By on August 4, 2015

jetta-sale

Price is the deciding factor in many new car purchases, so it’s no surprise that dealerships do all they can to advertise the lowest number possible. While the internet has given consumers a lot of power when it comes to purchasing a new car, many consumers still fall for age-old pricing tricks.

One of the easiest ways to reel people into a dealership is to set up an advertisement for a decently optioned popular car at a sale price significantly lower than MSRP. This advertisement will usually be the lowest in the geographic area and would cause a loss for the dealership if sold. The way that deceptive dealers get around honoring the advertised price is by specifying a single stock number that qualifies and then asking a friend or relative to put a deposit on that specific vehicle as soon as the advertisement goes up online or in print.

Since the specific vehicle is technically still in dealer inventory, they can continue to advertise it. However, once a potential customer shows up, they can tell them that it is no longer available due to the pending deposit. The next step is to try and switch the customer to a similar vehicle on the lot and sell it to them at a higher price. The best way to check for this type of deceptive advertising is to offer a deposit on the vehicle before you step on the lot. If the dealer refuses to take the deposit and asks you to come in and discuss, the vehicle is most likely not available.

The website popup coupon is another practice to make the customer think they are getting a deal, but in reality only serves the dealer as a lead generation tool. In most cases, a potential customer will receive a popup while on the dealer’s website offering a few hundred dollars off their purchase if they fill out their information for a coupon voucher. Once they fill out the information, it gets transferred to the dealer as a lead and generates a voucher for the potential customer. These vouchers usually have some fine print which states that it must be presented at the beginning of the transaction in order to be valid. This caveat allows the salesman to build the savings from the voucher into the price quote so that the customer believes that they are getting a better price.

Another favorite for many dealers is to advertise a vehicle online with all incentives and rebates combined. These dealers will show a very low price but will list a disclaimer that you must qualify for all rebates and incentives and have excellent credit in order to qualify. While this may seem attainable in theory, it usually requires someone to have an odd combination of qualifications that might include being a retired veteran that graduated from college in the past six months, who insures their vehicles with USAA, and is trading in a competing vehicle on the last Tuesday of the month.

Options are another easy avenue for dealers to bring additional profit. Dealers will advertise a vehicle for a low price but will include a disclaimer that dealer installed options are not included in the price shown. Once you show up on the lot, they tell you that they will sell you that pickup for a lower price but will need to add a few charges since they have already installed a $1,000 bedliner, added $200 worth of nitrogen fill to the tires, sprayed on $400 worth of undercoating, and tinted the windows for $300. These options cost the dealer pennies on the dollar, but since they are already installed the dealer can push for you to pay the higher price once you are in front of them.

The only somewhat honest version of these advertising tactics involves the use of “loss leader” vehicles. These vehicles are usually unwanted models that are missing important features or have odd colors. These models are listed at cost or lower in order to bring customers to the lot and generate buzz. The dealer hopes that once the customer comes to the lot and sees that the vehicle has manual crank windows and is missing air conditioning that they will ask to step up to the next trim level and buy a more expensive version. The dealers will pressure you to go for the higher priced model so that they can make money, but will actually sell you the loss leader at the advertised price if you push for it.

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84 Comments on “Car Buying: Is That New Car Price Too Good to Be True?...”


  • avatar

    I’ve dealt with the dealer-markup thing before. I’m normally an agreeable person, but my response was: “I’m sorry you feel that you put $400 worth of tint, $250 worth of pinstripe, and $75 worth of nitrogen on this vehicle; I’m not paying for those. So you can either take that stuff off and not charge me for it, or I’ll take my business someplace else.” Ultimately, since it’d be ridiculous to rip out the tint and remove the pinstripes and deflate the tires, they just kept the price as it originally was.

    I understand useful upgrades, like aftermarket leather or even those done-up monster trucks they commission (because you have to *want* that kind of vehicle in order to consider purchasing it). But otherwise, quit marking up the cars with dealer-installed options that carry 400% profit margins.

    • 0 avatar
      derekson

      I recently saw the ultimate in dealer cash grab via stupid aftermarket “upgrade”, a photo of a current gen Caddy CTS with a freaking landau roof! I’m sure it had gold badges too, though I dunno if they can pull off a gold grille swap on a modern Caddy.

    • 0 avatar
      jacob_coulter

      So many people are only focused on the monthly payment, I’m sure dealers more often than not get away with this. It might add $10 a month to the payment to the above scenario.

