And this is why the Dealership Model needs to change.

[billt460]

Years of paying peanuts for cars/significant discounts and now that gate is closed and people are upset.

I question if it's actually closed. I think it's more of a case of having it slammed shut in their face. More likely people today don't possess the buying power to actually open it any longer. So many cashless people today are at the mercy of the dealer.

Many people have lousy credit. Which translates to expensive credit. If the dealer can't finance them, they can't buy it. They feel lucky to get the vehicle at ANY price. Let alone at a discount. In any business endeavor money talks, and B.S. walks.... Always has, always will.

What they think they're "saving" on the deal, will just be eaten up by high interest and finance costs. Not to mention having their loan go underwater, due to depreciation and big interest financing, before they can get the bulk of it paid off.

"37% of subprime scores are represented by millennials. Only 20% of American consumers have scores of 800 and above".

34.8% of American consumers have subprime credit scores. 17% of American consumers have paid their credit cards, loans, and mortgages late in the past 2 years".​

How Many People Have Bad Credit? [2024 Statistics & Trends]

If you've ever wondered how many people have bad credit in the US and wider, these statistics and facts will tell you.

review42.com

 

[tbm5690]

I question if it's actually closed. I think it's more of a case of having it slammed shut in their face. More likely people today don't possess the buying power to actually open it any longer. So many cashless people today are at the mercy of the dealer.

Many people have lousy credit. Which translates to expensive credit. If the dealer can't finance them, they can't buy it. They feel lucky to get the vehicle at ANY price. Let alone at a discount. In any business endeavor money talks, and B.S. walks.... Always has, always will.

What they think they're "saving" on the deal, will just be eaten up by high interest and finance costs. Not to mention having their loan go underwater, due to depreciation and big interest financing, before they can get the bulk of it paid off.

"37% of subprime scores are represented by millennials. Only 20% of American consumers have scores of 800 and above".

34.8% of American consumers have subprime credit scores. 17% of American consumers have paid their credit cards, loans, and mortgages late in the past 2 years".​

How Many People Have Bad Credit? [2024 Statistics & Trends]

If you've ever wondered how many people have bad credit in the US and wider, these statistics and facts will tell you.

review42.com

And it's a vicious cycle...they have lower credit because they don't know how to manage money well which is why they're standing at the finance desk in the first place buying a vehicle that they can't afford.

 

[billt460]

And it's a vicious cycle...they have lower credit because they don't know how to manage money well which is why they're standing at the finance desk in the first place buying a vehicle that they can't afford.

These people are getting wrecked financially.... As Gordon Gekko so brilliantly said, "Because they're "wreckable".

 

[TiGeo]

These people are getting wrecked financially.... As Gordon Gekko so brilliantly said, "Because they're "wreckable".

Many know not what they do. Nobody to guide them and so the cycle continues.

 

[LDB]

It would help if schools actually taught money and finances and real life rather than focusing on grooming and indoctrinating.

 

[demarpaint]

OK. "Don't pay over the sticker price".
Sounds easy.
Does one simply find a dealership which doesn't charge an overage?

Shop around. When I was shopping I sent emails to various "internet managers" I told them in the email I was looking for an out the door price for an ordered vehicle and listed how I wanted it equipped, my credit score and that I was ready to place an order if the price was right. To avoid the canned reply to come in for a test drive and look at inventory to get the best deal, I spelled out in the email there was no need for me to come in, test drive, or any other nonsense like that. Simply put, how much is the out the door price, with everything factored in. At the end of the day that is the only number that matters. Anyone that said come in or tried to play games was ruled out. Basically they got one shot at my business. I did that a few times for family and friends and it works, but you have to do homework, know what you want and know what a good price to be paying is.

 

[billt460]

It would help if schools actually taught money and finances and real life rather than focusing on grooming and indoctrinating.

I've been saying this for decades. But it never changes. It just keeps getting worse. I went through public high school from 1967 to 1970. It required 4 years of English. But only one year of basic arithmetic. Of which none contained the slightest thing about basic finances.

