Anyone negotiate a car lately? Any room as consumers?

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workingovertime
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Anyone negotiate a car lately? Any room as consumers?

Post by workingovertime »

I've successfully negotiated many cars in my life but apparently it's definitely not the buyer's market right now. For anyone who has negotiated a car lately, are there even any room for negotiation? From the way some salespeople spoke on the phone, it sounds like there are back orders of cars with plenty of ready buyers, but then again, they are salespeople so... figured I'd ask.
MikeG62
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by MikeG62 »

Yes I have. Placed an order for a ‘22 BMW X5 for my DW. Was the most difficult negotiation I’ve done on a car purchase/lease.

Was able to get a small discount from MSRP (about 3%) after a lot of work (including contacting the sales manager at many other BMW dealers in the state in which I live). For comparison got a total of about 12% off MSRP on our current X5, which we picked up in 2019.

They simply can’t get the vehicles so they aren’t interested in dealing.

At the end of the day, it does depend on the vehicle you are after. My nephew just picked up a Jeep Compass and was able to get a reasonable deal.

My friend is trying to get a Lexus RX350L and he can’t get any dealers who are willing to sell at below msrp.

It’s tough out there.

Good luck.
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JoeRetire
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by JoeRetire »

workingovertime wrote: Sun Oct 10, 2021 8:20 pm I've successfully negotiated many cars in my life but apparently it's definitely not the buyer's market right now. For anyone who has negotiated a car lately, are there even any room for negotiation?
Almost no room, based on what I encountered a few weeks ago. I unexpectedly needed a new car.
From the way some salespeople spoke on the phone, it sounds like there are back orders of cars with plenty of ready buyers, but then again, they are salespeople so... figured I'd ask.
There's almost no inventory at all.

I checked websites and called around to find a few dealers that had cars I might want. One dealer showed 6 on their website. I called to set up an appointment to see one of them. When I got there, I found out that they blatantly lied - they had no cars of that model, didn't have any inventory at all, and all orders were at least 2 months from being fulfilled. Their website still shows those same 6 cars, weeks later.

I've heard that some dealers have lower-demand cars on their lot. But I can't confirm that.

The dealers I visited all had a "market adjustment" of different amounts tacked on top of MSRP. I was able to negotiate that away, but it took a lot more time than I liked to make it happen.
Just remember: it's not a lie if you believe it.
RedDog
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by RedDog »

Unfortunately, we had to replace a totaled car last week…not only wouldn’t the area Toyota dealers not bargain but even worse the cars were loaded up with high profit margin/low utility distributor added options.

If you can wait…wait. If you have to buy now…be ready to pay.
UpperNwGuy
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by UpperNwGuy »

I need a new car, and I'm afraid to begin the process because there are no cars on the dealer lots these days, and I don't want to pay MSRP or higher. I will reluctantly wait.
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BolderBoy
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by BolderBoy »

workingovertime wrote: Sun Oct 10, 2021 8:20 pm... are there even any room for negotiation?
Not at all for Mercedes-Benz. All dealerships I contacted require an MSRP + dealer handling contract for ordering a vehicle and delivery is at least 12-16 weeks out and requires a non-refundable deposit. To top it off, MB hasn't yet released its 2022 pricing so the contract is open-ended.
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BreadandButter
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by BreadandButter »

We looked at RAV4 Hybrids today. It was going to be a 6 month wait at that dealership because they only charge MSRP. Other dealers we called said they had a few in stock and were charging at least $1000 over. The one we were interested in sold before we could go look at it.
BarbBrooklyn
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by BarbBrooklyn »

I found the best deal by ordering a new vehicle from a deal about an hour's drive from me. Got about 10% off MSRP; dealers in my area are charging 1-2k ABOVE msrp on the Forester trim I wanted.

It was about a 6 week wait, from late July to early September.
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Murr
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by Murr »

We walked a few lots yesterday as we are in the market for a new vehicle due to a new job and loss of fleet car. I was shocked to see that on a Honda dealers lot literally every new car had a $4995 "market adjustment" added regardless of the car. That means civics were about 25% over msrp, nuts.
Nosirrah
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by Nosirrah »

Yes, just purchased a new Tacoma 3 weeks ago. Very similar experience to other posters. Inventory is so low if and that’s a big if, you can even find the vehicle you’re looking for your going to pay MSRP at the very least. The one exception to this maybe a very unpopular vehicle. Maybe then you could get a few points below MSRP but I wouldn’t even hold my breath on that.

