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Re: Car dealers are the devil [davearm] [ In reply to ]
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davearm wrote:
jmh wrote:
Complaining about car dealers being the devil is like complaining about water being wet or the sun rising in the east.

Their game is simple, they generally suck at it and most aren't that bright.

Outplay them.

I'm having trouble with most of this narrative.

The sales lackey may suck at it and may not be bright, and you may well have superior product knowledge.* But that person is mostly irrelevant. That's not the person you're negotiating with. The actual decisionmaker (sales manager or whomever) is not going to sell you a vehicle for less than the dealership is ready to take. The notion that you'd drive off the lot with the car guys scratching their heads wondering how they just got "outplayed" by some joe blow buyer just defies all logic.

The best you can hope for is to chip away enough to get closer to their bottom line price than a less savvy, or less patient buyer would.

*Actual discussion overheard between my buddy and a newb "sales" guy, when discussing options for the pickup he was buying:
Salesguy: "How about the limited slip differential?"
Buddy: "Should I get it?"
Salesguy: "Do you want it?"
Buddy: "Well what is it?"
Salesguy: "I dunno."

Suffice it to say, I was floored. A dude selling cars couldn't explain what a LSD is/does. Had no clue in fact. You can imagine the awkward silence that ensued when it became abundantly clear neither my buddy nor the salesguy knew WTF they were talking about. In that moment, it became obvious that everyone was just BSing each other.


The game is simple. They want to sell a car to maximize profit. The buyer wants to buy a car at the lowest cost. Both want the transaction to happen, but the game gets in the way. The sales manager has done this transaction hundreds or thousands of times more than most buyers. It is unemotional for him. If the process of buying a car is emotional for the buyer, they have already lost. The game is to make it emotional for the buyer. But the game boils down to a math problem for the sales manager. It the buyer keeps it unemotional they have a greater chance of a better result.

I think you are misinterpreting my "out play" comment. I am talking about making it a math problem and remaining unemotional about the purchase process. Out playing is recognizing the common moves they make and take those moves out of play.

A dealer should make some money on the transaction, but the buyer needs to understand that they make money even if they sell the car at invoice. So my objective is to get a deal that I think is fair once I understand what the dealer will make on the car. You will never get a "head scratching deal" and I didn't suggest that. Sometimes you might get a super deal that the dealer is willing to take a hit (however slight) in order to get an incentive from the manufacturer. Getting those deals is more luck than skill.

I think we agree that most of the sales team in a dealership are just in the way. They lack knowledge about their product and are being used by the sales manager in the game. Their only role is to make you feel good about the purchase, add pressure, or delay the process and act as an intermediary between you and the sales manager. The "sales lackey" generally suck at this part of the game. Most are clumsy and getting them out of the way early is key. They dominate the sales floor, and, yes, aren't that bright. Come back in a year and there will be 90% turnover in the sales people.

Oh and the game isn't over once the buyer and sales manager sign a deal. Trade in value is a separate game, if you choose to go this route. There might be a good reason (sales tax) to take a slightly worse deal from the car dealer than sell it on your own or to a Carvana or the like, but again that's a math problem. And if you decide to finance the car through the manfacturer, know the finance manger is also still selling and the game is still being played.

So what part do you disagree with?

Suffer Well.
Last edited by: jmh: Dec 1, 21 8:10
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Re: Car dealers are the devil [jmh] [ In reply to ]
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Several good comments thoughts so far. I'll just reiterate that it's good to be aware of all aspects and dynamics at play.

I actually don't mind the process as I find the negotiations and the "angles" (from all sides) interesting to work through. It's fundamentally the same game, but there are always variations. But I get that many folks' would rather not deal w/any of that. If so, there's always the no-negotiation routes these days.

Other observations to throw in:

Read that Carvana has been having significant issues getting the paperwork through. Heard that in some states it's running months and months before DMV paperwork goes through and license tags come in.

Have also observed that the more upscale the vehicle, the more the sales/dealership folks are also angling for a future purchase. They seem to be less of a one/done transaction and want to play a longer game. That's been another useful lever to work w/during the process.
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Re: Car dealers are the devil [CallMeMaybe] [ In reply to ]
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CallMeMaybe wrote:
In California (maybe not where you are because our laws are consumer-friendly and you probably shop in Wisconsin, which is the opposite of California in every way), state law requires dealers to actually have the car for the smoking hot deal they promote in ads. The vin number will be listed on the ad. The deal automatically expires within a few days (2?) or when the car is sold. So get up early and take the ad with the vin number to the dealer and say that you want to buy that exact car. Be firm and tell them you plan to finance it, whether you do or not.

With the ad, they will only make a couple hundred dollars on the sale if you’re paying cash*. But with financing, they will make $ off you in interest. They’re a lot nicer if they think you’re financing it. Once you are in the car, test drive it and do whatever you want.** When you get to the finance office, you can pay the ad price (plus taxes & fees) in cash. That’s how you get the best deal.

