Thinking I should go car shopping amidst the panic

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valleyrock
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Re: Thinking I should go car shopping amidst the panic

Post by valleyrock » Thu Mar 19, 2020 11:38 am

A couple of thoughts.

--What? Aren't driverless cars just around the corner?

--Why get a new car when there's nowhere to go, except the grocery store, the pharmacy, and the gas station? Maybe to get takeout.

--My father used to say "Buy foreign, and you put an American out of work." Sure, they make Toyotas in Tennessee, but where do the profits go?

--I remember hitch-hiking. Let's bring it back. Surely there can be an app for that, with participants screened as at Uber, etc.

--Put the school buses on the road. They're just sitting there. Run them up and down the road and let people hop on and hop off, sitting 6 feet apart, of course.

BusterScruggs
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Re: Thinking I should go car shopping amidst the panic

Post by BusterScruggs » Thu Mar 19, 2020 11:43 am

TomatoTomahto wrote:
Mon Mar 16, 2020 12:41 pm
What do you think?
I think I’ll have to check with my manager.
now that's great stuff!

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TomatoTomahto
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Re: Thinking I should go car shopping amidst the panic

Post by TomatoTomahto » Thu Mar 19, 2020 11:54 am

BusterScruggs wrote:
Thu Mar 19, 2020 11:43 am
TomatoTomahto wrote:
Mon Mar 16, 2020 12:41 pm
What do you think?
I think I’ll have to check with my manager.
now that's great stuff!
Thanks. I’ll be here all week, but since we’re sheltering in place in the Boston suburbs, you already knew that.
Okay, I get it; I won't be political or controversial. The Earth is flat.

HEDGEFUNDIE
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Re: Thinking I should go car shopping amidst the panic

Post by HEDGEFUNDIE » Thu Mar 19, 2020 11:58 am

valleyrock wrote:
Thu Mar 19, 2020 11:38 am
--My father used to say "Buy foreign, and you put an American out of work." Sure, they make Toyotas in Tennessee, but where do the profits go?
It depends whether you invest in International or not...

mortfree
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Re: Thinking I should go car shopping amidst the panic

Post by mortfree » Thu Mar 19, 2020 12:08 pm

I don’t know.

You show up at a dealership with a CRV and they might not want your car.

Please keep us posted.

Wellfleet
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Re: Thinking I should go car shopping amidst the panic

Post by Wellfleet » Fri Mar 20, 2020 5:42 am

I'm shocked, shocked that two weeks ago the dealerships were unable to close the deal unless I came into the dealership and now they are all emailing me that they have magically discovered DocuSign and can complete the transaction and even deliver the new car right to my house! :oops:

halfnine
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Re: Thinking I should go car shopping amidst the panic

Post by halfnine » Fri Mar 20, 2020 6:03 am

I'd hazard a guess that next quarter will offer better deals than this quarter. Maybe sales for this quarter have already been sufficient enough prior to the crisis.

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StevieG72
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Re: Thinking I should go car shopping amidst the panic

Post by StevieG72 » Fri Mar 20, 2020 7:43 am

I am in the market for a car for the kiddo. So far have not seen any variance in pricing. I do believe it is coming soon.
On the other side of the coin my finances have been impacted as a small business owner so I will have to see how the next month or two plays out.
Fools think their own way is right, but the wise listen to others.

260chrisb
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Re: Thinking I should go car shopping amidst the panic

Post by 260chrisb » Fri Mar 20, 2020 7:48 am

Do you need a car? If so, go. For the sake of just throwing around low ball offers? Why? Will you be disappointed if they take said low ball offer?

jpdion
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Re: Thinking I should go car shopping amidst the panic

Post by jpdion » Fri Mar 20, 2020 7:54 am

Mmmm . . . is Tesla offering incentives for new buyers on their Model Ys that folks are opting out of delivery on? Might be interesting to know.

delamer
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Re: Thinking I should go car shopping amidst the panic

