They WILL sell at invoice 'cost' price & indeed, show you the invoice, maybe 10-18%, for a generous deal.
what you WON'T see, is the bonus payment the dealer earns, on each unit sold.
So a genuine offer, to comply with all the legal requirements!
VB
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The cost price may be true.
At the end of the year (wherever itmay fall) dealers receive a rebate depending on the volume of cars they have moved.
They quite openly sell a few cars toward the end of the year at very low prices to hit the next volume target and get a bigger rebate. So they lose profit on a few cars to achieve a bigger rebate which will be worth far more. Simple sales targets and achievements !
probably one of the better deals you will ever get in fairness to them .
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Thats the trouble with people in this country, they are concerned that bob at no.22 has a shilling more than them,i find this very sad.
A customer of mine many years ago actually asked the question 'how much exactly have you in your pocket at the moment'
A few years ago us traders used to argue about swapping wedges at the sales, we never did, but we knew the crack.
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I suppose the thing to remember as well is that the dealer margin discount will be based on the cost of the car and will not be a discount on the sticker price that will include vat and delivery etc.
I found the statement below after jsut doing a quick internet search.
It would be easy to think that a 10% margin on a car costing £12,000 would give the dealer £1,200 profit but you'd be wrong. The dealer margin is calculated before delivery, tax and VAT (see table). As you can see, in this case expecting £1,000 off would be pointless and just annoy the dealer. Knowing in advance what a dealer has available takes the uncertainty out of asking for discount.
Cost of car to dealer £8,762
Dealer margin (10%) £876
Delivery £426
VAT £1,761
1st registration fee £25
Road tax £150
Retail Price £12,000
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>>Thats the trouble with people in this country, they are concerned that bob at no.22 has a shilling more than them,i find this very sad.<<
I'm sorry oldman - you have lost me.
I just received a letter from the dealer and queried with some people here what the discount might be.
What has that got to do with getting concerned about what other people have - or have I missed you point.
If I worried about my neighbours having more than me I would be a complete stress head - one side has a 6 month old Bentley Continental GT and the other side have a brand new Cayenne. And good luck to em - nicest people you could meet.
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you get me wrong i wasnt getting at you honestly :-0 it was the bigger picture :-( sorry if i offended it wasnt meant
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Ok.
I can't disagree with you on the bigger picture though.
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My understanding was that main dealerships usually have a monthly sales figure to meet to earn the bonus.
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What\'s for you won\'t pass you by
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I worked at a dealership where we did a "cost price or less" event.
It was a complete load of rubbish, of course we were happy to show customers the factory invoices, the cars cost us more than the advertised on the road price.
For example:-
Ford Fiesta Finesse advertised in national press OTR £6,999
The Factory invoice = £7,400 *
So, we used to buy the car off Ford for £7,400, sell the car at the advertised OTR and then get a nice payment from Ford for each unit sold that put the sale back into profit. As well as a payment for each sold unit, if we hit an overall sales target, we got another (very) hefty bonus payment.
Despite my cynical outlook I suppose it is worth pointing out that some of the cars were sold at the "true" cost price after all of the bonuses were taken into account, we were once so desperate to sell a Focus Ghia that not only did we flog the car at cost price after all of the cashbacks were taken into account, but we also used all of the commision that we received from the finance to reduce the customer's payment further. By the time we had paid for it to be cleaned and put £20 in the tank we actually made a loss on the sale, but hey, we were desperate.
So the point of my ramble is that most "cost price" sales are rubbish and I would never use a factory invoice as a guide to the true cost of a car to a dealer, however, it is possible to get dealers to sell you cars at, or below true cost price in their pursuit of a bigger pot of gold, if you happen to be buying at the exact right moment.
* Please note that this figure is not in any way exact or even approximate, it's been nearly two years since I worked there so I can't remember specifics, I'm just using it to illustrate what I'm trying to say.
Blue
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Given that the pre-tax price of a 1.8 Civic is 13,115 (13,600 with RHD) euros in Denmark and 17,533 (plus delivery) euros in UK, there's a large margin for Honda to juggle the "cost" price
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Given that the pre-tax price of a 1.8 Civic is 13,115 (13,600 with RHD) euros in Denmark and 17,533 (plus delivery) euros in UK, there's a large margin for Honda to juggle the "cost" price
It's generally thought that the manufacturing cost of a car is approx 50% of its pre-tax list price.
If that's true, then Honda is raking it in in the UK, and still doing OK in Denmark.
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There's no doubt there raking it in - you just have to look at the cash balance with companies like Toyota and Honda - they are sitting on billions.
So as not to confuse people though this is a local dealer campaign and not a national Honda UK campaign.
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Buying a new car is perhaps the only major purchase anyone ever makes in which the actual price is so confusing, by the time discounts, trade ins etc are calculated it is impossible for the customer to be sure he has got a good deal.
Car prices are very volatile and may be affected by any number of other factors -
how close the dealer is to a target,
whether a stock vehicle is approaching the 90 day point at which the dealer has to pay the manufacturer for it and possibly take a write down against his profits,
how much finance commission is in the deal,
whether your trade in has a long tax disc,
has he a buyer for the trade in or at least is he expecting to sell it on at a further profit,
and on and on and on.
none of these facts will be available to the buyer and so he is totally unable to have any idea of the real cost of the deal to the selling dealer - he just has to trust them - and if you dont trust them why are you giving htem £xx.000 of your hard earned?
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The £17.5k Vectra that I drive cost the company that bought it new about £9k!
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