      I remember hearing someone recount their car buying experience and how she didn’t care the dealer-added “Pep Boys” spoiler cost something like $1,200 because it was only around $15 more a month on her car payment.

      • 0 avatar

        $15 is about a quarter of what I spend on diesel each month, haha. I look at it that way.

      • 0 avatar
        duffman13

        OTOH the last new car I bought I went in knowing the exact one I wanted, price, options, etc. In retrospect after a few years of ownership, I realize I would have much rather had a trim level higher for the auto-climate and heated seats. I was being cheap when I got it, but it would have been an extra $25/month over the life of the loan. Yeah that’s $1500 in real money, but on a monthly budget that’s one lunch out at a chain restaurant, or a case of decent beer.

        • 0 avatar

          0% often requires giving up a rebate so it’s not quite the same as cash. Further, if you are cash, you can often get even more rebate by taking a higher interest rate for like 90 days and then paying off the loan in full.

          • 0 avatar
            duffman13

            At the time it was the only offer, not in lieu of a rebate; point taken though. It’s definitely something to keep in mind.

            In our case, it was just before credit started becoming readily available again so finance incentives were few and far between. Plus the Mazda 3 was the only really viable hatch on the market in 2010 (I wasn’t getting anyone in my family into another VAG product after my B5 A4).

      • 0 avatar

        While monthly payment is one of the easiest ways to hide extras, it’s the smartest way for a savvy customer to shop. After all, monthly payment X term is the real amount you are paying for a car. Whether the profit is on the front end or the back end, an all inclusive payment is an honest number. Everything else can have something slipped in.

        • 0 avatar
          jacob_coulter

          How is it more “savvy” than shopping by a cash price?

          The problem with shopping based on a monthly car payment instead of a final price is many consumers can easily be talked into a longer term. They figure they will always be making a car payment, so why not just do a longer term and buy more car.

          That’s when you see people WAY upside down on car loans that then get rolled into new car loans, etc. It’s great for the dealership, not so great for person’s financial future.

          • 0 avatar
            duffman13

            In my case it was 0%/60 so same as cash, less when you think about time value of money. The car was bought and in the middle of carpocalypse (2010), paid off for around 6 months, and is still my commuter. I don’t intend on getting rid of it for another 5 years or so, but that doesn’t mean I wouldn’t mind to have some heated seats when winter rolls around again.

          • 0 avatar

            Because final selling price doesn’t always mean final selling price. There are differences in doc fees, prep fees, transportation may or may not be shown, a low payment may come with a higher interest rate, or 0% may come at a higher price, you may or may not be eligible for all rebates. Some of these are 100% legit, and some are 50 shades of gray. Further, most dealerships can beat your banks interest rate, but they can still hold something on that. Some states cap this, others don’t. The only math that is pretty much foolproof is monthly payment X term. Understanding and comparing all the other variables is nearly impossible. I wouldn’t do it, and I work in the industry.

          • 0 avatar
            jacob_coulter

            Well my response was to Frantz and shopping purely on a monthly price figure. Not getting the features you wanted on a car that you could comfortably afford is a whole different debate.

            It’s just very easy for a dealer to make something appear cheaper than it is when going off monthly payments, a $600 tint job becomes $9 a month, etc.

            I don’t have a problem with car loans or debt in general, you can make a good strategic case for using those tools, but let’s be honest, a significant amount of people make unwise choices when they try and budget based on minimum monthly payments with no regard to the principal. They end up getting deeper in debt and often buy things they don’t really need.

          • 0 avatar
            jacob_coulter

            Franz,

            I think just as many games can be played with monthly payment as can a cash price.

            Eventually you’re going to get to the actual “out the door” amount for a cash price, otherwise, how do you write the check and take delivery?

          • 0 avatar

            Absolutely, My initial statement said as much. Proceed with caution. No matter what any other number is, payment x term is every penny you are paying to own the car. You can plug it in a calculator. Not only can you determine the budget you should be shopping for ahead of time, but you can do the math on what your expectations are and hold them to it. The money has to be made or even lost somewhere, as a consumer I really don’t care where. I’m paying $263 X 72 for my Fiesta with 72 month warranty. My total price is $18936. That’s real out the door as you can’t hide high interest rates, fees, or anything. If you do homework ahead of time and know what fair price you’re willing to agree to, protect yourself, do the math, and determine what the payment should be at your expected interest rate ahead of time. It’s amazing how many people either come in an say they want a $400 payment with $0 down, or they want a $50000 car for $400 a month. These are examples of bad ways to shop by payment, but that doesn’t mean there isn’t a smart way to do it and save much of the headache. “Sir $400 x 84 is $33,600, even at 0% that’s unreasonable”.