Post by delamer » Fri Mar 20, 2020 12:18 pm

Wellfleet wrote:
Fri Mar 20, 2020 5:42 am
I'm shocked, shocked that two weeks ago the dealerships were unable to close the deal unless I came into the dealership and now they are all emailing me that they have magically discovered DocuSign and can complete the transaction and even deliver the new car right to my house! :oops:
Just like so many employers are seeing the merits of teleworking now when they did not sanction it before.

ponyboy
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Re: Thinking I should go car shopping amidst the panic

Post by ponyboy » Fri Mar 20, 2020 12:46 pm

No way. Give it a few months. Car dealerships will be hurting. Good deals to come, for once. The consumer has the upper hand.

alfaspider
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Re: Thinking I should go car shopping amidst the panic

Post by alfaspider » Fri Mar 20, 2020 12:52 pm

valleyrock wrote:
Thu Mar 19, 2020 11:38 am

--My father used to say "Buy foreign, and you put an American out of work." Sure, they make Toyotas in Tennessee, but where do the profits go?
What if you buy a Chrysler (owned by Fiat) made in Canada? "American" cars aren't as American as they once were.

But to the OP, I would agree that it's better to wait a bit. We are only a week or two into this having an impact in the U.S. Car dealerships will be a lot more desperate in a few weeks. In some states, all nonessential businesses are being shut down anyways.

kidshrink
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Re: Thinking I should go car shopping amidst the panic

Post by kidshrink » Fri Mar 20, 2020 1:49 pm

JoinToday wrote:
Mon Mar 16, 2020 4:52 pm
Old Sage(brush) wrote:
Mon Mar 16, 2020 3:49 pm
Does anyone see an ethical issue with trying to take advantage of this health crisis?
No.

1. There is asymmetrical knowledge in the deal. The car dealer knows way more than you & I know. They wouldn't make the deal if it wasn't in their best interest.
2. If the tables were turned and cars were in high demand, do you think they would cut you a good deal? Not a chance.
Agreed. You watch out for you, the dealer will watch out for the dealer. This isn't a therapeutic relationship. Of course, "lowball" is subjective. I don't think I've ever seen it defined as a certain number of standard deviations from the mean. All they can say is 'no'.

I just closed a lease on a BMW M car. Phenomenal car, AWD, so I'm going driving for the sake of driving on the empty highways. $2.00 gas is cheaper than a bar tab, and the bars are all closed anyway. Like a Boglehead, I made sure I could afford the lease with my free cash, so this recession or me losing my fairly secure job won't matter.

Q1 ends March 30, and dealers will be hungry.

Enjoy your cars in good health.

kidshrink
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Re: Thinking I should go car shopping amidst the panic

Post by kidshrink » Fri Mar 20, 2020 1:51 pm

delamer wrote:
Fri Mar 20, 2020 12:18 pm
Wellfleet wrote:
Fri Mar 20, 2020 5:42 am
I'm shocked, shocked that two weeks ago the dealerships were unable to close the deal unless I came into the dealership and now they are all emailing me that they have magically discovered DocuSign and can complete the transaction and even deliver the new car right to my house! :oops:
Just like so many employers are seeing the merits of teleworking now when they did not sanction it before.
One of the golden truths I've learned is that people will do what's best for them. Also supply and demand.

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CULater
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Re: Thinking I should go car shopping amidst the panic

Post by CULater » Wed Mar 25, 2020 10:37 am

Yeh, they're hurting alright:
March car sales will drop by 36% compared with March 2019 and decrease in sales from March 2019 and a 23% decrease from February, analysts at Edmunds said in a note Wednesday.
https://www.marketwatch.com/story/march ... =home-page

Problem is that car dealers are closing showrooms and sales staff are working from home and others are laid off. So, it's probably hard to beat them over the head for a deal but I guess you could try online.
On the internet, nobody knows you're a dog.

Hockey10
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Re: Thinking I should go car shopping amidst the panic

Post by Hockey10 » Wed Mar 25, 2020 11:30 am

If you can wait until the last week of June to buy one, you might get a fantastic deal. By then, most car dealers will be desperate for sales.

