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NFT: Car negotiation help

OnTap : 6/16/2017 3:56 pm
So my wife and I went to the dealer today to test drive 2 cars.. we decided on a pre owned Acura RDX 2017 dealer loaner car.

Price was 34,900; out the door around $38,500.

I told the salesman our bottom line price was $31,000 out the door. (looking for around $400/mo payment).

Guy said nothing they could do, that they only make about $600 profit on loaner cars and that was the best deal. But suggested we lease.

Wife and I said thanks and call us if there's anything they could do.

Now we're both feeling like we could have done better...maybe upped our price point a little. It was a really nice car with tech package and 100,000 mile engine/powertrain warranty and 4 yr/60000 mile bumper2bumper.

Car has 18K mile on it.

We're both a bit overwhelmed by this so as a post-mortem, I was wondering if any of you guys or gals had some feedback or maybe could point out if we were being unreasonable.

Thanks BBI.
Hold the line  
Sec 103 : 6/16/2017 3:58 pm : link
... If you don't get a follow up call, so be it...
If you do, hold the line again, they will bring it down. The 600 cap is more than likely pure bs.
$600 profit??  
DC Gmen Fan : 6/16/2017 4:00 pm : link
BS
Yea okay  
Howyadoin : 6/16/2017 4:00 pm : link
As much BS in the 7,500 mark up...
forgot to add  
OnTap : 6/16/2017 4:01 pm : link
they offered 3500 for my trade in car bringing the OTD price to 34800. I think I could get more for my car btw.
If he made his best offer and you made yours, then walk away.  
Heisenberg : 6/16/2017 4:02 pm : link
If you're willing to offer more because you really want the car, call up after a few days and make that offer.
You have my sympathy  
KentGraham : 6/16/2017 4:05 pm : link
Buying a car is an absolutely terrible experience. Just wait until they try to throw in their $3k extended warranty without even telling you about it. Be sure to use a reverse car loan payment calculator before you sign anything.

I personally wouldn't buy a loaner car with that many miles, but if they don't sell it to you for your price point, then let it go. If you feel like you can pay a little bit more, then give it a week and give the dealer your final offer on a quick call. Good luck!
Have you done your research?  
Jim in Forest Hills : 6/16/2017 4:14 pm : link
Check for comparable models and what they are selling for. Check KBB, check Edmunds. Once you have an informed opinion then you can actually know whether your offer was real or not.
He's probably not lying  
armstead98 : 6/16/2017 4:15 pm : link
I'm sort of in the industry, in the auto finance side of things, so I see behind the curtain.

Gone are the days when dealers make a huge margin. They make almost nothing on new cars but do often have a decent margin on used. It's unlikely they're making a lot on that loaner car.

You might be able to get $1500 off of it if you're lucky but that's pretty unlikely.

Smart dealers these days don't negotiate. They price aggressively and make about $500 per car in margin but turn inventory at a high rate. Then they make a killing on add-ons (never buy them) and servicing.
It's a "used" car  
Shecky : 6/16/2017 4:15 pm : link
So there is no profit or loss. This ain't a new car with a cost of acquisition to the dealership lol. You'll get several follow up calls from them, be patient.
..  
Named Later : 6/16/2017 4:16 pm : link
In three months, that car will be last year's model. And I know I've beat up a Loaner Car -- my guess is those are 18K hard miles. I would pass on that deal and keep looking around.

Have you priced the Certified Pre-Owned Acura RDXs ??

RE: It's a  
armstead98 : 6/16/2017 4:18 pm : link
In comment 13502256 Shecky said:
Quote:
So there is no profit or loss. This ain't a new car with a cost of acquisition to the dealership lol. You'll get several follow up calls from them, be patient.


LOL, how do they not have an acquisition cost? They bought it from the OEM and have an outstanding loan on it that they need to pay off.
Go at the end of this month  
ron mexico : 6/16/2017 4:23 pm : link
as the dealers will want to book sales before the quarter closes
18K of the worst miles possible  
Stan in LA : 6/16/2017 4:28 pm : link
Pass.
What the Extra $4500 For?  
Samiam : 6/16/2017 5:24 pm : link
What are they charging you in addition to sales tax? That's a lot of extra for what,documentation?

Also, generally the warranty would have started already when the vehicle was first used. Maybe the dealer would honor but I don't think Acura would. I say that because I once bought a loaner car from Hyundai and had an issue with the full warranty
Go to Truecar.com  
DonQuixote : 6/16/2017 5:44 pm : link
That is about MSRP for a new car, it is not a deal.
You did the right thing walking out  
B in ALB : 6/16/2017 5:49 pm : link
always have to walk out at least once if they don't come down in price. I suspect you'll get a phone call.