          • 0 avatar
            duffman13

            For used cars it is far from savvy. For new cars however, you miss out on rebates, bonuses, etc. by not financing through a manufacturer’s captive finance arm. And as others alluded to above – you can generally pay off the loan in cash after 90 days and keep all of the incentives that you wouldn’t otherwise qualify for as a cash buyer.

            Now, if you are solely a payment shopper, that is a recipe for disaster generally.

        • 0 avatar
          Pch101

          Only a car dealer would claim that one should buy based upon the payment.

          The way to get to the lowest monthly payment is to apply the best financing terms to the lowest purchase price. This is not debatable, but just arithmetic.

          There are a few basic ways to reduce a monthly payment:

          -Pay less for the car
          -Get a lower interest rate
          -Increase the down payment (borrow less money)
          -Extend the term (lower payments per month, but more total payments)

          Dealers will naturally try to push you toward the last two methods, not the first two. This is why you should NEVER buy based upon a payment. If you negotiate the best price and terms, the payment will work itself out.

      • 0 avatar
        stuki

        The opposite happens as well. Particularly on leases. It seems like there’s an epidemic of car leasers out there, who don’t realize a $1200 down payment is the equivalent of $50/month added to a 24 month lease.

        For purchases, just dig up the best truecar quote from somewhere within 1000 miles of you, even if not technically in “your market.” Then adjust options downward from invoice in proportion to the price, making sure there are no regionals making your “deal” virtually impossible, and offer it to your dealer of choice. If they say yes, good. Otherwise, go somewhere else or wait for them to change their mind. Unless you’re Korean (sorry for the stereotype, but there seems to be a cultural aversion to overpaying, even a dime, that is so strong it makes me glad I’m not a Hyundai dealer…), you’re not going to leave too much on the table. And, if you’re not going to let them make much of a profit, don’t take up too much of their time bickering about nonsense, either. Do your homework, hit and run.

        • 0 avatar
          Pch101

          “It seems like there’s an epidemic of car leasers out there, who don’t realize a $1200 down payment is the equivalent of $50/month added to a 24 month lease.”

          It’s more than that, because the money is being front-loaded. On a present value basis, $50 paid 24 months from now is slightly less than $50 paid today.

  • avatar
    ajla

    Dealer-istalled options and dealer fees (usually around $1000 in Florida) are always such a huge hassle.

    I really wish dealers had to advertise the OTD price but they own the state legislature so that will never happen.

    • 0 avatar
      Land Ark

      There’s a Honda dealer up here that sells all their cars with OEM mud flaps, pin stripes, and wheel locks and then adds an astronomical amount for them (it used to be close to $600 if I recall). They have done this for decades. I haven’t looked to see if this is SOP for all Honda stores.

      I owned a Civic that had all three including the wheel locks despite it having steel wheels and plastic hubcaps.

      Here’s a fine example from that dealer:
      https://goo.gl/oaBA4L

      • 0 avatar
        bball40dtw

        The dealer I buy from always adds wheel locks for $25 extra, but you can say no. Since I am in Detroit often, I say yes.

      • 0 avatar
        RideHeight

        My Honda store is clean on that. You have to ask for the dealer-installed extras.

      • 0 avatar
        derekson

        Honda dealerships loading on the dealer-installed options doesn’t surprise me, since that was their entire business model for so many years. Even into the 90s, all A/C on Hondas was dealer-installed as an option.

        • 0 avatar
          RideHeight

          “Even into the 90s, all A/C on Hondas was dealer-installed as an option.”

          That sucks. Not because the dealer arrogated the choice to themselves but because I’d rather have the factory doing the install.

          Then again, who the hell would *not* choose A/C in the ’90s unless their locale never reached the 90s.

      • 0 avatar
        Zoom

        I’ll call out Boucher Auto Group in Wisconsin for still putting pin stripes on a lot of their new and used vehicles. They sell almost every mid-priced brand, in various dealerships. I’ll never buy a car from them with pin stripes. I don’t care if the stripes are free. No deal.

      • 0 avatar
        TMA1

        Two weeks ago I was looking at GTIs at a dealership that was also half Honda. Out of curiosity I went over see what was on offer. The first car I looked at was a Civic Si, with a $1750 dealership “appearance package”. Given how unrestrained Honda has been with the latest Civic, I couldn’t tell what the dealer might have added on to that tacky thing.