Sic Vis Pacem
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Re: Thinking I should go car shopping amidst the panic

Post by Sic Vis Pacem » Wed Mar 25, 2020 11:37 am

DW and I are in the market for a new car sometime in the next 1-2 years. If the deals get good, we may move on this one. GM already offering 84 month 0% financing. Hyundai offering to pay 6 months of payments if you have a COVID job loss.

I've tried searching for the information, but does anyone have any solid data on (1) magnitude of discounts offered during the 2008-2009 period, and (2) when those started showing up? I realize that car buying deals can be local, but it seems like the manufacturer-level response is already starting.

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Re: Thinking I should go car shopping amidst the panic

Post by TheOscarGuy » Wed Mar 25, 2020 12:15 pm

Sic Vis Pacem wrote:
Wed Mar 25, 2020 11:37 am
DW and I are in the market for a new car sometime in the next 1-2 years. If the deals get good, we may move on this one. GM already offering 84 month 0% financing. Hyundai offering to pay 6 months of payments if you have a COVID job loss.

I've tried searching for the information, but does anyone have any solid data on (1) magnitude of discounts offered during the 2008-2009 period, and (2) when those started showing up? I realize that car buying deals can be local, but it seems like the manufacturer-level response is already starting.
I am not claiming you are personally financially irresponsible (the fact that you are on BH means you aren't by definition :wink: ). But when I read the 84 months 0% financing by GM, it gave me the chills. Does that not encourage folks who *should not* be spending on expensive cars to buying those expensive cars?

kmurp
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Re: Thinking I should go car shopping amidst the panic

Post by kmurp » Wed Mar 25, 2020 12:19 pm

Dealers around us are are closed due to the pandemic. I would very strongly suggest to you all NOT to go out for things you don’t absolutely need (like a car).

Sic Vis Pacem
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Re: Thinking I should go car shopping amidst the panic

Post by Sic Vis Pacem » Wed Mar 25, 2020 12:38 pm

TheOscarGuy wrote:
Wed Mar 25, 2020 12:15 pm
Sic Vis Pacem wrote:
Wed Mar 25, 2020 11:37 am
DW and I are in the market for a new car sometime in the next 1-2 years. If the deals get good, we may move on this one. GM already offering 84 month 0% financing. Hyundai offering to pay 6 months of payments if you have a COVID job loss.

I've tried searching for the information, but does anyone have any solid data on (1) magnitude of discounts offered during the 2008-2009 period, and (2) when those started showing up? I realize that car buying deals can be local, but it seems like the manufacturer-level response is already starting.
I am not claiming you are personally financially irresponsible (the fact that you are on BH means you aren't by definition :wink: ). But when I read the 84 months 0% financing by GM, it gave me the chills. Does that not encourage folks who *should not* be spending on expensive cars to buying those expensive cars?

I think you're exactly right that lots of people will buy a whole lot more vehicle than they would have otherwise. I'm seeing a few offers now that are also (or in the alternative) offering no payments for months. I assume you need excellent credit to qualify for the financing (or at least I would hope). We paid cash for our last car, and are prepared to do the same with this one. But if an auto manufacturer wants to float me the money for 7 years...

Sic Vis Pacem
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Re: Thinking I should go car shopping amidst the panic

Post by Sic Vis Pacem » Wed Mar 25, 2020 12:41 pm

kmurp wrote:
Wed Mar 25, 2020 12:19 pm
Dealers around us are are closed due to the pandemic. I would very strongly suggest to you all NOT to go out for things you don’t absolutely need (like a car).
My thought would be to buy online and then have it delivered and wait 10 days before using it. I'm guessing this will become routine in the next couple of months. We are under an order in my state, and local dealers are offering free delivery.

Jags4186
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Re: Thinking I should go car shopping amidst the panic

Post by Jags4186 » Wed Mar 25, 2020 12:45 pm

Old Sage(brush) wrote:
Mon Mar 16, 2020 3:49 pm
Does anyone see an ethical issue with trying to take advantage of this health crisis?
Not at all. When times are good companies discount less, none, or even charge a premium. When times are bad they discount more.