I was lucky and had a smart mother who pounded financial common sense into my head, until I was sick of hearing it. Kids today are being raised by parents who are financial train wrecks themselves. Most would do better if they did the complete opposite of what they see their parents doing.

And as you said, the schools today are nothing more than indoctrination centers.

 

[Tdbo]

Shop around. When I was shopping I sent emails to various "internet managers" I told them in the email I was looking for an out the door price for an ordered vehicle and listed how I wanted it equipped, my credit score and that I was ready to place an order if the price was right. To avoid the canned reply to come in for a test drive and look at inventory to get the best deal, I spelled out in the email there was no need for me to come in, test drive, or any other nonsense like that. Simply put, how much is the out the door price, with everything factored in. At the end of the day that is the only number that matters. Anyone that said come in or tried to play games was ruled out. Basically they got one shot at my business. I did that a few times for family and friends and it works, but you have to do homework, know what you want and know what a good price to be paying is.

I've been doing this for years.
It really works.

 

[supton]

I've been saying this for decades. But it never changes. It just keeps getting worse. I went through public high school from 1967 to 1970. It required 4 years of English. But only one year of basic arithmetic. Of which none contained the slightest thing about basic finances.

Trying to remember. Did high school in early 90’s. Math all four years, but no personal finance—maybe they assumed it wasn’t necessary to learn how to balance a checkbook if you are taking precalc, and can derive how compound interest works? College bound versus whatever the other options were, maybe that was the issue.

My son did recently take personal finance at high school, but wife says its not a required course. Not sure if our daughter will take same course or not.

I do think it ought to be required, but I do remember that age, and I sure know it wouldn’t have done anything.

 

[demarpaint]

I've been doing this for years.
It really works.

It does, it also pisses off the Internet Manager, not that I care. Some people can't follow simple directions and insist you come in, talk, look at their inventory and take a test drive. Unfortunately for them they get ruled out. Smart people read the email and figure they have one shot, then they're in the mix. Others might read it and say I don't want to deal with this clown, that's fine too, odds are I don't want to deal with them either.

 

[tbm5690]

Reliance on the public system teaching finance isn't the answer...it falls with the parents. Problem is, of course, that unless the parents have good habits to teach it becomes a generational fault.

 

[SC Maintenance]

Folks love the capitalism until it works against them. Simple. Don't buy it of they won't give it to you at the price you are willing to pay. Why is MSRP some magical force field that cannot be crossed? Years of paying peanuts for cars/significant discounts and now that gate is closed and people are upset. I'll happily continue to drive my fleet. If I had to buy a vehicle I'd negotiate the price as far as possible and that's the value...regardless of the MSRP.

If this was capitalism I would agree with you - but its not. People are buying $100K SUV's due to easy credit - created by easy money policy and federal overspending - there is too much money sloshing around in the system so anyone dumb enough to ask can get it.

Its the same as when the government took over the student loan program. As soon as unsophisticated borrowers could get as much money as they asked for, tuition skyrocketed.

In capitalism there is the concept of excess profits - the point being when people are making this much money a efficient market would flood the market with new product to make money while they can. But there not - there making too much money as it is.

So it affects everyone. Yes, I am not buying a vehicle at these prices. Fine. But I have now been excluded from the market because the market is broken.

Not capitalism.

 

[Tdbo]

It does, it also pisses off the Internet Manager, not that I care. Some people can't follow simple directions and insist you come in, talk, look at their inventory and take a test drive. Unfortunately for them they get ruled out. Smart people read the email and figure they have one shot, then they're in the mix. Others might read it and say I don't want to deal with this clown, that's fine too, odds are I don't want to deal with them either.

Like I said in another thread, it is time saving because it vets out the ***hats.
It is much easier to terminate an e mail, then it is to shake off a Herb Tarlek type, chasing you out in the parking lot after you walk out.

