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Old 12-03-2015, 10:12 PM   #1
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Buying a Tow Vehicle How do we get the best deal

Buying a tow vehicle how do we get the best deal. Insiders insight encouraged,please.

Can anyone explain the behind the scenes money side of thing. What are holdbacks and how do they work. “Below” invoice how do they make money?

How do they make a profit if they sell a tow vehicle below invoice? What is the most effective negotiating tacts to our tow vehicle for less so we can enjoy our Airstreams more?

Any advice from insiders would help a lot of people I am sure.

Anyway I am about purchase a vehicle so the more information I have the better off I will be.

Thank you in advance Tony
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Old 12-04-2015, 05:39 AM   #2
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Tony - have you checked out Edmunds.com? Tons of good info there about pricing, incentives, negotiating tips, etc. as well as detailed configuration data and more.

"Insiders" may know more, but it's a pretty good place to start. Good luck!
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Old 12-04-2015, 07:06 AM   #3
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Buying any vehicle involves a number of financial factors. Once you get over the fact that dealerships have to make money to stay open it will seem a little easier.

Invoice is simply MSRP (Manufacturers Suggested Retail Price). Not what the dealer pays for the product. There are throughout the year "deals" offered by the manufacturer to help their dealers move product. When these occur depends on market and nationwide dealer inventory. Often this time of year is a good time to start shopping and negotiating as it's close to year end and almost all dealers pay their sales people to move product out prior to 12/31. Als, assuggested by SteveSueMac check the various websites as to the suggested purchase price of the vehicle you want with equipment you want in your area, then check the trade value of your present vehicle if trading at the same sites. And start the process.

Forget about how much the dealer is making, it should not matter to you or me. Concern yourself with your budget and work the deal into the budget. Never tell them you want to "pay this much a month" as they will work your deal to that amount thru creative financing. Simply state you know they have to make money, you respect that, but you are shopping for the best deal for YOU. Carry your research with you, don't show it to them but have it and don't tell them what sources you are using, as they will say they use one you did not mention.

If you are buying a Diesel PU like we do, we have an F350 Diesel now, the dealer shoots for about a $7,000 - $8,000 profit. These are their most profitable per unit sale, and they need it as some of the large volume cars only get them about a grand or so in gross profit.

If you can avoid it don't lease - leasing is actually more profitable for the dealership in many cases than the profit from the sale of the vehicle. I used to move 10,000 units a year in my business and leased about 60%, we loved leasing as in down years it would save our business.

If you can secure a 15% - 20% discount off MSRP you've done a good job as long as it fits your budget as again that should be your only concern.

Bud
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Old 12-04-2015, 07:33 AM   #4
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If you don't want to deal with it or play the negotiation games with the dealers, you can try a buying service like TrueCar, Costco, AAA, or other service. Just google it!
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Old 12-04-2015, 09:59 AM   #5
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I am past Edmunds in the process. I still seem to need more info on where I can go with them. Kind of what they are after beyond the largest profit.

One of my problem, perhaps, due to lack of inventory that match my wants, I may have to order it. They internet me a price of invoice - minus incentives at time of delivery. That is one thing, incentives at time of delivery, that I am uncomfortable with. I don't want to loose the current offer of $1500.

But I would love that Airstream matching silver tow vehicle. Most of the NV3500 cargo vans are white. No surprise there. Most of the model are the middle model the SV. I am after the SL.

I contacted a couple dealers to see what matches the needs closest on vehicle already around the NW. I are they will to go below invoice with local on hand stock. I will see.

Tony
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Old 12-04-2015, 10:36 AM   #6
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Well in that case, if a silver one exists somewhere on a dealers lot, you've got a bargaining chance for a deal. Split the cost of flat bedding it to your dealers lot.

If you have to custom order, you takes what you can get.
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Old 12-04-2015, 10:39 AM   #7
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I recently shopped for a new vehicle. The places I got the best prices on gave me a terrible price on my trade. The places where I didn't get good deals gave me more money on my trade. I ended up keeping my vehicle.

If I buy in the future I will likely sell my vehicle privately first.
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Old 12-04-2015, 11:24 AM   #8
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Best deals are end of model year. Often the dealer is able to offer additional discounts if you use their financing. The interest rate will be horrible, so either pay it off quickly, or refinance through another institution. Ford offered an additional $1500 discount financing through them. Another $500 for owning a Ford Ranger. We ended up with Platinum level F350 for a very deep discount!

