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Who cares what a dealership makes on the sale. If they are losing money then they should not be selling the car at that low of price.
You make an offer on a car. They take the offer or they don't take the offer. Who cares what they want, what are you willing to pay? If you look at a car that you like, how much do you think it is worth?
The only thing that matters in a car sale is how much are you willing to pay and will they accept your offer. If they don't take your offer you walk.
I used to work for the dealer floorplan division of a large US bank. We underwrote and managed the inventory turnover for dealers all over the southeast.
Our only dealers that routinely lost money were new, domestic branded dealers, and only on their sedans, occasionally a coupe. They sold so many into rental car fleets, and barely broke even, then got a kickback from the manufacturer. The SUV's and pickups they sold, they always sold at a profit, then we would get our repayment on the floorplan note based on the VIN of the unit sold.
The foreign dealers like Lexus, Honda, Toyota, BMW, etc., always turned a profit on every new car they sold, even their small cars. Big markups. The manufacturer didn't pay them back as much, like the domestics did, but they made bank.
Especially Toyota and Lexus and Honda. We didn't deal with used car only dealers, but the new car dealers that also sold used, didn't lose much money regularly. Just the occasional deal when they needed to move a unit.
I wouldn't trust Carfax. If you are buying a used Honda from a Honda dealership. It's right there for them to look up any info. Unless the previous owner didn't service it at Honda.
OK, I just talk to someone in the service department at the dealership and he gave me a list of the things that they did to the car to get it ready to be sold at their standards:
6 spark plugs replaced
Right front wheel baring replaced
Right front dust boot replaced
Right & left center rollers for sliding doors replaced
Right reverse tail light lense replaced
Oil press switched replaced
Cabin air filter replaced
Windshield wipers replaced
Timing belt replaced
Transmission fluid
Cooling system serviced
Oil change
Smog certificate- passed
Replaced engine air filter
Valve adjustments
... He said they do a thorough inspection on all their vehicles and are proactive and often replace things that "might be fine as is, but don't want to take chances on customers" which I can't tell if he is being honest or if that is a line of BS at this point I already bought the car so he would have no reason to lie about it.
Should I be worried that so much work was done? I feel like a fool, I had thought all of this would show up on car fax. I do know my hubby lifted up the hood and looked at the engine- asked a few questions and seemed satisfied... granted he isn't much of a "car" guy, I trust his judgement over mine because I'm clueless lol
Dealers do not really make much money on NEW car sales. For most mainstream vehicles, they do little better than break even mostly. The money comes from used cars, service and parts/add-ons.
OK, I just talk to someone in the service department at the dealership and he gave me a list of the things that they did to the car to get it ready to be sold at their standards:
6 spark plugs replaced
Right front wheel baring replaced
Right front dust boot replaced
Right & left center rollers for sliding doors replaced
Right reverse tail light lense replaced
Oil press switched replaced
Cabin air filter replaced
Windshield wipers replaced
Timing belt replaced
Transmission fluid
Cooling system serviced
Oil change
Smog certificate- passed
Replaced engine air filter
Valve adjustments
... He said they do a thorough inspection on all their vehicles and are proactive and often replace things that "might be fine as is, but don't want to take chances on customers" which I can't tell if he is being honest or if that is a line of BS at this point I already bought the car so he would have no reason to lie about it.
Should I be worried that so much work was done? I feel like a fool, I had thought all of this would show up on car fax. I do know my hubby lifted up the hood and looked at the engine- asked a few questions and seemed satisfied... granted he isn't much of a "car" guy, I trust his judgement over mine because I'm clueless lol
So it sounds like you bought a used Honda at a Honda dealership that they did a full inspection on as well as a major service. If they did all that, it's about $1200+ worth of service at the retail price. It sounds like you have yourself a nice vehicle. I wouldn't be concerned about the amount of service, just that it was done.
So it sounds like you bought a used Honda at a Honda dealership that they did a full inspection on as well as a major service. If they did all that, it's about $1200+ worth of service at the retail price. It sounds like you have yourself a nice vehicle. I wouldn't be concerned about the amount of service, just that it was done.
Good luck.
Phew!!
I think we'll still take it to a local mechanic for a look-over just to be on the safe side but that is reassuring to hear (like I said I am clueless when it comes to cars).. And yes it was a used Honda at a Honda dealership that I've heard good things about
He made some money on the car. Remember that the price quoted for the work done would be at retail, so you might have $1500 in work at retail with the timing belt and all other service parts. However, their cost is not the same as they would quote to a customer as the mechanics already work there, so the labor cost is a fixed cost of the dealership when they are working on the cars to recondition for sale. He probably lost the exorbitant profit margin built into that Odyssey, but wanted to close it out at the end of the month, possibly to make a bonus level, so a small profit is better than none. And, the dealership made money because they were able to sell a new car to the former owner, so the net profit was definitely in the positive when considering both sides of the transaction.
If you know people who have had good experiences at the dealer, and since it is a franchised Honda dealer selling a pre-owned Odyssey with the reconditioning work done, I would not be worried. It sounds like you got a good deal on a serviced Odyssey that should give you some good years of service. It sounds frightening with the Escape, and I can see that they would just sell that car at auction, since it's not the kind of vehicle that they would likely sell.
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All the world's a stage, and all the men and women merely players: they have their exits and their entrances; and one man in his time plays many parts, his acts being seven ages.
