truecar users are paying.

[robrobrob]

The car business has changed. For most buyers there are two numbers you have be be concerned with the value of the trade and the sales price of the new car. We have dealt with the same dealer twice in the last two years. Each time they game me the price of the new car up front that was lower than True Car. For one we had a trade so had to get the trade appraised. The other one didn't have a trade.

Start off with an email asking for a price. Pick a specific car on their lot.

Good luck.

[iamweasel]

Originally Posted by justanokie

This is exactly what I am talking about. You couldn't be more wrong. Don't get hung up on the 5K. Its all about percentages. You should be able to get at significantly below any truecar price for most cars.



I do know that they were trying to sell as many as possible. They were working deals with nearby dealers to soak up their inventory. Mine rolled off the truck that morning. I watched it. Still had the plastic on it and they had to "program" it before it could be driven regularly. I learned they come with only a basic "valet" type of programming and the initial firmware still has to be uploaded. At least thats what was explained to me.



Not sure about build date.

last week of June 2014, I don't know when VW comes out with their new models but I am thinking that the TDI Passats run much later than most other mfrs do.

MSRP was about 34.5K if I remember right. I know for a fact that I couldn't get a single dealer in 2 different metro areas down below 33K and change. Thats the price TrueCar gave me..and my credit union.

I drove away with that car out the door total price of 28K

VW Passat TDI SEL Premium



Its actually worse than that. This started long before Truecar. Back before the internet was widely used, you had to pay to get the real dealer numbers or do business with a bank that would give them to you. So few people actually used this that the dealers didn't really mind the info being out there. When the internet came along the info was suddenly available to the masses. Over time the dealer "invoice" price and "msrp" gap closed from 10-15% down to 3%. Now you would expect a business like a car dealer with so much overhead to be aiming for 15% to stay alive and actually make money. So how is it they can operate on such a razor thin margin....thinner than practically any other brick and mortar business in the world. Of course the answer is that the "invoice' price is far above what the dealer is actually paying.

The way the get around this is with sales quotas and customer feedback scores and many other similar things. This is why some dealers are practically begging you not to submit your feedback review unless your giving them a perfect score. If you arent they want you to contact them and they will do whatever they can to fix that and get a perfect score. Because anything less could be costing them a lot of bonus money back from the MFR.

Same thing applies to quotas.

You have to go find that dealer that is in a position where they will give you a steep discount to gain much more.

Larger dealers that trying to meet volume quotas are ideal candidates to watch for a super deal.

Now you may not be able to find the best deal immediately but if you take some time and spend a few weeks or months looking, you can greatly improve your chances of finding the car you want, at a price significantly below what Truecar users are paying.

In your case, the dealer you were dealing with exhibited a type of behavior seen when trying to reach the next level on a stairstep program. When they are giving them away yet trying to get more cars from dealers at the same time that is a signal.

So maybe they took $3K losses on about 10 units to get there ($30K loss), but if that gave them an extra $1K discount per car retroactive to the first through final 50th unit of the month ($50K gain) then that would be $20K in additional gross profit that month.

That's why info on stairsteps and what vehicles have them is so hush-hush. If consumers knew the program existed on a vehicle they may want they could wait until the end of the month and possibly get a screaming deal if the dealer needed to move more units to hit their goal.

I found this online:

http://www.autonews.com/article/2014...r-step-bonuses

So VW ran a stairstep on the Passat in the first quarter so maybe they ran one after that, too.