Published an article on how to not get ripped-off in a car purchase

Discussion in 'Shiny Things' started by Irish1, Dec 12, 2012.

  1. Irish1

    Irish1 Been here awhile

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    #1
  2. Bueller

    Bueller Cashin?

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    Congrats on selling your article.

    I don't think there's any ground breaking info on it, but I'm sure many who aren't well-versed in the tricks of the trade could extract some benefit. As a side note, with the exception of limited production highly desirable vehicles, I expect to pay behind invoice (before incentives) - not in front of it. Manufacturers have continued to shrink the margin between MSRP and invoice - meaning they are raising invoice prices disproportionately to the raising of retail prices - to take advantage of the fact that many people think buying a run of the mill production vehicle at invoice is some kind of huge score. The truth is it isn't.
    #2
  3. adam_c_eckhardt

    adam_c_eckhardt halfway there

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    How long did you actually work in the business?

    The car business is one of the most translucent industries out there today. With the Internet you can figure out just about anything you want to know. The fact that you attribute dealers making money with ancillary products as "scams" is insulting. People buy extended warranties all the time and many people are glad they did. I've never had someone come back to me and say, "I wish I hadn't bought that warranty." but I have had people say the opposite. People make transactions everyday on items that are marked up well beyond anything in a car dealership.

    Nothing wrong with negotiating for a fair deal. Happens all the time. It's the idea that you expect dealers to take a $100 deal on a $50,000 car that is absurd.
    #3
  4. adam_c_eckhardt

    adam_c_eckhardt halfway there

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    Perhaps I was a bit harsh. My apologies. I worked with some incredibly honest people in the car business and don't think it's fair that it's portrayed as such a horrible business.

    A few stories:

    The Barber:
    I sat down to have my beard trimmed up. I was away from home and had to attend an unexpected funeral and wanted to look presentable. The barber and I conversed a bit, he expressed sympathy for my loss, and in less than 20 minutes we were all done. When I got up from the chair he looked at me and put his hand on my shoulder. He craned his neck like a photographer does to gain a different perspective. He asked me to sit back down. He clipped one stray hair that he had missed. Whether or not this stray hair existed is not important. The fact is that he demonstrated that he was willing to go the extra mile to make me look presentable. I was the most important thing for those 20 minutes and he took pride in his work. He is an exceptional salesman and even if he doesn't do this intentionally I promise you he earns higher tips because of it. It's all salesmanship and he was a master at it. We don't read any articles about barbers that make their clients feel like a million bucks just to earn a bigger tip.

    The Waiter:
    I was at a nice restaurant with my ex girlfriend and her family. It was an incredible meal. The service was fantastic; waiter was attentive, knowledgeable, and didn't take notes. That always impresses me when a waiter can take an order for 8 people not using notes and get it all right. When it came time for dessert my girlfriend's father ordered a slice of chocolate cake. The waiter said, "That's my favorite dessert and I really enjoy it with a scoop of our homemade vanilla bean gellato. Would you like to add that?" He smiled and said yes. We actually talked about that upsell when the waiter walked away. The father was a mathematician and did some quick math about the additional tip the waiter could make in a given night if he could sell every table an additional scoop of ice cream. Again- not a scam, just excellent salesmanship. We don't read articles about waiters scamming people by upselling a scoop of ice cream that the person didn't ask for to begin with.

    The Tailor:
    I've purchased one custom made suit in my life. The man who owned and ran the store was always impeccably dressed and suave. I'm a pretty simple jeans and t-shirt kinda guy, but when I was in this store I wanted to dress just like him. He made it cool. The entire process of being fitted made me feel like the most important person in that given time (notice a trend here?:lol3) and in the end I left with extras that I never intended on purchasing when I walked in. I bet he made a lot more than 3% on the sale of that clothing, but nobody complains about the clothier that makes a huge profit on upselling high end clothes.

    I could tell dozens of stories about people I interact with on a daily basis that make a profit off of me. These profits add up to many times that which car dealers will make off of me, and all these interactions use great salesmanship to close the deal.
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  5. DriveShaft

    DriveShaft Long timer

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    The sales guy that got my $$$s on my purchase last year (literally, my *only* new car purchase, ever) was the guy who cold called me, didn't push me, and figured out quickly what kind of buyer I was without wasting my time.

    He did *not* try to get my trade in, because we both knew that he didn't have the sales channels to move my rather nice, but dated Audi TT himself (a chevy dealer), so he'd be moving it on the wholesale channels. Made the right call on that w/o me having to say a thing. Didn't even bother looking up a number on it.

    He did *not* waste my time, pitching all sorts of add-ons to the deal, and frankly, bent over backwards to find me the car I wanted on some lot 190 miles away. Actually, he found 3 options for me to choose from. No other dealer in the area came up with any of these options, so he was definitely checking under a bunch of un-turned stones. No, he didn't try to upsell me.

    Of course...it helps that I could talk the talk, and walk the walk. I knew the industry, and could come to him with wholesale numbers, if not franchise numbers. I had competitive loan offers, and all that. I was being reasonable, knowledgeable, and prepared. There was not much they could have done other than lose me. But not once did I catch him or his finance guy trying to pull a number on me, even before I showed my hand. He was straight up honest...more importantly, he was knowledgeable, and clearly did his homework (whereas some of the other monkeys I spoke with were clearly junior staff, and knew less about their lot than I did). When he didn't have an answer that worked...he worked at it to get an answer, and reached out to let me know.

