SDW=1, Nameless GMC Dealer "X" =0.

Well, I finally did it. My wife and I got a new GMC Envoy XL, SLT 4WD. (please, let's not go down the "Why'd you get the SUV, why are you killing the planet, why'd you buy new, blah blah, blah BLAH route).

After we had the baby, we knew we'd need some serious cargo space. We pretty much made the choice months ago, but were waiting 'till my lease was nearer to the end. "Anywho:"

I beat the hell out of these guys. They quoted me a first price of $3,000 under sticker (not all bad, I guess). They, thinking that I think I could actually know their true cost by looking at an invoice, tried to tell me that was $150 over their "cost". Having done this before, I talked about the number with them, then left and went to another dealer. Oooohhh....they HATE that.

The second dealer didn't really have what I wanted, so I decided to play hard ball with the first. After a quick call to the wife, we decided to get serious. I was playing for keeps this time, and offered them $2,500 LESS than their "best deal" price. They laughed. We negotiated...upwards, until we reached a price $1000 under their best deal. They pulled out their "invoice" (I believe Wayne would say...."AS IF!!!) and I picked it apart, then showed them, according to my math, what their actual invoice was. Anyway, after we fought for awhile the sales manager came out at my request and agreed on the price. Not ten minutes before, I was told the best they could do was perhaps $200 less than their "best deal". I got $1000.

So, I paid $4,132 under sticker, which probably puts them into their holdback (and the car's been on the lot for a while so that's not good for them). I also got a whopping $4,250 in rebates because I provided my own financing. I've prided myself on beating the hell out of dealers, but getting a car for $8,382 under sticker is a personal best for me. Picking up the car Thursday night.

Any stories to share? I know the dealer's tactic well, and I'm sure some of you do too. I'm not naive enought think they made nothing, but I think I did pretty well.

Here we go.

The answer is no. But, we also have an 85 pound collie whom we need to keep separate from her. We also wanted a lot of cargo space. In addition, it's going to be my car (my lease was coming up) so I'd PREFER not to drive minivan (In our opinion, the only other real option).


chinney:


I need the third seat it offers to give your big Straw Man a ride.

progmac:




Invoice depends on equipment of course. And, people need to realize that the dealer invoice is basically fiction. They get secret factory to dealer incentives, holdback, etc. We, as consumers, can never know their real cost. I'm sure they made at least $1K on me. The difference is, if I do say so myself, I know that going in.

The vehicle I got is essentially a large SUV, because it's the XL with the third seat. I got the 4WD SLT model, with 6 disc Cd changer, comfort and convenenience, load-level suspension (don't need it...but it was there) and Bose audio. Oh, and sunroof. I didn't care about that in an SUV, but after seeing it...it really makes the vehicle feel a lot more open.

The invoice, which they showed me without my asking (unusual), was like $37,700 as equipped. The sticker was a whopping $41,020. Their first offer was about $37,900 or so. Not bad, but I took them down another thousand.

I also had a few lease payments left to be considered (I needed to get rid of my Maxima because I was out of warranty recently...and we needed the bigger vechicle). So, we figured this in the price (not included above) and they are cutting me a check to pay it off. Here's the kicker: since they had to add the lease payments into the purchase price, they tried to charge me sales tax on the entire amount. I argued about that, since the lease payments were *not* a taxable sale. I got them to add the tax on the lease payments onto the lease rebate check...about another $100.

Cool.

To answer your question:

The sticker was 41,020. I paid $36,888, not including rebates of $4,250. This brings the total (not including the lease payments left) to $32,638. That means a paid $8,382 less than the sticker...or a whopping 20%.

Thanks. My family is starting to recruit me for their car shpping needs!

My Dad told me that in FL, some dealers have Lincoln Navigators marked down....wait for it....$15,000 off sticker! Apparently, Ford makes another $15K on the car. This means a $60,000 SUV costs less than $30K to make.

They could care less about the rebates. I agree. It's amazing how many people think that the rebates are the discount, though. The dealer cares if people are stupid...that's how they make money. What I did was offer them an absurd price. The orginal price they quoted me for the vehicle was "$150 over invoice". I offered them $2500 less than that. Then, I came up in $500 increments another $1,500. Then, we subtracted the $3000 rebate, the $750 GM owner loyalty, and the $500 Conquest discount (for having a non-GM car as well)

The price: It's an absurd amount of money. I know that. But, as trumptman and I have discussed before, I'm convinced that new is the way to go. A lot of folks disagree, but I've come to the conclusion that no matter what one does, he/she is going to PAY substantial dollars to drive ANY car. I'm choosing to pay a bit more and drive a new car. I've done the numbers, and I'm convinced driving used is not worth it in most cases. Trumptman disagrees and that's fine.

We did it through home equity (fixed). The interest is tax deductible and the minumum payment is low. It's a fifteen year loan, but my real goal is simply to keep it from going "upside down" (vehicle worth less than loan amount). In other words, I'll lease it from myself while still buying it. When I'm done, my equity will be right back where it was, and in 6-7 years I'll be ready for another vehicle.

It's also secured debt on an appreciating asset (the house) so it's better than a car loan. With a regular car loan, the car is "worth what it is worth" at the end...perhaps 70% less than you paid. You've made your payments, and that's it. With this, the money is back where it started. The vehicle is now listed as an asset because I'll have the title outright. Yes, I have the loan liability, but as I said it's secured debt, so it's not just a straight-out liability. Our net worth actually doesn't change much from this purchase, because what I'm really doing is paying down the depreciation...which, BTW will be clsoe to what a used car payment would be. And, a used car won't last 6-7 years for most people. I'd have to buy another one in 4 years.

