Dealer with their price on auto - no negotiation
 

I purchased my RX from a dealer in south Florida which supposedly has the highest volume in USA. Now will be getting another one in about 3 months. They now indicate they are a dealer which has a no negotiation policy with prices indicated on the auto. Apparently there are a few dealers in USA with that policy.

I have not as yet gotten any quotes from other dealers, but prefer to do business with this dealer. Anyone have any experience with such a dealer and how do their prices compare with dealers where you can negotiate? If I get a lower documented price from another dealer, do you think they will match this lower price?

The Lexus dealers with "no haggle" pricing have typically had pricing that is somewhat higher than what is available at Lexus dealers with traditional pricing. If you are a buyer who hasn't done his/her homework and who doesn't make a serious attempt at negotiating, you might do just as well at either type of dealer, but, if you have done your research and do negotiate, you are likely to pay a as much as a few thousand dollars more at one of the "no haggle" dealerships

You will pay more at a Lexus Plus dealer than you would if you negotiated a deal on your own with a traditional dealer.

they didn't become the volume leader by selling for higher prices.
Now that they are 'no haggle', i think they're gonna lose quite a lot of sales.

The Lexus Plus program seems to be stagnant. When the program started there were 12 dealers, then it went down to 11 for a while and is now back at 12. I think it would be a hard sell to dealers in competitive markets. Surprising to see JM Lexus in the program. Maybe they know something?

That can sometimes work to one's favor, though, on a high-demand, low supply vehicle. I know you are not as old as I am, but I'm sure you can remember the classic price-gouging on the Mazda Miata, Honda CRX, Chrysler PT Cruiser, 2-seat Ford Thunderbird, Plymouth Prowler, Camaro SS, Shelby Mustang, Pontiac Solstice, BMW Z3, and Porsche Boxster when all of those vehicles debuted. In general, no-haggle dealerships don't charge more than list price...and the policies of some no-haggle companies, like Saturn and Scion actually prohibited it, though dealerships could (and sometimes did) force customers to take dealer or factory-approved accessories at a markup.

Personally, I would never pay more than list for a vehicle (even if it was the last big Buick in production LOL) :D. But you would be surprised at those who would...and do. I remember, at one of my favorite restaurants, talkling with a guy and his wife who had just pulled up in a white, brand-new PT Cruiser....right out of the dealership. We were talking about the car, and he told me he had paid some 6 or 7K over list (I don't remember the exact figure) just to be able to get one. He said his attitude was "Hey...it's only money, and we wanted the car". :rolleyes:

I know the dealer you're referring to. I get my service there but after realizing that they're part of this this new no haggle thing I certainly will not get a car there. We're in the market for a new RX, just waiting to see what changes on the MY2019's. I believe they're the only dealer in South Florida doing the no haggle thing.

These no-haggle dealers are geared to the customer that just doesn't have the stomach for negotiating the price of a car--which are most car shoppers. Unless an entire dealer network is no-haggle, like Saturn was, if you are inclined to call around and work it, you WILL get a better deal than the no-haggle dealership; perhaps a substantially better deal.

A few years ago, I was considering a Highlander. I called a dealer in Easton, about 1 hour from my house. They were no-haggle. Their quote was the highest of 10 quotes I had (and that was before any back and forth with the other 9 dealers--all opening offers). Many people are drawn to the no-haggle dealers because they think they are getting a good deal, without the part of car shopping that they despise.

I have to imagine they aren't stupid if they are that big of a dealership.

They should know their market, and know what is a reasonable "discount" to sell to a high volume of customers. They can't be analyzing whether to go to no-haggle by saying "Gee, should we charge everyone more money than we do now, so we can make more money?" They know their average margins, and think know how the no-haggle pricing will fit into that model, and they know what percentage of customers historically purchase below the no-haggle price. Clearly they have determined that they will make more money, even if they lose those customers that squeeze the best deal by gaining more negotiation-averse customers.

I test drove a RX-L in late June, it stickered just under $57k. The first offer was $5k off list. How does no-haggle compare?

imho, there is a trend to kind of have the vendor/seller lay down the law. Auto insurance has been this way as long as I have been alive. Health care became that. amazon is now doing it. All kinds of products, OJ, mayonnaise, the containers got smaller, like 64 to 59 oz, 32 to 29 oz. (did you ever see them increase?). As long as consumers accept it, it will continue.

Imagine, amazon canceling prime memberships without any notice to customers, yet the founder is the richest man alive. btw they do this with partners too--take it, or leave it.

You also have to look at it sometimes from their point of view. For a pretty fair number of people, a little more money for a LOT less hassle is, to them, a good deal....and, in many cases, I can't say that I disagree. Not only that, but with some people, time IS money.

depends on who the 'you' is - not everyone does it like you do. :) and yes i know you say it doesn't take you long, just a few emails etc., but i've never been able to get anywhere trying that approach. not a SINGLE dealer has ever given me anything but basically an msrp quote via email. but hey, i'm gonna hire you next time to do my deal. :D

maybe so but maybe they think it's still worth it. here's why...

i see 2 types of customers:

1) aggressive haggle customers (very small percentage) give the dealer a very small margin AND typically take the most time to deal with.
2) the huge majority of customers who want to get in and out and feel like they weren't taken advantage of (even if that ends up being the case).

i think this dealer may have concluded that category 1 simply aren't worth it and the margin they'll make with no haggle for category 2 more than makes up for it, not to mention making the transactions happen faster and smoother.

exactly. :thumbup:

SW17LS's method is neither time wasting nor ineffective, it's easy and in my experience it delivers results.

What wastes everyone's time is continual back and forth over an extended period resulting in small adjustments or concessions,

The thing you need to do first is establish a) that you have a good baseline of the market, b) have a clear target price in mind and c) be in a position to pull the trigger if you come to agreement. Of these, establishing that you can execute is most critical.

Simply put, a credible buyer using SW17LS's method takes no more time and arguably sometimes less than a buyer who isn't pushing hard for a better price.

As an aside, there really is no magic to this. There are no golden words or sales approaches that will deliver you a result that would not be available to anyone else. If a dealer agrees to a deal, that deal made sense to them either because it was individually profitable or because it helped with collective profitability (e.g. if at the end of a sales tracking period a dealer needed sales to trigger step bonuses etc). There will always be edge cases, but in general there's no reason for a dealer to sell at an (actual) loss because there will almost always be another customer who isn't going to push as hard. There's a reason that "there's an ass for every seat" is an industry saying.

SW17LS's method, in my experience, tends to works best at period end for these reasons. if the dealer believes you are willing to buy if they will agree then you can and do get quick responses. For both the dealer and customer a quick "no" is as valuable as a "yes" (in either direction). Sure, some won't respond but most do. If you can establish credibility you can quickly get to a deal. The homework is all up front on what you're willing to pay, that wastes no dealer time. You are simply asking if I pay X and do so today, do we have a deal.

That's the easiest sale they will make all day.