Buying a 1

[m4tthew]

I know these kinds of threads come up all the time, but I haven't really found the answer to this. I'm looking at buying a 1 soon (actually my father will be purchasing it for me). We are friends with a CA at a local dealer and he has been working with us trying to find a car etc. but we have just settled on a car on the lot. I worked some numbers with him today and they gave me a first price (no negotiation) of ~$39.9 on a $41.4 msrp. I know we will be able get it down some, but my question is will that cut deeply into our CA's commission? Basically I'm asking if the CA's get paid a percentage of the final sale, a percentage of the profit or a flat fee? That being asked what kind of pricing should I be looking at on an off the lot 135i sport etc. with that msrp? I was thinking $38.4 would be reasonable.Thanks,
Matt

[mattssi]

Check out the invoice pricing on the sticky thread in this forum - or online at various web sites. You should offer invoice, or maybe less for an on-lot car. You can go order (albeit an ordered car) from bmwsonline.com for invoice + $500 shipping, so you have that to negotiate with.

Not sure about commission unfortunately.

[m4tthew]

Bump, anyone know?

[bluejaypanther]

I can't say for sure how a particular dealership works, but Edmunds once sent one of their editors to be an undercover car salesman for a few months and then write a ten page article about it. He talks about commission on this page.

http://www.edmunds.com/advice/buying...2/page003.html

Basically, he makes more if you pay more, particularly when you get past $1000 over invoice.

[cadeucsb]

Originally Posted by bluejaypanther

I can't say for sure how a particular dealership works, but Edmunds once sent one of their editors to be an undercover car salesman for a few months and then write a ten page article about it. He talks about commission on this page.

http://www.edmunds.com/advice/buying...2/page003.html

Basically, he makes more if you pay more, particularly when you get past $1000 over invoice.

Great article, increased my malcontent for car salesman...(though there are some great CA's/dealerships out there, this article definitely highlights the majority..at least in my experience).

Seeing all their behind the scenes jokes and tricks makes me not feel so bad about negotiating them completely out of their profit (maybe a couple hundred over invoice) as they will probably ruthlessly take advantage of someone else later that day.

To the OP, do your research on the invoice base price and invoice options price and see where that comes out relative to their asking price. NEVER EVER work down from MSRP, work up from invoice.

[m4tthew]

Well ended up finalizing a deal on a Montego/Black 135 sport w/heated seats, moonroof, power seats and ipod for $39.2, or $2250 under MSRP. It works out to ~$1300ish over Edmunds invoice so I figured ~$1000 over actual invoice was a decent deal w/mats etc and only ~$100 in "dealer fees".

[gatorfast]

Isnt the point of having a CA as a friend that he will take less commission and give you a better price since thats what friends do?

[KingOfJericho]

Not that it should really matter to you as you didn't pay for the car anyway but it still seems quite high for a car that has already depreciated a year. I wouldn't expect to pay anything over invoice for a 2009 lot car as I paid $700 over invoice, all in, for a 2010.

People make negotiating a sale price out to be rocket science or an art form. It's pretty effing easy to walk in, see the car on the lot, tell them it's already a year old car and that you'll buy it but not for a penny over invoice. Most dealers would jump on this with new cars coming in 2 months.

[amdmaxx]

This article is entertaining and quality.
Thanks for a good read.

Originally Posted by bluejaypanther

I can't say for sure how a particular dealership works, but Edmunds once sent one of their editors to be an undercover car salesman for a few months and then write a ten page article about it. He talks about commission on this page.

http://www.edmunds.com/advice/buying...2/page003.html

Basically, he makes more if you pay more, particularly when you get past $1000 over invoice.

[bluejaypanther]

Originally Posted by amdmaxx

This article is entertaining and quality.
Thanks for a good read.

No problem. Reading this showed me how important it is to take control of negotiations- while I didn't encounter practices quite so abusive when shopping for my car, it's important to have a feel for the gamesmanship of the process.

[m4tthew]

Originally Posted by KingOfJericho

Not that it should really matter to you as you didn't pay for the car anyway but it still seems quite high for a car that has already depreciated a year. I wouldn't expect to pay anything over invoice for a 2009 lot car as I paid $700 over invoice, all in, for a 2010.

People make negotiating a sale price out to be rocket science or an art form. It's pretty effing easy to walk in, see the car on the lot, tell them it's already a year old car and that you'll buy it but not for a penny over invoice. Most dealers would jump on this with new cars coming in 2 months.