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CULater
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Re: Thinking I should go car shopping amidst the panic

Post by CULater » Wed Mar 25, 2020 1:21 pm

The info I got from one dealer is that you can buy now online but you have to wait until people are back in their offices to sign the paperwork and complete the deal. Can't get the car until then.
On the internet, nobody knows you're a dog.

MathWizard
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Re: Thinking I should go car shopping amidst the panic

Post by MathWizard » Wed Mar 25, 2020 1:27 pm

Wellfleet wrote:
Fri Mar 20, 2020 5:42 am
I'm shocked, shocked that two weeks ago the dealerships were unable to close the deal unless I came into the dealership and now they are all emailing me that they have magically discovered DocuSign and can complete the transaction and even deliver the new car right to my house! :oops:
Yes. For 2 weeks I tried to get approval to have my staff work remotely. Repeated: We'll think about allowing it.
Then a week ago, we are ordered out of the office. :oops:

We have no problem doing almost everything remotely, and go on-site almost never.

pj1983
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Re: Thinking I should go car shopping amidst the panic

Post by pj1983 » Wed Mar 25, 2020 4:31 pm

CULater wrote:
Wed Mar 25, 2020 1:21 pm
The info I got from one dealer is that you can buy now online but you have to wait until people are back in their offices to sign the paperwork and complete the deal. Can't get the car until then.
I think you may have misspelled "pressure customers into extended warranties" :wink:

Seriously, if I can make a deal on a $400k house via Docusign why can't I do the same for a $40k car? Yes, I know there's still closing paperwork required on a house but by that point the financials are done. The only in-person signature that should be needed on a car is the final purchase order and the registration, or whatever document is needed to finalize the deal and title.

GibsonL6s
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Re: Thinking I should go car shopping amidst the panic

Post by GibsonL6s » Wed Mar 25, 2020 4:34 pm

I actually need a car, but am thinking when this ends the good deals will be around for a while.

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Re: Thinking I should go car shopping amidst the panic

Post by abuss368 » Wed Mar 25, 2020 4:39 pm

Our local car dealers have moved to online shopping only with showrooms closed.
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Re: Thinking I should go car shopping amidst the panic

Post by abuss368 » Wed Mar 25, 2020 4:40 pm

You could also try online.
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Re: Thinking I should go car shopping amidst the panic

Post by manuvns » Wed Mar 25, 2020 7:42 pm

bloom2708 wrote:
Wed Mar 18, 2020 8:03 am
GM is offering 7 year, 0% financing for A1+ credit score borrowers.

Bogleheads who love free money will like that one.
does this deal apply to 3 row SUV ? most cash discount do not apply on 0% APR financing .

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Re: Thinking I should go car shopping amidst the panic

Post by FireSekr » Wed Mar 25, 2020 7:54 pm

Old Sage(brush) wrote:
Mon Mar 16, 2020 3:49 pm
Does anyone see an ethical issue with trying to take advantage of this health crisis?
Absolutely not.

Why do you think a car dealer would agree to a below market deal? Because for them, they would rather get some cash flow and take a small loss than be sitting on inventory that they're paying a great deal of interest on. They're not going to agree to a deal they are uncomfortable with, you're not putting a gun to their head.

I'd go so far as to say you're helping them cover their fixed costs and keeping them in business even if they are taking a loss on the deal

crg11
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Re: Thinking I should go car shopping amidst the panic

Post by crg11 » Wed Mar 25, 2020 7:58 pm

Actually mulling this ourselves. We are expecting our 3rd child later this year and have to upgrade a car because 3 car seats (2 rear facing) won't happen in our current cars.

Subaru has a 0%, 63 months deal on the Subaru Ascent that looks really hard to pass up.

Thinking about trading both of our cars in for the new car, since we are only using one car for the foreseeable future in this crisis. Once the crisis is done, if needed, we can thinking about some sort of second car.

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Re: Thinking I should go car shopping amidst the panic

Post by Nate79 » Wed Mar 25, 2020 8:14 pm

crg11 wrote:
Wed Mar 25, 2020 7:58 pm
Actually mulling this ourselves. We are expecting our 3rd child later this year and have to upgrade a car because 3 car seats (2 rear facing) won't happen in our current cars.