Btw, the $600 profit bit is complete bullshit.

If you have USAA or certain credit cards like Capital One, you can use their car buying service. Should save you a few thousand.
On Tap...  
EricJ : 6/16/2017 6:17 pm : link
good job walking out. A few thoughts on what you described...

First, never tell them you have a car to trade until after you have negotiated the price. You want to keep that as a separate negotiation. Otherwise, they play with the numbers to make you feel good about getting more for your trade but then you are probably paying more for the new car. Sell on your own if you can.

Second, never tell them what kind of payment you want. THAT is when they try to put you into a lease and they typically make more money that way. Always focus on the total price.

Finally, do not get emotional over this. It is just a car. You also need to go into it understanding that because it is a car, you are going to lose money. So, dont be in a rush to make a deal just because you are in love with the idea of having a new car. The longer you wait, the more money you end up saving by not having a payment this month or next month. You don't NEED a car, you just want one.

If you have a car to trade in  
bob_in_ec : 6/17/2017 7:31 am : link
then I recommend that you go to CARMAX and tell them that you want to sell your car. They will give you a price that is good for a week. You now know the price that someone will actually pay you for your car. That's powerful information to have in your mind when negotiating with a dealer.
Dealers don't make big money on sales of cars  
montanagiant : 6/17/2017 8:35 am : link
They make it on Service and volume selling
And the Salesman was correct  
montanagiant : 6/17/2017 8:37 am : link
For low payments without a ton of money down leasing is the way to go. You always have that option to buy the car but why when you can get a new one every 3 years?
RE: You have my sympathy  
Howyadoin : 6/17/2017 9:19 am : link
In comment 13502248 KentGraham said:
Quote:
Buying a car is an absolutely terrible experience. Just wait until they try to throw in their $3k extended warranty without even telling you about it. Be sure to use a reverse car loan payment calculator before you sign anything.

I personally wouldn't buy a loaner car with that many miles, but if they don't sell it to you for your price point, then let it go. If you feel like you can pay a little bit more, then give it a week and give the dealer your final offer on a quick call. Good luck!


Ditto
RE: And the Salesman was correct  
Jim in Fairfax : 6/17/2017 9:58 am : link
In comment 13502620 montanagiant said:
Quote:
For low payments without a ton of money down leasing is the way to go. You always have that option to buy the car but why when you can get a new one every 3 years?


Why? Because some people value saving money over bring in a new car every 3 years.
I always do the Carmax quote when I am selling a car  
PatersonPlank : 6/17/2017 11:02 am : link
Just to get a sanity check if nothing else.

Also they don't make huge amounts per car anymore. If the dealership let you walk then they won't do it, at least now (maybe in a few months when the next year models come out). If they were close they would have stopped you.

Finally leasing is great if you want to have the car for 2-4 years. If you want to hold it for long term than buying is cheaper.
One more point, if you were just kicking tires and "wanted" a newer ca  
PatersonPlank : 6/17/2017 11:08 am : link
car, then walking out if you can't hit your price point is fine. However if you "need" a car, because your current car is dying for example, then you'll need to make some type of deal.

Have you looked online at a place like cargurus.com and seen if any other cars like this are available in your area? What are the prices? That will tell you a lot.
You should take your used vehicle to CarMax  
bradshaw44 : 6/17/2017 11:16 am : link
They gave me $2,000 more then the dealer for my tradein car. I then took that check as part of my down payment. CarMax will give you the true trade in value of the car. So if it comes out to the same offer as the dealer you know they aren't dicking you around on that end of the negotiation.

As far as the profit margin they are definitely lying. But it's about how much they are lying about total. And I second those that say wait until the end of the quarter to make the purchase. They really are quota driven.
check the blue book value esp the trade in price.  
mdthedream : 6/17/2017 11:20 am : link
that will give you a idea of the profit they are making. Don't believe that they are making $600 it is total BS.
Also  
mdthedream : 6/17/2017 11:21 am : link
they made the money on the other end when they sold the person a new car.
RE: Also  
bradshaw44 : 6/17/2017 11:25 am : link
In comment 13502717 mdthedream said:
Quote:
they made the money on the other end when they sold the person a new car.


The dealer doesn't look at it that way though. They look strictly at the cost basis of what they bought the vehicle for on the trade in.
RE: RE: And the Salesman was correct  
montanagiant : 6/17/2017 12:06 pm : link
In comment 13502652 Jim in Fairfax said:
Quote:
In comment 13502620 montanagiant said:


Quote:


For low payments without a ton of money down leasing is the way to go. You always have that option to buy the car but why when you can get a new one every 3 years?



Why? Because some people value saving money over bring in a new car every 3 years.

