IS invoice a fair price on a 2010 Sport Order?
Rookie
Joined: May 2009
Posts: 97
Likes: 0
From: San Antonio, TX
Truck Pricing
My deal back in May was $33,400 + TTL with 0% for 48 months and 3 free years of oil changes. My truck stickered at $46,800 so I received $13,400 off MSRP in addition to 0% and the oil changes.
The pricing all depends on multiple factors. There are special APRs, national rebates, regional rebates, dealer discounts, holdbacks, freebies, etc.
First of all let's dispell the myth that "dealer cost" = invoice...it doesn't. Dodge's holdback for an AVERAGE dealer is 3% of Total MSRP. In my case, that would be $46,800 * 0.03 = $1404. However, my particular dealer had a holdback of 4% which I received all of for a holdback discount of $1872. Holdback depends on how successful a dealer is. In other words, a dealer who is one of the top dealers in the state or nation with regard to volume of sales, will get an even cheaper price from the manufacturer (Dodge in this case) so they get their trucks cheaper and therefore can offer even better deals because they have a larger margin to work with than the average dealerships.
When you want to start looking at what price to pay you should start with Edmunds.com and price your truck to get the "invoice" price. This is your STARTING point to negotiate down from. Take that invoice price and subtract any applicable rebates, dealer cash, holdback etc. Remember the rebates do not come out of the dealer's pocket. If they sell you a truck for example at $10K off sticker and there are $10K in rebates, it's like they are selling the truck for full MSRP.
Just FYI here's an explanation of various discounts.
- Rebates are given from the manufacturer to the buyer directly and therefore do not come out of the dealer's pocket at all
- Dealer cash is cash that is paid from the manufacturer to the dealer directly for sales. It is up to the individual dealership to decide how much, if any, of that cash they want to pass on to their consumer however recent economic conditions have pretty much guaranteed all of that will go to the consumer but you might have to fight for it (negotiate).
- Regional rebates are specialized rebates such as Texas State Fair $500 discount that are given to people in specialized areas.
- Job specific rebates such as Military, Quarter horse member etc. are given to people who can prove they belong to a certain profession.
- Holdback is sort of a bonus amount of cash that can be made by the dealer if they sell their inventory within 90 days of receipt from the manufacturer. This is why salesmen will always try to sell from their lot first.
I'm not trying to insult anyone's intelligence so if you already knew all of this information then great but if not it should be of great help. I have bought my fair share of cars and I'm only 31 but I have always gotten great deals because I know this information and I use it against the dealership when I buy my vehicles. I'm always polite but I let them know up front that I'm an educated buyer and I go in with a minimum price I'll accept and work from there.
When you buy, IF you have a trade, NEVER NEVER NEVER let them know up front. They generally will ask you what payment you're making or are looking for as this is one of their tactics. Just simply use the phone and internet to solicit best prices before even going to a dealership. Then you know who is willing to play ball and who isn't. Tell them you are a cash buyer (unless you play to use 0% through the dealership but still save this for last) and have no trade. Once you have agreed on the price of the vehicle you want to buy, then you can work the other two items separately. If you let them, they will confuse you with math and try negotiating a deal by monthly payment.
You have to be willing to walk out the door. I have done this many times before. I know it's a pain but believe me I've had them come out and get me from my car before I've driven away and other times they've had a message on my machine by the time I get home. Ultimately, they need us not the other way around. Take your time, do the math and DO NOT BE AFRAID TO CONFRONT THEM on misinformation and lies.
When I bought my Ram in May, it was the EASIEST purchase so far. I called their Fleet Manager (Internet Guy) and told him I saw a truck on their lot that I was interested in. I told him I wanted to know his best price on the truck and I informed him that I was aware of all the applicable discounts (rebates, dealer cash, holdback, etc.) and listed them for him. I told him I was ready to buy that day if we could agree on a price but that I would not come into the dealership unless I already knew we agreed on a deal. He was very honest and he placed me on hold for about a minute and came back and offered me just under $14000 off MSRP. I didn't jump and say ok! I told him I thought that was a good price and then told him I wanted 0% through Chrysler, etc. I walked in, signed the paperwork, picked up the truck and that was that. I even purchased the lifetime maxcare $100 deductible bumper-to-bumper warranty for $1675 (I negotiated that after I bought the truck)
I hope this helps!