Often, cash talks. Pull out your checkbook and start writing for the price you want. If they balk, start to tear up the check. Salesmen hate to see money disappear. Be willing to say no! Remember, you only want a new vehicle, you don't 'need' one. Shift the advantage to yourself.
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Old 12-04-2015, 12:01 PM   #9
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To answer your specific questions, the paper "invoice" will have two columns: one lists MSRP for the base vehicle plus each of its options. The parallel column shows "dealer cost." But imbedded in that cost is holdback--an amount later remitted to the dealer. So the "invoice" column does not represent true dealer "cost."

Also, don't forget about "doc. fees." These are fees that vary in amount from dealer to dealer, and are pure profit. I'm yet to find a dealer that will compromise on or reduce the doc. fees, so I just deduct it from the amount I would otherwise pay.

I don't know much about the pricing of any vehicles except Ford. For Fords, you should be able to negotiate invoice less the doc. fee (because it will get added back on your sales invoice), less incentives and rebates. That gives the deal the full holdback--about $1800-2000+ on a truck. I'm yet to find a dealer that won'r go for this deal, so even this may be too rich. There are probably other gimmicks used by the dealers that are part of their total profit that I don't know about, but this will get you started...
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Old 12-04-2015, 12:25 PM   #10
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After spending 30 years in the automobile business I think I can answer your question. I read all of the advice given you so far and couldn't believe the misinformation out there. The easiest way to get a "good deal" is to use the website Truecar.com. I have found after using True car for friends of mine that they are the most accurate source of what you should pay for a new vehicle. If you have a trade in go to Edmunds or Kelly Blue book for a trade in value. Make sure you print all your research and take it with you to the dealership. When you go to a dealership ask for the General Manager and tell them you want to speak to their truck specialist. Dealers would rather deal with a educated consumer over someone who walks in with a defensive attitude. The idea that a dealer makes 7 or 8 thousand on a diesel is ridiculous . A friend of mine used true car to buy his 2015 GMC Denali HD diesel and received a outstanding deal without any hassle. The dealer needs to make a fair profit and you need to get a deal you feel comfortable with, true car can accomplish that for you. By the way I don't have any affiliation with true car I just believe from experience they are the best at what they do .
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Old 12-04-2015, 12:32 PM   #11
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I spent 23 years in the 'Shop' side of the automotive business. I guarantee this is the most crooked business you will ever see. Through the years I compiled 'my' list of to-do's when going to buy a vehicle.
FWIW:
Only buy a vehicle because you 'want' one, never show up and say you 'need' one.
Always have you own financing, their 0 % is far from it.
Never lease, this is the biggest scam they run.
Never have a trade. I guarantee if you walk onto a lot and ask 'How much is this vehicle?'
Before they give you a number, they ask 'What are you trading in?'
Because, they add $$ to the price if you are trading in, so, they have even more 'wiggle room' when they are trying to steal your trade.
Never sign any paper or give them an 'offer cheque' if they sit you down and say 'If I take a written offer to my manager, he is more likely to accept it if he knows you're serious'.
Always ask the salesman 'Do you want to sell a vehicle, today?'
This totally throws them off their game plan, and, gives them some level of assurance you are seriously looking to buy.
I always offer 20% below their asking price and state 'This includes everything', not 1 penny more for taxes or paperwork fees or admin fees etc.
Be prepared to WALK AWAY.
They will sell it to you.
Dealers make $$ on the initial sale, then at the end of EVERY month, they get extra kickbacks for the total number of units they moved.
Then they get extra for some 'harder' to move models.
Then they get extra for any that the manufacture 'drop shipped' to them, unexpectedly because the manufacturer's lot was too full.
Then they make an absolute fortune on all the 'extras' they up sell you, like undercoating, fabric guard, wax treatment etc.
The 2 best times of year to buy north of the 49th parallel are...
February, everyone is broke from paying the Christmas credit card bills.
June, the manufacture re-tools in July, so, they absolutely want rid of all the previous model year stock.
Sorry for the long post, but, it is something near and dear to me, i just don't like to see good people being taken advantage of
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Old 12-04-2015, 12:36 PM   #12
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Times are changing and so has the vehicle purchase process. Let the dealers compete for your business! Draw up your wish/feature list, then get information and bids via the internet from sources like shopclickdrive.com, truecar.com, edmunds.com, carsdirect.com, and/or auto buying services from AARP, Costco, etc., and choose the best/ least cost alternative.

