Agreed. So the reason people don't trust them is because they say thing to your face like "we're losing money on this deal". It's obviously a lie. It's like when your 6 year old says "i didn't do it" but it's obvious by the dirt all over him that he did (whatever it is) lol. Why go down that road? Why not just say " we need to make 4% on this deal " and be done? If we sell you any of the ancillary items or you financed through us then all the better.

 

"The initial responses all attacked my industry and called us liars, with nothing but their emotions to back it up. Sorry, that is ignorance, not disagreement."
As you, yourself have noted, every deal is a different deal and you even admitted to selling someone a car above sticker.....by mistake, of course.

I call BS on a lot because I've lived it. Had a written offer, via e-mail. Salesman wasn't working on Saturday but said "print this e-mail and bring with you, all good". I show up at 8:00 AM to sign papers and drive away. After being ignored for 90 minutes, a F&I guy shows up and starts running the 4-square on me (I'm sure you know what that is..) and when I said I was just there to sign the papers, he admits the salesman made a mistake and they won't honor the offer.......AFTER they made me wait 90 minutes to tell me that. So yes, the reputation of your industry is real and well-earned, in many cases.

 

Yeah, that "we are losing money on this deal".... is BS.

I've called out a few salesmen on this.

And in Frantz's defense, there are A LOT of D-bag customers too.

We can all agree that there is virtually no place where d-bags can't take hold of some niche.

 

Never said there aren't d-bag customers....I was an insurance adjuster (homeowner side) for a while, many years ago. The job itself was good but I quit after 9 months because dealing with the general public is miserable......no argument here.

That being said, I'm in my 50's and have literally bought dozens of cars in my lifetime. I could count on 1 hand the deals that were clean, easy and no BS......very rare.

 

I've bought 4 new vehicles in my life, a 2005 F150, a 2008 Hyundai Santa Fe (for my ex wife), a 2011 Toyota Sienna (for my ex wife) and my 2017 F350. So far I've had nothing but excellent experiences. The first two vehicles were off the lot and the Hyundai was purchased over the phone and picked up a few days later. The Toyota Sienna was ordered and the process was simple and flawless. And besides the order allocations screwing up how long it took to get my 2017 F350, the actual deal couldn't have been easier.

 

It has gotten better, I agree. However, even with this latest deal, I order the truck at an agreed price. Upon arrival, I made sure they sent me a printed Buyer's Order before I went to pick it up so there would be no price issues. Salesman was showing me around the truck while we were waiting on F&I to do the paperwork and he gets a call on his cell phone. Sounds like a problem so I ask "is that my deal" and he says "yes, they say the paperwork is $100 off." In the end, they didn't ask me to pay the extra $100 but also made it seem like they were doing me a favor......and yes, I would have walked over $100 if they had.

 

We absolutely do lose money on some deals. Not very many, but it certainly happens! The "strategic marketing strategies" aka "crooked deals" I spoke of actually are more prone to it, because they'll take one person that does everything right, pays cash, and in order to save face they'll take the bad deal and move on to the next 9 folks that will finance and buy warranties. That's why it's not crooked. If you're in a position to do it right, you can get a better deal than such a place then you can from me. I never intentionally lose money on a deal. I avg $1000 per unit I sell. When I'm spiting the holdback with guys on the forum for $75k trucks, the HB is $2k... half is $1k, take out the $300 pack, and I'm making 18% of $700 and getting a deal for the dealership that we wouldn't have otherwise. I tell folks to tell me what rate to beat, or finance with Ford and then sort it out later. I make a cut of that too, but I don't keep anyone captive, if we earn a bank business, we do deserve to get a cut too. The rates the banks give are a tad higher than the fed... so they're the real money makers (them and Ford itself on the trucks anyhow). So one crooked strategy has prices so low they are a loss, but since most folks do finance and buy warranty, they can take a few loses and make out great on everyone else with upcharges and what not. My prices are higher, but I've not sold a unit for a loss for quite awhile. Towards the end of the month it's more likely something like this comes up. Losing $1k is a bit unusual, but I've seen it happen. We screwed up on one and messed up a payoff amount and lost $10k. I was glad not to be part of that deal, but it happens. So yes, we do occasionally operate on a loss for a single unit legit. We also use ad money or push pull to sell old units. Heck, this can be a few grand! I've sold some $5k under invoice. Big loss, but it was intentional because I knew we had ad money for that unit, I kept $1k profit for myself and helped my customer out with the rest. When these deals come up, I always try to let my regulars know first to take advantage of it.

