Don't Assume Car Dealers Might Be Desperate To Give You A Deal

Illustration for article titled Dont Assume Car Dealers Might Be Desperate To Give You A Deal
Photo: David Tracy (Jalopnik)

Car sales have taken an unprecedented dive. Of buyers who can financially handle a new car right now, many are going to take advantage of huge savings from dealers and automakers looking to move units. But that doesn’t mean the opening offer is always going to be a good one.

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I had a reader reach out to me regarding the potential purchase of a Dodge Charger. He plans on trading his Buick TourX and wanted to see if the offer he had on hand was good. This reader was focused on the “total out the door” number, which is a wise thing to do, but that doesn’t always tell you the whole story.

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Here is the screenshot:

Illustration for article titled Dont Assume Car Dealers Might Be Desperate To Give You A Deal

As you can see there are available rebates from FCA in the amount of $4,850 on this Scat Pack, but what is curious is that this particular store is offering nothing in the way of a dealer discount prior to those rebates being applied.

For a dealer not to take anything off the top on something like a Charger is surprising and especially strange in an age where there are dramatically fewer buyers on the market than before. But the key point is the fact that this particular reader had a total cost objective in mind and the dealer was able to achieve that, however, that doesn’t mean this buyer is getting a competitive deal.

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This isn’t a unique instance of dealers just not trying in what should be a highly competitive market. Recently I was shopping for a Ford Expedition for a customer in Texas. The dealer informed me that they had a unit with the exact specification that the customer wanted in stock and was motivated to make a deal ASAP.

When I requested a price on the car this is what they sent -

Illustration for article titled Dont Assume Car Dealers Might Be Desperate To Give You A Deal
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The “sale price” of 77,449 is the full MSRP of the vehicle and then the dealer tacked on $1,000 worth of add-ons. It’s rare for a dealer to sell a Ford Expedition like this in a normal market, let alone a scenario where car sales are dropping by upwards of 40 percent.

Even on specialty cars that normally command markups you would think dealers would start to be a bit more flexible, but that is not always the case. I spoke with three dealers this week that had a Mustang GT350 R, every one of them wanted at least $10,000 over the MSRP and were willing to “wait for the right buyer.”

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In the coming months, automakers and dealers are likely going to pull out all the stops to get consumers into a new ride. Some are already offering zero percent interest loans and/or deferred payment programs. What those deals look like in reality compared to what consumers think they should be is another story, but regardless of the market conditions it always pays to shop around.

Tom is a contributing writer for Jalopnik and runs AutomatchConsulting.com. He saves people money and takes the hassle out of buying or leasing a car. (Facebook.com/AutomatchConsulting)

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DISCUSSION

what-a-witty-name
What-a-witty-name

My observation: used car prices down about 5%. New car prices are no different than they have been. Dealers are in the denial stage...”I know what I have”. Deferred payments?  70+ month 0% financing?  Puh-lease.  It seems it will take a few more months of no sales for them to reach acceptance.