I utilized my usual tactic of emailing ever Toyota dealership with 300 miles and most didn’t even have the vehicle I wanted let alone a willingness to negotiate.

BIL is a GM for a few large dealerships, most cars are now sold before they ever arrive on his lot and he has a large list of folks waiting on specific trims.
PaunchyPirate
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by PaunchyPirate »

I just purchased a Toyota Highlander. There was no inventory, but I was able to get one that was just about to be built in Indiana. I got it 8 weeks later. I had to pay full MSRP. No deal at all to be had. It was basically "Do you want it or not?"
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8foot7
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by 8foot7 »

Your negotiation at this point will be looking to pay sticker and getting rid of “market adjustment” fees, or as I call them, “how bad do you need this right now” fees.

It is just business. Remember this when you’re given the “I have to make a profit” lines negotiating your next vehicle.

This is the worst time in memory to buy a car. Good luck.
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Sandtrap
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by Sandtrap »

workingovertime wrote: Sun Oct 10, 2021 8:20 pm I've successfully negotiated many cars in my life but apparently it's definitely not the buyer's market right now. For anyone who has negotiated a car lately, are there even any room for negotiation? From the way some salespeople spoke on the phone, it sounds like there are back orders of cars with plenty of ready buyers, but then again, they are salespeople so... figured I'd ask.
Some tips:
1
Dealerships approach and attitudes do not change:
"To make the most money from every customer on each sale, and sell them, today, now."
*Note: Everything said on the phone and every contact and conversation is similar to "financial news". . . the truth needs to be parsed from "the sale". Consider every sentence a "sales approach" and listen accordingly.
Scarcity means higher price = higher profits and commision. So, there must be the appearance of scarcity of "your one and only".
2
Each car deal is unique, per car, per customer, per dealer, per day, per hour.
For example: the same car and same customer on day 1. $5000 over list. The same car and customer on another day, $2000 below list. See?
3
The quality of a car deal is highly dependent on how much work a customer does; before shopping, shopping, before the deal (comparing deals, working deals against each other, etc), during the deal (be willing to walk away, keep trying . . . dealerships count on wearing out a customer until they just want to "get it over with"), and dealing in the finance office (even if paying cash).
4
The quality of a deal is also dependent on a customers flexability on car makes and models, instead of "the one and only". It is better to have more than one "one and only's".
And, also, dealer locations. Shop many dealers. Not just one dealer close to home.

5
The more a customer understands and actually puts into practice, knowledge of how cars are sold, how dealerships sell cars, how car salesman sell a car, how car sales "closers" sell a car, how the finance office makes money in closing, etc, . . .the better the deal. (even on internet deals).

6
A car dealership and sales force depends on the customer's need to; be nice, be fair, not cheat people, not lie, not manipulate, be a good person, not offend, build relationships, walk away on good terms, etc. (Something to think about).

Recently:
2021 Toyota 4Runner TRD Pro 4wd. Loaded. $3000 below list (Moroni sticker).
2021 Honda Passport Elite AWD Loaded. $2800 below list (Moroni sticker).
(we were able to get both cars in the exact color and configuration and options we wanted).

j :D
Last edited by Sandtrap on Mon Oct 11, 2021 7:41 am, edited 1 time in total.
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burritoLover
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by burritoLover »

Was seeing a mark-up of $8k-$10k over MSRP on the Kia Telluride in my area. Also seeing the same as someone else reported - dealers showing vehicles at MSRP (which in this market is reasonable) that they don't actually have nor can they get.
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Sandtrap
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by Sandtrap »

burritoLover wrote: Mon Oct 11, 2021 7:40 am Was seeing a mark-up of $8k-$10k over MSRP on the Kia Telluride in my area. Also seeing the same as someone else reported - dealers showing vehicles at MSRP (which in this market is reasonable) that they don't actually have nor can they get.
+1
Yes. There's a mystique growing on the Kia Telluride and the Hyundai equiv. And this practice seems common.
As well as the dealership attitudes.

