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Phoenix86
Lifer
- May 21, 2003
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You can get their offers in writting w/o a full sales contract. It'll likely only be good for a handfull of days, it may be a state law in Texas, but every dealer I have worked with (sold cars for a short while) has a form for this. Of course this may vary by state...
As far as the dealer trade, there actually may be legal obligations to the manufacturer to make the trade to the other dealer. The inventory may be theirs, but it could come with strings attached. At any rate it's BAD business for dealerA, dealer swaps allow the dealer to virtualy increase his inventory w/o actually paying for it. Hosing dealerB could get dealerA a bad rap with all the dealers in the area, I wouldn't piss that away.
Besides, GT said he's getting invoice on the vehicle. dealerA could have done that themselves and kept the kickback from the manuf. at the end of the year for their bonuses. FYI the dealer may have paid "invoice" and you are paying the same amt. but the dealer will still make $$. How? At the end of sales cycles (month/quarter/year) the manuf. will give the dealers "bonuses" for volume. That effectivly reduces the cost of the car to the dealer, and is their profit (- sales comm.). Ends up being several hundred dollar/ vehicle.
Phoenix86
Lifer
- May 21, 2003
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Correct, dealerA is screwing themselves out of the sale. When the above bonuses are figured they will not get anything for the car since *they* didn't sell it, dealerB did. They don't lose anything, but they don't gain anything either.
I can't understand why dealerA isn't doing the trade unless there are other issues between the dealers...
Vic, this is what's in the deal for dealerB, the kickback for higher volume. They are selling "at invoice" but will make $ off of the car on the back end of the deal. That's also assuming the dealer will stick to it's original invoice and not discount the line further (after the sale), effectivly reducing the original invoice cost. Trust me, dealerB will make $ off of the deal selling at invoice.
You didn't think "invoice" was the bottom line did you?
Vic
Elite Member
- Jun 12, 2001
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I agree that Dealer A is engaged in a bad business practice. I don't think that I ever said any differently. I also understand quarterly volume bonuses from the manufacturer.
This is an interesting situation. If Dealer A will lose money by matching the price, then Dealer B (as the recipient of the dealer trade) would lose even more, as the receiving dealer on a dealer trade is always in the inferior negotiating position. Tha harder the vehicle is to get, the more so.
And without a trade-in or financing, this deal is very "mini" (meaning that no one is making anything besides volume).
I think there is something behind the scenes here. GT, after you told Dealer A that you wouldn't be entertaining a counter-offer from them, did you call Dealer B and tell them that?
Oh, and even offers in writing are not binding for a dealership. The deal is not done until the fat lady sings, i.e. you signed the full sales contract and drive it off the lot. Up until that time, the dealer can always back out, regardless of how many written offers they make have given you. This is why I always advise people to read the final sales contract carefully when they get to that point in the process and not assume anything. Of course, if they screw around you can be pissed off and file complaints, but that still doesn't get you the car.
This is an interesting situation. If Dealer A will lose money by matching the price, then Dealer B (as the recipient of the dealer trade) would lose even more, as the receiving dealer on a dealer trade is always in the inferior negotiating position. Tha harder the vehicle is to get, the more so.
And without a trade-in or financing, this deal is very "mini" (meaning that no one is making anything besides volume).
I think there is something behind the scenes here. GT, after you told Dealer A that you wouldn't be entertaining a counter-offer from them, did you call Dealer B and tell them that?
Oh, and even offers in writing are not binding for a dealership. The deal is not done until the fat lady sings, i.e. you signed the full sales contract and drive it off the lot. Up until that time, the dealer can always back out, regardless of how many written offers they make have given you. This is why I always advise people to read the final sales contract carefully when they get to that point in the process and not assume anything. Of course, if they screw around you can be pissed off and file complaints, but that still doesn't get you the car.
dude your dealership will get the car from you, i know with chevys you have to fulfill a dealertrade.
- Oct 24, 2000
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Vic
Elite Member
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As I already posted, it is customary for the dealer who actually has the vehicle in inventory (dealer A in this case) to retain the holdback on a dealer trade. The idea is to keep competing dealers from low-balling other dealers' inventories. And the more difficult the car is to acquire, generally the better the negotiating position for the original dealer (and vice-versa if it's a common model that doesn't sell well, the original dealer is only too happy to get rid of it).Originally posted by: Phoenix86
Correct, dealerA is screwing themselves out of the sale. When the above bonuses are figured they will not get anything for the car since *they* didn't sell it, dealerB did. They don't lose anything, but they don't gain anything either.
I can't understand why dealerA isn't doing the trade unless there are other issues between the dealers...
Vic, this is what's in the deal for dealerB, the kickback for higher volume. They are selling "at invoice" but will make $ off of the car on the back end of the deal. That's also assuming the dealer will stick to it's original invoice and not discount the line further (after the sale), effectivly reducing the original invoice cost. Trust me, dealerB will make $ off of the deal selling at invoice.
You didn't think "invoice" was the bottom line did you?
