Nissan 370Z Forum - View Single Post

edeeZee · 08-12-2009, 10:51 PM

I read your thread, and this is what I gotta say. I'm not on the dealer's side, but then I'm not on the customer's side. I play this out, and maybe some get irritated by it, but I'm a former car salesman. What does this mean? I know what goes on from the dealers' side as well as the customers'.

This forum, along w/ the plethora of other internet sites mislead people into thinking they can cut below invoice.

There is nothing wrong with getting a deal i.e. between invoice and MSRP, but asking @ or below invoice is too much.

Customers will say, dealers are unethical and will rape you whatever way they can--TRUE. Why? Because so many customers go into dealers and DEMAND unreasonable figures. You got the pinstrip they charge $700 for but cost the dealer $25, the extended warranty that adds $50/month for 5 yrs. when it really cost $1,000; the Lojack that cost $175 but they "hook you up" for $600, and these added accessories and extended warranties make your payments jump accompanied by the fact you pay interest on them. This is "back end" make up for the fact you got it close to, or below invoice. The poor old salesman makes a flat or mini i.e. less than $100 while the F&I guy says "go get another one killer, the next one's a high gross!"

I understand that average customer isn't going to make a career out of studying the car business. But I did, thus I got lots of inside knowledge & experience. When I worked at Peyton Cramer VW/Lincoln/Hyundai, I was buddies with the GM. We had parties and get togethers at his home. Why do I give you this intimate but seemingly "irrelevant" info? Because I used to ask him the "behind the scenes" financial mechanics of a typical new car dealership.

A new car dealership spends several hundred thousand dollars PER MONTH to keep the doors open, YES--SEVERAL HUNDRED THOUSAND U.S. DOLLARS MONTHLY. It doesn't run on air like a lot of you seem to think.

There's something called "flooring." Flooring is essentially the dealership "renting" the new car from the bank that owns it. You see, dealerships do not own the cars they physically carry on hand at the lots. It's about 1% from what I remember my buddy telling me, the GM. So, for a 370 brand new, it's at least $300 per month to have that unit on the lot. If that 370 doesn't sell for like 3 months, then it costed the dealer $900 to have kept it. You see how expensive it is to run a dealership? This is the tip of the iceberg.

Lastly, a lot of you people need to stop approaching dealer with this "so and so got his for $300 beneath invoice, why can't I?"

370's are not LOSS LEADER nor ADVERTISER cars. A loss leader is essentially a bait & switch ploy.

Just go in there, and say: I want $500 over invoice + fees and no accessories nor extended warranty. I already test drove the car, I already ran my credit, no need to lower my FICO score anymore, I was here few days ago, let's go.

08-12-2009, 10:51 PM	#18 (permalink)
edeeZee Track Member Join Date: May 2009 Location: s. cali, los angeles Posts: 627 Drives: 09 370z plat 6 speed Rep Power: 266	I read your thread, and this is what I gotta say. I'm not on the dealer's side, but then I'm not on the customer's side. I play this out, and maybe some get irritated by it, but I'm a former car salesman. What does this mean? I know what goes on from the dealers' side as well as the customers'. This forum, along w/ the plethora of other internet sites mislead people into thinking they can cut below invoice. There is nothing wrong with getting a deal i.e. between invoice and MSRP, but asking @ or below invoice is too much. Customers will say, dealers are unethical and will rape you whatever way they can--TRUE. Why? Because so many customers go into dealers and DEMAND unreasonable figures. You got the pinstrip they charge $700 for but cost the dealer $25, the extended warranty that adds $50/month for 5 yrs. when it really cost $1,000; the Lojack that cost $175 but they "hook you up" for $600, and these added accessories and extended warranties make your payments jump accompanied by the fact you pay interest on them. This is "back end" make up for the fact you got it close to, or below invoice. The poor old salesman makes a flat or mini i.e. less than $100 while the F&I guy says "go get another one killer, the next one's a high gross!" I understand that average customer isn't going to make a career out of studying the car business. But I did, thus I got lots of inside knowledge & experience. When I worked at Peyton Cramer VW/Lincoln/Hyundai, I was buddies with the GM. We had parties and get togethers at his home. Why do I give you this intimate but seemingly "irrelevant" info? Because I used to ask him the "behind the scenes" financial mechanics of a typical new car dealership. A new car dealership spends several hundred thousand dollars PER MONTH to keep the doors open, YES--SEVERAL HUNDRED THOUSAND U.S. DOLLARS MONTHLY. It doesn't run on air like a lot of you seem to think. There's something called "flooring." Flooring is essentially the dealership "renting" the new car from the bank that owns it. You see, dealerships do not own the cars they physically carry on hand at the lots. It's about 1% from what I remember my buddy telling me, the GM. So, for a 370 brand new, it's at least $300 per month to have that unit on the lot. If that 370 doesn't sell for like 3 months, then it costed the dealer $900 to have kept it. You see how expensive it is to run a dealership? This is the tip of the iceberg. Lastly, a lot of you people need to stop approaching dealer with this "so and so got his for $300 beneath invoice, why can't I?" 370's are not LOSS LEADER nor ADVERTISER cars. A loss leader is essentially a bait & switch ploy. Just go in there, and say: I want $500 over invoice + fees and no accessories nor extended warranty. I already test drove the car, I already ran my credit, no need to lower my FICO score anymore, I was here few days ago, let's go.