It's also very common to take a loss on a vehicle and make it up on finance. So it's not dishonest to say we're taking a loss. Many dealerships don't pay their sales folks on the finance side too, so for them it's really no different than you paying cash. Again, whether its the bank or the dealership, if you're not paying cash, someone is making money off the financing. Considering in 90% of cases, the financing is more profitable than the truck, it's again amusing that folks here, who generally are educated consumers, will fight over the price of the truck and ignore the financing aspects. If I'm making $2k from the bank I can sell you the truck for a $1k loss... but again, the gross screen will account for this if the deal is fully structured.

I've worked at two dealers in my career and neither used four square, but yeah, of course I know what it is.. it's used in most sales professions. I can't speak for your situation, but sure, if a mistake happens and is caught before paperwork is signed, in most cases they'll just take it if it's not too much of a loss. If we had caught the 10k mistake, the deal wouldn't have happened. People make mistakes. Some honest, some not. I won't judge someone for one without knowing all the details. The amount of figures we go over in a day means mistakes are pretty easy to make. There have been times I breathed a sigh of relief that the customer never called back!

4% would be a dream! Literally double my annual income. That's why I get so defensive about it. 4% of $50k would be $2k profit per unit! Since I'm at closer to 2%, or $1000 bucks, it's why I don't understand the notion of folks then asking for thousands more off, and then calling me a liar if I say "we'd be losing money".

Ford got rid of the volume bonus, but last year we had it. The one month, we needed to sell one more car in order to get an extra $200 bucks per unit, I think the number was 80... so $16000 was at stake! We couldn't find anyone to bite. We would not have given $16k away, but you can bet someone would have gotten a heck of a good offer! We ended up selling our Kia store a brand new Focus to put into our used inventory. We lost less selling that car as a used one than giving up the bonus obviously. So sure, knowing what the deals are and when folks are trying to hit numbers, even if it's just for a sales managers pride, you can get a banging deal at the end of the month. While I write my own deals, there have been times I passed on business and the retail sales manager looks over all the desking logs and tells me to take the losing offer because he wanted another unit for the month.

How many have you gone in knowing what you want and showing them what it should cost and how much your trade should be worth, with a realistic knowledge of deductions? While such a bold statement would probably throw a green salesperson off their game, any seasons sales person would get on their knees and kiss your feet. Such information is very easily available online. TrueCar shows what invoice is, on expensive units you can then figure out the holdback, rebates are listed on Fords site, KBB Fair is always pretty close to real actual cash value if you deduct any issues. You can work a few bucks from there, but it'll get you in the ball park. Get approved at your bank, let the dealer beat the rate, and sign paperwork. It's really that easy, no games, and no fuss. Not sure about TrueCar? Go in and tell them you'll split the holdback with them off the invoice, they'll take it most likely and you'll do better than most people who claim to have paid thousands less than you did.

