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The first thing you want to look at without getting overly complicated and still getting a good deal is looking at the invoice price of the car you want. The invoice price is readily available online. The invoice is the price the dealer "paid" to the manufacturer for the car including the destination charge. If a dealer sells you a car at invoice, they still make a profit, just not much of one. It can be anywhere from 1%-3% depending on the brand and can even be more than that.
You are right in assuming that smaller cars like the Yaris have narrower profit margins for the dealer than larger vehicles like luxury cars and SUV's. In the case of your Yaris, the MSRP of the various models runs from $12,605 - $14,165. That number does not include options, which would raise the price above that. The invoice rates for these cars are $11,975 - $13,465. So, the average Yaris is marked up anywhere from $630 - $700, not much wiggle room. I would say they should be able to knock $500 off the car to get the deal done. As for low-balling, dealers aren't that desperate to take a loss on a new car.
Since you were also considering the Hyundai and are someone who tends to hold onto cars, while the Yaris has good long term reliability, the 10yr./100k mile warranty on the Hyundai buys you a lot of confidence. Not to mention that the car itself is several thousand cheaper and to be frank, there isn't that much of a difference between Toyota and Hyundai these days.
Right now Yaris is 0% for 5 years, in my area, so I'm not sure if financing makes any difference. There is also a $500 back alternate choice. Depends on your area, see Toyota website for options. Truth is, 0% is hard to beat, unless you are getting a really good deal.
A lot of 0% offers are in leu of other incentives (cash back offers). Depending on your credit, it's usually better to take the cash discount and pay off the vehicle next month if you have the cash - taking the 0% usually means a higher sales figure.
Mike, that is exactly what I will do. Thanks for the advice. I have already called three dealers, btw. Only two have what I want in stock. I do have some time--I have the car for 200/week, so I can definitely do a little leg work. If it saves me 1000 dollars to look another week, I still save 800 even with the cost of renting.
I don't know if it is realistic to expect to save 1000 on a 14,000 car. Everyone I talk to says, offer 9000--they are desperate! It's a recession! I think these people may be nuts, however. I was hoping to get better advice on a car forum.
No Toyota dealer will sell you a Yaris for $9,000. That is below true dealer cost (which is usually below invoice). If you were buying a Suburban you could probably get $$$ off MSRP.
Research your car on Edmunds.com. They will give you guidelines of what other people are paying for the car. You need to give your zip code because pricing varies throughout the US. You also need to specify what options you expect the car to have.
Someone already pointed out that there is a $1,000 rebate or incentive on Yaris now. Otherwise it looks like a Yaris 3dr hatchback is going for about $500 over invoice.
Thanks so much to all the people who took time to reply. The web pages (edmunds, the Toyota page, etc.) were god sent. I now have a notebook page with MSRP and invoice price for the Yaris and for two other cars, Kia Rio and Nissan Versa 1.6. I made phone calls all day yesterday whenever I could and am off for my first test drive this morning at nine. It would be nice to have a new car tonight; I will report.
I took a Yaris for a test drive when I was looking for my last car. If you're tall, you should be fine. But if you're short, you might feel boxed in. The window ledges are very very high, and I felt claustrophobic inside the thing.
Thanks, everybody. I bought the Nissan Versa. It is a 1.6 L engine with a stick shift and air conditioning. It's pretty much just what I was looking for. I'm convinced that somebody who can haggle would manage to pay $1000 less than I did, but I like the car and it's so cheap in general. I did get the rental back to the agency before noon, so I saved $200 for another week's rental. Thanks everyone! Hopefully you will not hear from me for another 15 years!
That's great, Karen! May I ask, what was the deciding factor with the Versa vs the others?
Mike
Mike, I really wanted a stick shift; it makes driving more fun. So what I wanted was: inexpensive but reliable car, stick shift and AC.
I located a Yaris with AC and stick shift, but it was a substantial drive for me. Ditto with the Kia Rio. Embarrased to admit it, but I didn't feel like driving across state to test drive these cars.
The Nissan dealership was close by.
So when I got a reasonable deal on the Nissan, I decided to take it. I like the car, it drives a lot like my Saturn and I read good things about it on line. I read good things about all three: Nisson, Kia, Yaris and also Hyundai.
But--I found the stick-shift Nissan locally.
(I mean, the others were local, but they were a long (hour or more) inconvenient, drive--the Nissan dealer happened to be a few miles away.)
Well, if you truly want no haggle, Scion does the same thing Saturn used to do as far as price goes. Then again, why anyone would pay more for an xD when you can get the Yaris is beyond me.
Mike
My understanding is that Scion dealers are not allowed to discount off sticker. Sticker isn't bad on them for what they have on them and considering they're made in Japan and have import tariffs. They make their money on the aftermarket accessories, which are all overpriced.
There is a good reason to buy an xD, if you ask me. They have a larger engine and are better suited to highway driving...also, they don't cost much more if at all than a completely loaded Yaris S. The instrument panel is in front of the driver, too, unlike the Yaris. Reliability scores are very good for both.
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