Internet Pricing vs On the Lot Pricing (vehicle, 2014, auto)

[jadedlady]

I recently bought a pre-owned vehicle and did a lot of research online prior to contacting the dealers from my favorite buying site, CarGurus dot com. I noticed the pricing on the internet was a lot less (thousands) than the prices on the same exact vehicles on the dealer's lot, the one that is painted on the windshield. Has anyone else experienced this? Do you think it's because they intentionally overprice ones on the lot for negotiating room, or to make more money on people who don't research online and are clueless about what the cars actual value price should be?

[Ziggy100]

I emailed a dealership's internet sales department about a car once and they came down $4k immediately.
The same works with new cars. I usually shoot for invoice either through my employer's auto buying program, Costco's, TrueCar's, or just flat out email them and tell them this is what intend to pay.
If you order the car from the factory and are patient, you can get exactly what you want for invoice and even skip the stupid dealer add ons like $250 nitrogen and $200 wheel locks.

[unit731]

Originally Posted by Ziggy100

I emailed a dealership's internet sales department about a car once and they came down $4k immediately.
The same works with new cars. I usually shoot for invoice either through my employer's auto buying program, Costco's, TrueCar's, or just flat out email them and tell them this is what intend to pay.
If you order the car from the factory and are patient, you can get exactly what you want for invoice and even skip the stupid dealer add ons like $250 nitrogen and $200 wheel locks.

Couldn't have stated any better.

Some people pay full stated price - new or used.

[notnamed]

Absolutely. If you're on the net they know you are seconds away from getting a quote at a competing dealer and have access to pricing tools so they bring a competitive offer immediately.

If you show up to a lot, take a test drive, and come inside to talk numbers you've fallen into their trap. Where they want you emotionally invested in the car that is right outside the door rather than a choice of a few identical ones at other dealerships around the area.

With Truecar and Costco you are still overpaying. Last new car I came in with the USAA Truecar number(less than the general public Truecar) and still managed to come in another $1k below that just by saying I was going to the VW dealer next to test a competitor.

[Ed_RDNC]

Keep in mind that the car sales industry is different than most other sales experiences (in the US).
The sales staff are paid more if they can get more. They are allowed to lie about anything, except what's in writing, and even then sometimes they try.

Invoice Price AND Sticker Price are both arbitrary numbers created by the factory.
In the past, the best process was to start from the sticker, but then Invoice because available (usually through forums like this one, specific to the cars in question). So the dealers got wise and started adding the Extras, like car mats, gasoline fill charge, dealer delivery prep, and other tasks that should be a part of their overhead.

Now, the best process it to get the Invoice for the car, and for each factory extra you wish.
Do a LOT of research (tens of hours) to determine how 'hot' your specific choice is going, in your specific location.
Subtract the Invoice Sum from the average selling price to get the local sellers profit.

Add that to your specific Invoice Car + Factory Adds and any additional mandatory fees.
(My car had a factory mandatory delivery fee $800, and I made the decision that the $100 paperwork fee to the dealer was small enough to eliminate my inconvenience of getting new tags and title processed myself).

Contact every seller within 10 hour drive or so via email. Be polite and businesslike. Offer an amount that includes a 'reasonable for them and you" profit amount. After all, they need to keep in business, but also they are going to spend not more than maybe an hour total salary for the Internet Sales junior person + 10 minutes senior sales. If they order it for you, they're not even out the cost of holding it on their lot.

Make sure you look for all factory and local discounts (aka Trunk Money).

I spent at least 30 man hours over a week doing my research, then doing my shopping and ended up saving at least $4,200 over street retail. Pretty good hourly rate!

[jadedlady]

Thank you all for the insight into dealer pricing. I should have mentioned that I was buying pre-owned, a 2014 model, Mazda CX-5 Grand Touring to be exact. I had been doing online research for about 2 months. I narrowed it down to 3 vehicles; the Nissan Rogue, the Honda CRV and the Mazda CX-5 GT. I wanted the best deal for the money but also the one that I actually liked the best.

During the time I was considering these, I saved them as a favorite on CarGurus dot com. The site makes it easy to compare because it ranks the price in terms of how low or high or in the middle it is based on the current market. Oh and it ranks dealers too from customers reviews.

I also wanted specific things that all models don't necessarily have; backup camera, leather seats, and good reviews. Oh and no black cars because living in the desert they get too hot.

Well twice now I've gone and edited to add more and it's gotten lost somehow. Sigh. Bottom line here now; I think I got a good deal due to the easy way of comparing cars online and I was shocked at the prices on the cars when i went to see them in person.