chikoo

ooooooooooooooooooooo

Shouldn't I get paid based upon my skills and not based upon what I can negotiate?

Wait. That did happen somewhere in the world. Hmmm where was that?

toy4two

Abolish NADA and instantly the direct sale to consumers like they do in other countries will lower the price of cars 10-20%.

Their lobby is strong. Elon Musk is fighting the good fight but he needs more allies in Washington. I would back a grass roots effort to over turn these decades old and outdated rules. These rules were created before the Internet, times have changed.

Fizzboy7

It's survival of the smartest. Those who do research and their homework know what prices to ask for and how to negotiate. The rest of everyone else, which is mostly everyone, goes in uneducated and the dealer makes good money off of it. Even with the advent of the internet and invoice pricing being revealed, there's still other perks and payouts a dealer takes advantage of under our noses. I don't see the industry changing too much, since they comes out on the winning end most times.

1JZsoarer

But again, what's the question in that sentence? What's the good price for you? Does that price include your trade-in or not? Would you be more inclined to do a purchase if there was some extra parts delivered with the car? What about service reputation, doesn't that factor in the price you're going to be paying? What's the good price for the dealership? If they accept to sell you the car at invoice, how will they pay their staff, their buildings?

There is more to it than the ''right price''.

Joeb427

iTrader: (1)

I'm in the minority but I enjoy the haggling game with dealers.

tex2670

I sort of agree. I don't like the process while I'm in it, but I do get a sense of satisfaction at the end of it when I've ended up with a price that's below the Truecar or Edmunds price.

In the end, I just don't see the no haggle strategy being good for the consumer--dealers would (and I'm sure those that have shifted that way do) find a way to make it work in their favor. They can easily set the no haggle price above the average selling price for a vehicle, and come out ahead while making customers feel they got a "good deal".

I don't have any problem with the system the way it is--let those that want to do some extra work get rewarded. To me, the bigger issue is ridding the industry of dishonest dealers.

keyframe13

I never purchased new cars but people who do I think they are willing to pay the full price. I really don;t see why the NEW car prices should be negotiable. You don;t negotiate the price of a new TV in the store do you?! It's brand new, it's nothing to negotiate. Of course from time to time manufactures have rebates, sales etc.. but the new price should be the price
On the other hand I hate dealers who won;t negociate used cars prices. There is no way to evaluate precisely a used car. You don;t know how the previous owner treated his car, how he drove it etc.. Used cars should be negotiable.
That's my 2 cents

tex2670

This is totally false. Big ticket items such as a TV or home appliance are DEFINITELY negotiable as to price. Maybe more negotiable in a mom and pop store as opposed to Best Buy, and not in the same way that car prices are negotiable; but you can definitely do this. You walk in to an electronics store and tell them you saw the same TV on Amazon for less money plus free shipping, and show them proof--they may not price match, but you'd be surprised.

keyframe13

How can that be TOTALLY false? Are you telling me that if I go in any store I can negotiate the big items prices and the managers WILL agree?! That would make it TOTALLY false. In reality some might do some might send you to buy if from amazon.
I did mention that dealers might have sales if stock is big, or manufacture might have rebate. My point of negotiations is that you cannot negotiate like you'll do with a used car. Especially if there is an all new model it's little room to negotiate as the demand is high.. Next year you have higher chances to get some rebates, etc
Like no dealer wanted to stay with 30 2013 Lexus IS when the 14 was coming in stock for the same price and was redesigned.

Infra

iTrader: (1)

Ideally, it'd be nice to not have to haggle, simply for the sake of not having to haggle.

However, in every situation, the advantage of the "no haggle" environment always lies with the vendor (dealer/manufacturer/whatever). If you think dealers are bad at adding "market value" charges, wait until the manufacturer artificially limits supply.

Bartering ensures both parties obtain what they feel is the best deal. Sure, some deals may be better, but for a single, specific transaction, the negotiation ensures the best deal possible for both parties.

keyframe13

It makes little sense also I think, to try to save yourself few pennies on a new car as a new car looses 30/40% of the value in the first 2/3 years Saving 1-2k shouldn't be your main concern if you're buying new

tex2670

Perhaps we both should have been more precise in what we said. You asked if you negotiate the price of a new TV in a store? If I'm buying at Walmart, probably not. But at Best Buy or a mom and pop shop, my answer is "Yes, I absolutely give it a shot." I did not mean to imply that everything is negotiable--that is not correct. But many big ticket items are--people just may not realize it. You may not negotiate the same way that you do with a car, but expensive electronics, home appliances, power yard equipment, jewelry, etc--you definitely have a shot. Even if you just offer to pay cash.

My wife got an extra $5 off her purchase at Bed Bath & Beyond because the line was slow--she complained, and the manager offered. I just did it a couple of months ago for shoes at REI--"Oh, that sale price was only on the brown style, and not the black? The salesman never said that and now here I am at the register--I never would have bothered if I knew that."--OK, 20% off. I would categorize that as "negotiating" with the store as well.

And, by contrast, you can't negotiate the price of every car; some models just sell too well, and certain dealers won't budge. But, that does not make it inaccurate to say that car prices are negotiable.

So, when you ask "You don't negotiate the price of a TV", I don't agree with that, so I see it as a "false" statement as opposed to a "true" statement. I think you would find a fair amount of people that cut themselves a better deal than the listed price on expensive items.

dsw13

I agree. You really do need to negotiate with an eye towards invoice as opposed to MSRP. Recognizing that the dealers and manufacturers are well aware of the information available on the internet, the best bet is to always keep in mind that you never know as much as you think you do about dealer cost, regardless of what cites like Edmunds and KBB tell us.