I'd love to hear your explaination how your saving money buying one vs leasing?
RE: RE: RE: And the Salesman was correct  
Jim in Fairfax : 6/17/2017 12:16 pm : link
In comment 13502747 montanagiant said:
Quote:

I'd love to hear your explaination how your saving money buying one vs leasing?

While paymemts are higher when buying, you can have many years with no payments. With leasing you will have monthly payments forever.

RE: RE: RE: RE: And the Salesman was correct  
montanagiant : 6/17/2017 1:18 pm : link
In comment 13502752 Jim in Fairfax said:
Quote:
In comment 13502747 montanagiant said:


Quote:



I'd love to hear your explaination how your saving money buying one vs leasing?


While payments are higher when buying, you can have many years with no payments. With leasing you will have monthly payments forever.

Yes, if you have a decent interest rate and you're planning on holding onto the vehicle for at least 6+ years plus you have no major repairs after the warranty runs out. Not many people do that.

With a lease you're only paying on the depreciation which with an Acura is not that bad at all. Your warranty and in some cases maintenance is covered, and you can usually get much more car and still have cheaper payments.

99% of Cars are not investments
I did not view my car purchases  
pjcas18 : 6/17/2017 1:29 pm : link
as investments per se, but financially buying was better than leasing.

0% interest on a car that I liked (two of them actually) and kept for 10 years+ is better financially than 10 years of lease payments. Plus when I traded both in after the 10 years (12 for one) they still had residual value in a trade and if I felt like it could have sold privately for even more.

If you want to drive a new car every few years then it doesn't make sense to buy, otherwise if you buy a reliable car and plan to keep the car a long time buying can absolutely be financially better than leasing.

RE: RE: RE: RE: RE: And the Salesman was correct  
Jim in Fairfax : 6/17/2017 1:48 pm : link
In comment 13502791 montanagiant said:
Quote:
In comment 13502752 Jim in Fairfax said:


Quote:


In comment 13502747 montanagiant said:


Quote:



I'd love to hear your explaination how your saving money buying one vs leasing?


While payments are higher when buying, you can have many years with no payments. With leasing you will have monthly payments forever.



Yes, if you have a decent interest rate and you're planning on holding onto the vehicle for at least 6+ years plus you have no major repairs after the warranty runs out. Not many people do that.

With a lease you're only paying on the depreciation which with an Acura is not that bad at all. Your warranty and in some cases maintenance is covered, and you can usually get much more car and still have cheaper payments.

99% of Cars are not investments


Low interest rates are not hard to find right now. When they go up, that's also going to drive lease rates higher. So the comparison won't really change.

Cars today are built to last. Choose a reliable brand and model and you can expect it to last without major problems. We've owned 7 cars we purchased new, and kept all a minimum of 8 years. Currently have 10 and 11 year cars, and they're both holding up fine. Sure we have to spend some maintenance money on them every year, but it's still far less than what annual lease payments would be. And when I do buy another, I'll get cash for the current car that will lower the payments on the next one.

No, cars are not investments. But that's irrelevant. Long term ownership cost is what matters.

And hey: I'm not telling you you're doing the wrong thing. If you want a new car every 3 years, it's certainly more cost effective than buying and trading every three years. But there is a cost to having new wheels every three years.
maybe the Rules are Different  
Samiam : 6/17/2017 2:41 pm : link
Not arguing about the finances; it make alot of sense to buy a good car an hold it for a long time. I'm wondering if the rules are different now because of new safety features that seem to come out every few years. In my older cars, the only safety features are air bags. In my newer car, I have a rear view camera, buzzer if I go over the highway line, slowing the car down if I get too close to the car in front of me and others. Who know what will be available in a few years including driverless? If that's important to you, and it is to me, I made not look that far down the road in terms of the calculation.
RE: maybe the Rules are Different  
Jim in Fairfax : 6/17/2017 4:05 pm : link
In comment 13502843 Samiam said:
Quote:
Not arguing about the finances; it make alot of sense to buy a good car an hold it for a long time. I'm wondering if the rules are different now because of new safety features that seem to come out every few years. In my older cars, the only safety features are air bags. In my newer car, I have a rear view camera, buzzer if I go over the highway line, slowing the car down if I get too close to the car in front of me and others. Who know what will be available in a few years including driverless? If that's important to you, and it is to me, I made not look that far down the road in terms of the calculation.


That's nothing new. New safety features have been coming to cars since they replaced the lever pressure brake with the mechanical pedal brake. If you always want to have the latest and greatest, then spend the extra money and lease.
I might be in the minority  
gmenrule : 6/18/2017 3:06 pm : link
but car buying is the easiest it's ever been thanks to all the sites spelling out what a car costs, what the dealer pays, and what you should offer. I walk in with everything printed out and tell him this is what I am willing to pay (usually up to a $500 profit for dealer). I've gotten the car every time. If one dealer won't agree, there will be another one who is. Once a dealar says no and talks leasing - get the hell out of the dealership. You will LOSE every time.
What's a comparable used acura on the market for?  
AnnapolisMike : 6/18/2017 6:38 pm : link
I doubt the dealer has thousands of profit in a loaner vehicle. If the car is roughly the same price as other used cars then you are getting a good deal.