So, there are a lot of equiv or better cars than just the Kia/Hyundai.
We went with a far better car "for OUR needs" and paid below list for more car that was priced in the same range or higher.
It helps to be have flexible options as a car buyer.

j :D
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galving
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by galving »

BolderBoy wrote: Sun Oct 10, 2021 9:39 pm
workingovertime wrote: Sun Oct 10, 2021 8:20 pm... are there even any room for negotiation?
Not at all for Mercedes-Benz. All dealerships I contacted require an MSRP + dealer handling contract for ordering a vehicle and delivery is at least 12-16 weeks out and requires a non-refundable deposit. To top it off, MB hasn't yet released its 2022 pricing so the contract is open-ended.
Wow.
I'd have trouble signing an open-ended contract.
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by Ramjet »

Does anyone have a guess as to when this chip shortage is likely to be resolved and when car prices may trend back to normal

I was hoping to make a purchase around March 2022 but I am not optimistic anything will be different
Last edited by Ramjet on Mon Oct 11, 2021 8:02 am, edited 2 times in total.
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gogreen
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by gogreen »

MikeG62 wrote: Sun Oct 10, 2021 8:36 pm Yes I have. Placed an order for a ‘22 BMW X5 for my DW. Was the most difficult negotiation I’ve done on a car purchase/lease.
How did you do it? Just configured via website and placed an online order?
ATM there are 0 models my DW is looking for available in 100 miles radius. I just wonder if ordering online will help at all :confused
GmanJeff
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by GmanJeff »

You might consider less popular brands and models, where supply and demand may not be so out of balance. Fiat, Alfa-Romeo, Jaguar, Volkswagen, and many domestic models may offer a better value proposition if their attributes meet your fundamental needs. You may also find more attractive pricing on sedans and minivans, vice SUVs and certain hybrids (e.g., Prius models) which are currently trendy.
Last edited by GmanJeff on Mon Oct 11, 2021 3:34 pm, edited 1 time in total.
SpaghettiMonster
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by SpaghettiMonster »

I purchased a car last month for $1000 under MSRP. I had to drive 200 miles away to test drive and purchase it as the dealers in my city and the next closest one hadn’t had the model in their inventory for months. Also, due to the chip shortage, they stopped making them for the 2021 MY and and did not have a start date for 2022 productions. I chose a one off the showroom floor which was almost the spec I would have ordered. There was not much back and forth in the negotiations and was surprised that I got anything off of MSRP.
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burritoLover
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by burritoLover »

Car and driver posted an article listing the models with the most current inventory.
https://www.caranddriver.com/news/g3788 ... inventory/
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by TJat »

Ramjet wrote: Mon Oct 11, 2021 7:49 am Does anyone have a guess as to when this chip shortage is likely to be resolved and when car prices may trend back to normal

I was hoping to make a purchase around March 2022 but I am not optimistic anything will be different
I wouldn't count on it by then. Right now there are less than 100k vehicles in active inventory across the entire country, which creates a big supply glut. Replacement production is way down due to the chips and it's unlikely chip production will be even back by Mar 22. Even when supply starts flowing to Auto makers, there'll be quite a backlog to work through. Up through the summer, industry estimates kept getting pushed back from Q421 to Q222Latest industry projections expect pretty flat prices from today through 2022 (one was even through 2023!)
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by BolderBoy »

galving wrote: Mon Oct 11, 2021 7:49 am
BolderBoy wrote: Sun Oct 10, 2021 9:39 pm
workingovertime wrote: Sun Oct 10, 2021 8:20 pm... are there even any room for negotiation?
Not at all for Mercedes-Benz. All dealerships I contacted require an MSRP + dealer handling contract for ordering a vehicle and delivery is at least 12-16 weeks out and requires a non-refundable deposit. To top it off, MB hasn't yet released its 2022 pricing so the contract is open-ended.
Wow.
I'd have trouble signing an open-ended contract.
Doubtful it is very problematic - there is so little MB inventory that if you ultimately declined the vehicle, the dealership would probably just refund the deposit and sell the auto to someone else within a few hours or days.
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BolderBoy
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by BolderBoy »

Ramjet wrote: Mon Oct 11, 2021 7:49 am Does anyone have a guess as to when this chip shortage is likely to be resolved and when car prices may trend back to normal

I was hoping to make a purchase around March 2022 but I am not optimistic anything will be different
A guess? Okay. This from amalgamated sources...

The chip allocation issue likely won't get back to "normal" until the alternate wafer suppliers get their USA plants going full tilt - anticipated in 2024 (TX and AZ locations).