        Going to check out something much more restrained (I was there to look at VWs, after all), I checked out the Accords. Each with a … $1750 dealer-installed appearance package. Every Honda on the lot had that. But there were no appearance changes at all that I could see on any of the cars. Not even tint and pinstripes! The VWs were merely hit with $200 in nitrogen.

        I’ve additional dealer markup at Nissan, Kia, and Hyundai stores too. Who do they think they’re fooling with that nonsense? One Chevy dealership had a $2,000 markup on an electric Sonic. OK, I figured that’s an electric vehicle (and I didn’t even know they sold those outside of California). But every car on the lot was marked up $2,000, whether it was a $15K Sonic or a $45K Camaro 2SS.

    • 0 avatar
      whynot

      There is a Kia dealership near me that has a $500 pinstripe, $1500 “dealer fees”, and $2000 markup on every. single. car. $4000 extra for a Kia- and during the sales pitch they talk about how good values Kia’s are to the competition (not when you add $4000 to MSRP). Their year end sale is just removing those fees from the previous model years.

      Needless to say I have since noticed very few Kia’s in town were actually bought there (easy to tell because of pinstripe).

      • 0 avatar
        onyxtape

        My in-laws are complete morons when it comes to anything to do with money (well, I guess that’s just about everything). In 1994, they managed to buy a new Jeep Grand Cherokee and ended up with a grand total of almost $40,000.

        $40,000 in 1994 dollars = $65,000 in 2015.

        They just got themselves into a very fatty inheritance. I can’t wait to see what they buy next.

    • 0 avatar
      MrGrieves

      I’ve lived in most of the major areas in the US (except the Northeast), but it seems like the dealers in the Southeast are by far the worst with the shenanigans. Many years ago I looked at a Pontiac G8 GXP and the dealer had slopped on $4,500 worth of “extras.” Including $400 for nitrogen filled tires, and a $1,000 “high demand vehicle” fee. I laughed at the sticker and walked out, but it wouldn’t surprise me if somebody came in the next day and paid it.

      The salespeople in the Midwest seemed the easiest to deal with, but there are surely good and bad apples everywhere.

  • avatar
    twotone

    A timely article as I helped a buddy buy a new Honda Accord last week. Looking through the on-line dealer ads here in Denver, we came across one Denver area Honda dealer advertising $1,700 off MSRP and 0.9% financing. Reading through the ad, I did not see the usual fine print stating that you had to be a recent college grad, left handed minority war vet or other typical stuff.

    We went to the dealership, my buddy found one he liked, took it for a test drive and said he wanted it. It had no extra stuff added to it. He said that the dealership does not automatically add clear bars, window tinting, etc, to cars but can add them if he wanted. My buddy said no thanks.

    The salesperson said that the internet ad was in fact the price, but they were having another promotion that day. He came back and said that the price was actually another $500 less.

    We asked about the promotional financing and he said the usual “If you qualify we may actually have a better deal.” After my friend completed the credit app, the salesman said that he qualified for the zero down, zero percent interest for 60 months.

    I’ve helped a lot of non-car friends buy cars over the years and this way by far the smoothest, easiest and least hassle purchase ever. My guess is that being able to do Internet research before even setting foot in a dealership has helped keep them honest.

    • 0 avatar
      MUSASHI66

      Which Honda dealership?

      I’ve bought two Hondas so far from Mile High Honda, and I didn’t experience any dealer add-ons. Buying a Subaru was a different story – Shoreline tacks about a grand worth of pinstripes (seriously?? I won’t drive a car with that hideous shit on), nitrogen, fabric protector, rust protector etc. I had to go to Heuberger to get the best price.

    • 0 avatar
      2KAgGolfTDI

      Wow, which dealer was that? Not Planet or Schomp, maybe Kuni or Mile High?

    • 0 avatar
      zaxxon25

      Had a similar experience with Honda a few years ago when I was helping a friend get a Civic lease … between the time we looked at the car and negotiated and the time she decided to go with it they had sweetened the lease deal even further, the dealer honored the new terms with no further negotiation needed. I was impressed at their honesty, though as above I think it had more to do with doing our research (twice) and being prepared before we walked in the door (twice).

    • 0 avatar
      Dave M.