    Yeah...he got my $$$s. God damn right, he earned it too.

    You get all sorts, in this business. Just like any business. I will agree, there are definitely cadres of young dumb sales guys, who do treat this like a game. But if you have ever seen volume sales teams at work...it's definitely not the only business that have volume sales tiers. I'm talking ad sales, wall street, insurance, telecom, any sort of loan...They're all run like it's a sales game. Running different sales bogeys to keep them hungry, quarter after quarter. Drilling stupid slogans and pitches so an idiot who isn't going to make it to the State University can still move a damn car when he's on your payroll. It's what you do, when your team isn't a bunch of seasoned pros. Keep them motivated. Keep them equipped. Keep them out there trying.

    His service department is a bit less stellar, though. Not quite so impressed with them.

    Btw...those "100-point certified pre-owned inspection programs" They do cost money to run. I mean...you do have to pay a tech to take the wheels off, and check conditions, and correct anything that doesn't meet spec. I'm not saying it's worth what a random sales guy says it's worth, when justifying lot prices...but the tech's time isn't free...he's got kids to feed. The parts...not free. The PDR guy...not free. The bumper guy...not free. They're not going to send *every* trade in through the inspection program...just the ones that have a shot at being certified. The rest they'd rather move quick through wholesale channels, and be done with. Audi...Their leasing department runs a HUGE pre-certified operation so that their dealers can get first crack at the best used inventory that's gone through the checklist, so that the dealer knows he doesn't have to blow his own time getting it front-line ready. When they say "oh, it costs us alot of money." Well...I dunno if it's alot...but it's certainly not free.
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  6. Speedo66

    Speedo66 Transient

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    And I've also seen a certified pre-owned that had bald tires that wouldn't pass inspection, so I'm not 100% convinced they actually check anything.
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  7. Going_Commando

    Going_Commando Been here awhile

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    That's probably where when you go to buy the car, they will put new tires on it. No sense wearing out new rubber when the car is going to get new tires when someone buys it anyways.
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  8. troidus

    troidus Long timer

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    Now that's just dumb. The number of miles that will be put on new tires in the course of test drives is minimal, but many potential customers won't even bother asking about a car with obviously worn tires, and if it has a "Certified" sticker in the window with those bad tires, those potential customers are going to consider the whole dealership untrustworthy and go somewhere else.
    #8
  9. Mini Trail

    Mini Trail n°°b

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    I note that you didn't address the doc fees. When I sold cars in '96 our doc fee was $60 or $80 and we didn't like it because it was money that the customer was paying but we weren't getting commission. When I bought a used truck from the same dealer in 2003 the doc fee was up to $240. Not an insignificant amount since I was only paying $12,000 for the truck.

    Last year when I was looking for a Jeep, dealers had $600-$700 doc fees and told me that it was pretty much industry standard. I didn't find much on the internet but did find that the employee pricing contracts limited the doc fees to $250-$350 so I consider that to be a fair price if Detroit says so.

    When I bought my Jeep I made an offer that included whatever mandatory fees and what have you. The dealer had a $350 doc fee PLUS a $400 dealer warranty or some such bullshit that included clear coat and 60 day free flat fix or windshield chip repair.

    I also noted that the gap between invoice and sticker had shrunk considerably. In 2006 it was always right around 10% on the Fords. Plus there was a comparatively small holdback and occasional rebates that I wasn't necessarily privy to being a scum of the earth car salesman.
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  10. arkansawyer

    arkansawyer Long timer

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    Where do all those under one thousand mile cars come from? Every salesman says they were the owner's wife's car or something.
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  11. Attico

    Attico Wrong way 'round

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    Congrats.

    I think you had enough material for a couple articles.

    It was a bit all over the place to be honest, too many tangents.

    I liked it anyway, just pace yourself next time.
    #11
  12. Mini Trail

    Mini Trail n°°b

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    That's where ours came from but some dealerships let the salesman drive demos too.
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  13. Andrew

    Andrew Optimus Primer Super Moderator

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    Good on ya, getting paid for your writing.

    In the past, I have enjoyed Remar Sutton's articles in his book "Don't Get Taken Every Time, which seems to stand the test of time quite well.

    http://www.dontgettakeneverytime.com/
    #13
  14. Irish1

    Irish1 Been here awhile

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    MY problem as a sales guy was that I've always felt it was dishonest not to be genuine with people, whether selling them a car or talking with them at the Post Office. It's called respecting them. I was extremely straightforward with people selling BMWs and Audis and I did pretty well, BUT I was always dealing with incompetent Managers and incompetent General Managers who were trying to rush the customer and get an instant commitment on a $50K+ item. If I chose to do this again I'd chose a small, family-owned dealership that was long vested in the community and had a great reputation. The weird thing is that dealerships expect customers to make fast decisions on very expensive items like BMWs and they don't help the customer relax and enjoy the experience. It's an archaic business mostly driven by archaic large multi-dealer dealer groups who don't realize the world has changed, that people will refuse to buy when they're treated like dazed cattle. I've been retired six months and I still have old customers call me and talk about cars. If they're back in the market I send them to smart sales peers and help them get through to the new person. It COULD be a great business if sales staff and managers were professional and weren't working from a script written by a 40's vacuum salesman. :deal
    #14