Your best bet is to place an order for what you want to have built for you. That will put you in that auto manufacturer's queue. It'll take months. But at least the auto manufacturers are getting the chips they need doled out in small quantities.
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by psteinx »

1) Compare out the door prices. Dealers that claim to be selling at MSRP (or even under), may be adding on big doc fees, junk add-ons, etc, and may not budge from those. Similarly, don't put too much stock in internet posters claiming to have gotten good deals, relative to MSRP, unless they're clear about the other fees, add-ons, etc. Of course, your state will generally add taxes - whether directly bundled into the check you write at the dealer, or paid separately to the state. Those should be disregarded in price comparisons (as other posters may be in high or low tax states). But again, folks are often unclear about conveying this information.

2) The market, when I was shopping (ca. 6 weeks ago), is basically non-comparable to just about anything anybody can remember (unless maybe they car shopped during WW2). It's even different than how it was in late spring/early summer of this year. Don't get hung up on outdated information/experiences. If you want/need a car now, you'll have to deal with the current market, not outdated notions.

3) Yes, there's some variation across car brands and across car dealers. No, I don't think there's too much room for negotiation AT a specific dealership (though of course there are presumably exceptions). Internet tools for checking inventory and pricing and cross-comparing are not working well, as dealers may list cars not actually for sale (stuff they may not get for weeks, or perhaps already have a deposit on, or whatever). You gotta work the phones, and maybe even the shoe leather.
Rex66
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by Rex66 »

Reality is you will pay more now.
bi0hazard
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by bi0hazard »

IMO: The reality is from now on car prices will around the MSRP. They will not go lower again. Why? Because car manufactures are flourishing , and the epidemic/"chip shortage" is a paradigm changing godsend for them. They will not start spewing out cars to the dealers even when they can. Dealers will become more of a "showroom experience", rather then "pick what you like from the lot experience".
Disclaimer: I'm not very smart, and this is just my hypothesis.
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by 8foot7 »

bi0hazard wrote: Mon Oct 11, 2021 2:05 pm IMO: The reality is from now on car prices will around the MSRP. They will not go lower again. Why? Because car manufactures are flourishing , and the epidemic/"chip shortage" is a paradigm changing godsend for them. They will not start spewing out cars to the dealers even when they can. Dealers will become more of a "showroom experience", rather then "pick what you like from the lot experience".
This is a one-sided view. Consumers have been willing to change cars far more regularly than their personal circumstances would dictate because of plenty of supply, ever-present deals, and wide choices. If the supply spigot doesn't get turned back on and people are buying at sticker or sticker-plus, it will have a negative effect on the frequency with which consumers engage in vehicle transactions. They won't change cars every two years if they take a beating every time they do so. Further, dealers make a lot of money indirectly financing negative equity; if vehicle supply is permanently decreased, then the supply of used cars also decreases, lessening the depreciation hit most used cars take and making them worth more overall, thereby reducing negative equity and removing a big reason why many less-sharp consumers switch vehicles.
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by Old Guy »

I ordered a Ford Mustang Mach-E premium, all wheel drive, extended range directly from Ford on October 1 and designated a local dealer. The dealer accepted the order on 10.3 at the price stipulated in the order which is MSRP. They will charge the MSRP minus Ford’s X Plan. That should reduce the cost by 2% and limit dealers fees. Of course I won’t get it for five or six months. We’ll see.
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by stoptothink »

BolderBoy wrote: Mon Oct 11, 2021 12:48 pm
galving wrote: Mon Oct 11, 2021 7:49 am
BolderBoy wrote: Sun Oct 10, 2021 9:39 pm
workingovertime wrote: Sun Oct 10, 2021 8:20 pm... are there even any room for negotiation?
Not at all for Mercedes-Benz. All dealerships I contacted require an MSRP + dealer handling contract for ordering a vehicle and delivery is at least 12-16 weeks out and requires a non-refundable deposit. To top it off, MB hasn't yet released its 2022 pricing so the contract is open-ended.
Wow.
I'd have trouble signing an open-ended contract.
Doubtful it is very problematic - there is so little MB inventory that if you ultimately declined the vehicle, the dealership would probably just refund the deposit and sell the auto to someone else within a few hours or days.
This is exactly how it is with Ford right now, especially with the Maverick and Broncos. The dealers actively want customers to decline the vehicles they ordered because dealer stock is so limited, customer-ordered cars are prioritized, and they can add adjusted dealer markup and sell them for more almost immediately.
FootballFan5548
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by FootballFan5548 »

I just purchased a 2019 Ram 1500 Crew Cab from Carvana. It's used, but only 7200 miles. Carvana doesn't allow any room for negotiation... however they did offer by far the best price for my trade-in ($4k OVER the KBB price).

