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How or where can I find out how much the dealers pay the factory? I am thinking about buying a left over new 2014 car but the prices seem ridiculous. I want to offer the dealer a reasonable profit on his purchase but not a lot more.
How or where can I find out how much the dealers pay the factory? I am thinking about buying a left over new 2014 car but the prices seem ridiculous. I want to offer the dealer a reasonable profit on his purchase but not a lot more.
Thanks in advance.
A left over is not going to be a lot cheaper than a current model. You still get a complete warranty because it is a new car.
He could show you an invoice and ask you for $100 over and if that makes you happy fine but that would not be what he really paid.
No car dealer will stay in business very long unless that make a decent profit.
How or where can I find out how much the dealers pay the factory? I am thinking about buying a left over new 2014 car but the prices seem ridiculous. I want to offer the dealer a reasonable profit on his purchase but not a lot more.
Thanks in advance.
What's a "reasonable" profit?
What if the dealer paid $1 for the car?
Consumer Reports offers a (for fee) service that attempts to say what a dealer paid, or in any case to generate what your initial offer should be.
With all the incentives, holdbacks, etc. - I'm not sure a dealer could say exactly what his cost basis is in a particular car. He could (but probably won't) say what "true" invoice cost is - but if you bought a car today, he might make a particular sales goal later in the month, reducing his cost basis or alternatively increasing his profit - and then at the end of the year he might or might not meet another sales goal and be financially rewarded by the factory.
At the end of the day, IMHO you can get a better deal on a car a few years old, buying from an individual. You can check CR for reliability ratings, avoid the ones they label as "turkeys" - and if you check the car over and verify it's not been wrecked, that the engine oil has been changed a few times - for all intents and purposes "good as new".
What car? How much is MSRP? What are they negotiating to?
At the end of the day, it is still a brand new car. So they are not likely to knock unreasonable amounts off just because of the model year. You honestly may be better off with a 2015. Especially if you typically replace your cars within the first half of their lifespan, since that model year difference will also have a significant affect on your resale (unless you keep it to really old age).
How or where can I find out how much the dealers pay the factory? I am thinking about buying a left over new 2014 car but the prices seem ridiculous. I want to offer the dealer a reasonable profit on his purchase but not a lot more.
Thanks in advance.
What do you mean by "the prices seem ridiculous"? Are you talking about the sticker price? That doesn't change, if the guy keeps it on the lot for 10 years the MSRP isn't going to change.
Most dealers will show you the invoice, but that's only part of the story.
Every car has holdback, which is a credit the dealer gets when he pays for the car which is usually when it's sold.
Most cars have rebates. There are two kinds, consumer rebates which have to be given to the buyer (if it's to be applied to the purchase of the car the buyer has to sign a form agreeing to this) and dealer rebates which the dealer can do with as he pleases. These rebates increase the longer the vehicle stays in inventory, up to the point where the manufacturer will eventually just cut the dealer a check for the rebates regardless of whether or not the vehicle has sold (usually after the second model year following comes out, in other words when the 2016s come out for a 2014).
On the other side of the coin is the floorplan. Most dealers finance their inventory through a line of credit for which they are charged interest on a monthly basis. Although it's a sunk cost, some dealers have a hard time discounting a car too deeply if they've already invested several hundred dollars or more in keeping it on the lot. On the other hand, some dealers will cut one to the bone just to stop the bleed.
So the answer is, it's hard to know what the answer is. Do some internet research on the year, make and model for what rebates are available. You should be able to find at least general information on invoice pricing and holdback, as well. And don't be afraid to ask to see the invoice. Once you have all of the info you can gather determine what you consider a fair profit and make an offer accordingly.
But a word to the wise, ask the dealer to quote you a price before you make your offer. Years ago my brother-in-law did all his homework and went to the Subaru dealership armed and ready to do battle only to learn that they did business on a single price basis and didn't haggle on prices. But it worked in his favor because the price the dealership gave him was lower than what his initial offer was going to be.
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