      I help well over a dozen people a year with new vehicle acquisitions. The honest dealers get repeated referrals. The idiots don’t. There’s a local Toyota dealer that has at this point made 60+ sales based on how they treated me whrn we bought our Highlander in 2003. Honesty pays.

      I also drove 50 miles out of town to buy my Outback based on how they handled my original inquiry and how smoothly the transaction went. In the past two years they’ve sold four more Subarus to Friends of Dave M.

    • 0 avatar
      wilandlane

      I had a similar experience. I was taking advantage of a College Grad rebate at a Toyota dealership. The salesman said something along the lines of, “Just wait a minute, I think Toyota just increased the rebate, I’ll go check.” He came back with a recent fax from Toyota saying the rebate was now $750 instead of $500.

      In addition to that, their prices very very transparent, the lowest in the state and were very pleasant to work with. We qualified for 0% financing and signed the papers the next day. I can’t recommend this dealership enough to friends: Ira Toyota of Danvers. There are some honest dealers left out there, thankfully!

  • avatar
    indi500fan

    I always think “wow in this age of the educated internet savvy consumer, SURELY they aren’t still pulling this crap”

    And guess what, it’s just like five DECADES ago…

    • 0 avatar
      319583076

      If you accept that the proportion of stupid people is approximately constant, then couple that fact with the largest human population in the planet’s history, it follows that there are more stupid people alive today than ever before. P. T. Barnum comes to mind…

  • avatar
    cgjeep

    I’ve been seeing some shady adds on cars.com were the used car dealer states a price and in the description of the car it states price good after $3,000 down payment.

    • 0 avatar
      Alfisti

      but every manufacturer does that, “Lease for just $399 a month!”

      ***** $5,000 down. Wellhang on it’s not $399 any more is it??

      • 0 avatar

        Additionally taxes aren’t included, but that’s sorta justifiable due to different states having different taxes. In PA, retail sales tax is 6%, but on retail leases its 9%. That’s $35 right there (and you would also be taxed on the amount down). Talk about built in obstacles to overcome.

  • avatar

    #1 People buy what they want.

    #2 People buy what they can “afford”.

    #3 (“afford”) THE MONTHLY PAYMENT is what the vast majority of buyers are focused on.

    #4 THE TOTAL MONTHLY PAYMENT people focus on includes the cost of insurance. It can make or break a deal.

    #5 Smart buyers focus on INTEREST RATES and ensure their credit score takes them as far as it can go. The vast majority aren’t buying with “cash-on-hand” and the vast majority of dealers will work numbers so that they make their sales goals one-way-or-the-other.

    This means that an otherwise overpriced, unaffordable car becomes $680 per month with a $250 per month insurance cost!

    • 0 avatar
      JMII

      For sure, they always work the payments. So that $400 window tint package is only $5 in monthly payments, which the salesperson will remind you is less then a happy meal. Most people will not cheap out on just $5 a month so the dealership can easily slips these BS charges thru the system when people just focus on the “per month” price.

      Often these bogus item are add-ons the F&I people put on top of the deal. They get separated from the cost of the car and instead get bundled in the financing package. One way to avoid any such games is having your financing arranged ahead of time from a credit union or another bank. This can work against you however if the dealership has some special deal due to working with a preferred bank. For example 0% for X months, but if you use “Ford Credit” (if you qualify of course). While people almost always negotiate on the vehicle price they often forget you can negotiate on the rate or note as well. They are two separate transactions.

  • avatar
    Felix Hoenikker

    I’ve run across these tactics in the past especially with Japanese car dealers. I didn’t encounter any of it last June when I was car shopping. Maybe things are changing for the better.
    In the not so distant bad old days, I remember the stack discount scam. Once, I cut out the ad from the paper and presented it to the local dealer, but not till after taking a test drive and selecting a car from their stock. When he went to write up the sale, I pulled out the ad and asked for the price. He asked me if I meet all of the qualifications on the ad. I just said that the fine print was too small and made him read each one. I didn’t meet any of them.
    I acted very sad, and said I had my heart set on that car at that price. Then I got up and started walking for the door. He followed me out to the parking lot begging me to come back and deal. I politely declined and said I was too depressed for any more talk and needed a few years to get over the disappointment. I just about peed my self laughing all the way home.

    • 0 avatar
      bball40dtw

      I think some of the tactics are dependent on location. I purchased a few cars in Michigan with negotiations, but no shady business practices. I already knew I would qualify for most Big 3 employee deals. However, I moved to Arizona and had a heck of a time trying to buy a car without a “Desert Protection Package” or something similar. I hate those dealerships.