So, my advice, is take advantage of your trade-in used car if you have one and try to maximize the price on that side, rather than negotiate off of MSRP which seems hard to do at the moment.
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by gator15 »

8foot7 wrote: Mon Oct 11, 2021 2:17 pm
bi0hazard wrote: Mon Oct 11, 2021 2:05 pm IMO: The reality is from now on car prices will around the MSRP. They will not go lower again. Why? Because car manufactures are flourishing , and the epidemic/"chip shortage" is a paradigm changing godsend for them. They will not start spewing out cars to the dealers even when they can. Dealers will become more of a "showroom experience", rather then "pick what you like from the lot experience".
This is a one-sided view. Consumers have been willing to change cars far more regularly than their personal circumstances would dictate because of plenty of supply, ever-present deals, and wide choices. If the supply spigot doesn't get turned back on and people are buying at sticker or sticker-plus, it will have a negative effect on the frequency with which consumers engage in vehicle transactions. They won't change cars every two years if they take a beating every time they do so. Further, dealers make a lot of money indirectly financing negative equity; if vehicle supply is permanently decreased, then the supply of used cars also decreases, lessening the depreciation hit most used cars take and making them worth more overall, thereby reducing negative equity and removing a big reason why many less-sharp consumers switch vehicles.
Good point!
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by rockstar »

8foot7 wrote: Mon Oct 11, 2021 2:17 pm
bi0hazard wrote: Mon Oct 11, 2021 2:05 pm IMO: The reality is from now on car prices will around the MSRP. They will not go lower again. Why? Because car manufactures are flourishing , and the epidemic/"chip shortage" is a paradigm changing godsend for them. They will not start spewing out cars to the dealers even when they can. Dealers will become more of a "showroom experience", rather then "pick what you like from the lot experience".
This is a one-sided view. Consumers have been willing to change cars far more regularly than their personal circumstances would dictate because of plenty of supply, ever-present deals, and wide choices. If the supply spigot doesn't get turned back on and people are buying at sticker or sticker-plus, it will have a negative effect on the frequency with which consumers engage in vehicle transactions. They won't change cars every two years if they take a beating every time they do so. Further, dealers make a lot of money indirectly financing negative equity; if vehicle supply is permanently decreased, then the supply of used cars also decreases, lessening the depreciation hit most used cars take and making them worth more overall, thereby reducing negative equity and removing a big reason why many less-sharp consumers switch vehicles.
The average vehicle on the road is 12 years old. Consumers will have to start buying as their old vehicles start to break down. This is going to drive up demand with already limited supply.

https://www.bts.gov/content/average-age ... ted-states
Northern Flicker
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by Northern Flicker »

OTOH if you will pay MSRP anyway, at least you can order exactly what you want in color and options.
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by ivyhedge »

I bought a Tesla, so no negotiation: took 80 days from order to delivery. Deliveries are longer now, with several models and trims sold out for 2021, nearly so, or having been so for a month.

Friends along the South Carolina coast were in an accident last month and had no difficulty finding anything in the Accord - Camry range at multiple dealerships from Savannah through Bluffton to Beaufort.

Here in Boston, the local BMW/MB/MAS/MINI/AM/VOL businesses are just as packed with vehicles as anytime pre pandemic. Our market is huge for electrics and AWD variants of various models, though, and I have read about shipment diversions here to accommodate demand.

Another anecdote: I sold my MB to Carvana the day before I picked up the Tesla and was handed 1.35x what I expected on my books. Wow.
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by hudson »

psteinx wrote: Mon Oct 11, 2021 1:26 pm
2) The market, when I was shopping (ca. 6 weeks ago), is basically non-comparable to just about anything anybody can remember (unless maybe they car shopped during WW2). It's even different than how it was in late spring/early summer of this year. Don't get hung up on outdated information/experiences.
Right after WW2, my dad bought a Jeep because that was all there was new.