Subaru has a 0%, 63 months deal on the Subaru Ascent that looks really hard to pass up.

Thinking about trading both of our cars in for the new car, since we are only using one car for the foreseeable future in this crisis. Once the crisis is done, if needed, we can thinking about some sort of second car.
We've had our Ascent for a little over a year now and absolutely love it.

michaeljc70
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Re: Thinking I should go car shopping amidst the panic

Post by michaeljc70 » Thu Mar 26, 2020 8:18 am

I think it is too early. Probably a good time to look if you are not immunocompromised though as I expect there are few people looking at cars. It is the end of the month so maybe you will have some luck at getting a decent deal. I just don't think that after a few weeks of this they are going to be giving cars away.

I would never buy a car model I haven't test driven.

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Re: Thinking I should go car shopping amidst the panic

Post by JackoC » Thu Mar 26, 2020 9:22 am

JoinToday wrote:
Mon Mar 16, 2020 4:52 pm
Old Sage(brush) wrote:
Mon Mar 16, 2020 3:49 pm
Does anyone see an ethical issue with trying to take advantage of this health crisis?
No.
1. There is asymmetrical knowledge in the deal. The car dealer knows way more than you & I know. They wouldn't make the deal if it wasn't in their best interest.
2. If the tables were turned and cars were in high demand, do you think they would cut you a good deal? Not a chance.
I agree, no. 1 and 2 both get back to whether you're dealing with 'big boys and girls' who can take care of their own interests, or somebody who might actually get taken advantage of, 'widows and orphans'. Car dealers are absolutely in the first category. They deal as professionals in a market and aren't going to give you a price that doesn't make sense for them in the circumstances, don't worry. Another thread raised a supposed ethical issue of getting better prices out of home contractors if they have less business. Same there basically IMO. Though maybe at the margin there are some very small time contractors/handymen where you might debate which category they are in. But not car dealers.

But there could be some actual obstacles to actually getting a good deal even if ethics is not a valid one, and as other mentioned: possible inertia in the short term whereby the dealer's attitude is affected by still reasonable sales results March or quarter to date, whether dealers are even open some places, and there will also be less supply of cars in coming months as some assembly plants shut down.

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Re: Thinking I should go car shopping amidst the panic

Post by TomatoTomahto » Thu Mar 26, 2020 10:42 am

FireSekr wrote:
Wed Mar 25, 2020 7:54 pm
Why do you think a car dealer would agree to a below market deal? Because for them, they would rather get some cash flow and take a small loss than be sitting on inventory that they're paying a great deal of interest on.
I don’t know the interest rate that they’re paying. I would have thought it would be low. Does anyone know?

FWIW, not having inventory is one of the things I like about Tesla’s model.
Okay, I get it; I won't be political or controversial. The Earth is flat.

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Re: Thinking I should go car shopping amidst the panic

Post by alfaspider » Thu Mar 26, 2020 11:19 am

crg11 wrote:
Wed Mar 25, 2020 7:58 pm
Actually mulling this ourselves. We are expecting our 3rd child later this year and have to upgrade a car because 3 car seats (2 rear facing) won't happen in our current cars.

Subaru has a 0%, 63 months deal on the Subaru Ascent that looks really hard to pass up.

Thinking about trading both of our cars in for the new car, since we are only using one car for the foreseeable future in this crisis. Once the crisis is done, if needed, we can thinking about some sort of second car.
If you are interested in a Subaru, look at signing up with an organization that does partner pricing. with Subaru The Pennsylvania Horticultural Society will let you sign up for $60 and gives you partner pricing immediately (other organizations like the ASPCA require a $500 donation for immediate partner pricing eligibility). Partner pricing is 2% under invoice, and you can stack it with a $500 Subaru loyalty or ambassador coupon. At least when we bought our Ascent last year, most were selling for at or very close to MSRP, so this was a pretty substantial savings. It's possible you could get a similar deal due to a Coronavirus fire sale without the partner pricing, but consider signing up if that doesn't seem to be happening.

