hatchgeek,
There is also what's called a holdback which is a percentage of the invoice held back by the manufacturer and remitted to the dealer after a time period.
So, there is profit beyond the difference between invoice and sales price.
I think that's how it works. A bit of padding for the house, yes?

 

You can get Scions for about $400 off of list price - which is about $300 over invoice. There is not much room between invoice and list on Scions.

 

The amount of money stashed between holdbacks, rebates, and dealer incentives cannot be stressed enough. Any time a salesman says they are losing money on an approved deal it is just part of their act.

 

Wow, what happened to the much hyped "no haggle" policy?

 

if you have the slightest clue to how much it actually cost to run a dealership, you would realize how ludicrous your statement actually is.

honda almost never give rebates, even when they do, it's a few hundred dollars, no where near the thousands toyota, gm, or ford, etc gives.

holdbacks and incentives goes straight to the owner, the sales person is paid a percentage on the gross profit of the vehicle only.

 

i meant if i had to pay MSRP for the fit i'd rather get the corolla S as i could probably get invoice price on that and after taxes and fees i could probably get out spending less than the fit at MSRP with taxes and fees. and the fit is supposed to be priced below the civic ...the civic's competitor, the corolla costs less than the fit

 

Im somewhere in the middle on this, as to what the dealer should make. Deals where one is actually getting a vehicle for invoice and there are no other profits other than holdback, is obviously a serious/despirate situation for a dealership. BTW, the holdback for hondas is only 2% of MSRP.

I personally dont have any problem being several hundred above invoice, but i take offense to being scammed on things like dealer prep (when this is covered in the MSRP (see the fine print on the sticker)), and dealers insisting on installing add-ons on the car for outrageous prices. If i wanted this crap, i'd ask for it. If the car was intended to have these options, it would have come that way from the factory.

 

pxcbell@gmail.com

 

True, aywwsd. Money to keep the lights on. Money to pay salaries.
Oh, and money to keep the dealer's yacht moored and sparkling clean.
Still, the horror stories persist and I'm sure you probably know some of those "high Five" I really nailed this sucker type adventures.
Sometimes, on hot models such as the Fit, I've heard the dealership owner only pays the salespeople a flat, meager $75 to $100. That's sad, but whether the money goes to the dealer or the salesperson and the managers, the customer is the one that forks it over.

 

No Honda dealer should be charging "dealer prep" or "PDI" since I believe those things are paid to the dealer from the manufacturer. If you run into one, I'd report him to their customer relations department at the least and possibly to the DMV or the state consumer office.

 

i really nail this sucker type deals do happen, mainly because for every i nail the sucker, there is 10 the sucker lowballed me, i wasted 3 hours of my life because this guy refuse to pay invoice for a vehicle and wants another 1000 off, plus 2000 more then his trade in is worth.

unfortuntedly, this is the way the car market is. wish it would be everyone pay a few hundred over invoice and thats it, but it's not.

 

actually, holdback is 3% of msrp, and it's main purpose is pay for the finance cost to keep the vehicle in inventory. certain vehicles like accords, crv, ridgelines, even some odyssey and pilots can potentially sit at the dealership for 2 month before they sell. outside of civics, navi odyssey, 4wd pilot, there arent too many in demand vehicles.

as for the scam charges, i cant speak for other dealership, other then my dealership doesnt charge them. i personally actually explain every charge before the sales contract is signed with the customer, and my finance manager will explain it again when the offical contract is signed.

 

Holdback percentage varies depending on the make (ie: toyota, chevrolet; for most it is 3%. I think the 2% holdback for Honda came from edmunds, so you're disagreeing with them, not me. In other words, i didn't pull the figure out of my ass. If i weren't so lazy, i'd google it for you so you could see for yourself.

I'm sure most all dealers explain every charge including the ones scamming you. Dealer prep would be explained by all the work the dealer does to get the car ready (take off the tape, spit shine it, etc). Of course what they dont mention is that this charge is built into the MSRP. Im sure etch and undercoating has an official explanation too, course that wouldn't change it being a money-making scam either.

Azanon

 

Well, now i'm seeing 3% of Base MSRP for honda (I just googled today). * shrug * I checked on this about a month ago since i was considereing the fit and i found a site that said 2% of base MSRP for honda.

So, ok, whatever. I agree, I don't much focus on holdback either, other than to realize that the dealer does make profit from a sale at invoice. But i agree that this amount might not necessarily be enough to cover all of the expenses associated with the dealer selling the vehicle, including the monthly taxes for it to sit on the lot.

Azanon

 

Hi everyone,
Go to http://www.collegehillshonda.com/hon...s/interior.htm and you'll get exactly the Fit accessory pricing you need. If you show this to the dealer (like I did) they lowered the pricing to match it - a great deal! They initially marked up it more than 100% in my first quote. Don't take any more than this website for accessories - because why not just get them from collegehills?!?!?! Hope this helps.

 

Anyone know what kind of financing a person can expect (as far as rates) for a FIT on a loan from Honda? Do they offer pretty competative rates, or am I better off going to a bank loan? 36 months vs 60 months?

 

Then why do they have a seperate fee for Freight & PDI on their websites?

 

On the Honda Canada site, they have the various types of financing. The rates range between 6.95-8.25%. GRRR

Expect the Honda USA website to have the info shortly.

 

Oh I dunno - cause I'm not a mechanic and dont like to install car parts myself and because i'd also like them under warranty?????

Its a good chance that "100% markup" is labor. You know, when i get my car serviced, labor is usually 66% of the total cost. So going by that "100% markup" would actually be a slight discount.

 

The names given to each portion of profit are entirely irrelevant. The point is the dealer makes more money than negotiated cost minus invoice price. Call it ludicrous till you're blue in the face, but it's a fact.

I don't give a crap who gets what part of the profit. That's not of any concern to any buyer.