Willys CJ2A
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June 24, 1946

I got to ride in it a few times, then he got a black 47 Plymouth
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MortgageOnBlack
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by MortgageOnBlack »

Best deal I was able to find on a 4runner was MSRP - $500. They also wanted a $500 non-refundable deposit so I do have concerns of some potential bait-in-switch/unknown issue with pricing once I hand over the deposit. 4runners are also 4-6 months out in my area. Going to try to get by with my older cars for a bit.
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by delamer »

BolderBoy wrote: Mon Oct 11, 2021 12:48 pm
galving wrote: Mon Oct 11, 2021 7:49 am
BolderBoy wrote: Sun Oct 10, 2021 9:39 pm
workingovertime wrote: Sun Oct 10, 2021 8:20 pm... are there even any room for negotiation?
Not at all for Mercedes-Benz. All dealerships I contacted require an MSRP + dealer handling contract for ordering a vehicle and delivery is at least 12-16 weeks out and requires a non-refundable deposit. To top it off, MB hasn't yet released its 2022 pricing so the contract is open-ended.
Wow.
I'd have trouble signing an open-ended contract.
Doubtful it is very problematic - there is so little MB inventory that if you ultimately declined the vehicle, the dealership would probably just refund the deposit and sell the auto to someone else within a few hours or days.
We visited a MB dealership about 8 weeks ago to test drive a preowned SUV. The salesman said they had 25 vehicles on the lot compared to their usual 125.

And yet we continue to see ads on TV for MB vehicles and a variety of other brands. Maybe they have long-term media contracts?
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bi0hazard
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by bi0hazard »

8foot7 wrote: Mon Oct 11, 2021 2:17 pm
bi0hazard wrote: Mon Oct 11, 2021 2:05 pm IMO: The reality is from now on car prices will around the MSRP. They will not go lower again. Why? Because car manufactures are flourishing , and the epidemic/"chip shortage" is a paradigm changing godsend for them. They will not start spewing out cars to the dealers even when they can. Dealers will become more of a "showroom experience", rather then "pick what you like from the lot experience".
This is a one-sided view. Consumers have been willing to change cars far more regularly than their personal circumstances would dictate because of plenty of supply, ever-present deals, and wide choices. If the supply spigot doesn't get turned back on and people are buying at sticker or sticker-plus, it will have a negative effect on the frequency with which consumers engage in vehicle transactions. They won't change cars every two years if they take a beating every time they do so. Further, dealers make a lot of money indirectly financing negative equity; if vehicle supply is permanently decreased, then the supply of used cars also decreases, lessening the depreciation hit most used cars take and making them worth more overall, thereby reducing negative equity and removing a big reason why many less-sharp consumers switch vehicles.
This may be a temporary "issue". Right now you THINK you're getting a bad deal @ MSRP, b/c your neighbor got the same car for "invoice". But when everyone is paying MRSP for a year, you will no longer think that way. Just like when you buy a 2L coke bottle at the store, you don't ask the manager to see their invoice price, to get a better deal.. I bet car manufacturers are counting on that, they can wait out this "mindset adjustment period" , and then start cashing in the the big bucks.

Right now manufacturers are making up to $10k more per pickup than they used to, so they don't necessarily need to sell as many vehicles. However, ultimately their intent is to sell as many cars/trucks as before, without incentives. You simply go to the dealer, and you order the car, you do not get it off the lot. This season's problems are the perfect storm for this paradigm, and a single manufacturer couldn't have done alone, but due to covid/"supply chain issues", they're all in the same boat, so I think of it as more of a legal collusion deal. I realize this a complex topic, and that manufacturers and dealers may not be on the same page, but those are my thoughts. Read this short article to see where I'm getting these ideas : https://www.caranddriver.com/news/a3718 ... g-changes/

Unfortunately, as much as I hate it, I believe the days of "getting a good deal" are over. We've been spoiled.

Disclaimer: I'm not very smart, and this is just my hypothesis.
Disclaimer: I'm not very smart, and this is just my hypothesis.
psteinx
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by psteinx »

There's nothing magical about "invoice", "MSRP", etc.

A car at $1K over MSRP is a better deal than a car at $2K under MSRP, if it's the identical car, and the manufacturer raised the MSRP by $4K between the first and the second deal.

MSRPs are somewhat sticky. IIUC, it's rare for manufacturers to raise MSRP much, if at all, mid-year. And even year to year, barring a redesign, makers moderate MSRP increases. But they can still "raise prices" by being less aggressive in rebates offered directly to consumers, and various cashback systems they have with dealers.