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Re: Thinking I should go car shopping amidst the panic

Post by friar1610 » Thu Mar 26, 2020 12:01 pm

Wellfleet wrote:
Fri Mar 20, 2020 5:42 am
I'm shocked, shocked that two weeks ago the dealerships were unable to close the deal unless I came into the dealership and now they are all emailing me that they have magically discovered DocuSign and can complete the transaction and even deliver the new car right to my house! :oops:
This goes in the same category as ordering something over the Internet and paying with a credit card. The charge shows up on your cc account almost instantaneously. But cancel the order or return the item and it takes 7-10 days. :oops:
Friar1610

FireSekr
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Re: Thinking I should go car shopping amidst the panic

Post by FireSekr » Thu Mar 26, 2020 12:58 pm

TomatoTomahto wrote:
Thu Mar 26, 2020 10:42 am
FireSekr wrote:
Wed Mar 25, 2020 7:54 pm
Why do you think a car dealer would agree to a below market deal? Because for them, they would rather get some cash flow and take a small loss than be sitting on inventory that they're paying a great deal of interest on.
I don’t know the interest rate that they’re paying. I would have thought it would be low. Does anyone know?

FWIW, not having inventory is one of the things I like about Tesla’s model.
I'm not sure the exact numbers but it's not as low as you'd think...cheaper than what you or I would pay, but it's not nothing either.

Goes beyond the interest rates though. These dealers are also getting incentives from the manufacturer, and the sooner they can move product, the sooner they get the incentive payments which help them cover their fixed cost. So if they're losing $1k on a car, but getting a $2k marketing incentive from the manufacturer or some type of volume bonus, they're still coming out ahead.

Bottom line is that they're not going to agree to a deal that puts them in a worse situation than they were in before.

And I agree about Tesla's build to order no inventory model. It makes great sense.

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Re: Thinking I should go car shopping amidst the panic

Post by surfstar » Thu Mar 26, 2020 1:00 pm

Tip: careful when test driving - they might have a "You cough on it, you bought it" rule ;)

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Re: Thinking I should go car shopping amidst the panic

Post by papito23 » Thu Mar 26, 2020 1:10 pm

$10,000 off Chevy Bolts (fully electric, 259 mi range) right now through Tuesday (Google it)
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Re: Thinking I should go car shopping amidst the panic

Post by alfaspider » Thu Mar 26, 2020 1:46 pm

papito23 wrote:
Thu Mar 26, 2020 1:10 pm
$10,000 off Chevy Bolts (fully electric, 259 mi range) right now through Tuesday (Google it)
They've been running that one through the beginning of the year. I'd probably take the $199/month lease deal if I were in a state that only taxes the payments. If you can charge at home, your all in ownership costs should be around $150 a month. Car shouldn't require any maintenance during the lease payments other than maybe a tire rotation. You can spend more than that on a public transit pass in some places.
Last edited by alfaspider on Thu Mar 26, 2020 1:47 pm, edited 1 time in total.

crg11
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Re: Thinking I should go car shopping amidst the panic

Post by crg11 » Thu Mar 26, 2020 1:47 pm

alfaspider wrote:
Thu Mar 26, 2020 11:19 am
crg11 wrote:
Wed Mar 25, 2020 7:58 pm
Actually mulling this ourselves. We are expecting our 3rd child later this year and have to upgrade a car because 3 car seats (2 rear facing) won't happen in our current cars.

Subaru has a 0%, 63 months deal on the Subaru Ascent that looks really hard to pass up.

Thinking about trading both of our cars in for the new car, since we are only using one car for the foreseeable future in this crisis. Once the crisis is done, if needed, we can thinking about some sort of second car.
If you are interested in a Subaru, look at signing up with an organization that does partner pricing. with Subaru The Pennsylvania Horticultural Society will let you sign up for $60 and gives you partner pricing immediately (other organizations like the ASPCA require a $500 donation for immediate partner pricing eligibility). Partner pricing is 2% under invoice, and you can stack it with a $500 Subaru loyalty or ambassador coupon. At least when we bought our Ascent last year, most were selling for at or very close to MSRP, so this was a pretty substantial savings. It's possible you could get a similar deal due to a Coronavirus fire sale without the partner pricing, but consider signing up if that doesn't seem to be happening.
Great tip, thanks! Will check it out.