Yea, personally if I had be doing the negotiating I wouldn't have gone much over 38.6-38.8, but I didn't want to step on my father's toes in the process so I let him handle it. He likes the dealer because they refuse to support religious organizations, etc. and wanted to help our CA out a bit so the extra few hundred wasn't a big deal to him and he hates negotiating (paid essentially sticker for his last three cars, only talked them down a bit because I suggested it). Unfortunately I just got a call saying that when they brought the car in from the sun yesterday they (stupidly) started to wash it without letting it cool and cracked the windshield so we're going to have to wait until tomorrow to pick the car up.

[JimD]

I've found edmunds website to be a good source of information. They show you what features are on the car and allow you to compare. And when you get serious, you can get the MSRP, invoice, and what they think a reasonable price is for the vehicle. Only takes a few minutes.

The other thing that I think is very important in any negotiation is to know what you will do if you do not reach a deal. In this case, it seems like you may need to buy from this guy. Do you have to buy right now? If you do and you tell them that, you should expect to pay what they want. If you can go somewhere else or you can wait, you have more leverage. I was able to easily get prices over the internet. I just went to the dealerships website and told them I wanted to buy within I think I said a week, a 128i convertible with the only options walnut and sport. I told them I wanted an out the door price with all fees, taxes, and plates included. Nobody refused. Even if you are going to buy from the family friend, if you had a significantly better offer from somebody else, he would probably come down some. And if they are about the same, you get confirmation his price is OK. I ended up less than $500 over invoice and never negotiated. I just asked 5 dealerships for prices and took the lowest. The biggest effort it caused me was called the four that did not get my business to tell them the news. They were all pretty good about it.

When there are multiple dealerships for the same vehicle in your town, you can do it their preferred way by going back and forth between dealers. If you tell them you are prepared to buy today, you get their full attention. Be prepared for silliness like them saying no way to your suggested price and then calling you when you are 2 miles away agreeing. It happened to me just last year when I bought my daughters car.

Jim

[Angry3]

Originally Posted by KingOfJericho

Not that it should really matter to you as you didn't pay for the car anyway but it still seems quite high for a car that has already depreciated a year. I wouldn't expect to pay anything over invoice for a 2009 lot car as I paid $700 over invoice, all in, for a 2010.

People make negotiating a sale price out to be rocket science or an art form. It's pretty effing easy to walk in, see the car on the lot, tell them it's already a year old car and that you'll buy it but not for a penny over invoice. Most dealers would jump on this with new cars coming in 2 months.

Uhhh, ok. Getting an invoice or lower deal isn't rocket science, and in fact negotiating skill has less to do with it than most think. People that know how the car business works know that with BMW it takes one or more of the following:

1. Factory incentives (published rebates or unpublished marketing allowances).
2. A dealer willing to take a net/net deal or loss on a particular unit to make or move near a sales target and qualify for a unit bonus at the end of a sales period.
3. An oversupply of a particular model in inventory.

There are other things that might lead a dealer to go below invoice (like a dealer having a special ordered unit that ends up in inventory in a hard to sell configuration), but for the most part you need one or more of those 3 things. Right now on 1s there is no factory cash. Sales are down, but BMW and the dealers adjusted production and inventory levels very well and there are not a ton of these cars sitting around on lots in most markets. It is the end of the month, so that may help hard bargainers over the next few days.

And telling a dealer that you expect an invoice or lower deal because the car has depreciated a year will likely produce nothing but and . Right now is the strong car sales season, the 2009 is the current model year, and dealers won't have a single 2010 model for another 8-12 weeks. In 3 months buyers can have their choice of a 2010 car or likely some much better deals on 2009 cars, but right now below invoice deals are far from plentiful (except in the minds of people who are convinced they can exercise mind control over dealers).

And finally, the idea of walking into a dealer and walking out with the best deal is beyond absurd. When you set foot in showroom the dealer considers you an impulse buyer, and you are claimed by a full-commission floor CA instead of the internet reps that work on smaller margins. You might end up with an invoice deal in the end, but of late that isn't the norm and it certainly isn't going to happen without a fair amount of grinding.

Anyway, I invite all of the members who took delivery of a 1 this month at invoice or less to chime in and tell us what it took and how you did it. Be sure to include all of the fees and extras in your deal.

Good luck and good negotiating everyone, and congrats on your new car OP.