I’m planning a purchase this summer. The two cars I’m looking at most closely are the Mazda2 and the Scion xD. I noticed that the 2011 Mazda2s are spending an average of 109 days on the lot, and the 2010 xD is even worse at 239 days. Your February sales charts and March charts paint a similar picture. They’re both selling terribly, but I’m so far unable to find good deals on either, for different reasons.
The Mazda2 is a new model and one local dealer actually had them marked up by $1,700! The xD on the other hand suffers from Scion’s no-haggle pricing — but, the 2010 models at my local dealer are all marked down, but only by about $400 below MSRP. The huge inventories mean that neither are really affected by the parts shortage — there are dozens of each in stock at dealers in my area. I’ve even read that Mazda2s have up to $2,000 advertised discounts in other parts of the country.
I’m not totally set on either of these vehicles, but I do really like the Mazda. I just don’t think I’d feel OK with paying MSRP for either of these cars. If you wanted to end up in one of these cars before the summer was out, how much do you think I would have to spend, and how would you go about it? The only new vehicle I’ve ever purchased was a Scion at MSRP, so I have no experience manipulating a dealer.
Thanks to my personal writing constraints, my advice is far from timely. But one thing is still true; it’s pretty foolish to buy a new Japanese car until the fall or (maybe) winter. That said, there’s still a chance you won’t need to pay MSRP, especially for a Mazda. I wouldn’t go out on this particular limb if you said Honda, Toyota or Lexus. One other thing to consider, the difference between MSRP and Dealer Invoice is less than $500 on the Mazda 2, and that’s less of the exception and more the rule these days.
Since you like the Mazda2, let’s stick with that. Considering your reference links and the assumptions that go with, finding one for less than MSRP should be simple, if time consuming. Basic research on pricing/options on Edmunds.com is mandatory: with the invoice price in mind, its time to find a way to get one for that price, or very close to it. You can decide what that price might be. Invoice plus $200? Invoice plus $50? Whatever.
Generally speaking, there are three ways to save money in this business: dealer discounts/perks, factory-to-customer discounts and factory-to-dealer discounts. The first is straightforward, is usually offset with re-loading of profits from your trade, the value of a financing rate, cost of warranty plans, add-ons like pinstriping, free oil changes, etc. The second is well publicized, and usually to your advantage, but certain times leasing is better than buying with incentives, especially if the vehicle is for a business. The last one is often hard to know, and I usually prefer to maximize a buyer’s return on the first two, and let the dealer give this back to you via competitive bidding amongst themselves.
Here’s the point: shop around. Don’t be afraid to hop on a plane, drive a car back if you find a dealership nearby willing to sell one at invoice, or less. Dealers can and will sell below invoice if a unit (especially if its in a funny color) sits around longer than 60 or 90 days. Work that system and play them against each other. You will come up with a clear winner rather soon, and they might earn your trust for future purchases. Good luck.
Bonus! A Piston Slap Nugget of Wisdom:
Always shop by the “drive out” price, and only for the car itself. We’re talking the bottom dollar, bullshit free selling price. Don’t mention a trade in, accessories, financing and never, ever shop by monthly payment. It’s way too easy for a dealer to re-load their losses when you mask the truth with extra variables. Always focus on the price of the vehicle first, worry about the rest later. That will make shopping far easier and less stressful.
Do that and not only will you do better, you will earn the respect (and guarantee their future income) of the dealership. Once you find that special place, of course!
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