I bought my Ram this way and saved almost $12,000 off the sticker. I did have to drive to the winning dealership 90 miles away. Arrival to vehicle inspection, test drive, and paperwork complete was about 50 minutes as everything was ready to go without any hassle or "up selling."

I chose not to include my prior truck in the deal but sell it outright myself.
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Old 12-04-2015, 01:11 PM   #13
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Quote:
Originally Posted by Bob662 View Post
To answer your specific questions, the paper "invoice" will have two columns: one lists MSRP for the base vehicle plus each of its options. The parallel column shows "dealer cost." But imbedded in that cost is holdback--an amount later remitted to the dealer. So the "invoice" column does not represent true dealer "cost."

Also, don't forget about "doc. fees." These are fees that vary in amount from dealer to dealer, and are pure profit. I'm yet to find a dealer that will compromise on or reduce the doc. fees, so I just deduct it from the amount I would otherwise pay.

I don't know much about the pricing of any vehicles except Ford. For Fords, you should be able to negotiate invoice less the doc. fee (because it will get added back on your sales invoice), less incentives and rebates. That gives the deal the full holdback--about $1800-2000+ on a truck. I'm yet to find a dealer that won'r go for this deal, so even this may be too rich. There are probably other gimmicks used by the dealers that are part of their total profit that I don't know about, but this will get you started...
This fellow is right on. Find a dealer that will go below invoice and get into their hold back money. The end of the year is the best time to deal on a vehicle. Also you get any incentives subtracted from the total as well. Even at that, I still like a lease instead of buying simply because you don't pay sales tax on the total, only on the monthly payment. Plus, the first 2-3 years you are paying down the depreciation. At the end of the lease if you still like the vehicle, you buy your own rig at the residual price on the lease. If you don't like it, turn it in and go get another one . If you buy it, miles doesn't matter. I have leased every vehicle in our family since 1993.
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Old 12-04-2015, 01:14 PM   #14
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Quote:
Originally Posted by 1crazycdn View Post
I spent 23 years in the 'Shop' side of the automotive business. I guarantee this is the most crooked business you will ever see. Through the years I compiled 'my' list of to-do's when going to buy a vehicle.
FWIW:
Only buy a vehicle because you 'want' one, never show up and say you 'need' one.
Always have you own financing, their 0 % is far from it.
Never lease, this is the biggest scam they run.
Never have a trade. I guarantee if you walk onto a lot and ask 'How much is this vehicle?'
Before they give you a number, they ask 'What are you trading in?'
Because, they add $$ to the price if you are trading in, so, they have even more 'wiggle room' when they are trying to steal your trade.
Never sign any paper or give them an 'offer cheque' if they sit you down and say 'If I take a written offer to my manager, he is more likely to accept it if he knows you're serious'.
Always ask the salesman 'Do you want to sell a vehicle, today?'
This totally throws them off their game plan, and, gives them some level of assurance you are seriously looking to buy.
I always offer 20% below their asking price and state 'This includes everything', not 1 penny more for taxes or paperwork fees or admin fees etc.
Be prepared to WALK AWAY.
They will sell it to you.
Dealers make $$ on the initial sale, then at the end of EVERY month, they get extra kickbacks for the total number of units they moved.
Then they get extra for some 'harder' to move models.
Then they get extra for any that the manufacture 'drop shipped' to them, unexpectedly because the manufacturer's lot was too full.
Then they make an absolute fortune on all the 'extras' they up sell you, like undercoating, fabric guard, wax treatment etc.
The 2 best times of year to buy north of the 49th parallel are...
February, everyone is broke from paying the Christmas credit card bills.
June, the manufacture re-tools in July, so, they absolutely want rid of all the previous model year stock.
Sorry for the long post, but, it is something near and dear to me, i just don't like to see good people being taken advantage of
I totally disagree about a lease being a scam, at least with a Ford lease. A lease has way more advantages than buying outright.
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