When looking to purchase a car for my wife a little less than a year ago, I stumbled across this website: http://www.fightingchance.com/, which I found both informative and enlightening. The guy running the site has been helping people purchase cars for over twenty years. His theory is essentially that the automotive business adapted a long time ago to the wealth of information that is readily available via sites like Edmunds and KBB and has shifted its business model as a result. As an example, he lays out statistics showing that twenty years ago, the typical markup between invoice and msrp was around 15-18%, whereas today is closer to 6-8%. Recognizing that dealerships could not survive such a drastic drop off in markup, he surmises that hidden dealer incentives are a much greater factor than everyday consumers realize.

These are not the incentives that you can find out about by simply looking on the web and that less informed consumers are often times unaware of, but true, trade secret level dealer incentives that can easily exceed six figures in a given period (month, quarter, year) for selling a certain number of a particular model. Only the highest level employees at a particular dealer are aware of these incentives at any given time. These incentive are also in addition to whatever holdback the dealerships get for selling each vehicle, which technically allows them to show a profit even when selling at or slightly below invoice before even getting to incentives.

He goes on to explain that the best way to give yourself a shot at stumbling onto a dealership that is approaching reaching one of these targets and thereby willing to give you a better deal than you think is to seek multiple quotes using a combination of phone calls/e-mails, but all through the internet sales department, where your contact is likely to be more concerned with bulk than making a killing on any one sale. Essentially, the dealers know that there is only so much information available to the customer, but they also know that every other dealer you contact has as much information as them. Thus, you pit them against each other.

I purchased two cars in a three month span using this guy's approach, and paid on average about $1,500 under dealer invoice on both with very little hassle. Each time, I started out with a phone call to someone in the internet sales department. It was suggested to start with a call to help yourself standout from all of the requests for e-mail quotes that they get. I told them that I knew precisely which car I wanted and that I was going to be sending out requests for quotes from about six or seven local dealerships. I hoped to hear back from everyone by the following morning, at which time I would give a call back to each dealer (starting with the worst offer) and give them each a chance to match the best offer I received, at which time I would purchase the car from the dealer who gave the best offer. I then asked if they would be willing to participate. I think between the two times I did this, one dealership bowed out at the beginning and the rest participated. I was glad that they bowed out, because there was no way that dealer was going to give me the best price so it saved me the effort of dealing with them. The letter I sent was from a template that I got by purchasing the packet from the aforementioned site (I have no affiliation with that site) in which I also set forth all of the information that I had on the cars that I wanted (msrp vs. invoice of the base car and added options). The point was to let each dealer know that I had done my homework and was serious about making a purchase. I made it clear both in the initial phone call and the letter that I would not keep pitting the dealers against each other after giving each that one chance to match the best offer, as I wanted to set a firm ending to the process and not waste everyone's time, including my own.

Both times, I received one or two good offers the first time around, a couple of ok offers, and two or three that would have been insulting if I allowed myself to take the process personally. The most surprising thing was how quickly I was able to get the ok offers to improve upon telling them of the best offer. Usually, the offer came with an attachment showing the vehicle and options, including a vin number. If during a call, the dealer asked me if I had a vin number, I did not hesitate to share. Once they verified that the dealer I claimed was giving me the particular offer actually had the car I was looking for, they would either come back with a better offer or tell me that at this time, they couldn't match. Overall, the process was simple and made me comfortable that however things wound up, I got the best deal that I could at that particular moment in time.

The guy from fighting chance did explain that there is truth to the philosophy that purchasing at the end of the month is the best time, so that you should hold off to the end of the month if possible (months ending on a weekday are considered the best). Due to circumstances beyond my control, both purchases that I negotiated were done at the beginning of the month. Nevertheless, I averaged about $1,500 below dealer invoice on both cars without any published incentives. The second purchase was an Avalon for my mom at a time when the new Avalons were scarce, yet I still had no problem getting what I felt was a great deal (also, there was no trade in and it was a cash deal, so they did not find another way to squeeze a few bucks out of us).

Anyways, in response to the original post, this was just a really long winded way of saying that I can't imagine the Saturn formula of no haggling to become the standard. There are so many variables for dealers when selling a car that it simply wouldn't make any sense to be beholden to one particular price regardless of circumstances. From a selfish standpoint, my recent purchase experiences have been so positive that I would hate negotiations to change, as such a change would only serve to penalize those who take the effort (and it really doesn't take much effort) to educate themselves with the information that is freely accessible to all.

mmarshall

One system I particularly like (and it is generally becoming more widespread) is the practice of dealerships offering no-haggle "Internet" discounts for each car (though, technically, they are for everyone, not just for Internet customers), which is one officially discounted price including no free service and another, slightly higher one that does includes some things as oil changes, tire-rotations, inspections, etc.....(if not already included by the factory in the deal). You simply decide which of the two you'd rather have, work out your trade-in and financing (if applicable), sign, and go. In the D.C. area, the Fitzgerald chain of auto dealerships has been doing buisness this way for years, and some others are also adopting the practice.

I agree that the Scion no-haggle system is quick and easy, but of course, includes all of a fairly hefty mark-up that the customer cannot avoid....and, of course, dealer-factory-approved accessories on a new Scion pump it up even more. The Fitzgerald/"Internet" system I described above allows the customer to avoid at least some of the mark-up from wholesale to retail, though, of course, sometimes the official discount is less on high-demand/low-supply vehicles.

Infra

iTrader: (1)

This is pretty much off-topic. The reasons why someone buys a new car have nothing to do with the negotiation of the price for the car.