SW17LS

Are you willing to pay more for that?

Sulu

Who's to say that I would be paying more? I may be paying more than you (but again, who's to say?), who claims to be the world's greatest price haggler, but I really do not care about that.

I am willing to pay a price for respect, self-respect and honesty. I am sickened by those salepersons (and backroom finance people) who feel they have to grovel for a sale. Do they have no self-respect? Just let me buy the car I want.

I am thinking about returning to Toyota (and my old Toyota dealer) because my experience when purchasing my Lexus was not a very good one. I felt that whole sales process was less than an honest one; it just made me uncomfortable.

jer

Reading back thru the posts I checked one of the dealerships listed and the savings on their website for the 'no-haggle' price on an RX is around 2.5K. Reading the other threads regarding prices paid, seems that many are getting around 5k off. So this Lexus-Plus may work where there is only 1 dealership, but where there are several I just don't see it unless they all do the same. I'm in the Tampa area where we have 2 dealerships, if they go Lexus-Plus at 2k off I'd be willing to drive 1 hour if it means saving an additional 2-3k. I realize the dealership experience, etc., but knock on wood, it's a Lexus, so how often are we really at the dealership???

SW17LS

You didn't answer the question. Would you be willing to pay more for that sort of sales experience? Not will the price be more. It's a yes or no question.

The hilarious part of all of this to me is that people want to pay a straight price and not have to negotiate. Okay. Well, there is a price on the cars sticker. If the car says $59,974 and you come in and say "I will buy this car" they will sell it to you for $59,974...and you won't have a haggling experience, everybody will be overjoyed to do business with you and you'll have a great experience.

But...you guys want some "discount" you just don't want to have to put any effort into getting that...you just want them to hand you a discount and be happy about it.

You don't want to pay MSRP, but you'll pay some arbitrary amount under this arbitrary MSRP and be happy? Do you not see the lack of logic in that? If they made that car $64,974 MSRP and offered to sell it to you for $59,974 that would make you happy, but if the MSRP is $59,974 that's a no go? Honestly bewildered...

coolsaber

I understand the sales experience is one thats terrible, not honest, lack of self respect, however on the flipside how is keeping the people at the root of the problem helping anything then? Training etc is one thing, but removing whats been taught to a person their entire career is hard to forget.
Plus the idea of dumping all the obligations of various members of the dealership onto a single person is going to be an interesting one. Unless the CA has a better means of earning from the traditional system in place now, Each individual CA has to be well versed in not only product, but also paperwork financial and be able to accommodate a generous amount of leads to bring in his or her required #s.

On top of that the numbers were seeing out there is not really concrete. With market wide adoption, Vehicle pricing numbers may remain the same or go up higher and be charged at a premium that no one besides lexus sees fit.

chikoo

How much less will make you happy? How do you know where to bottom out? Based upon other sales? What about your own value calculation? Why use comparative pricing and then negotiate further down? Is it about earning bragging rights?

I have a retail business and sell apparel, same as Nordstrom, and sell it less than Nordstrom pricing. Even then people of certain origins come in and try to haggle the price down. For them, the closest comparison I can draw is a vulgar one, but it does seem accurate.

Sulu

What is this fixation on the MSRP? Everybody knows that it is a false figure. In my experience, no one pays the MSRP, not even people who do not like to haggle. Go into a dealer, talk to the salesperson and she says: "Interested? I can give it to you for $X [where X is already some figure lower than MSRP]".

This is being dishonest. And we have laws about dishonesty in advertising.

If you hesitate (you don't even have to say anything), she pulls you to her desk and says: "Let's see what we can do". Then she goes and has a laugh with the sales manager.

So why not eliminate all this playacting and just advertise a no-haggle price on the windshield? If I like it, I will say so; but if I am not interested, I walk out.

Be honest with me. Be honest with yourself. And, please, let's just respect each other and ourselves.

coolsaber

I dont get the issue, then at all. Why study Lexus Plus at all then?

MSRP which is a fixed price set by the mfg is evil.

Any discount currently we get from a salesmen or mfg incentives to buy a car is evil.

A fixed price that is discounted and set from a salesmen or mfg incentives is good?



The only thing I support that I believe we as customers should get is the removal of dealer add on fees and transparency on the tag and title fees. I have seen my sales orders from new dealerships love to tackle on their nice service fees, fluid fees, etc fees to make up some of their profit they lost in negotiations, I see that and make sure I get those removed from the list before signing the paperwork.

Everything else makes absolutely zero sense to change and seems like a way to appease dealers and mfgs and those who hate to overpay because they are in a geographical disadvantage (lack of competition) or just too scared to put in some time to figure out what they are buying.