I understand how this process works, and that invoice is not the bottom line. But (I think it shoud be noted) holdback is never substantial. For example, 3% of $30k is only $900. Chump change commission on a new car sale. And even selling a car at "break even" is still a loss for a dealership -- there are costs to doing business.
- Oct 24, 2000
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Vic
Elite Member
- Jun 12, 2001
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"Sorry, we were unable to acquire the vehicle."
"Sorry, but management did not approve this offer."
And so on, as many as you can think up, so can they.
And typically, you will be told this by a sales manager who will also inform you that the saleman who presented the offer to you "will be fired" (if the day they tell you is his day off), or "will be reprimanded", etc.
When buying a car, the negotiations do not end until you have signed the final sales contract and have driven off the vehicle. Never put the dealer in a comfortable position. And as most contracts with financing include a provision that the dealer can take the car back and/or renegotiate the deal in the event that the financing falls through, always make sure the financing is solid (preferably by getting your own through your bank or credit union, or using the manufacturers financing).
- Oct 24, 2000
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DrPizza
Administrator Elite Member Goat Whisperer
Personally, I agree with Kranky.. I had the same thing with furniture. I bought was buying an entire living room set - broyhill, plus oak end tables and an oak coffee table. I asked the salesperson for the price, asked why there wasn't a discount. He offered me 5% off on the oak. I asked if that was their best price, since they guaranteed the lowest price. He said yes. 30 minutes later, I was writing a check at another furniture store when THAT salesperson promised me (before knowing the other places price) that he would blow away their price if I agreed to buy it that night. He undercut them by quite a few hundred dollars. Good enough for me.
Store A called me back several times, trying to convince me to cancel my order with store B and they would beat the price by 10% of the difference. I turned them down on principle and stated that "your guarantee of lowest prices is there only to connive people into shopping at your over-priced store. If your price was more reasonable in the first place, I would have paid cash right there on the spot. When I asked what the discount was on everything, you wouldn't even match the standard discount you had on other sets that were complete with the end and coffee tables. You lost my business by trying to rip me off." They ripped a LOT of people off on their promise... but had I gone back to them, then perhaps it would have helped them stay in business and rip even more people off.
Store A called me back several times, trying to convince me to cancel my order with store B and they would beat the price by 10% of the difference. I turned them down on principle and stated that "your guarantee of lowest prices is there only to connive people into shopping at your over-priced store. If your price was more reasonable in the first place, I would have paid cash right there on the spot. When I asked what the discount was on everything, you wouldn't even match the standard discount you had on other sets that were complete with the end and coffee tables. You lost my business by trying to rip me off." They ripped a LOT of people off on their promise... but had I gone back to them, then perhaps it would have helped them stay in business and rip even more people off.
Usually dealers trade cars in situations like this. For instance, Dealer B will send a Mazda Tribute to Dealer A in exchange for a Mazda6 or something to that effect. You can bitch and moan to corporate, but there isn't much they can do as Dealer A doesn't owe you anything legally meaning they don't have to sell you the car. The only way you can get a dealer in serious trouble with the manufacturer is if they deny recall work. Dealers can deny you service but they can't deny you Recalls.
I would ask Dealer B about the car out of state. HOWEVER, find out how they plan on transferring the car. Most of the time they negotiate a swap and they'll send a guy with a car and transporter plates. He then drives the car back to the dealership for prepping putting any additional mileage onto your car. Just don't assume they are using a flat-bed unless you're buying a BMW or MB, which I highly doubt as you probably wouldn't be going through all this trouble...
I would ask Dealer B about the car out of state. HOWEVER, find out how they plan on transferring the car. Most of the time they negotiate a swap and they'll send a guy with a car and transporter plates. He then drives the car back to the dealership for prepping putting any additional mileage onto your car. Just don't assume they are using a flat-bed unless you're buying a BMW or MB, which I highly doubt as you probably wouldn't be going through all this trouble...
Phoenix86
Lifer
- May 21, 2003
- 14,643
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Vic, thanks, I guess I was being a little short sighted about the validity of those agreements and as always, check the lawyer print...
For what it's worth I got my last vehicle the same way GT is w/o the hard line on dealerA. Play the dealers agaist eachother. DealerB got my business in my case too, dealerA had to transfer the vehicle (in my case it was worse, as dealerA had a buyer too, I just pulled the trigger first).
For what it's worth I got my last vehicle the same way GT is w/o the hard line on dealerA. Play the dealers agaist eachother. DealerB got my business in my case too, dealerA had to transfer the vehicle (in my case it was worse, as dealerA had a buyer too, I just pulled the trigger first).
- Oct 24, 2000
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Dealer B called. Car is on the way to dealer A tomorrow morning.
I will be giving it a thorough look-over before signing on the dotted line!
I will be giving it a thorough look-over before signing on the dotted line!
- Oct 24, 2000
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Originally posted by: GTaudiophile
maybe after i've purchased it
Just tell us what kind of car your are purchasing that is causing all this bullsh!t, and stop being a dick and avoiding the question. :|
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