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Discussion Starter · #1 ·
So I keep hearing of all these "deals" and "they are reducing the prices 25%" on cars. Then when I look at the dealerships all the prices are as if there was nothing going on in society. I was looking at a dealership and asked how this pandemic was effecting them and he said "Were super busy selling tons of cars" and he went on to talk about the internet sales and deliveries yada yada. Why haven't the prices budged? Was this car salesman giving me a line of BS??
 

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The one others want to be
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They are lying their butts off. I was seriously shopping for new trucks back in the beginning of March. Had a new leftover 2019 picked and the deal made at $39,600. Due to an unforeseen tax issue I had to delay the purchase. But I had the paperwork. Last week I went to the dealer's site and the truck was still on the lot. But it was listed at $41,300. I called, asked the salesman about the truck and he told me the truck was still available. I told him I would take it at the $39,600 number but I wanted the 0 percent for 84 month deal. No dice he said. They have to buy down the rate from the lender and that jacked the price. Mind you, I was approved with 0 down 2 months ago for 60 months at 0 percent for the first price. 2 years costs $1,700 more and they won't deal on the truck? Yeah, they're dying right now. Not.

You know it.
 

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I was shopping for a work box truck. The deals where OK not great. The problem is they don't have what I want since all the plant shut downs. If you financed no the deals are gone but cash and the deals got better.
 

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take It for what it’s worth but a dealership that has an extra 25% margin to give up on a deal will not last long because prices will be too high or they will run out of inventory to sell because they won’t be able to buy and turn around and sell.
I do believe some buy here pay here lots are making 30-40% margin but they are also taking risk on default. They are spreading the risk out through higher margins. If 1 of every 3 transactions defaults and they make a 33% margin, they sort of break even...they still have overhead expenses to pay.

in my opinion, if your getting 10-15% discount, that’s a good deal.

I’m in a little different business than selling cars but still very similar. I would assume average used car margins at a dealer is around 10%. New cars is less. A dealer makes their money off parts and service and the volume bonus they get from the manufacturer based on how many units (cars) they sell.

And regarding financing, please understand nothing is free. If your getting 0% for 1 or 1,000 months, it’s costing you money. Trust me!
The dealer has discounts to use on cash and on finance. Very rarely are the discounts the same. That’s life, every manufacturer does it, it’s not the dealer.

if you have specific questions or want some advice on negotiating, direct message me.
 

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Discussion Starter · #7 ·
So it seems prices even go UP during a pandemic. Thats a crazy concept!! Less sales = higher prices to cover the dealers losses?? All I can say is that I HAVE NOT SEEN A SINGLE used car price drop or seem any cheaper. Thats nuts. Could be that with the extra 600 a week people are acutally making more money on unemployment/cares act then actually working. Maybe people are still buying cars. Darn, can't believe ANYTHING
 

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Dealers have been making a killing. They can afford to wait before having to drop prices. They are hoping the economy picks back up. Automakers shutdown to keep from flooding the market with new cars. Currently dealers don't want your trade in unless you give it to them. Also this 7 of 8 year 0% is bs. Your paying more for the vehicle, how you think they making money? Either from price of car, bs products from the finance office, or a cut of the interest.
 

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Car sales keep dropping. But they think without the factories turning out more cars than people buy, which is normal, the stock on hand is more valuable.
 

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If you don't put down 20% at least, you don't need to be in the market for a 40k automobile
If I can borrow $40K for 7 years at zero percent, why would I want to put any money down? Why not keep that money (in your scenario $8K) in my own investment earning interest? In 7 years at a modest rate it could double. If I give the dealership that money up front what benefit do I get other than a lower monthly payment? I could buy the truck outright if I wanted to but why dump $40K on the spot? Dumb move.
I keep vehicles until they die; my 2001 F150 has 255,000 miles on it and is my daily driver. Telling me I don't need to be in the market is not your call to make.

You know it.
 

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If I can borrow $40K for 7 years at zero percent, why would I want to put any money down? Why not keep that money (in your scenario $8K) in my own investment earning interest? In 7 years at a modest rate it could double. If I give the dealership that money up front what benefit do I get other than a lower monthly payment? I could buy the truck outright if I wanted to but why dump $40K on the spot? Dumb move.
I keep vehicles until they die; my 2001 F150 has 255,000 miles on it and is my daily driver. Telling me I don't need to be in the market is not your call to make.

You know it.
From the rule of 72, your money will double in 7 years if you can get 10.2% per year compounded.
 
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catchin my own bait since 1957
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I read it on the internet so it has to be true but supposedly there are boats w/thousands of vehicles on them just sitting at anchor because there's no place to send those vehicles ... by the end of summer they should be begging to make a deal, there's only so much inventory they can sit on and new models coming out ..,. car companies are going to be hurting, should be a buyers market, especially if you have some cash ...
 

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We got a great deal on a Toyota Corolla for the wife by getting quotes through Truecar.com

If you're a Costco member you can get $1000 back through them if you buy one of a couple different Chevy truck models by June 3oth.....( I got $750 last year for buying an Equinox)
 

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If I can borrow $40K for 7 years at zero percent, why would I want to put any money down? Why not keep that money (in your scenario $8K) in my own investment earning interest? In 7 years at a modest rate it could double. If I give the dealership that money up front what benefit do I get other than a lower monthly payment? I could buy the truck outright if I wanted to but why dump $40K on the spot? Dumb move.
I keep vehicles until they die; my 2001 F150 has 255,000 miles on it and is my daily driver. Telling me I don't need to be in the market is not your call to make.

You know it.
You dont think the dealer is making money on you? They are not marking the car down because you are getting "a steal" of 0 % financing. You are on the hook for roughly 600$/month for the next 7 years.
 

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I didn't say the dealer wasn't making money. They wouldn't sell me the truck if they weren't. I don't expect any business to not make a profit on a sale as that's not sustainable. And that wasn't my point. I pointed out it's not smart to put a bunch of money down when you can borrow at no cost and keep your money earning interest elsewhere.

And Snake, the return is closer to 12 percent.

You know it.
 

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Harry
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Negotiated the price on a new forestor for my wife a couple years ago. Salesman gave me a sale price, we negotiated and I declined. He then asked me “what it it would take for us to buy it today”. I gave him a number $3000 less than his “best price”. No trade in. He laughed and told me that “nobody is going to sell you this car for that price.” We weren’t in a hurry, so I told him to call me when he could sell it at my price. It worked! He called me in about a month and we got it for our price. It was late summer, so maybe clearing out old inventory or the time of the month is why . Doesn’t really matter why, but we got it for our price. I’d read to try that strategy....try it!
 

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I didn't say the dealer wasn't making money. They wouldn't sell me the truck if they weren't. I don't expect any business to not make a profit on a sale as that's not sustainable. And that wasn't my point. I pointed out it's not smart to put a bunch of money down when you can borrow at no cost and keep your money earning interest elsewhere.

And Snake, the return is closer to 12 percent.

You know it.
You're going to be upside down on your loan as soon as you pull off the lot.
 
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