      • 0 avatar
        derekson

        This is absolutely true. In areas with more competition, dealerships are forced to be more honest I think because there are so many places a buyer could take their business if they realized they’re being screwed over. In areas where a few big conglomerates control all the dealerships, you probably see more of this stuff because they know most customers will only go so far from home to buy a car.

        From what I’ve heard and read here and elsewhere, the Southwest sounds particularly bad with the desert protection packages and other crap. And I know in southern California there are markups over MSRP on almost any car you’d look at buying, especially performance models and limited editions but really anything that’s currently in demand enough that they can get away with it. I’ve read about people buying things like a Golf GTI and having the dealer ask for a markup!

        • 0 avatar
          dal20402

          The Seattle area is bad because all other metropolises are so far away. In-town competition is limited and buying a car from anywhere out of town involves serious shipping costs (or a long road trip). Dealer trades are pretty much impossible because of the logistics. It’s hard to get a good deal on most cars, and also hard to get a rare or unusually configured car.

          • 0 avatar
            bball40dtw

            Good deals from the domestic brands is one of the perks of living in Metro Detroit. We need those deals as our roads are rated somewhere between Kabul and Ramadi.

  • avatar
    threeer

    My favorite one lately is from the local KIA dealership advertising “up to $6000 trade over blue book” for your car. Of course, in the fine print it states that “adjustments may be made account for condition, mileage, etc…” So, some schlup appears at the dealership expecting something approaching $6000 (which, the ad also states in fine print that any negative equity is rolled into the current loan) and is told that the car is only being offered to be taken in on trade for something like $1000, which will also be added to his new loan. What. A. Bargain.

    Do people actually fall for that?

    • 0 avatar
      mmreeses

      —-Do people actually fall for that?

      people rob banks cuz that’s where the money is. dealers advertise gimmicks cuz it works.

      and don’t forget the ‘sunk cost fallacy’ since people bothered to drive 30min to the dealer and spent 30 min milling about, they figure “i;ve already spent 1 hour (x hours) looking/negotiating for the car, might as well get it today.”

  • avatar
    zaxxon25

    The one time I got duped was on an internet price that included a brand loyalty bonus. After the test drive their initial offer was above what I expected. But by then the dealer knew I was looking for an MT with a specific option package and had leverage. I negotiated it down but eventually capitulated rather than move on to the only two other similar vehicles on the east coast.

  • avatar
    WhatDaFunk

    My mom actually bought one of these bait cars, a 90 (or 91, can’t remember) Ford Aerostar. Vinyl interior, 5 speed manual, crank windows, no AC, not even a radio! I ended up inheriting it when she bought a New Beetle some 12 years later. I might still have that car if it hadn’t been totaled by a driver running a stop sign.

  • avatar
    Ron

    I tell dealers to bid percentage above dealer list (NOT MSRP) less incentives and rebates. If a dealer bidding the lowest percentage has an option on the car that I am willing to take, then I pay dealer list for that option plus the negotiated percentage above dealer list. Three years ago I bought a Prius for exactly dealer list. The car had two “dealer packs” (a decal on the bumper and a cargo net). I refused to pay for them and the salesman threw them in for free.

    Check out http://www.dealerrater.com to weed out the worst dealers.

  • avatar
    kvndoom

    Car dealers are still liars and crooks. More news at 11.

  • avatar
    Alfisti

    As an Australian i still find buying pretty much anything, let alone a car, an exercise in frustration in North America.

    Why on EARTH it is not required to post the out the door price on any good or service just staggers the crap outta me. So shady and so many avenues to dodge and mislead the consumer, just advertise the price already!

    • 0 avatar
      Zoom

      “Why on EARTH it is not required to post the out the door price on any good or service just staggers the crap outta me.”

      Dealership lobby. U.S. politicians are bought and paid for.

    • 0 avatar
      Pch101

      It’s probably best that you not advertise the fact that you’re an Aussie who can’t stop whining about America.

      Sales taxes vary here by locality. In the case of cars specifically, the tax is determined by the location where the car is registered, not where the dealership is located, so there is no way that a car dealer could post a sticker price that includes the tax.

    • 0 avatar
      duffman13

      Piggybacking on what pch101 said about tax, sales tax is affected by a myriad of factors as well when you’re dealing with a trade-in depending on the state you live in. In many cases, the trade-in value cancels out some of the sale price of the new car in the eyes of the government thus reducing your tax burden.