If the supply crisis were really a long-term (2-5 years or more) issue, manufacturers would just raise their MSRPs by an abnormal amount, and resume traditional discounting. That said, I suspect the supply shortages will be somewhat shorter term in nature, so manufacturers will mostly go the route of trimming rebates, dealer incentives, etc.

In the long run, once supply and demand get back to something like equilibrium, I expect that most manufacturers will get pricing, relative to ACTUAL selling points, back to roughly where it was <=2019. i.e. Sophisticated consumers will be able to expect a 5-10% discount off of MSRP from, say, Honda and Toyota, and more from GM, Ford, and others. Having an MSRP that's significantly above expected selling point gives manufacturers latitude to tweak incentives as demand waxes and wanes.
talzara
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by talzara »

BolderBoy wrote: Mon Oct 11, 2021 1:04 pm
Ramjet wrote: Mon Oct 11, 2021 7:49 am Does anyone have a guess as to when this chip shortage is likely to be resolved and when car prices may trend back to normal

I was hoping to make a purchase around March 2022 but I am not optimistic anything will be different
A guess? Okay. This from amalgamated sources...

The chip allocation issue likely won't get back to "normal" until the alternate wafer suppliers get their USA plants going full tilt - anticipated in 2024 (TX and AZ locations).

Your best bet is to place an order for what you want to have built for you. That will put you in that auto manufacturer's queue. It'll take months. But at least the auto manufacturers are getting the chips they need doled out in small quantities.
The Texas and Arizona sites will have very little effect on chip availability for automobiles.

The TI factory in Richardson, Texas and the TSMC factory in Phoenix, Arizona are 300 mm wafer factories. Most automotive chips are fabricated in mature processes on 200 mm wafers.

The semiconductor industry is investing a relatively small amount in 200 mm to make chips for cars. They're investing mostly in 300 mm to make chips for computers and smartphones.
Despite the auto industry's desperation, there's no great rush to build new 200-mm fabs. “The return on investment just isn't there," says Morales. What's more there are already many legacy-node plants in China that are not operating efficiently right now, but “at some point, they will," he says, further reducing the incentive to build new fabs. ...

The long-term trend to the end of 2024 is for a 17 percent increase in capacity for 200-mm facilities. Spending on equipment for these fabs is set to rise to $4.6 billion in 2021 ... In comparison, spending to equip 300-mm fabs is expected to hit $78-billion in 2021.

https://spectrum.ieee.org/chip-shortage
talzara
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by talzara »

TJat wrote: Mon Oct 11, 2021 9:20 am Replacement production is way down due to the chips and it's unlikely chip production will be even back by Mar 22. Even when supply starts flowing to Auto makers, there'll be quite a backlog to work through. Up through the summer, industry estimates kept getting pushed back from Q421 to Q222Latest industry projections expect pretty flat prices from today through 2022 (one was even through 2023!)
Maybe prices will be better by 2022, but not supply.

The industry consensus for the end of the chip shortage is now 2023, and some are even saying 2024.
Pat Gelsinger, the chief executive of Intel, the U.S.'s largest chip maker, has said he expects shortages to last into 2023. Others say it could last through the end of that year.

“The chip shortage continues to get worse and at this point we’re going to go through 2023,” said Ambrose Conroy, founder of Seraph Consulting, which is advising car companies on the crisis.

https://www.washingtonpost.com/us-polic ... utomakers/
Ford Europe's Herrmann, meanwhile, estimates the chip shortage could continue through to 2024, adding that it's difficult to pinpoint exactly when it will end.

https://www.cnbc.com/2021/09/06/vw-ford ... -time.html
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BolderBoy
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by BolderBoy »

talzara wrote: Mon Oct 11, 2021 8:40 pm The Texas and Arizona sites will have very little effect on chip availability for automobiles.

The TI factory in Richardson, Texas and the TSMC factory in Phoenix, Arizona are 300 mm wafer factories.
Will that also be true of the planned Samsung plant in TX?

If so then this chip shortage for autos could be pretty long term, eh?
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jarjarM
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by jarjarM »

BolderBoy wrote: Mon Oct 11, 2021 8:49 pm
talzara wrote: Mon Oct 11, 2021 8:40 pm The Texas and Arizona sites will have very little effect on chip availability for automobiles.

