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I would like to see a company use publicly available MV data to canvas every car buyer and publish their bill of sale online (minus personally identifiable info of course). This way we, as car buyers, can establish a true market value for all the components of a car deal.
Edmunds claims to do this with their TMV, but they are intertwined with generating sales leads for car dealerships and I don't trust them any more than I do the car dealers and salesmen who are a proven and verifiable lot of cheaters.
The biggest reason car salesmen continue to rip us off is because we let them. They control the data, and that is why we have to work so hard to buy a vehicle without getting ripped off.
If all, or most, bills of sale with complete details were available in a database, we could establish the market value of the car, the market value of the upsells and other dealer-added nonsense, and the market value of the financing package.
We need a better way to figure out how the car salesmen are swindling us. We have the data as car buyers. We just need a way to share it and manipulate it. In other words, we need to establish a centralized source of sales data.
This could be sold on a subscription basis to the public. I'm sure most car buyers would eat this up.
Marc, didn't Saturn do it that way, back in the day? They are long gone because the cars were not that exciting, but I think many people liked the sales process.
Is it really true that paying cash never allows you to get a better deal like it did in the old days? What about for used cars?
Generally IMO it doesn't matter.....as a salesperson all I cared about was selling the car....I wouldn't even mention the finance end of it. Once sold the finance manager could deal with this.
Marc, didn't Saturn do it that way, back in the day? They are long gone because the cars were not that exciting, but I think many people liked the sales process.
I am one of those people that liked the sales process.... Pretty much like going to a retail store without the back and forth. I for one wouldn't mind more dealers offering that experience.
And there is the rub. Car salesman are a nuisance and don't add any value to the sales process. They were never there for the customer. They are all there to get paid (which in itself is not a bad thing but the problem is you don't add any value, why would I need to pad your wallet)
I'd rather that money go to the dealer or manufacturer as they put up all the risk and hard costs.
In the interest of repeating myself........I would go and pick up a customers car for service when it was inconvenient for them (it's actually how I got my current job). I would help provide a loaner (we still had demo's back when I sold) or my loaner to a customer.
I taught two customers how to drive a standard. I helped another get an engine at no charge from the manufacturer.
Granted you aren't likely going to find this in a high turn over big city dealer today but you still do (outside of the demo use) find it locally. So my point is, not all things are the same everywhere.
I've read through some of these posts and I'm amazed at the entitlement that some people have. They expect the dealership to just hand over a vehicle at no profit. The holdback that everyone feels entitled to receive is not yours to have. The holdback is a small percentage of profit on the back end that is between the manufacturer and the dealer and paid out only after the vehicle has been sold and warranty registered. No dealer is ever required to show the holdback or even offer it. In the past few years it has become almost expected that the dealer show and offer their holdback.
Every manufacturer is different with their holdback, but the number I see being thrown around on here is 3%, so let's use that. If you walk into a dealership and expect the dealer to sell you a vehicle at invoice price, plus incentives and rebates, that leaves him with a 3% profit that will not be paid to the dealer immediately. A 3% margin on a $50k vehicle is $1500. For a lot of customers this still isn't good enough and they want part of that, which unfortunately I see some dealers willing to offer half of their holdback. That leaves 1.5% ($750) for the dealer to pay the sales guy, finance guy to complete the paperwork, sales manager, title dept, detail guy, advertising, electric bill, water bill, etc. See where I'm going with this?
The new car department of a dealership makes a lot less money than what everyone thinks. The service department is the bread and butter of a dealership. I know several dealers (large dealers) who could actually take a loss on the sales side and still be very profitable at the end of the month because of their service department.
What's even more baffling is that quite often the local used car lot selling a 180k mile, $5k junk car is making more on that sale than the big franchise dealer selling a shiny new $50k car that is under warranty with no miles.
Next time you try selling your home using a realtor, which will most likely be a much greater amount than your average vehicle, ask the realtors to work for you for only a 1.5% commission. Walk into an Apple store and ask to see invoice on a new MacBook and tell them you're only willing to pay invoice. The automotive industry is the only industry that I can think of where everyone loves the product they're buying, hates the establishment offering the product and expects to pay the same amount the dealer is paying.
You are showing exactly why the industry is corrupt. The very fact that there is a secret "holdback" is evidence of the corrupt structure. That is why the auto dealership business is hated and despised. Lots of secrets. Lots of hustle. Lots of con.
The term "holdback" is poetic irony. Because that is what auto dealers are great at: "Holding back" on honesty, transparency, and the cost of their product.
If I received a fantasy statement such as this, I would be quite happy:
Cost of car: $40,000 all-in
Dealer-added items at cost: $2,000
Dealer profit: $5,567
My cost: $47,567
Now I can shop and if the industry standard profit is about 13% of the cost of the vehicle, and that is what they all get plus or minus based on their cost structure, and I am not able to drive any dealer down below that, then I know I am getting an honest deal, the dealer is getting an honest profit, and we can move on.
No secrets, no hidden MTD incentives, no upsells, no holdbacks, no F&I thugs making clerical errors, no con merchant salesmen playing good cop bad cop to rip off some stupid plumber or bank teller who doesn't know any better, no nonsense.
I HAVE NO PROBLEM WITH AN HONEST PROFIT, NO MATTER HOW HIGH. I EXPECT CAR DEALERS TO MAKE A NICE PROFIT ON PROVIDING AN HONEST SERVICE.
I want the ability to operate in a free and transparent market. As it stands, we have the opposite of that, with most car dealerships operating as quasi-corrupt organizations.
Marc, didn't Saturn do it that way, back in the day? They are long gone because the cars were not that exciting, but I think many people liked the sales process.
Yes, I think the problem was the cars, not the process. Over time, we are going to go back to something like this. People generally hate car dealers and car salesmen. Social darwinism will one day change it all.
Notice how the car salesmen think they did a good job if they swindle someone but he is "happy"?
Selling someone a car for what they offer is not swindling anyone.
Quote:
Can it get any more sociopathic? Perhaps a new dealership model could be introduced where all sales personnel are salaried rather than commissioned. As it stands, the biggest hustlers are the ones that swindle people the best, and are vastly overpaid with the swindled profits.
In other words, the best car salesmen, who are the most sociopathic, inflate the cost of cars by the "swindling increment". The best car salesmen sell most of the cars, and do it by using con man charms to pull money out of unsuspecting consumers who don't realize how evil these guys can be, will be, are paid to be, and are admired to be (within their dysfunctional and damp "boiler room" world).
Therefore, the entire car market is skewed because of the "swindling increment", which I estimate to be about $4,000 per car on average for cars selling below $50,000, and MUCH MORE for premium vehicles.
So your position is a 8% profit is swindling someone? If so you get swindled a lot on many things.
Generally IMO it doesn't matter.....as a salesperson all I cared about was selling the car....I wouldn't even mention the finance end of it. Once sold the finance manager could deal with this.
Years ago it could help land a better deal, but not anymore. The dealerships would much rather finance than do cash deals. At times you can negotiate a slightly better deal on the sale price of the vehicle when financing. I get a kick out of car buyers who puff up and say I'm an all cash buyer like they're special and will get a much better deal. At the end of the day it is all the same to the dealership no matter if you are counting out stacks of green or the finance company is cutting them a check. It all ends up in the bank.
I have to laugh, there is a Dealer in my town who actually charges a $1000 "Loyalty Fee" on every purchase. Wait, what??
Their Yelp reviews are about 98% negative, yet people still go there. People are strange.
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