Jason
The pricing all depends on multiple factors. There are special APRs, national rebates, regional rebates, dealer discounts, holdbacks, freebies, etc.
First of all let's dispell the myth that "dealer cost" = invoice...it doesn't. Dodge's holdback for an AVERAGE dealer is 3% of Total MSRP. In my case, that would be $46,800 * 0.03 = $1404. However, my particular dealer had a holdback of 4% which I received all of for a holdback discount of $1872. Holdback depends on how successful a dealer is. In other words, a dealer who is one of the top dealers in the state or nation with regard to volume of sales, will get an even cheaper price from the manufacturer (Dodge in this case) so they get their trucks cheaper and therefore can offer even better deals because they have a larger margin to work with than the average dealerships.
When you want to start looking at what price to pay you should start with Edmunds.com and price your truck to get the "invoice" price. This is your STARTING point to negotiate down from. Take that invoice price and subtract any applicable rebates, dealer cash, holdback etc. Remember the rebates do not come out of the dealer's pocket. If they sell you a truck for example at $10K off sticker and there are $10K in rebates, it's like they are selling the truck for full MSRP.
Just FYI here's an explanation of various discounts.
- Rebates are given from the manufacturer to the buyer directly and therefore do not come out of the dealer's pocket at all
- Dealer cash is cash that is paid from the manufacturer to the dealer directly for sales. It is up to the individual dealership to decide how much, if any, of that cash they want to pass on to their consumer however recent economic conditions have pretty much guaranteed all of that will go to the consumer but you might have to fight for it (negotiate).
- Regional rebates are specialized rebates such as Texas State Fair $500 discount that are given to people in specialized areas.
- Job specific rebates such as Military, Quarter horse member etc. are given to people who can prove they belong to a certain profession.
- Holdback is sort of a bonus amount of cash that can be made by the dealer if they sell their inventory within 90 days of receipt from the manufacturer. This is why salesmen will always try to sell from their lot first.
I'm not trying to insult anyone's intelligence so if you already knew all of this information then great but if not it should be of great help. I have bought my fair share of cars and I'm only 31 but I have always gotten great deals because I know this information and I use it against the dealership when I buy my vehicles. I'm always polite but I let them know up front that I'm an educated buyer and I go in with a minimum price I'll accept and work from there.
When you buy, IF you have a trade, NEVER NEVER NEVER let them know up front. They generally will ask you what payment you're making or are looking for as this is one of their tactics. Just simply use the phone and internet to solicit best prices before even going to a dealership. Then you know who is willing to play ball and who isn't. Tell them you are a cash buyer (unless you play to use 0% through the dealership but still save this for last) and have no trade. Once you have agreed on the price of the vehicle you want to buy, then you can work the other two items separately. If you let them, they will confuse you with math and try negotiating a deal by monthly payment.
You have to be willing to walk out the door. I have done this many times before. I know it's a pain but believe me I've had them come out and get me from my car before I've driven away and other times they've had a message on my machine by the time I get home. Ultimately, they need us not the other way around. Take your time, do the math and DO NOT BE AFRAID TO CONFRONT THEM on misinformation and lies.
When I bought my Ram in May, it was the EASIEST purchase so far. I called their Fleet Manager (Internet Guy) and told him I saw a truck on their lot that I was interested in. I told him I wanted to know his best price on the truck and I informed him that I was aware of all the applicable discounts (rebates, dealer cash, holdback, etc.) and listed them for him. I told him I was ready to buy that day if we could agree on a price but that I would not come into the dealership unless I already knew we agreed on a deal. He was very honest and he placed me on hold for about a minute and came back and offered me just under $14000 off MSRP. I didn't jump and say ok! I told him I thought that was a good price and then told him I wanted 0% through Chrysler, etc. I walked in, signed the paperwork, picked up the truck and that was that. I even purchased the lifetime maxcare $100 deductible bumper-to-bumper warranty for $1675 (I negotiated that after I bought the truck)
I hope this helps!
Jason
Last edited by HEMICrew; Nov 6, 2009 at 11:13 AM.