In terms of respect, well how is that going to change in any way if the person disrespecting you before is still sitting there now given a license by Lexus to handle everything from A-Z on your transaction? The grass is not greener just cause everyone is now holding the Lexus Plus sign

SW17LS

Theres not a set amount. It depends on what all of those sources of data are showing at the time. I don't care about bragging rights, I just care about getting as good a price for me and my family as I can. Why do I try and push it down a little bit more than the comparative pricing? If I feel that theres a little bit more room there I might try that, or sometimes I may just take the best offer. Why do I do that? Because I want to pay less.

I would never negotiate the price of clothing lol. And I'm as white bread family from the hills of WV as they come...

Its not being dishonest, its a negotiation. If the MSRP is a "false figure", why do you have confidence in the "LexusPlus no haggle price" and not the MSRP? Both the figures are just made up. The difference is now you can use your own data and competition between dealers to arrive at an actual market value for the car, a number that isn't just "made up" by somebody, but that you arrived at by negotiating, using market data, and you have confidence that number is indicative of what the market value of the car is. With "LexusPlus" pricing you have to take their word for it and I don't trust them one iota.

And second of all. I never do any of that and neither should you. Go to the dealership to drive the cars, decide what you want, go back home and email the internet sales departments at your local dealerships. I always email the salesman who test drove the car with me just out of respect also. Negotiate it from your home, and then walk into the dealer when everything is all done. Its not a big deal.

There are also plenty of no haggle services out there like TrueCar or Edmunds Price Promise if you really don't want to deal with it.

chikoo

SW15LS said: That is the most horrifying indicator of the Human psyche.
I can spit - further
I can earn - more
My organ is - bigger
My wife is - better looking

And so on and so forth.

SW17LS

LOL, it's a business transaction. It's not an emotional thing. I want to pay as little as I can. The fact that it shocks you makes no sense to me. Why do your customers buy clothes from you instead of Nordstrom? Because they want to pay less. The reason they still haggle with you is because you are catering to a price conscious customer. They don't haggle at Nordstrom I promise you.

If you're content paying more than you have to, why not pay MSRP?

Cars, houses, boats, big stuff I negotiate for. Something like a TV, computer, other moderate purchases I may not haggle, but I price shop. I'm not going to buy a TV from Best Buy if I can buy it from Sears for cheaper. I'm going to buy it at Sears. If Best Buy will price match and I'm there, I'll buy it there. Why not wanting to overpay is so shocking and insulting to you I legitimately don't understand.

I bought a business from someone a few years ago to fold into my own. Negotiated that heavily. I owed it to my business, my family and my employees to do that. The cost of that wasn't all that much more than my car...and nowhere near as much as my house. Was I wrong to do that?

bitkahuna

iTrader: (20)

most negotiate cars and salespeople expect it because the whole process is so stupid. goes like this:

- msrp is for suckers
- discount some to close deals quick
- add some massively overpriced fluff like 'pin stripes' and nitrogen in tires and then claim to be giving discounts
- discount some more to 'knowledgeable customers' knowing we get some more after the sale (holdback, moving it off the lot financing load, etc.)
- discount some more if we're desperate or want to make quota

dealers WANT as big a spread from msrp to invoice price (and other creative financing details) so there's as much negotiating room as possible and as much opportunity for profit as possible, AND so the process is as confusing as possible so consumers fall into traps giving dealers more profit. manufacturers play along because the dealers have a lot of local, economic, and political clout, and are organized (NADA etc). manufacturers CANNOT set the price the consumer WILL pay (that's price-fixing and illegal) and they CAN'T sell direct due to laws in place lobbied hard for and protected by NADA, etc. to say the system is rigged is putting it mildly.

so given this 'system', 'smart consumers' have to research, haggle, and overcome psychological, sales tactics and other advantages of the dealers. it SUCKS.

but car business is hardly unique. realtors are paid liars. never believe anything any of them says, especially if it's not verifiable. like "this won't stay on the market long" and "there's other offers to you need to offer more" and "that would be easy to change/fix" and predictions about future value as they pocket the 6% commission split of yours and the seller's hard earned money. a giant racket.

and ever bought furniture? GIGANTIC RACKET. cost of goods is probably 10% of selling price.

hopefully in coming years things like cars can be sold direct and homes can be sold without realtors. like objections to this lexus pricing test though i hear "but i want to haggle!" and "how do i know the price is fair?" you know it's fair if you compare it to other vehicles and it offers better value to you.

mmarshall

Tesla, in effect, is trying to do that now, with its company-owned stores, essentially by-passing traditional dealerships. But, as Bob Lutz pointed out in a recent column in Road & Track magazine, no auto manufacturer has ever succeeded in the long run with company-owned stores....it just eats up too much of the company overhead trying to run all of the sales facilities, parts departments, service-bays, wash/detail-bays, and all of the other departments that make up a modern dealership. And, of course, Tesla is clearly losing money trying to rely on that system.