Many say a car is an investment, and a terrible one at that. I basically disagree. One buys a car to drive. It's like any other product, but more expensive. One doesn't hear people talking about what a lousy investment a Pismo PowerBook is worth now ($400-700) because it had a "sticker" of $3500 when new.

I don't agree. Any decent used car is going to cost $10-15K. Then, the buyer is exposed to a lack of original warrantty, repairs, added interest because the car is used and most importantly...the buyer is paying every month to drive a 4-5 year old vehicle.

One can, of course, buy cash. But what is one going to be able to buy for cash? Most people I know don't have an exra $15K sitting around, no matter what their income is. It's just reality. Sure, we can sit back and poo-poo those who don't save enough, spend too much; but, that's not really the problem when it comes to a car. They're just too damn expensive. People also think that if they buy cash, they don;t have a payment. That's not true. One has to amortize for repairs and the monthly savings for the NEXT car.

In most cases, buying a used car is poor man's thinking. No offense intended at all.

Wow. An honest to goodness disagreement with minimal, perhaps NO flames.

Buying a new car is going to cost more. That's true and I don't dispute it. For me, I know it's not really about prestige. Despite the price of the vehicle, I don't generally live beyond my means. I don't finance things other than my house an my cars for the most part We did finance my dining room set for one year at zero interest...we're a payment ahead and will be done next month. We did this so we could use some of the cash to build a deck. It worked out great.

We have two vehicles, one being a 2001 Grand Am and the other is the Envoy. The Grand Am is paid off. We put a lot of money into our vehicles and our house. A nice, clean and exceptionally reliable vehicle is very important to me. I drive almost an hour to work and we make fairly frequent long trips...sometimes to FL to see my Dad. I'm not doing that trip in a 1994 Caravan, for example. We plan to keep the car for quite awhile. Or, depending on whether we're upside down on the loan, we may trade it after several years (this would amount to leasing the car from ourselves with no restrictions). We'll have to see about that. Anyway, we'll soon have NO other debt than the mortgage and the home equity loan, both of which are secured debt on an appeciating asset. We also have substantial investments, including IRA's and a college fund, not to mention substantial reserve cash and bond fond as well. Making a judgement that we live beyond our means is premature and ill-informed.

Trumptman, I'm not taking a dig at you. I know plenty of folks who go the used route. I just disgaree with it...that's all. I don't fault you or anyone else for going that way.

BRussell, as far as twisted logic goes, I don't think that's fair. It's a matter of perspective. Though spending and saving are not the same thing, one is still "making a a payment" in a sense when he saves for next car. Most analysts will also tell you that saving has to be treated as an EXPENSE. That's a fact.

Let's say you buy a nice used vehicle for $9600 with tax, tags, etc. There is a 30 day warranty on the car. It has 65,000 miles on it. This vehicle is probably not going to last more than 4 years. This means to buy another car for cash in four years, one has to save $200 a month just to buy the next car. One also is going to amortize repairs. Though it would be nice to accept the "feel good" scenarios here about repair frequency and cost, I have seen people drop $1500 into a 5 year old vehicle on multiple ocassions. It is NOT uncommon. I've seen this with cars that are 4 years old, 5 years old, and 6 years old. Head gasket goes? $1200. Clutch? $700 Transmission? $400-$1200 Shocks? $150-$600. Brakes? $50-$200. All of these are going to have more wear (probably) with a used car.

But let's be fair and amortize in $50 a month for repairs and maintainence one wouldn't have to do on newer vehicle (we're exlcuding regular scheduled maintenece except for higher "mileage maintainences" like a 60,000 mile service). This means we're ate $250 a month. That's what it WILL cost to drive the car. Assuming you want to keep buying cash, that's what it will cost. During the time you're doing this "saving", you're driving a 4-9 year old vehicle which doesn't have any warranty at all...usually even powertrain at that point. If you've never seen someone drop this kind of money, you're practicing wishful thinking. Again...no offense.

Is it going to cost me more than you. I know that. I'm also driving a fairly new car every day. When I'm done, the money will be back in my home instead of being pissed away like with third-party financing. If I move (unlikely) and need the cash, I'll just go get a used vehicle loan.

One last point: You are right that most financial advisors will tell you to buy used. That's because they look at it as an investment. Newsflash: If a car were a true "investment", we'd have people jumping off buidlings every day. It's NOT an investment. It's a product. It's become no different than a computer or TV set. As I said...I don't hear anybody telling me I'm crazy because I bought a $3500 Pismo 3 years ago...which is now worth $500-$600. That's a bigger percentage loss than on the vehicle!

trumptman:



Again, we'll just have to disagree. I spend more and I'm fine with that. I'm not putiing my retirement in jeopardy in any way. My only debts at the end of next month will be my mortgage and equity loan. I've had knowledgeable folks (like loan consultants...who are pretty tough) look at my credit, debt loab, etc...and I've been told I'm in superb shape. We've got IRA's and a college fund in securities. I have bonds and cash for reserve funds and emergencies/castostrophies (like losing a job or the like).

I think your assumptions are a bit off, in other words. An expensve car does not equal financial peril or future jeopardy.

JRC:


And I'm saying it's not as much waste as one thinks...expecially when compared to buying used. To me, it's more than worth it to drive new.

Though, in a sense, ALL cars are a money pit. I figure if I'm going to pay, then I'm going to drive new. Period.