Thread: Discount or No Discount

Unless you have a really crap car to trade in the dealer will be interested in taking it off your hands. This is part of their standard business model whic h is built on

New sales
They do this to provide work for the aftersales departments which is where the profit lies. There is no profit for the dealer in selling new cars as this is controlled by the manufacturer. You have to be in it to understand how screwed up the new sales process is. The more control the manufacturer attempts to put in place the worse it gets.

Used cars
This area also generally breaks even which is better than the loss new car sales generally makes. Another method of getting you into the aftersales departments.

Aftersales
Still profitable however prices are higher than might otherwise be necessary if they did not have to carry the losses made in new and used sales. Manufacturers have spotted that this part of the business is still profitable and are now focusing on controlling it also so probably not for much longer.

Control of new sales was achieved through taking the margin off the vehicle and making it dependent on a volume targets and service standards which they make up and alter as they go along. Similar tactics are now appearing in aftersales.

Purchase price of the used car is determined by the used car sales department. They will know if it is a retailer for them or to sell it on. They have the contacts and will know what it is worth in very quick time. Anything above thier price is from the new car department profit.

Always shop the change over price as this what you are paying from you pocket. Too many people fall for the low new car price or high trade in price.

My personal experience is in contradiction with your first statement. A dealer I went to almost told me direct he wasn't interested and then offerred some $20,000 below current dealer asking prices on the same car with the same miles. IMHO mine is in better condition than many of the second hand ones on offer that I looked at in determining my private sale price. (If that's breaking even, I'd like to break even a bit more myself).

I understand what your saying with the rest of it though, and that dealers have limited profit margins on new cars. But their margin on options appears to be quite high. For instance, when I went to buy my D3 I asked for the LR winch kit - $6,500 was price. I said No. Went to ARB got a bar $1600 and the same winch for $2200. ARB still made a profit!

It is my estimation that my car did not 'fit' the mix of vehicles they wanted in their yard so offered a low price so they could wholesale it off faster.

But thank you for your input. I just wanted to know if it was reasonable to expect a discount with no trade.

one never pays full $$.

always bargain for what you want.

get prices from other areas.

Michael.

It will depend on stock levels of your chosen steed. Supplu and demand and all that.

I bought my STi when they were brand new and in short supply. The discount was not impressive.

I bought my V8 D3 when people seemed worried about fuel prices. >25% off.

Both with no trade in.

Cheers, Steve

Originally Posted by weeds

soooo your saying if i brought a car in brisbane today for the best price in the country then move to sydney next week there would be an expectation to have warranty work done in brisbane or have i misread the thread

You have misunderstood. If you live in say Biloela or Emerald, buy in Rockhampton because the Rocky dealer is cheaper, but continue to live in Biloela or Emerald, then your local dealer is entitled to be a bit s.o.l. when you take it to him for warranty. Particularly if you have got prices from him and rejected them as being too much. If you buy locally and then move, pretty well any dealer will meet his obligations without hesitation. The Rocky dealer is going to do a better deal because he knows he will never see you again and doesn't have to retain the fat built in to cover underpaid warranty.

I used a car broker for the wife's new car last year and thoroughly recommend them. Never had to meet or talk to the car salesman and got a great deal. Saved $2k+ on a 17.5K car with no hassles and they delivered it with a tank full of petrol. PM me if you want the details of the one I ended up choosing.

Good luck


Marty

JAMO you are right in the mix has a ot to do with trade in price, lets face it if you are rading a white commodore sedan, standard don't expect much... you can get them anywhere, tjey are a dime a dozen, likewise soemthing like a rover, some delaers will touch them others are terrified by them and how much they potentially could cost them under warranty, so they call a wholesaler and ask them what they are willing to put (read buy) it for, if dealer doesn't want it they know what the wholesalers are willing to take it for and base the trade on that. All this plays out in the deal you are offerred.

Originally Posted by Jamo

Well, I'm actually hoping to buy a car that doesn't need warranty work!!

Well I guess your buying a Land Rover then.......


Ben.....