 

[demarpaint]

Like I said in another thread, it is time saving because it vets out the ***hats.
It is much easier to terminate an e mail, then it is to shake off a Herb Tarlek type, chasing you out in the parking lot after you walk out.

Exactly.

 

[dumkid]

My parents taught me finance, if I wanted something (that wasn't food clothes Etc) I had to buy it. This taught me that you have to earn a little more than you spend, or you have to stop spending money. Many kids get a car handed to them along with the parents paying for gas, and they also get the parents to buy them phones, video games, etc. If you want your kids to learn how to work and manage money, don't give them what they want. Make them work for it.
Also the kids who are given everything don't take care of their stuff, because they don't know or care about the cost to replace it.

 

[4WD]

On his cell phone he found it to be $26k-something, right?

 

[userfriendly]

Shop around. When I was shopping I sent emails to various "internet managers" I told them in the email I was looking for an out the door price for an ordered vehicle and listed how I wanted it equipped, my credit score and that I was ready to place an order if the price was right. To avoid the canned reply to come in for a test drive and look at inventory to get the best deal, I spelled out in the email there was no need for me to come in, test drive, or any other nonsense like that. Simply put, how much is the out the door price, with everything factored in. At the end of the day that is the only number that matters. Anyone that said come in or tried to play games was ruled out. Basically they got one shot at my business. I did that a few times for family and friends and it works, but you have to do homework, know what you want and know what a good price to be paying is.

I did that last year and saved $50 a month times 84 months. Fifty bucks a payment might not seem like a lot, but it’s an extra $4,200 in dealership profit.

 

[AZjeff]

I looked it up online. Consumer Reports is saying that the Subaru is better (actually quite a bit better) than the RAV4. They rate the Subaru as #1 of 24 compact SUVs. The RAV4 is #13 of 24. And it's even a bit cheaper.

Would the friend like it? I dunno. But I'd say it's worth a look.

Notice I said MY 2nd choice not what Consumer Reports or neighbor or someone on the internet says is best.

The advice to put $5k into a 15 year old car on the hope it will last a few more years and maybe the $5K ADM will be gone is a little silly. The car will cost more, the ADM might not be gone and the Prius may be troublesome to keep running. Vs driving a new car.
We're talking RAV money here not $100k SUVs and we know nothing about the buyer's financial health.

 

[demarpaint]

I did that last year and saved $50 a month times 84 months. Fifty bucks a payment might not seem like a lot, but it’s an extra $4,200 in dealership profit.

$50/month is a nice savings. Used in reverse it was a trick the F&I Managers often used when discussing warranties and other after sales goodies. They'd often try and steer clear of the cost of an extended warranty and say "rolled into your loan it's only X $$/month more, which is nothing when you think about it." It amazed me how many people swallowed that hook.

 

[DwightFrye]

As someone else pointed out a lot of dealerships are owned by the same people. And you wouldn't know it without doing some detective work. We have what amounts to price fixing going on. And it is enabled by supply and demand. There is a short supply of a lot of models. Shoppers are finding this out and when they go to three or four dealerships within a 100 mile radius they soon learn that to get the car they want the dealerships have a "take it or leave it" attitude and if you don't like it another buyer will be along shortly and pay the asking price.

At least the one dealer realized that all they had to do is submit my friend's order to Toyota and when the car arrived they would make the full profit at MSRP and an additional $2500. She will bring them a cashiers check and be in and out in an hour and then they can go on to the next sucker I mean customer.

I will also comment that she was quite upset by the rudeness and attitude of the dealers she contacted. It was obvious that they were only interested in selling what was in stock or arriving shortly, only interested in talking to customers who were going to lay down and pay the ADM and not break their balls and didn't want to place an order with the factory for a customer to get the options they wanted rather than what the dealers thought were "popular".

In addition most of the dealers were adding dealer installed options like ceramic window tint. For $2500. Seriously.
This is on top of the ADM over MSRP. No wonder people despise car dealers.