If you want to finance it, go to your bank or credit union before you go car shopping and set up a car loan. Shop around for the loan terms you like.

At the car dealership, you can compare your bank’s loan terms with the financing offered by the dealership. Then either pay cash, use your own financing or use the dealership’s financing.


* The ad price is the fair market price. It doesn’t really matter what the MSRP is if the market price is something else. This is their most competitive price.

**You love cars, so I don’t know why you’re not having fun. Personally, I like to test drive the car as well as be chauffeured by the salesman so I can test the passenger experience from the back seat. I like to borrow the car overnight to test our school drop/off and pick-up routine and give my kids an opportunity to voice their opinion on the car. I like to test how the car looks in the driveway. I’ve never spent more than $30k on a car, but that’s a chunk of change. Why have a bitter and bad experience?

To add to the bolded.. if the dealer is offering incentives based on financing through them, ask about any early payoff penalty. If there isn't one - and your bank/credit union's rate is preferable, obviously - take the dealer financing then pay it off as soon as you can. If there is a penalty, weigh that against the savings over the life of the loan by using your bank/CU's financing.

We did this on our last two vehicle purchases (wife's and daughter's) and got something like $1000 and $500 rebates respectively, then paid the VWoA loans off using a check from our credit union whose rate was ~1% better. In the case of my daughter's car purchase, the sales guy (who was young, starting out and likeable/straightforward) basically told us he'd get a commission based on selling the financing but was fine with us paying it off almost immediately.
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Re: Car dealers are the devil [EiE_] [ In reply to ]
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EiE_ wrote:
The US should just embrace the new Agent model that currently only Tesla use in the US. Go to a website, spec the car (visit a showroom (where they do not sell the cars if you want to test drive)), get the price. Wait 1-2 months and then pick it up from a pick up point. No need to have cars on the lot, just messes up everything and makes the end product more expensive


A
I certainly couldn't put an accurate percentage on it, but I imagine a good share of folks on car lots are there because they need a car right now. Maybe they can borrow or rent a car for a couple days, but a 1-2 month wait is a nonstarter.
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Re: Car dealers are the devil [40-Tude] [ In reply to ]
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40-Tude wrote:
Several good comments thoughts so far. I'll just reiterate that it's good to be aware of all aspects and dynamics at play.

I actually don't mind the process as I find the negotiations and the "angles" (from all sides) interesting to work through. It's fundamentally the same game, but there are always variations. But I get that many folks' would rather not deal w/any of that. If so, there's always the no-negotiation routes these days.

Other observations to throw in:

Read that Carvana has been having significant issues getting the paperwork through. Heard that in some states it's running months and months before DMV paperwork goes through and license tags come in.

Have also observed that the more upscale the vehicle, the more the sales/dealership folks are also angling for a future purchase. They seem to be less of a one/done transaction and want to play a longer game. That's been another useful lever to work w/during the process.

I purchased two vehicles through Carvana about a year ago, even went through the process of returning a third vehicle from them. Overall, it was a really positive experience and about as minimal hassle i've ever had in a car buying experience, besides a craigslist transaction. Way better than CarMax and not even in the same universe as a Dealership.

The final DMV paperwork did take longer than I expected and they told me the sub all the DMV filings out to a third party but its not a real big issue, just keep using your temp plate. At least in TX the DMV told me they have a lot of leeway in enforcing temp plate expirations (as in months leeway).

Anyway, i'd recommend anyone to try Carvana out. Overall, at least a year ago, you're going to pay a premium over a private party transaction, but I found their warranty program to be stellar and easy...use it to the full extent to get all the little stuff fixed. Their pricing, on average was a fair bit better than CarMax and way better than Dealerships.

.
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Re: Car dealers are the devil [jmh] [ In reply to ]
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jmh wrote:
So what part do you disagree with?
I disagree with the suggestion that the person(s) at the dealership that you're truly negotiating against (sales manager, finance guy) "generally suck at it", and can be outplayed.

As you said, they've done this thousands of times. A typical buyer does it once every 5-10 years. You're not going to get one over on them.
Last edited by: davearm: Dec 1, 21 8:07
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Re: Car dealers are the devil [Endo] [ In reply to ]
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Endo wrote:
40-Tude wrote:
Several good comments thoughts so far. I'll just reiterate that it's good to be aware of all aspects and dynamics at play.

I actually don't mind the process as I find the negotiations and the "angles" (from all sides) interesting to work through. It's fundamentally the same game, but there are always variations. But I get that many folks' would rather not deal w/any of that. If so, there's always the no-negotiation routes these days.

Other observations to throw in:

Read that Carvana has been having significant issues getting the paperwork through. Heard that in some states it's running months and months before DMV paperwork goes through and license tags come in.

