The next time the salesperson asks you, “What can I do to sell you this car today?” tell them something ridiculous like, “Sell it to me for $100.”
That’s because there’s not much money in selling cars. The real money is in financing.
When it comes down to it, car dealerships are in the business of making high-interest loans. That’s it. The cars are incidental.
Yup, and in general in this kind of situation it’s better for the consumer for things to be unbundled. As I said in the other thread, I think consumers would be better served if the traditional salesman simply disappears - they add value for the dealership only if they can trick consumers into taking high-margin extras or financing with large hidden profits; they add little value for the consumer in assisting with the product itself, rather they are seen as an unpleasant and dishonest obstacle to be overcome in the buying process.
The consumer would be better served it the dealerships hired a few inexpensive clerks to deal with customer paperwork, and saved the money that the salespeople take out of the system. Publish a transparent catalog with car prices, making it easy for consumers to shop around comparing like with like; publish financing rates and lease rates separately, with strict regulation allowing customers to shop around for independent financing if they choose.
This is the vast bulk of my job. Just because you’ve read about cars on the internet doesn’t mean you understand all the features a car has, how they work or how they add value to your purchase of said vehicle.
And the sad thing is that while you might be an honest expert, nobody is going to trust you when you tell them that, no really, a left-handed flange scrubber really will extend the life of the car and it actually is worth the markup.
It’s like being a climate scientist without the lab coat!
(You don’t wear a lab coat, do you?)
It’s asking for the close. Salesmen have to ask for the close because very rarely do shoppers just pull out checkbooks. There’s nothing wrong with asking for the close, although it’s certainly possible to do so excessively or in a scammy way.
There’s also nothing wrong with not agreeing to be closed yet.
Which means that a perhaps fairer response to that question would be “Are you making me a formal offer?”
If they don’t hastily back out, then you can consider it seriously, knowing they won’t use it as data towards a less favorable deal.
Yes, all of a sudden they were quite subdued when they knew I was onto them. No more happy, cheerful people. The calls for me to “come in and sign some paperwork” really pissed me off. It was a DONE DEAL.
I would have called 911 so they could arrest him for theft and forgery.
Ha! No, no lab coat but that is not a completely unfair comparison. I guess it’s all about gaining trust with the customers I interact with. People are (mostly rightfully so) very guarded at car dealerships. If I can get them to uncross their arms, I have made a great first step.
And I am an honest quasi-expert (still learning this brand). I never lie to customers about anything. I make no promises I cannot or do not intend to keep. Where I work everything is really straightforward. No four squares, no sketchy anything. When I present a set of numbers to you, everything is itemized: selling price of the vehicle, trade value (if any), your money down (if any), your sales taxes, document fees…all of it. You know exactly what you’re getting into.
Yeah, I suppose we have to do that at some point. My time is as valuable as a customer’s (or anyone else’s), and at some point in the process I need to ascertain of they are ready to buy a vehicle today, or how far out they are in their own minds. Hey, if you’re a long term customer that’s doing vast amounts of research, that’s okay. Let me know, I showed you our car, we drove it together, here’s my card, keep me in mind, may I call you at some point if any incentive programs change or if we offer anything additional on the vehicle? That sort of thing. I do have to ask, politely, what your intentions are.
LOL. I’d certainly backpedal there on that response, but I’d never ask quite so directly for someone’s business to begin with…at least not until someone agrees to see what it would take to get themselves into the car (run numbers, trade appraisal, etc).
I still cannot for the life of me understand how these places that conduct themselves this way still exist. It’s 2018, that should be over.
I at least try to do my small part to treat people with respect and honesty. I guess I’ll die on that hill for the betterment of the business, even if ultimately it’s futile.
Leases are often a better bet for business users. Note the word “often”. You still need to check out the actual costs and what the other financing options are.
The Internet has reduced the number of scams? Just the opposite, IMHO.
A house retains value and may actually appreciate in value. A car loses value steadily and predictably. Apart from tax breaks, if applicable (mainly for business users). the main reason for leasing is that you do not have the large initial capital outlay.
Whichever way you go, the question is always the TCO - Total Cost of Ownership. With older vehicles the lower initial purchase price can be offset by repair costs.
