The "ins" and "outs" of CPO and Used Car Buying!

[Ralphie]

Im looking to get some insight from people who work in the "business".

Buying a car new or used, is all about hagling.

Well new not so much, its a level playing field.

Used very much so!

Everyone know's about Kelly Blue Book.

From reading I have done and friends and family, I have heard that Dealerships do NOT use KBB. Instead they use either NADA, or the "Black Book".

www.whypaysticker.com

http://www.nadaguides.com/Cars/Research-Center



Now I was curious how true that is?

What im trying to find out is how close these prices are to the dealers cost.

Im going to be trading up in the spring, probably for an 8th Gen Accord, and I want to get the best deal I can.

I know there is a lot concerned and a lot of different tactics and such.

I know there is a bottom line for them as they won't make any money but I have also heard that they get rebates and kick-backs from Automakers and various entities for sales, so they can make money back in that form.

Any insight on this?


Im looking for good advice!

Im almost positive we have 0 salesmen on here, but a few people work/ed at dealerships and I know if your curious, you learn a lot about other departments etc.

So discuss!!!


Many would benefit from this information!

[mozzandherb]

I was a salesman before I secured a job at the Government and I actually liked it. The best way to haggle down a price of the new car is to simply go directly to the sales manager and ask him/her to show you the invoice price. Dont even bother with salespeople, the sales manager normally has the last word anyway. So to save you a lot of time, just ask for the sales manager and most of the time they will be glad to help because they (as well as the saleperson) normally get commission on the new car.
Now keep in mind, you probably wont get the invoice price, but dealerships can sometimes sell the car for around $200 above invoice because the salespeople still need to make some money, but by going directly to the sales manager and asking for the invoice will save you time and money. There's nothing worse than hanging around a dealership all day haggling with a salesperson who is always running back and forth to their sales manager to do their deals.
As for the resale value on your car, I know a little bit about that, but not much. What I can say is that the sales manager is usually also responsible for getting that value. They make a few calls to their wholesalers and get a price from them. But since you will already be in their office and have hopefully established a good relationship with the sales manager, then maybe they can get you a good price for your trade-in. It's all about just being nice and friendly to them, that will help you out! Hope this helps...good luck

EDIT: Just saw you're buying an 8th Gen Accord, but the process is the same new or used.

[ChIoVnIdCa]

If you are looking 4cyl... COLD start the car and listen for a quick rattle.. (Right after crank.. Lasts a second or two)

Immediately accelerate .. Listen for rattle


......


Guess how I know

[Leung]

If you are looking 4cyl... COLD start the car and listen for a quick rattle.. (Right after crank.. Lasts a second or two)

Immediately accelerate .. Listen for rattle


......


Guess how I know

what was rattling?

[ChIoVnIdCa]

what Was Rattling?

Vtc... I have a second replacement right next to me for when I have a chance to do it AGAIN

[Ralphie]

If you are looking 4cyl... COLD start the car and listen for a quick rattle.. (Right after crank.. Lasts a second or two)

Immediately accelerate .. Listen for rattle


......


Guess how I know

Im assuming your referring to 4cyl 8th gen Accord!!?

If so thanks for the tip!

[toycar]

I have found that a cool, calm approach helps best. But, keeping a serious "I know you can go down on the price" position is important too. I have often times mentioned that I was previously a salesman(even though I wasnt) and talked about commissions and stuff. Basically, take the wind out of their sale if they are trying to act like they cannot negotiate. I agree that talking to the sales manager directly is a much better way to get a deal. The best thing to keep in mind is that they are the ones making the end-all decision.

So, don't be a douche. Just articulate yourself in a fashion that they understand that you know better. Dont say,"I know better" and expect them to believe you. Explain your position and knowledge so they get the impression that you are educated about the subject.


Also, don't buy on your first visit. Shop around or give the impression that you are shopping around. Make them sell you the car, rather than giving the impression that you want to buy it. If you make them put some work and effort into it, they are going to want to close the deal just as bad as you do.

That is when they are most likely to budge on the price. Work them around for a day or two but never talk money or prices. Test drive with the same guy 2-3 times, let your wife drive it and get all excited. Then leave. Come back the next day and do the same and ask for some comparable priced cars to look at. The longer you draw it out, the better the chances are they budge to seal the deal.

[Accrdwgnguy]

Bottom line is, salespeople make much more money off used car sales then new. SO they are more negotiable on a used car.

However, its my opinion that retail prices are still a ripoff. You are paying hundreds to thousands more just to cover the dealerships expenses.

[Ralphie]

I have found that a cool, calm approach helps best. But, keeping a serious "I know you can go down on the price" position is important too. I have often times mentioned that I was previously a salesman(even though I wasnt) and talked about commissions and stuff. Basically, take the wind out of their sale if they are trying to act like they cannot negotiate. I agree that talking to the sales manager directly is a much better way to get a deal. The best thing to keep in mind is that they are the ones making the end-all decision.

So, don't be a douche. Just articulate yourself in a fashion that they understand that you know better. Dont say,"I know better" and expect them to believe you. Explain your position and knowledge so they get the impression that you are educated about the subject.