~William Shakespeare (As You Like It Act II, Scene VII)
Sure, they can "lose money" on certain units. It's not about making money on "a" car but making money overall. Sometimes it's to push for lucrative stair step bonuses at the end of a sales period, sometimes it's to make room for incoming inventory, to get the thing off of floor plan for another month, or whatever.
Also, if the car was a trade in, they can work numbers 100 different ways. Maybe it was a "loss" if you just consider what they gave on trade and reconditioning, compared to the sale price of the new vehicle. But that "loss" on the used car they sold you, doesn't factor in the manufacturer bonuses that they got for moving the new one, or the $3500 of paint protectant, VIN etching, brake light flasher, maintenance contract, and whatever else they jammed the new owner with in F&I.
We bought a car!! 2008 Honda Odyssey. Sticker price was $15733.. I saw they had an "internet special" of $12500, I talked to the sales manager before going down there who said his bottom line price was $11900. We got there, saw that the car was in fair condition (advertised as "excellent") and I was able to negotiate down to $10800! Which is almost $5k from the original sticker price. The sales manager said he paid "$11300 for the car when you factor in the detailing and reconditioning that's done to used cars" but that he needed "to sell 10 cars today so he will take a loss on this one if it means making a sale" and then repeatedly brought up how he was losing money on the minivan by selling to me at the $10800 price.
What I don't understand is how car dealerships would stay in business if this is truly the case? I remember my first real car I bought as a teen, the dealership gave me the same line.. Even showed me a paper with the alleged price they paid for it.. Is is all just a line of BS to make consumers think they're getting a good price? My thinking (and I could be totally wrong here, as I'm sure you all know by now I am not well versed in anything car-related ) is that when they know you are serious about making a sale, they just input a number they "paid" and make you think you're getting an awesome price....? I kept reminding the sale man this time around how I wasn't really getting a good price so much as I was paying what Kelly blue book said was a fair price! And how it isn't my fault his dealership had overpriced a van or if they paid too much for a trade-in that needed detailing/minor work/tune up.. the sales man didn't say anything in response to that lol. When he was trying to get me to pay $11900 he kept saying "but we did a thorough tune up and brought it up to excellent standards before selling, and we even offer a 90 day warranty.." To which I told him I didn't care what he did to get the van to where it was- bottom line is it was only worth what I was willing to pay and that I'm not paying more than what Kelly blue book suggested. I told him it's the same when you go to sell a house- buyers don't care how much money you put into the home, it is only worth what the market dictates and what the buyer is willing to pay... He finally just directed me to the sales manager because he knew his sales tactics weren't going to work with me lol.
Do you think the fact that it was the end of the month had anything to do with the alleged "losing money" by selling the minivan? Cargurus.com told me it had been on the lot for 21 days but supposedly the dealership takes about 10 days to detail, inspect, tune up/do anything needed to get it up to their standards.. So allegedly it hadn't actually be available to buy for that long...
Oh, and a huge thank you to those who offered invaluable advice and negotiating tips. I couldn't have done it without your help!!
They could easily overpaid for the minivan as part of a deal where it was traded in by someone who paid far too much for their new vehicle. Several years ago a a local Ford dealer advertised they would pay $2000 trade on ANYTHING. Of course you had to buy a new loaded PU at full price to qualify. My friend took them up on this and dumped a total POS pickup on them. They wrote it up for $2000. A while later she got a call from a salvage yard that bought the vehicle from the Ford dealerhsip asking her how to get it started. It had no ignition switch -- you had to twist wires together.
There are alot of shady things used car dealers do to cut cost. If they get a car with collision damage, they have their preferred s-hole body shop willing to do work for dirt cheap doing horrible repairs.
I go to body shops for my job and I've had shops tell me the crazy things they do. The dealer gives them x amount and they don't care how it gets done. It looks OK on the outside but if it gets into an accident in the same repaired area, it's a mess.
Also, all service they did doesn't cost that much parts wise. Its the labor rate at dealers which makes it expensive. 100-125 per hour at most Honda dealers.
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at this point I already bought the car so he would have no reason to lie about it. 
2008 Honda Odyssey. Sticker price was $15733.. I saw they had an "internet special" of $12500, I talked to the sales manager before going down there who said his bottom line price was $11900. We got there, saw that the car was in fair condition (advertised as "excellent") and I was able to negotiate down to $10800! Which is almost $5k from the original sticker price. The sales manager said he paid "$11300 for the car when you factor in the detailing and reconditioning that's done to used cars" but that he needed "to sell 10 cars today so he will take a loss on this one if it means making a sale" and then repeatedly brought up how he was losing money on the minivan by selling to me at the $10800 price.
) is that when they know you are serious about making a sale, they just input a number they "paid" and make you think you're getting an awesome price....? I kept reminding the sale man this time around how I wasn't really getting a good price so much as I was paying what Kelly blue book said was a fair price! And how it isn't my fault his dealership had overpriced a van or if they paid too much for a trade-in that needed detailing/minor work/tune up.. the sales man didn't say anything in response to that lol. When he was trying to get me to pay $11900 he kept saying "but we did a thorough tune up and brought it up to excellent standards before selling, and we even offer a 90 day warranty.." To which I told him I didn't care what he did to get the van to where it was- bottom line is it was only worth what I was willing to pay and that I'm not paying more than what Kelly blue book suggested. I told him it's the same when you go to sell a house- buyers don't care how much money you put into the home, it is only worth what the market dictates and what the buyer is willing to pay... He finally just directed me to the sales manager because he knew his sales tactics weren't going to work with me lol.