The TI factory in Richardson, Texas and the TSMC factory in Phoenix, Arizona are 300 mm wafer factories.
Will that also be true of the planned Samsung plant in TX?

If so then this chip shortage for autos could be pretty long term, eh?
Samsung's plant in TX will likely be 300mm as well, which means they're targeting more advance ASIC/NAND/DRAM production. The main automotive chip shortage are in the 200mm line. Based on current Gartner projection, this will likely continue til 2023.
pennywise
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by pennywise »

Sandtrap wrote: Mon Oct 11, 2021 7:37 am
Recently:
2021 Toyota 4Runner TRD Pro 4wd. Loaded. $3000 below list (Moroni sticker).
2021 Honda Passport Elite AWD Loaded. $2800 below list (Moroni sticker).
(we were able to get both cars in the exact color and configuration and options we wanted).

j :D
Could you be more specific as to when you bought these vehicles than “recently”?
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Sandtrap
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by Sandtrap »

pennywise wrote: Mon Oct 11, 2021 9:45 pm
Sandtrap wrote: Mon Oct 11, 2021 7:37 am
Recently:
2021 Toyota 4Runner TRD Pro 4wd. Loaded. $3000 below list (Moroni sticker).
2021 Honda Passport Elite AWD Loaded. $2800 below list (Moroni sticker).
(we were able to get both cars in the exact color and configuration and options we wanted).

j :D
Could you be more specific as to when you bought these vehicles than “recently”?
Around April 2021, after 2 weeks of poor sales and poor inventory, but new shipment of cars, at the dealership.
Around August 2021, on a dead sale weekend sunday afternoon at the dealership.
j :D
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PatrickA5
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by PatrickA5 »

In July, I bought a Genesis G80 for $3K under MSRP (OTD). Two months later we're looking at a Hyundai Palisade and they wanted $15K over sticker. Yep, a $49K car for $64K. I almost choked. Sent the GM (that was so nice on the first transaction) a nasty email. I have no doubts they got the $64K for the car - probably the same day, but they've lost a customer for life with that offer.
RobLyons
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by RobLyons »

Short answer is no. This applies to new and used at dealerships. Longer answer is yes if you're talking about buying older cars from private parties.
Last edited by RobLyons on Mon Oct 11, 2021 11:07 pm, edited 1 time in total.
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AllMostThere
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by AllMostThere »

PatrickA5 wrote: Mon Oct 11, 2021 10:09 pm In July, I bought a Genesis G80 for $3K under MSRP (OTD). Two months later we're looking at a Hyundai Palisade and they wanted $15K over sticker. Yep, a $49K car for $64K. I almost choked. Sent the GM (that was so nice on the first transaction) a nasty email. I have no doubts they got the $64K for the car - probably the same day, but they've lost a customer for life with that offer.
You need to be posting this experience on other social media to get the word out on this bad practice from this dealership. They need to lose more than you as a lifetime customer. This is NOT a supply and demand issue, it's Predatory Pricing in an extreme environment! How is this any different that someone selling $500 generators after a Hurricane for $2K? I'm really quite shocked that the OEM's are not stamping this "Market Adjustment" pricing down as it's bad optics for them with the end consumer. :annoyed
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DoubleComma
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Re: Anyone negotiate a car lately? Any room as consumers?

Post by DoubleComma »

TJat wrote: Mon Oct 11, 2021 9:20 am
Ramjet wrote: Mon Oct 11, 2021 7:49 am Does anyone have a guess as to when this chip shortage is likely to be resolved and when car prices may trend back to normal

I was hoping to make a purchase around March 2022 but I am not optimistic anything will be different
I wouldn't count on it by then. Right now there are less than 100k vehicles in active inventory across the entire country, which creates a big supply glut. Replacement production is way down due to the chips and it's unlikely chip production will be even back by Mar 22. Even when supply starts flowing to Auto makers, there'll be quite a backlog to work through. Up through the summer, industry estimates kept getting pushed back from Q421 to Q222Latest industry projections expect pretty flat prices from today through 2022 (one was even through 2023!)
Can’t say when the auto market return to something more normal. But the chip shortage specifically is forecasted to be largely resolved in late Q3 2022, this feels optimistic to me. Take a long time to to start wafers and process through to finished semiconductors. Can’t even start wafers till you have fab capacity to handle the wafer.
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