Also, don't buy on your first visit. Shop around or give the impression that you are shopping around. Make them sell you the car, rather than giving the impression that you want to buy it. If you make them put some work and effort into it, they are going to want to close the deal just as bad as you do.

That is when they are most likely to budge on the price. Work them around for a day or two but never talk money or prices. Test drive with the same guy 2-3 times, let your wife drive it and get all excited. Then leave. Come back the next day and do the same and ask for some comparable priced cars to look at. The longer you draw it out, the better the chances are they budge to seal the deal.

Well see that is interesting.

I definitely can feel you on dragging it out to get them to budge on a price.

However,

as the saying goes....Money talks, bs walks.

I've always been under the impression that if I walk into a dealership with a price in mind and I give off the "ive got cash lets talk" vibe, and I have my facts in order(NADA, Black Book, other dealership prices etc)

They are more often willing to play ball.

I believe both can work, but id personally rather come in(not cocky, but just informed and ready to drive off) and get it done then come back 2 or 3 times.

Another trick is never mention a trade in until AFTER you have negotiated the price you want for the new car.

If they KNOW your trading in beforehand, they will make changes to help them recover the cost.

Once you got the price you want, then they can always try to give you a shit deal on the trade in but from my experience they usually don't if you A) Know its value and B) are about to buy a new car lol.




also- I don't ever try to be desperate or seem like Im really excited or attached at the hip to this car.

I want them to know that Ill walk all the way up until I lend them my Hancock. LULZ


Don't get this fucker caught up.....Over 100 dealerships in this area....ill get that price.....question is.....is it going to be you?

[ChIoVnIdCa]

Im assuming your referring to 4cyl 8th gen Accord!!?

If so thanks for the tip!

Yup.. My 8th gen.. 4cyl manual lx-p sedan

[Soufkackicustom]

I tell them what iam going to pay, if they so no, I walk. If they follow with the " I was told I could do it for that price!!!" I tell them knock another grand off for wasting my time, because the next guy will take my original offer. Some times it works, sometimes it doesn't and I leave.

Buying used, if I can pay cash. I don't talk, I just hand them money and ask if we have a deal, if not...hand it back...not took my people give it back

[crazymikey]

I used to work in sales, for a brief period, and currently work in the shop at the same dealership I sold at.

When it comes to new cars, as said before, there is little money in it for the salesperson. Where I work, a salesperson gets 25% commission of the dealer profit on a car. So, dealer makes $1000 on a car, the sales guy only sees $250.

You have to sell like 15 new cars per month just to make money equivalent to $14-16/hr.

On our Mitsubishi products, there is no markup built into the price. There's little to no haggling room on the price of a new one. The dealer pays their cost for the vehicle, then we have to add another $160 for the PDI inspection, another $60 (I think) to add a block heater, as our particular dealer sells all new cars with one. Then the freight cost is typically $1250, and another $6 for an AMVIC fee, and $399 for admin. The freight and PDI get added into the sticker price. Then top it off with 5% GST and you arrive at your final price.

For used vehicles, it varies. We get both trade ins and purchase vehicles from the auction. The majority of sales at our dealer are used units, since we obviously profit significantly more on them.

However, here is the trick about used vehicle pricing on our end; It's not how much the vehicle costs that is going to make you your commission money. It's how much is/isn't invested into the vehicle.

The less money we have to put into a vehicle for it to pass inspection and be lot ready will make the salesman more money. However, there are cases where we get in a vehicle, pay an amount for trade in and then during inspection find out it needs like $3000 worth of work....which we recently had happen with a 2002 Blazer. We still sold it for $8500....a couple thousand more than I'd say it's worth, but the price was high to offset the amount of extra cash we had to invest for some significant work into it.

There's always room to bargain on a used vehicle. There are some vehicles we get that are scabs on our lot, and after a while, they just become tiresome and problematic to have sitting on our lot, so we'll shovel them off for cheap and not make much, if any profit on them.

My boss has a habit of buying absolutely beat to hell piece of shit ex-fleet work trucks. Why? He gets them stupid cheap at the auction. But by the time they get into our shop, I have to spend like 2 days cosmetically repairing them to make them look half decent, and then most need tires, brakes and exhaust and other work. We spend so much time and money on these stupid trucks and they sit on the lot for months.

Here's a good example of a truck we're selling.

2004 Dodge Ram 1500 crew cab 4x4, 5.7 Hemi. 236k KM. $10,995. I know for fact he paid $6000 for it at auction and we have $1100 worth of repairs into it, so this truck cost him $7100 and he's selling it for $11 000.

However, the biggest number 1 factor in how much you are going to pay for your vehicle is your finance rate. Sure, you might knock $2500 off the price of the used car you're looking at. But if you're like me and have less than stellar credit and get approved at a higher rate, well, you can kiss that $2500 saving goodbye as you'll be paying a hell of a lot of extra interest.

Case in point; bought my 2005 Mazda 3 from where I work. Poor credit. Got the car knocked down to $12,428 from $14,995. Put $1000 down. Had to finance just over $11 000. At the 20.9% interest I was paying, over the 60 month term, my $11 000 car was going to cost me almost $17 000.

