By: Pierre

Pierre — Sun, 17 Feb 2008 09:05:07 +0000

Obviously the person who wrote this has never sold cars? A 2-hour test drive? No way! Doesn’t happen. Also Kelly Blue Book values are way over what cars are really worth. Dealers and wholesalers laugh at the prices Kelly quotes. I don’t know where they get their numbers but it isn’t based on any real world data.
Typical… some staff writer is given the assignment to write a piece on buying a car. They go out on the Internet or talk to some “Ivy Tower” factory representatives but never talk to the people on the front lines. I meet people every day who have read articles like this and they think they know - but they don’t. All they do is waste their time trying to get what Kelly says their car is worth only to be disappointed.
On new vehicle pricing, KBB is correct most of the time. Invoice is what the dealer pays to purchase the vehicle from the manufacturer and MSRP is the Suggested Retail Price. KBB also has info. on “incentives, rebates, lease deals,” etc. Again, mostly correct. The biggest time waster I see is the person who comes in, wanting to buy the hottest model on the lot - one that is in short supply and the manufacturer can’t build enough of for invoice price or below. This is usually after they have been given a complete “walk-around” demonstration, a 15-20 minute ride and a tour of the service department, coffee bar, and customer waiting area. (Total time 1 - 1.5 hrs). They then leave, hit the internet and contact every “like-brand” dealer within a 200 mile radius trying to buy the car for a cheaper price.
Driving 2 hours to save a couple of hundred dollars could come back to haunt you when you need your local dealer in a pinch. Is it realistic to expect him to bend over backwards to get you a loaner car and squeeze you into his service department if you used him to demo the vehicle (wasting 1 -2 hrs of his time) and then purchased it somewhere else? That’s like trying to return the dress you bought at Marshall’s (overstock discount store) to Nordstrom (full service high-end department store).
As far as different brands are concerned, here is a hint - big rebates and 0% finance rates = “distressed or overstocked merchandise. Be realistic, supply and demand rule the market. There is a reason that Ford, Chrysler, and GM are offering all kinds of crazy deals - they are producing too many vehicles and their market share is shrinking.
Don’t expect to walk into a Honda or Toyota store and have them react to the fact that Jeep has a $5k rebate so therefore the Pilot or Highlander should be discounted too - apples vs. oranges. If the $5k means that much - buy the Jeep - just don’t expect it to be worth what the Honda or Toyota is worth at trade-in time. Remember - every time a manufacturer comes out with a rebate on a specific model to move it off the showroom floor, the used vehicle market adjusts accordingly and devalues that models overall value. When customers come in and say; “Why should I buy that used 2005 model over there when I can buy a new one for nearly the same money?” What they are really saying is - “You paid too much for that trade-in Mr. Dealer.” Therefore, why would a dealer pay big money for a trade-in that had all kinds of discounts applied to it over its lifetime? The truly insidious thing is that the customer who is looking to trade the car in today, might not have even got the benefit of those discounts and rebates when he purchased his car. They may have been given to subsequent customers who purchased that vehicle months or even years after but because the wholesale market has adjusted to the “newer, cheaper” price, it hurts him just the same.
The Internet is a great tool - I encourage people to use it and educate themselves about the product and prices. It just gets me crazy when so-called experts write these “how to buy a car articles” when they just don’t know what they are talking about and have no first hand experience with the subject matter. I also object to being characterized as “a shark reacting to blood in the water.” I use a patient, consultative sales approach and give my customers all the information they need to make an informed purchase decision. I believe that most people appreciate good service and will come back to me as a result. I guess the writer feels it’s OK to paint all in my business with the same brush by using that tired shark cliché.

Comments on: 6 Rules for New Car Buyers

By: Pierre