      Plus, discounts and incentives change monthly if not weekly and are regionally and qualification dependent. Thus the price of the car is almost always a guesstimate for a shopper coming through the door at best.

  • avatar
    sirwired

    The worst is probably Toyotas in the Southeast. All Toyotas in the Southeast have to go through the distributor for that part of the country. In addition to a mandatory “SE Toyota Distrobution Fee” (which is in addition to the delivery fee and any dealer-imposed “documentation fee”, every single one that is not special-ordered has the “ToyoGuard” package, with useless fabric and paint protectant and VIN Etching that every consumer publication warns you about already on the car.

    We went through an auto-broker for our last Toyota specifically to avoid paying for Toyoguard.

    If you don’t go through a buying service, the best way to avoid that sort of crap is to request an “out-the-door” price when collecting quotes and then threaten to walk when they try and pile that stuff on. (And refuse any offers to “meet them halfway” or somesuch.)

    • 0 avatar
      threeer

      Ahhh…VIN etching! One of my favorites. My current car (bought used, 2004 Lancer Sportback Ralliart) already had the VIN etched on it. I test drove the car and went back and forth on making the decision to buy. When I finally decided to make the purchase, the dealership tried to sneak in VIN etching (for some ridiculous amount of money) as if they had to do it. Not that I wanted it, but it was already on the car, and I called BS on them for it. Needless to say, they removed the charge, but it torqued me that they had even attempted a blatant lie like that.

    • 0 avatar
      Japanese Buick

      I live in NC and do all Toyota buying in Maryland because that’s the closest place you can without having to go through SE Toyota.

      Not only do they have too many junk fees, but they also restrict the option packages available, naturally to the more expensive (i.e., if the sunroof is optional on a trim level, all Toyotas in the SE will have it).

  • avatar
    Dan

    One of the most blatant lies in a fundamentally dishonest industry is leaving the $800-1200 “destination fee” out of the advertising. This isn’t just dealers, the manufacturers hide it in the fine print as well.

  • avatar
    slance66

    I’m a cash buyer for this reason. Any mention of “monthly payments” is met with “I don’t know and I don’t care”. If the manufacturer has some sub 2% financing, I might take it just because it’s available. I look at the price of the car, period. As for pinstripes, I looked at a Red 2013 Lexus GS350 two days ago and it had pinstripes. So 1978. Yuck.

    Several of our local dealers use the “all incentives applied to the price” approach and it is rather annoying. My approach to them is that they can give me that price or I won’t buy a car from them. I’m not paying more because I’m not a Vet or I’m not coming off a competitive lease.

  • avatar
    APaGttH

    …and many of the B&B will March out on of these adds as proof positive that the MANUFACTURER has put $10,000 on the hood of a $20,000 car to goose sales.

    Dealer ads do not equal factory incentives or programs.

    Oh, and Ford of Kirkland SUCKS

    • 0 avatar
      dal20402

      Haha Ford of Kirkland. Way back in 1992, when I got my license, they tried to sell me a nicely waxed ’87 Taurus LX that, upon startup, made a nice cloud of blue smoke and sounded like bolts in a paint mixer. I don’t even know how that happens to a low-mileage Vulcan V6. “But it has leather!”

      • 0 avatar
        APaGttH

        When Bark wrote his story about the crazy lease rates on the FiST – I went to Ford’s website and confirmed it was eligible in my area. I was craving a manual toy in the driveway, and a $200 and change 24 month lease on a FiST would be just what the doctor ordered. About $850 out of pocket and goodbye.

        Went in, drove a FiST with the Recaros (tight but I fit in them) and was so impressed on how absolutely fun it was to drive. Right equipment, right color.

        Went back inside and the fun and games began. Showed them the Ford site and basically told, “oh that doesn’t include fees, and other charges, and your rate would be $389 a month.

        Let me be crystal clear – no credit report pulled (didn’t give them any info, nor a photo copy of the DL at this point) and my FICO is 765 to 803 (3 bureaus, 3 scores) so I’m definitely “well qualified.” My debt to income is under 8%.

        I would definitely fully qualify for the rates but they clearly were hoping to gouge me on BS.

        Ford of Kirkland’s position was that Ford, the manufacturer, lies on their website and shows lease deals that don’t exist. Ludicrous. The sales manager was saying to me, that they advertise the lease rates and but don’t include the fees. I showed him on my iPad all the footnote disclaimers and that it did include the fees, except local taxes. It was all spelled out. I said conversation was over and walked.