Have also observed that the more upscale the vehicle, the more the sales/dealership folks are also angling for a future purchase. They seem to be less of a one/done transaction and want to play a longer game. That's been another useful lever to work w/during the process.


I purchased two vehicles through Carvana about a year ago, even went through the process of returning a third vehicle from them. Overall, it was a really positive experience and about as minimal hassle i've ever had in a car buying experience, besides a craigslist transaction. Way better than CarMax and not even in the same universe as a Dealership.

The final DMV paperwork did take longer than I expected and they told me the sub all the DMV filings out to a third party but its not a real big issue, just keep using your temp plate. At least in TX the DMV told me they have a lot of leeway in enforcing temp plate expirations (as in months leeway).

Anyway, i'd recommend anyone to try Carvana out. Overall, at least a year ago, you're going to pay a premium over a private party transaction, but I found their warranty program to be stellar and easy...use it to the full extent to get all the little stuff fixed. Their pricing, on average was a fair bit better than CarMax and way better than Dealerships.

.

I suppose whether you have a temp tag or a permanent tag on the car is a minor issue (unless you really can't wait to display a vanity plate).

Tangentially, read that Steve Jobs would have a temp tag perpetually on his Benz. He'd lease a new one every 30days just to be able to display a temp tag as he didn't want some kind of permanent plate, for some reason. Totally first world problem and having the wealth to pull it off.
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Re: Car dealers are the devil [davearm] [ In reply to ]
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This is part of the problem for many. I understand there are situations that can land you in needing a car soon. But, like a job, looking for a new car should be done when you have one and not solely when you need one.

I have already started the process of looking for my next vehicle. I am thinking I will purchase either later this year or early next. This entire shut down related chip issue will likely play a part in my end decision. But, I am looking through my options now and plan to do a few test drives this spring. I do not plan on waiting until I absolutely need a car. I want the ability to walk out of the dealer with no deal because it wasn’t good enough for me rather than taking the best they will give me.
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Re: Car dealers are the devil [davearm] [ In reply to ]
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davearm wrote:
jmh wrote:
So what part do you disagree with?

I disagree with the suggestion that the person(s) at the dealership that you're truly negotiating against (sales manager, finance guy) "generally suck at it", and can be outplayed.

As you said, they've done this thousands of times. A typical buyer does it once every 5-10 years. You're not going to get one over on them.

I don't think he said that, I think he's actually saying the only one on the lot who knows is the finance guy and he also knows they need to make money as well.

_____
TEAM HD
Each day is what you make of it so make it the best day possible.
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Re: Car dealers are the devil [40-Tude] [ In reply to ]
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Adding a link on the Carvana tag issue. If you're in a state that's imposed a stop-sale on carvana that's another complication to deal with.

FYI - https://www.autoblog.com/...laints-registration/
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Re: Car dealers are the devil [ryans] [ In reply to ]
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Well that's obviously the preferred approach.

If your current vehicle blows a head gasket or slips a timing belt, your schedule would change in a hurry (assuming you don't have a backup readily available). I've had both of those happen.
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Re: Car dealers are the devil [jharris] [ In reply to ]
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jharris wrote:
Add my work trucks and there are 13 more. It’s tiring with repair lists on vehicles.

My personal cars, 4 are fun cars/ project cars. Wheels and bumper off of one in my garage right now. I always wanted to collect cars, but I admit it gets overwhelming.

That does sound overwhelming. I too would like a couple more collector cars but I am severely limited by real estate. I will admit I have measured my garage for a lift.

------------------------------
The first time man split the atom was when the atom tried to hold Jens Voigt's wheel, but cracked.
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Re: Car dealers are the devil [TheRef65] [ In reply to ]
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This all began with post #60, which puts "car dealers" under one umbrella.
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Re: Car dealers are the devil [davearm] [ In reply to ]
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davearm wrote:
This all began with post #60, which puts "car dealers" under one umbrella.

Understand and then he clarified that position after you posted a response.

_____
TEAM HD
Each day is what you make of it so make it the best day possible.
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Re: Car dealers are the devil [TheRef65] [ In reply to ]
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He did. And at the end of that post, he asked "So what part do you disagree with?"

So I explained what I originally disagreed with. I don't really disagree with his clarifications.
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Re: Car dealers are the devil [BigDig] [ In reply to ]
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BigDig wrote:
jharris wrote:

Add my work trucks and there are 13 more. It’s tiring with repair lists on vehicles.

My personal cars, 4 are fun cars/ project cars. Wheels and bumper off of one in my garage right now. I always wanted to collect cars, but I admit it gets overwhelming.


That does sound overwhelming. I too would like a couple more collector cars but I am severely limited by real estate. I will admit I have measured my garage for a lift.


