uclachan

Hello folks.
just want to ask some questions.
I love reading you guys' post. lots of good information and insight.
not so many folks w/ 2011 ISF tho.

so here we go.
just today, i visited a dealer and struck a deal. super good deal in my mind.
invoice level + / - some amount of money. the car had little defects (mixture of glue residue on the paint + scratches. yes scratches. prob. when a person washed the car, didn't care about small rocks on their sponge or something it was pretty deep. lucky didn't scratch the whole thing. but noticeable) car had ~30 miles on it when i got in. so obviously, ppl test drove this vehicle. i don't mind since i was getting a super good deal. it's Lexus not BMW. (in a good way so)

so back to the main point, when i deal w/ the dealer, we talked about invoice. when i got a copy of the invoice, there was this charge called "LDA " and it was about $890. almost $900. so even with my super good deal, i was gona pay about little more than the invoice price. i never heard of LDA. i heard about Dest. Fee ($875) so i googled it. i found out that was Lexus advertising fee. ~900? i thoguth all those marketing figures are inclueded in a car's price

so i had to blew the deal. i have purchased couple different brands, Inifiniti, BMW, Toyota, and Honda. never heard of anything like this before. do you guys all pay LDA? some ppl from other forum (not ISF, Lexus GX or something like that) says i can opted out. is it possible? never thought about advertising fee in my budget. so weired. any thought or advice please? thank you in advance

bnizzle87

initially when you said it was about 890, i thought it was the destination fee, too. i know that there is a leasing fee, which some members have mentioned here on the forums before. but advertising should be paid by lexus, not the customer. hopefully you'll find one that is just as good somewhere else, without the scratches and this LDA. best of luck!

uclachan

Thank you for your support!
yes i thought it was dest charge too.
when i ask the dealer what LDA charge is for, he said he doesn't know.
never heard of it before so i asked.

companies have to add their advertising fee to their products. yes i understand. that's why they have invoice.

never purchased Lexus before so i never knew. hope with this post, people know there is a charge called LDA from Lexus for Lexus dealer advertisement fees.

Raralith

So, they wouldn't work that $890 out, or you just saw it and walked? Another dealer trying to squeeze more money out of you, but they try to do this all the time, i.e., one chance to buy an extended warranty and you gotta get it here and now otherwise you can't buy it later, etc... I find though that if you catch their bluff, and they do know what an LDA so they are trying to play dumb, they come clean and you might be able to take it off the final price.

matt310

iTrader: (1)

Is this LDA charge an actual item on the window sticker? Or is it next to the window sticker on a supplemental piece of paper?

LDA could mean 'local dealer advertising' or some other nonsense they tack on to each sale to recoup the 'loss' they 'incur' when car shoppers look at invoice pricing on sites like Edmunds, etc.

Keep in mind that 'invoice' is not the price the dealership paid for the car. Usually that's 'wholesale' or some other undisclosed number that's less than invoice.

Some manufacturers also participate in something called 'holdback' which is a certain amount of the sale or purchase price that the dealer receives based on selling each unit on their lot.

It's complicated, but Lexus' holdback is 2% of MSRP. So, if the MSRP on a '11 IS F is $63,000 and you strike a deal for invoice price, and say in this example that's $57,000, the dealership still receives the holdback of 2% of the FULL MSRP for this sale. In this case it's $1260 on top of whatever profit they've baked in with additional fees (like the LDA) in addition to whatever they make between their actual dealer cost for the vehicle versus the selling (transaction) price. So you can see, even though you may think you're getting a steal, it's really not when all numbers are revealed. It's just usually people are so tired and worn down from the transaction process they stop caring.

matt310

iTrader: (1)

^I should also note that you don't really want to mention holdback or that you know about it during the deal. Just know there's 'room' below invoice and it's really up to them if they decide to sell at or below that threshold.

uclachan

Thank you "matt310"
i really appreciated your explanation. one thing to note! i did not mention anything about holdback. i knew the invoice they showed me was not the actual price the dealer paid for the car. =)
i kinda figured.

wow 2% on MSRP? that's lots of money. (well in a sense)

oh~ the LDA, i never seen one. when i dealt with other dealer, they didn't have that. and was offered let say x amount. this dealer told me they could offer x + $1000. and when i went there, they throw me that number w/ LDA at the bottom of the invoice . so basically, they make it looks so attractive you can't resist. so i drove ~50 miles just to get the car. i was disappointed after i saw that LDA. my family and sisters and whole pack spent a whole day there. at the end, nothing. just waste of time. i did learn some stuff tho.

anyway, now i learned how Lexus dealers work. nothing better than personal experience!!! (never had that from infiniti, BMW, Toyota, Honda, even hyndai)...

if there are people who wants to buy ISF, just keep in mind that there is a charge called "LDA" and it will cost up to $900.