        The sales manager chased me out of the door, “I don’t want you to leave mad, I mean there are these other,” and I just kept saying I don’t need the car, I’m just scratching an itch, and I have no time to play games. You gave me your best first price knowing full well what I expected, and I’m not going to negotiate.

        I actually knew there was going to be an issue when I noticed the sales drone had historical ADM stickers from cars they sold under a piece of glass with RIDICULOUS mark up.

        I’ve told dealers in the past when buying when there is an ADM sticker – I’m negotiating from THIS sticker (and point to the Monroney sticker) and not this one.

        Never got the FiST anywhere else – the whole experience left a bad taste in my mouth and the itch to have a manual toy went away with the summer sun and pulling the G8 out of the garage again.

        Just wish the G8 was a manual.

  • avatar
    Zackman

    The dealership I bought my 2012 Impala from had a ridiculously low price on some of their cars when I bought mine 3 years ago. You had to look REAL CLOSE to see that price was for GM employees only! Add $3,000 more for everyone else.

    That dealership doesn’t do that anymore.

    If it sounds or looks to good to be true, it is!

  • avatar
    Mandalorian

    The biggest hose out there is EMPLOYEE DISCOUNTS. Seeing a car online then coming in and having it be a couple hundred more due to misc charges is to be expected. Cars are often advertised with employee discounts which tend to be in the THOUSANDS of dollars.

    Also, I tend to have a gripe with small town dealers who think they are God. A couple years ago, I went to a local GM dealer to test drive and check out a new Yukon Denali. I had been taking my Tahoe to this dealer for service, they were good people. Afterwords I sat down, told them I liked to support local business and I knew they couldn’t compete with the big city dealers on a volume basis, so if they could come within $1000 of the quote I got from the big city dealer I would buy from them.

    The small dealer said the best they could do was $8000 MORE for the EXACT SAME VEHICLE as the big city one. After hearing that I got up and walked straight out the door. Ended up buying a Q7 instead of a Yukon Denali.

  • avatar
    FreedMike

    Yeah, but that truecoat…you don’t get it and you’ll have oxidation problems.

  • avatar
    eggsalad

    I’ve said it before about my town and I’ll say it again. Las Vegas is a metaphorical island. It’s 250 miles to the next major metropolitan area, LA or Phoenix.

    I hate to use the word collusion, but all of the dealers know there isn’t another place to shop, so they all pack on that extra crap, like the dreaded Desert Protection Package.

    Don’t like it? Have a nice drive to Phoenix or LA!

    • 0 avatar
      bball40dtw

      All those Southwestern cities are population islands (and the mountain ranges are sky islands). Vegas may be the most isolated though. There is a whole lot of nothing in every direction.I had the same issue in Tucson. I ended up buying in Phoenix.

  • avatar
    SCE to AUX

    Very helpful article – thanks.

    If I’m trading a vehicle, I combine the trade-in with the new car price to achieve a bottom line I’m happy with (after having done some research, of course). This way, I don’t get burned on two transactions. I don’t care if they’re losing money on the new car or the old one.

    Sure, I’m probably not getting the very best deal possible. But money buys convenience; I don’t have time for selling cars on Craigslist – fielding calls in the evening and hoping for somebody to show up with actual money, who won’t murder me during the deal.

    As for new cars, a two years ago I walked out on a salesman who persisted in using the 4-square even after I told him to put it away. He started with the old “the car you want isn’t here” routine. After a long test drive, repeated negotiating with the mysterious backroom manager, and endless 4-square, we walked after he wasted 2 hours on us. This was to be a car for my son; his eyes were opened by the process, and we ended up buying a great used car for the same money at a very nice dealer.

  • avatar
    TDIGuy

    WRT dealer invoice pricing or employee pricing, I just use that as a starting point. I have told the sales drone: “Great that’s your price, so what’s my price?”

    The old chestnut they drag out around here is the “free gas card”. Wording is usually something like “includes .89/L gas card”, when in reality the fine print says it is really a discount of .30/L to a limit of $1000. In other words, the card is worth $300 and you can bet that’s not what the dealer paid for it.

  • avatar
    jim brewer

    It’s fairly easy to find out who the “quality buying experience” dealer is and who the high pressure scumbag is for the car you are interested in. They usually share the same inventory because of manufacturer rules.

    High Pressure guy is for test drives. Quality guy is for closing the deal. Even still, you should plan on some dickering.

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