Comments on: How to Determine New Car Price

By: john.mather

john.mather — Sun, 23 Sep 2007 17:42:32 +0000

Kevin,
Thats fine, and I’m glad you are happy with the purchase price, and that you continue to support your retailer, assuming that you do. Many times, vehicles are sold much, much less than invoice; it all depends on the vehicle, how many the dealer has, and how long it has been in inventory. The dealer that has had a unit on his lot for 6 months with no consumer interest will be willing to get it out of his inventory, even if it is at a loss. This happens every day, although more often with used cars. The only point I had to make was that nobody should dictate what any retailer should be able to profit. For every loss, there is an offsetting gain, or they go out of business. I would also mention that it has been my experience that the “shrewd” buyer is not typically a dealership service customer, just a price shopper, who gets his oil changed by barely trained people because it’s cheap. Same goes for all the other stuff. No value is placed on the individuals who have invested in the tools and training to be true professionals.

By: kevin

kevin — Thu, 06 Sep 2007 10:58:53 +0000

I have purchased several vehicles at 4% over invoice or even less. The dealer knows I will be in for service and has plenty of other customers that will pay sticker price. I have talked with several dealers in the Eastern PA area that are willing to sell their vehicles at invoice to make money down the road on service and other add-ons. It’s called lifetime value of a customer, they know it and are willing to sell at a lower price.

By: john.mather

john.mather — Fri, 17 Aug 2007 16:21:00 +0000

Unfortunately, the notion of 4% being â€œmore than fairâ€ does not allow for the costs associated with keeping an inventory of product for consumers to have the choices they do when they shop. The costs of holding inventory include interest, insurance, maintenance (cleaning) and continue on to include other things like dead batteries, key management, and personnel expense to order and manage the inventory. If these costs were not borne by the dealer, yes, 4% would be more than fair, but let me know the next time you go to any other retailer and tell them that 4% is all youâ€™ll allow them in markup.