[Ralphie]

I used to work in sales, for a brief period, and currently work in the shop at the same dealership I sold at.

When it comes to new cars, as said before, there is little money in it for the salesperson. Where I work, a salesperson gets 25% commission of the dealer profit on a car. So, dealer makes $1000 on a car, the sales guy only sees $250.

You have to sell like 15 new cars per month just to make money equivalent to $14-16/hr.

On our Mitsubishi products, there is no markup built into the price. There's little to no haggling room on the price of a new one. The dealer pays their cost for the vehicle, then we have to add another $160 for the PDI inspection, another $60 (I think) to add a block heater, as our particular dealer sells all new cars with one. Then the freight cost is typically $1250, and another $6 for an AMVIC fee, and $399 for admin. The freight and PDI get added into the sticker price. Then top it off with 5% GST and you arrive at your final price.

For used vehicles, it varies. We get both trade ins and purchase vehicles from the auction. The majority of sales at our dealer are used units, since we obviously profit significantly more on them.

However, here is the trick about used vehicle pricing on our end; It's not how much the vehicle costs that is going to make you your commission money. It's how much is/isn't invested into the vehicle.

The less money we have to put into a vehicle for it to pass inspection and be lot ready will make the salesman more money. However, there are cases where we get in a vehicle, pay an amount for trade in and then during inspection find out it needs like $3000 worth of work....which we recently had happen with a 2002 Blazer. We still sold it for $8500....a couple thousand more than I'd say it's worth, but the price was high to offset the amount of extra cash we had to invest for some significant work into it.

There's always room to bargain on a used vehicle. There are some vehicles we get that are scabs on our lot, and after a while, they just become tiresome and problematic to have sitting on our lot, so we'll shovel them off for cheap and not make much, if any profit on them.

My boss has a habit of buying absolutely beat to hell piece of shit ex-fleet work trucks. Why? He gets them stupid cheap at the auction. But by the time they get into our shop, I have to spend like 2 days cosmetically repairing them to make them look half decent, and then most need tires, brakes and exhaust and other work. We spend so much time and money on these stupid trucks and they sit on the lot for months.

Here's a good example of a truck we're selling.

2004 Dodge Ram 1500 crew cab 4x4, 5.7 Hemi. 236k KM. $10,995. I know for fact he paid $6000 for it at auction and we have $1100 worth of repairs into it, so this truck cost him $7100 and he's selling it for $11 000.

However, the biggest number 1 factor in how much you are going to pay for your vehicle is your finance rate. Sure, you might knock $2500 off the price of the used car you're looking at. But if you're like me and have less than stellar credit and get approved at a higher rate, well, you can kiss that $2500 saving goodbye as you'll be paying a hell of a lot of extra interest.

Case in point; bought my 2005 Mazda 3 from where I work. Poor credit. Got the car knocked down to $12,428 from $14,995. Put $1000 down. Had to finance just over $11 000. At the 20.9% interest I was paying, over the 60 month term, my $11 000 car was going to cost me almost $17 000.

Hmmm all good points, and it sounds a lot like Canada is pretty much on par with the US.

Only thing is my finance rate will be awesome.

1.9 or so.

I have awesome credit.

I don't fuck around when it comes to CC bills, and besides my house, I have never leased/financed anything.

[GeoffM]

I was a salesman before I secured a job at the Government and I actually liked it. The best way to haggle down a price of the new car is to simply go directly to the sales manager and ask him/her to show you the invoice price. Dont even bother with salespeople, the sales manager normally has the last word anyway. So to save you a lot of time, just ask for the sales manager and most of the time they will be glad to help because they (as well as the saleperson) normally get commission on the new car.
Now keep in mind, you probably wont get the invoice price, but dealerships can sometimes sell the car for around $200 above invoice because the salespeople still need to make some money, but by going directly to the sales manager and asking for the invoice will save you time and money. There's nothing worse than hanging around a dealership all day haggling with a salesperson who is always running back and forth to their sales manager to do their deals.
As for the resale value on your car, I know a little bit about that, but not much. What I can say is that the sales manager is usually also responsible for getting that value. They make a few calls to their wholesalers and get a price from them. But since you will already be in their office and have hopefully established a good relationship with the sales manager, then maybe they can get you a good price for your trade-in. It's all about just being nice and friendly to them, that will help you out! Hope this helps...good luck

EDIT: Just saw you're buying an 8th Gen Accord, but the process is the same new or used.

This sounds like:
Show me what you paid for it, I'll give you a few hundred more.
Am I correct?

[Gemini]

I tell them what iam going to pay, if they so no, I walk. If they follow with the " I was told I could do it for that price!!!" I tell them knock another grand off for wasting my time, because the next guy will take my original offer. Some times it works, sometimes it doesn't and I leave.

Buying used, if I can pay cash. I don't talk, I just hand them money and ask if we have a deal, if not...hand it back...not took my people give it back

i did that with my last purchase. i dictated what i was willing to pay..i even dictated the minimum i was willing to take for my trade in. It worked and i got a helluva deal.....this method doesn't work all the time tho.