I tell most people it sounds fun until you do it. I have a hard time going backward though as I get attached to the cars I have. I admit I lose interest when they are done. That is the weird part. I get stressed out working on them, but I also enjoy it! When the work is done, I barely drive them and I end up selling it and moving to the next project. LOL
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Re: Car dealers are the devil [jharris] [ In reply to ]
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Like any business, you have good and bad. I've been in the car business for over 26 years and I have seen it all. Currently I am CFO of a large group in the DFW area. Prior to that I have been CFO with groups that had stores in Kansas, Arizona, New Mexico, California, Idaho, Kentucky and Florida. Some dealers are the devil, the group I worked with in Florida, the owner was an out and out crook. But then I've worked with some great people who had a heart of gold. When my younger daughter graduated from HS, the dealer wrote her a graduation check of $500 out of his own pocket.

I took a Lyft home from the airport Sunday night and I counseled the driver to not look for a car for the next year due to the supply issues. Through next year dealers will continue holding their gross and there won't be any discounts to speak of.

I never would have dreamed I would be in the car business. However, it has been good to me and I have never had to forsake my integrity or morals during those 26 years.
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Re: Car dealers are the devil [davearm] [ In reply to ]
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davearm wrote:
EiE_ wrote:
The US should just embrace the new Agent model that currently only Tesla use in the US. Go to a website, spec the car (visit a showroom (where they do not sell the cars if you want to test drive)), get the price. Wait 1-2 months and then pick it up from a pick up point. No need to have cars on the lot, just messes up everything and makes the end product more expensive


A

I certainly couldn't put an accurate percentage on it, but I imagine a good share of folks on car lots are there because they need a car right now. Maybe they can borrow or rent a car for a couple days, but a 1-2 month wait is a nonstarter.


If your in that much of a hurry, you can always go to a used car dealer or hit Craigslist/Blocket/Finn/genericCarAddWebsite.

My main point is that it works well here, and most dealers in Europe including WAG, Mercedes, Volvo, Seat etc. are pushing this model
lower price to the customer (+ ovbiously they control more of the value chain and earn more money themselves)


Full Disclosure: i work for a bank where the majority of our revenue is financing cars to consumers. The above commetns are solely my own and not on behalf of my employer
Last edited by: EiE_: Dec 2, 21 3:49
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Re: Car dealers are the devil [EiE_] [ In reply to ]
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That model is becoming the de facto norm in the US during the current shortages. In the past you would get a significant discount for buying off the lot. Now you are often better off ordering the car and waiting. Mini has been mostly using the European model in the US. I have heard stories now that some of their dealers are trying to sink their preorders by adding a bunch of port options. They can get an extra few thousand if the original buyer backs out and it is sold off the lot.
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Re: Car dealers are the devil [torrey] [ In reply to ]
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torrey wrote:
That model is becoming the de facto norm in the US during the current shortages. In the past you would get a significant discount for buying off the lot. Now you are often better off ordering the car and waiting. Mini has been mostly using the European model in the US. I have heard stories now that some of their dealers are trying to sink their preorders by adding a bunch of port options. They can get an extra few thousand if the original buyer backs out and it is sold off the lot.

The Jeep dealer in town who is ordering and waiting 6-8 weeks says this is working better now, than before. I suppose people get exactly what they want instead of getting what’s on the lot. Probably a lot of value there and worth waiting a bit of time.

The Subaru I just leased….. the build date on the car was 11/21. Geez. Made less than 30 days ago. Didn’t sit on the lot for long at all. Anything coming in is selling in days.
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Re: Car dealers are the devil [EiE_] [ In reply to ]
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EiE_ wrote:
The US should just embrace the new Agent model that currently only Tesla use in the US. Go to a website, spec the car (visit a showroom (where they do not sell the cars if you want to test drive)), get the price. Wait 1-2 months and then pick it up from a pick up point. No need to have cars on the lot, just messes up everything and makes the end product more expensive


A

While I do agree with you this model can make sense (and does for a brand like Tesla that has an almost cult following) and is likely how many other new car sales will shift towards especially in light of current situation, it will take a very long time IF it ever becomes standard fare in the US. Too many people are impulsive buyers, and there is also a long history of "how it's done" that while it may be archaic, will take another few generations to shake. The same way Mall's still exist despite being a product of the 80's.

The new Bronco is absolutely insanely hot right now. A friend was looking for one, wanted a higher end model (really wanted a first edition but obviously none of those available at anything resembling a reasonable price, even if you consider reasonable ~$10k+ over sticker) and there are two Ford dealerships nearby. First one he went to was willing to order him what he wanted (outer banks) in roughly his price range - although obviously with a wait... he went by the second lot and they had a base model in stock... also (wildly) roughly in his price range.

He's happy as can be in his base model Bronco

My Blog - http://leegoocrap.blogspot.com
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