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Re: Thinking I should go car shopping amidst the panic

Post by Jack FFR1846 » Thu Mar 26, 2020 5:37 pm

Only "essential businesses" are open in Massachusetts. Restaurants can have delivery and take out, but no sit down.

Iiquor stores are open.
Car dealers are open.
Mechanic garages are open.
Auto body shops are open
Landscapers are working
grocery stores are open
gas stations are open
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michaeljc70
Posts: 6425
Joined: Thu Oct 15, 2015 3:53 pm

Re: Thinking I should go car shopping amidst the panic

Post by michaeljc70 » Thu Mar 26, 2020 6:52 pm

Jack FFR1846 wrote:
Thu Mar 26, 2020 5:37 pm
Only "essential businesses" are open in Massachusetts. Restaurants can have delivery and take out, but no sit down.

Iiquor stores are open.
Car dealers are open.
Mechanic garages are open.
Auto body shops are open
Landscapers are working
grocery stores are open
gas stations are open
Don't most dealerships have mechanics? Is only that part allowed open? I laugh how every state thinks liquor stores are essential (and I drink :sharebeer ). Is it because they sell food (limes and olives)?

Rotarman
Posts: 121
Joined: Tue Apr 05, 2016 5:14 pm

Re: Thinking I should go car shopping amidst the panic

Post by Rotarman » Fri Mar 27, 2020 7:40 am

michaeljc70 wrote:
Thu Mar 26, 2020 6:52 pm
Jack FFR1846 wrote:
Thu Mar 26, 2020 5:37 pm
Only "essential businesses" are open in Massachusetts. Restaurants can have delivery and take out, but no sit down.

Iiquor stores are open.
Car dealers are open.
Mechanic garages are open.
Auto body shops are open
Landscapers are working
grocery stores are open
gas stations are open
Don't most dealerships have mechanics? Is only that part allowed open? I laugh how every state thinks liquor stores are essential (and I drink :sharebeer ). Is it because they sell food (limes and olives)?
I think it's because of alcoholics. If the liquor stores shut down, there would unfortunately be tons of people withdrawing in the emergency department.

michaeljc70
Posts: 6425
Joined: Thu Oct 15, 2015 3:53 pm

Re: Thinking I should go car shopping amidst the panic

Post by michaeljc70 » Fri Mar 27, 2020 8:58 am

Rotarman wrote:
Fri Mar 27, 2020 7:40 am
michaeljc70 wrote:
Thu Mar 26, 2020 6:52 pm
Jack FFR1846 wrote:
Thu Mar 26, 2020 5:37 pm
Only "essential businesses" are open in Massachusetts. Restaurants can have delivery and take out, but no sit down.

Iiquor stores are open.
Car dealers are open.
Mechanic garages are open.
Auto body shops are open
Landscapers are working
grocery stores are open
gas stations are open
Don't most dealerships have mechanics? Is only that part allowed open? I laugh how every state thinks liquor stores are essential (and I drink :sharebeer ). Is it because they sell food (limes and olives)?
I think it's because of alcoholics. If the liquor stores shut down, there would unfortunately be tons of people withdrawing in the emergency department.
True, but here you can buy liquor at Walgreens, CVS, Costco and just about any grocery store. I wondered if the liquor stores argued it would be unfair for other places to be open selling liquor and not them.

iamlucky13
Posts: 1746
Joined: Sat Mar 04, 2017 5:28 pm
Location: Western Washington

Re: Thinking I should go car shopping amidst the panic

Post by iamlucky13 » Fri Mar 27, 2020 9:24 am

Jack FFR1846 wrote:
Thu Mar 26, 2020 5:37 pm
Only "essential businesses" are open in Massachusetts. Restaurants can have delivery and take out, but no sit down.