Reciprocal

LDA is on the invoice from Lexus, and the dealer does have to pay it. It's the dealer's contribution toward local advertising for Lexus not specific to him.

When you negotiate from invoice up, you will have to pay the LDA, and freight. The holdback amount is coded on the invoice, as well as his financing cost.

The bottom line is this, knowing the dealer's cost while useful, doesn't really improve your bargaining power. You can get the information off Edmunds, or the dealer himself may just give it to you. When I bought the recent Corvette ZR1, he just gave it to me without even asking.

What's really stupid, is negotiating twice. In other words, fighting for what your trade is worth, and then fighting again over the new car price.

The best way to keep it uncomplicated, is to just negotiate for the difference. You make an offer like, "I'll give you my trade plus this much money," or "I'll give you my trade plus $1000/month for 36 months."

That way you don't involve yourself in all the dealer games and arguing over the minutia line by line, which works to his advantage, not yours. If the price isn't agreeable, I won't make the deal and neither will he, no matter how it is broken out or packaged.

ISFC6

Chan, as I explained in my post to you a while back, it is TDA (Toyota Dealer advertising). There is also holback money and wholesale financial reserve. You will see the ACTUAL invoice amount, then there will be 3 additional charges, TDA, holdback, and wholesale financial reserve. SUBTRACT ALL THREE, and you will have the ACTUAL dealer invoice, as they receive those fees back from Toyota, and other incentives at times that we may not even know about.

uclachan

Thank you ISFC6,

yes i recall your post.
the thing that actually got me, was that ~$900 advertising fee. and the dealer refused to explain it to me. i asked what LDA stands for. he simply could explain it to me and said "all Lexus dealer has to pay" then i'd say ok if that's the case, i'll buy it. simple as that.

he refused to explain what it was. so ok then. in my mind, if something worth ~$900, i better know what it is. then i'll decide if i want to pay it or not.

when i got a quote from other dealer, i did not see LDA. and had sufficient amount of money was discounted. however, when this dealer said "oh we can beat his deal by 1000" wow that must be the deal of the year. so i went for it. well he didn't mentioned, "oh we have to add LDA"... that he forgot to mentioned. dest charge is well know. everyone knows that. LDA or TDA, prob. not many people know about it. i didn't. so. that's the bottom line. i learn couple of new things. and spend my whole day (not just me but whole family) i guess that's worth the lesson!!!

DaveGS4

iTrader: (2)

Here's a long thread with other member's experience on mileage on their 2IS when they picked it up (most 'new', some used).

https://www.clublexus.com/forums/is-...d-threads.html

PHXF

so, does $890 on a $63,000 car change it from a smoking deal to a terrible deal?
I wouldn't be happy about it either, but just sayin'

You can try what I always do...get them to throw in a bunch of super high margin items to close the deal. So let them offer the last price, then say "well, it isn't what I wanted...but if you throw in X, X, X, and X I'll do it". As long as you're asking for car mats, trunk organizers, free details, wheel warranties, oil changes or whatever else you can think of that are essentially all profit to the dealer (and hence almost zero cost to them), they'll probably do it.

uclachan

Thank you DaveGS4, interesting post!!!
when i got my m3, it had ~20.
other 2011 IS-F from different dealers had ~10 miles + /- couple.
BMW M3 has specific manual instruction on how to break-in for first 1200 miles. lexus ISF i haven't seen any break-in instruction on their manual or discussed in this forum. i am pretty sure ppl have different techniques to break-in their cars. being Lexus, as long as you don't hit the rev limiter, you are fine. right????

FYI, for M3 break-in instruction, no more than ~135 mph and 5,500 RPM within the first 1200 miles. no flooring either. (not sure about exact number but it's there) XD that was the most difficult thing i had to keep in mind. XD

uclachan

Thank you PHXF!!!
i thought about that too. =)
but like you said, i was really disappaointed how they played with the number. yes ~$900 is nothing comparing to the MSRP of the car.

i was gona ask them for oil change and stuff like that. detail, i am not so sure. i'd rather do it myself. not that i don't trust a detailer who works at the dealer, but i'd like to wash my car by myself. like sat morning alone. listening favorite mucis and spend some time w/ my car.

my girl friend doesn't understand that tho. she always asked me to detail her car but at the same time, she thinks it's waste of time washing a car. so mixed feeling there. haha

anyway, drive safe guys and thank you for all your information.