Ditto. Since I generally intend to keep my vehicles for the long run, I buy exactly what I want (make, model, color, and options), and buy new. I know I’m taking a hit buying new instead of used, but am reassured by the fact that I know that all the maintenance has been done, and I figure I make up for the initial hit by keeping them forever. For example, I have a 2004 Toyota 4Runner (that my son is now driving) with 240,000 miles on it.
Interesting. I always show up with pre-approved financing from my credit union, and have never had an issue.
My mantra with car buying is to negotiate the purchase price…period. Nothing else is relevant. I won’t discuss trade-in, payment plans, or interest rates until the purchase price is set, and usually never discuss them. (I bring my own financing, and I can always get more for my old vehicle than a dealer is willing to give me.) Nevertheless, I actually had a dealer pull out a four-square sheet on me during my last car purchase, and got miffed when I laughed at him.
Once, when I went to pick up a vehicle, I had a dealer try to add $550 at the last minute after the out-the-door purchase price had been agreed on (for “dealership fees” and “doc prep fees”, IIRC.). I refused. He told me that “all of their customers paid this fee.” “Not me,” I replied. He said, “I’ve never had anyone refuse to pay these fees.” “Then I’ll be the first,” I replied. (I didn’t pay the fees, and would have walked away if they hadn’t backed down.)
This stuff is just so pathetic. Lat time a dealer tried this (after I’d been crystal clear that were negotiating total all-inclusive price) I said that it was fine, but they would also have to subtract my “hourly negotiation rate” and “contract signing fee”, which came to $650.
But of course, the far more egregious example of this nonsense is in medical billing. It’s like you pick up a loaf of bread from the supermarket shelf, there’s no prices displayed, and when you get to the checkout you get a bill listing 30 separate items:
wheat harvesting fee, milling fee, chaff disposal surcharge, yeast technician fee, 45 minute oven fee, fuel charge, cooling supervisor, assistant cooling supervisor…
Some of you are far more forgiving than I am. If a dealer is trying to add antenna wax, or some $500 fee above the agreed price, I’m not going to make them fix their sleazy ‘error’, and then buy their car; I’m going to leave. They don’t deserve a dollar or a minute of my time.
I always forget which Tarantino movie that’s from…
Here in Northern VA the large used car dealers seem to all be “no haggle.” The price of the car is the price and if you don’t like it walk. This is of course before all the bullshit extras.
I had the financing guy try and sell me a warranty on my used Honda accord to the tune of $3,300. (the car itself was only $16,500) I kept saying no and looking at my watch he became progressively less friendly and took it down to around $1,200 before he quit.
The last new car I bought was in the mid 90s and I have been buying used ever since.
Can someone tell me the year when it became a necessity to buy an extended warranty on a brand new car? Such things didn’t exist for me in the 90s, and since you have to do all of the maintenance to abide by the warranty anyway, you are probably better off not taking it and putting the money in an account for a rainy day.
OH well ymmv
Most of those extended warranties are junk. The only ones that might be good are those that are offered by the manufacturer.
Oh yeah I finally remembered this story from This American Life talking about a Jeep dealership in Long Island which has a monthly sales goal to hit. if they don’t hit it then the dealership doesn’t get their montlhly bonus from the manufacturer. It could run as high as $85,000 which could decide whether or not the dealership ended up in the black or not.
it is an interesting story. Their goal this particular month was 129 cars and they thought they had hit it with about a day and a half to go but then suddenly realized that they were 2 cars short.
It is eye opening as these are the types of things that you never really know dealers have going on. At least I didn’t.
Totally agree on both fronts.
The reason owning a car has no great appeal to me if that I can’t figure out the desire to maintain a depreciating asset. One that will, over time, run into the ground and become unusable (or, very expensive to continue using). This, in my opinion, is the biggest difference between the two biggest assets most people own - your house and your car. Unless you are trying to get to that sweet spot between no car payments and no major repairs (which I can understand to be a nice savings), what’s the value of owning a car for as long as possible?
I bet the response to my question above is that it is cheaper in the long run to own a car - besides the years with no payment, you probably don’t have too many serious repair costs if you’ve maintained the car the whole time. And that’s perfectly valid. But there is also the fact that a car is a place that you spend a great deal of time, so there might be value in having some luxury; switching out your car every few years may be a bit of an extravagance, but it is one that some people can justify by how much time they end up spending behind the wheel.