anyone getting MSRP (or below)

davidyan

Invoice price is a great deal as well. However, what I suggested is not only possible but has been done. I got 600 below invoice which is right at their breakeven after holdback. One person here got 1000 below indicating a loss for the dealer. There are quite a few buyers within the 500 - 1000 below invoice range which is why I thought it would be helpful for you to know.

Do whatever makes you feel comfortable. All this talk of "hot car" = higher price isn't always true either. When I worked as a salesman at Dodge during college, we had two Vipers. We sold one Viper at $10K below invoice with no dealer incentives other than the std holdback simply because it sat too long. The owner would yell at us each Saturday asking us why it wasn't sold. For the second one, another person came by thinking that because it was rare that MSRP was a great deal and paid just that (we even had a $20K markup sticker on top of the MSRP). Good thing he's probably rich enough as a Viper buyer to not have been impacted by the lost savings he could have had.

My dad bought an S-Class Mercedes at a time when the dot com boom happened and people in the Silicon Valley (where I'm from) were making tons of money left and right from IPOs. There were Mercedes all over the road. Even then, they sold it to him for $4K below invoice. The car business (dealer side) just has very low margins. Its their structure. They make up for it and still profit by:

- Volume Bonuses offered to the owner of the dealer: For ex, if a dealer sells X number of new cars in a month, the owner of the dealership will get a huge check from corporate. This is different BTW than customer incentives that they pass on to you. This makes up for the $400 he lost selling you the Z for $1000 below invoice (after roughly 600 holdback) worthwhile if he is close to hitting that target and just needs to sell a few more units. This is why people buy cars for far below invoice all the time.

- Selling extended warranties, service packages, paint sealant, etc.

- Financing

- Used car sales where they buy from auctions for dirt cheap. Also, with used cars, the customer never really knows what the dealer paid. Its not like new cars where you can look it up online.

- Trade ins.

- This next one is not a incentive but, a dealership owner could actually lose its ability to sell that brand if they consistently miss volume targets. This almost happened to my friends dealer where he worked as a salesman. They sold few new cars and mostly relied on used cars for revenue. Finally Chrysler (it was a Jeep dealer) told their owner that they would cut his dealer if he didnt start pushing volume. This happened by the way a couple years before the current auto crisis.