Here's the article, BTW, if you want to see it:

http://www.roadandtrack.com/car-cult...ob-lutz-tesla/

Tesla's showing all the signs of a company in trouble: bleeding cash, securitized assets, and mounting inventory. It's the trifecta of doom for any automaker, and anyone paying attention probably saw this coming a mile away. Like most big puzzles, the company's woes don't have just one source.

It's true that the world may be running light on buyers who will spring for a big-dollar electric vehicle that can't make the hike from Detroit to Chicago without stopping for a long charge. And cheap gasoline isn't helping Tesla's case. Right now, prices around the country are hovering close to $2 a gallon. If that's bad news for the Prius and the Volt, it's worse for the Model S.

In addition, there's never been any secret sauce to the company's battery technology. The automakers that bought into Tesla's tech early did so to avoid having to pony up development dollars on first-generation battery packs of their own. Now that Audi has announced it's getting into the EV game, Tesla should be even more concerned. If you're a luxury buyer, which car would you rather have?

IF I WERE SITTING IN ELON MUSK'S SEAT, I WOULD TAKE AN URGENT LOOK AT CUTTING COST.

And then there's the distribution problem. Nobody has ever been successful with company stores, though plenty of manufacturers have tried them. When I came to BMW in the Seventies, it had five factory stores. The idea was, like Tesla, to be in control of the retail environment and give customers an upscale experience. They were all money pits.

I think Tesla CEO Elon Musk figured that if factory stores work for Apple, they'll work for Tesla. But the fixed costs for an Apple store are next to nothing compared with a car dealership's. Smartphones and laptops don't need anything beyond a mall storefront and a staff of kids. A car dealership is very different. It sits on multiple acres. You need a big building with service bays, chargers, and a trained sales force, plus all the necessary finance and accounting people. It ties up a staggering amount of capital, especially when you factor in inventory. Under a traditional franchise arrangement, the factory never has to carry that burden. Right now, Tesla does.


Stockholders may be clinging to the hope that the company's upcoming crossover will help put Tesla back on track, but there's little evidence to bolster that optimism. A big, expensive vehicle with a compromised structure to accommodate gullwing doors can hardly be a sales knockout.

If I were sitting in Musk's seat, I would take an urgent look at cutting cost. Not just taking cost out of the car, but reducing expense in general. When they have a situation where, on an operating basis, they're losing $4000 per car, they're in trouble. At some point, they're not going to get any more money.

I would seriously consider an entry-level model with a cheaper, range-extended hybrid driveline. Something with a much smaller battery that also looks great and drives great. Something that's electric most of the time, say 50 or 60 miles, but can carry on under gasoline power past that. Would an internal-combustion engine dilute the Tesla brand? Maybe, but everyone said Porsche could never build a front-engine car, and look how that turned out.

I like Elon Musk personally, and I think the Model S is a fabulous car, but history's filled with defunct companies with great products run by brilliant people. Unless Tesla rights its organization and products in a hurry, it'll join those ranks.

(In all fairness, though, since this article was written, like Lutz recommended, Tesla HAS introduced a smaller, less-expensive 35K model....and, of course, has a back-up of hundreds of thousands of orders for it, and no guarantee that the factory can even fill those orders).

gengar

This pretty much sums up my objection to the current sales model - it puts the incentives in all the wrong places. During sales, the objective should be to sell a product the customer wants. We all know how dealerships - even Lexus dealerships - add on all kinds of dealer options of uncertain or even downright questionable value to the end customer in order to boost MSRP. My local Lexus dealer has done this to all the GS F's I've seen on their lot - it's obviously not to add value, but to increase the haggle room on an already very expensive (overpriced...?) car.

Meanwhile, car companies have to build in margins to support all these middlemen that are involved in this transactional fluffmongering - and yet somehow those who enjoy haggling deny that getting rid of this archaic model won't reduce costs and prices. This is all aside from the consumer benefit to incentivizing dealerships to actually *gasp* spec cars the way customers want them or push customers to custom order, something that will make profits more predictable and thus align pricing better with consumer value.

I look at people who are "proud" that they haggled down a price on a car as no different than the people who go to an outlet mall and think they got a deal buying from some kiosk with a "50% off today" on it. But it's 50% off every day. Naïveté reigns supreme.

chikoo

Did you ever offer 2 cents for your LS? They might have taken it. LOL.

and neither does 98% of my clientele. It is that 2% coming from a specific ethnic background ( 2 types) who do that. They just cannot take what is offered even when it is better than what is available in the open market.

I have done that too - on a $30,000 sale. I liked it. I paid what was the sticker on the car, as I thought it was a fair market value, and drove away. Have you ever had the guts to do something like that?

It is not the overpaying part. The part that is shocking is you want to pay "less" - for no specific reason. You say you want to save money. But then I propose, have you ever offered $1000 for a $90K car and got it? That would be really "less".

No nothing wrong in negotiating. But if you were negotiating just so that it was less than what somebody else had paid for similar business in the market, then yes. It is horrifying window into the human mind.