Tag: Car’s Dealer Cost
How To Find A Car’s Dealer Cost
by admin on Mar.17, 2010, under Car Tips, Cars
How To Find A Car’s Dealer Cost
Whenever you approach a car dealer, you can expect to spend time negotiating the final price. This is true for both new and used cars. The problem is that consumers are often confused about where to start negotiating. It’s understandable, especially given that there’s a sticker price, dealer invoice, and other terms that are used loosely in the industry. Each has a specific meaning and knowing them can be essential toward negotiating a better deal. Today, we’ll briefly explore what these terms mean. Then, I’ll show you how to find the dealer cost of a vehicle (the best place to begin negotiating).
Numbers Explained
First, let’s take a moment to clarify what some of the most common prices mean. Most people know what “sticker price” means. If you walk into a dealership and are willing to pay the sticker price for a car, there’s no need to negotiate. You can leave with your new car in minutes. Paying sticker price is obviously a bad idea (which we’ll discuss in a moment).
You’ve probably heard of the “dealer invoice” cost, but you may not fully understand what it means. It’s the dollar figure that car manufacturers print on invoices that are given to dealers for every car they purchase. However, there are often details under the surface of this dollar figure which aren’t disclosed to the public.
For example, automakers commonly give dealerships incentives and other deals to encourage purchase orders. Sometimes, the dealerships will transfer these incentives directly to customers, lowering the price of their vehicles. However, they’ll often keep the incentives and use them to preserve their profit margin during negotiations with prospective buyers. Ultimately, you may be proud of the fact that you’ve aggressively negotiated a price for your new car that is below the “dealer invoice.” In reality, the dealership can still be making thousands of dollars in profit without your realizing it.
Finding The True Dealer Cost
Knowing how much money a dealer truly paid for a vehicle is critical to negotiating the best price. So, how do you uncover this dollar amount? First, the dealer invoice cost is widely available. Some dealerships will actually offer it to you (though, acquiring it from an unbiased source is always preferable). Once you know the dealer invoice, you’ll need to find out what types of incentives, rebates, and cash deals were offered. Then, you’ll subtract those from the dealer invoice to determine the actual dealer cost.
You can ask a salesperson to divulge the information. But, some will be resistant while others may actually mislead you. The easiest way to gain access to the numbers is to use ConsumerReports or a similar resource. Once you’re armed with the dealer cost, you can negotiate a better deal on your new or used car.