Iiquor stores are open.
Car dealers are open.
Mechanic garages are open.
Auto body shops are open
Landscapers are working
grocery stores are open
gas stations are open
For most people in the US, going to the grocery store or the doctor involves driving. Of course, essential workers have to get to work, too. That makes mechanics and gas stations arguably important. It's also an industry where it should be straightforward to keep one's distance from others.

Car dealerships do seem quite a bit less essential than mechanics, though.

Landscapers generally don't need to interact directly with their customers. Keep in mind the real goal here. I see zero problem with allowing landscapers to work, although it does seem odd that in my state they're listed as essential, rather than simply exempted based on level of risk.

In my state, liquor stores qualify as essential only if they also sell food. Oddly, marijuana stores qualify as essential regardless of whether they sell food, and I'm not talking about medical marijuana. Our state's list of essential businesses mentions medical marijuana outlets as one type of essential business, and other marijuana retailers as a separate essential business.

H-Town
Posts: 2581
Joined: Sun Feb 26, 2017 2:08 pm

Re: Thinking I should go car shopping amidst the panic

Post by H-Town » Sun Mar 29, 2020 2:07 pm

CULater wrote:
Mon Mar 16, 2020 12:37 pm
Wondering if the car dealers are starting to hurt. Seems logical that fewer people would be in the mood to be car shopping now. I'm considering hitting some dealers and throwing a lowball offer at them for something. What do you think?
I'm here trying to buy houses and properties for cheap. Rental properties are better than cars.

denovo
Posts: 4432
Joined: Sun Oct 13, 2013 1:04 pm

Re: Thinking I should go car shopping amidst the panic

Post by denovo » Tue Mar 31, 2020 11:52 pm

TomatoTomahto wrote:
Thu Mar 26, 2020 10:42 am
FireSekr wrote:
Wed Mar 25, 2020 7:54 pm
Why do you think a car dealer would agree to a below market deal? Because for them, they would rather get some cash flow and take a small loss than be sitting on inventory that they're paying a great deal of interest on.
I don’t know the interest rate that they’re paying. I would have thought it would be low. Does anyone know?

FWIW, not having inventory is one of the things I like about Tesla’s model.
I had a dealer explain this to me in detail after a sale.*
(1)Car manufacturers require payment for vehicles when they obtain the vehicle.
(2) Most car dealers finance these purchases from a local credit union or community back. They will pay interest based on their outstanding loan balance.
(3) So yes they have an incentive to move cars and suffer if they have a lot of cars sitting on the lot and can not clear their inventory.


* This is was explained by the dealer (Honda) because others dealers couldn't come near this dealer in a bidding war. We asked why. He said they are one of the few dealers who pay cash for cars and do not finance. Since they aren't saddled with the interest costs they can win any bidding war.

https://www.edmunds.com/car-buying/dealer-holdback/

This relates to holdbacks.


Dealerships have an inventory on hand so that consumers can browse and ultimately choose a vehicle. Dealerships pay for this inventory when they obtain vehicles from the manufacturer. The amount the dealer pays is the price reflected on the invoice from the manufacturer to the dealer. This is the so-called "invoice price."

Now the twist: With the introduction of holdbacks some years ago, most manufacturers inflated the invoice prices for every vehicle by a predetermined amount (2-3 percent of MSRP is typical). The dealer pays that inflated amount when it buys the car from the manufacturer. But later, at predetermined times (usually quarterly), the manufacturer reimburses the dealer for the excess amount. This is the "holdback," so named because funds are "held back" by the manufacturer and released only after the vehicle is invoiced to the dealership.

Why the complex accounting? Because holdbacks can benefit dealers in three ways:
1. Dealerships borrow money to finance cars based on an invoiced amount that includes the holdback. So the higher the invoiced amount, the more the dealership can borrow from its lender.

2. Inflating the dealership's cost can have the effect of increasing profit, since sales personnel are paid commissions based on the gross profit of each sale. Holdbacks have the effect of lowering the gross profit, and thus the sales commissions.

3. Holdbacks enable dealerships to advertise invoice-price sales and sell their vehicles at or near invoice and still make hundreds of dollars on the transaction.
"Don't trust everything you read on the Internet"- Abraham Lincoln

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