If they let you walk... You probably had the best price. They are entitled to make a reasonable profit.
RE: I might be in the minority  
UConn4523 : 6/18/2017 7:21 pm : link
In comment 13503310 gmenrule said:
Quote:
but car buying is the easiest it's ever been thanks to all the sites spelling out what a car costs, what the dealer pays, and what you should offer. I walk in with everything printed out and tell him this is what I am willing to pay (usually up to a $500 profit for dealer). I've gotten the car every time. If one dealer won't agree, there will be another one who is. Once a dealar says no and talks leasing - get the hell out of the dealership. You will LOSE every time.


It isn't that it's hard it's just that playing the game is annoying and time consuming. I went to get my new car a month ago, test drove it for 15 minutes, agreed to the price, and it still took 4 hours to take it off the lot. It's almost a whole weekend day gone and that's if things go your way.
Get bids from dealers by Email  
Jim in Fairfax : 6/19/2017 12:34 am : link
Avoid their game - shop by email. Send an email to every dealer in your area selling the car you're interested in. Start by getting quotes from TruCar and other car buying services. That should give you contact emails at various dealerships. You can also find contacts on dealer websites.

Then send an email similar to the following for every dealer you can:

Dear [contactname],

Thank you for your response to my inquiry. I'm interested in purchasing a new car within the next week. Could you please provide a price for a [year] [make] [model]? Please specify all applicable fees and add-ons including destination and documentation fees, floor mats, splash guards, etc.

I'm interested in this model in [color1] or [color2]. Are either of those colors available? If so, please include any additional charges for paint in your price.

Again, I'm interested in acting quickly, so please provide as much information as possible on your available cars including the VIN#(s) so that I may make an informed decision.

Sincerely,
[yourname]

RE: I did not view my car purchases  
Matt M. : 6/19/2017 6:28 am : link
In comment 13502794 pjcas18 said:
Quote:
as investments per se, but financially buying was better than leasing.

0% interest on a car that I liked (two of them actually) and kept for 10 years+ is better financially than 10 years of lease payments. Plus when I traded both in after the 10 years (12 for one) they still had residual value in a trade and if I felt like it could have sold privately for even more.

If you want to drive a new car every few years then it doesn't make sense to buy, otherwise if you buy a reliable car and plan to keep the car a long time buying can absolutely be financially better than leasing.
pjcas - Where are you getting 0% for the life of the auto loan?
RE: RE: I did not view my car purchases  
pjcas18 : 6/19/2017 8:05 am : link
In comment 13503549 Matt M. said:
Quote:
In comment 13502794 pjcas18 said:


Quote:


as investments per se, but financially buying was better than leasing.

0% interest on a car that I liked (two of them actually) and kept for 10 years+ is better financially than 10 years of lease payments. Plus when I traded both in after the 10 years (12 for one) they still had residual value in a trade and if I felt like it could have sold privately for even more.

If you want to drive a new car every few years then it doesn't make sense to buy, otherwise if you buy a reliable car and plan to keep the car a long time buying can absolutely be financially better than leasing.


pjcas - Where are you getting 0% for the life of the auto loan?


Auto loans in my experience are always fixed - so the rate is always for the life of the load but that's just my experience.

But I misspoke, only one of my vehicles was 0%, but anything sub a specific number (maybe 2.5%? is still worth buying IMO based on how much you finance)

And the 0% is not now, it was when I bought the cars. I bought an Acura (a TL) in 2002, and it was 0% through Acura, and Honda Pilot was 2005 and was 1.8% through AAA. I replaced the Acura with an Acura MDX at .08% interest (dealer financed again) in 2012 and the Pilot with a new Pilot in 2017 at 1% (also through Honda this time).

if the dealer finance dept does not have sub 2% interest rate offers at the time I shop around, with excellent credit someone will offer you those rates. Only the dealer would offer 0%, since otherwise why lend the money, but I got the 1.8% on the Honda Pilot in 2005 from AAA.

Right now Honda is offering 0.9% on certain vehicles.
What is the sticker on that car brand new as configured  
jcn56 : 6/19/2017 8:26 am : link
that 18k rental car miles is only taking it down to $34k?

Personally, I wouldn't touch that car unless it was a very sweet deal, as in 30% less than what the book value of that car is. God knows what the people who drove that car did to it.
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