I'm here because I'm a car guy. I sell cars intentionally. I sell Fords intentionally. I'm on the forum because I want folks to have a great experience. Yell at me all you want. Call me a liar. It's fine. But use what I'm giving you for free and get yourself a great local dealer to take care of you! I considered advertising on this forum, but I didn't want a sales gimmick. In my mind, there isn't a single reason you should buy from me vs the slimiest dealer down the street (or at least the closest not slimy dealer). But I will adamantly defend the industry and it's practices. If the OP has the information, they can feel free to post it and I'd be happy to provide my analysis to it as best I can and post. If I see something amiss on the gross I'll tell you. But to say it's most likely a lie with no other information has little merit. The only thing a salesperson likes more than making a sale is when a customer misses a deal that's too good because they wanted to think about it. We LOVE to tell them that someone else got the deal. It happens more on used than new of course, but even new sometimes has better than possible deals. Even if the dealer was lying... was the deal good? Some (mistakenly) thought that the gross screen was based on invoice rather than net net net... so even if that's the case, wouldn't you be happy with $1k under invoice? Walking away because you don't think the dealer is REALLY losing a thousand bucks? I mean at some point, it's just silly and either the dealers being honest and you missed out, or the dealers being almost honest and you missed out. Maybe you can go back in and get it! But if showing a customer the truth makes us a liar... then we might as well just lie from the get go right? That's what you believe anyhow, so being honest just means we're losing more money! It's a catch 22, so rather than that, I champion my world on this forum! A number of members read all the garbage and get great advise out of it, from both me and you. The continued dialog paints a more complete picture. I believe everything I say is easily verifiable online, so I neither feel I'm doing myself a disservice in terms of lost gross, nor do I feel you could be given better advice. I'm a salesperson, not a consultant. But I enjoy consulting, so I do it here. There isn't time to have this battle with every customer and I'd never sell anything! But I dream of folks using my advise, accidentally coming in here, and trying it out. I love getting messages of thanks from folks who get great deals from their local store and avoid long travels for out of state promises that aren't true. I even enjoy the rep bar on the side of my name. I apologize that I do get heated sometimes, it really isn't personal. Just like you've had bad experiences with dealers, I have bad experiences with customers. Ask any salesperson in any industry, the customers lie far more than we even think about telling a half truth.

 

Besides a screwup.... why would you ever lose money on a deal? What I pay is of no concern to the next customer. I understand what you mean when you say we can make money and nine deals and lose money on the 10th and still be ahead. However that's from the dealer's point of view not the customer. Do you advertise wanted it every 10 customers we lose money on ? It makes no sense whatsoever to lose money on a customer (dans a mistake)

 

You seem like a passionate guy, and I appreciate that. However, the car business is unlike any other retail transaction. There are so many angles....price, finance, trade, warranty, service contracts, gap insurance, etc and the dealer holds about 90% of the cards.
I traded a paid-off truck for my F250. Truck was worth $26K all day. However, I knew exactly what their offer would be....$25K, precisely because in my state, you only pay sales tax on the difference so the dealer knows that it's a lost cause for me to try and go sell it because even if I get the $26K, the $1K is almost exactly the amount of the tax advantage. The tax advantage should go to me, not the dealer but I accepted it as a cost of doing the deal.....doesn't mean it's right.

 

Because if you know 90% of the market WILL finance at whatever rate you tell them (especially if you make that a condition of the sales price), you can not get into legal trouble by advertising at a loss, because you know 9 out of 10 folks will give you more money on the back end. The idea is your not making money on the truck, but on the finance. You can lose $1k on every truck, with a business plan of making $2k on 9 of those trucks in finance... It's the same as making every unit a loss leader because you know most folks won't want to pay cash, by choice or by need. It's pretty simple actually. Some states allow "captive" financing as a requirement for pricing, others don't. But really, when you buy cars, how many folks in the showroom with you do you think are paying cash or bringing in their own outside loan? It's very very small. So the current market allows some dealers to decide to sell everything as a loss, because the overall deal will net out to a positive. So yeah, losing money to you means they can capture the internet sales of 9 other people who would otherwise not consider them.

 

Was KBB fair value $25 or $26? I really don't dable in used and would not consider myself a full insider. What I do know is that the auction prices tend to follow very close to KBB fair trade value. I've used this in both guess what I would get for a customer, and for what it would take to buy something specific. And lets be honest, if I can get your truck for $25k at auction, that's what it's worth. The only value in giving you any more is as part o the deal. Some folks like to pay full sticker and get a crazy trade number. It's a common sales tactic I hate, but I know it works and see other local dealers doing it to customers joy. And then again, maybe the ACV was $26, and they kept $1k profit. Or perhaps they discounted the truck an extra $1k, or maybe only $800. yeah, it's the big picture, and it's complex, but it's really not hard to work it out. Want great pricing on warranty? Check out Flood Ford. Again, the internet, and knowing where to look by chatting on this forum, make it too easy.

 

KBB, Edmunds, etc all had the truck between $25,500 - $27K as a clean trade. There is a large used dealer near me that had already made a written, $26K offer to buy it outright (no, I had not told the selling dealer that. None of their business). My point was I was prepared to get the $25K offer from the selling dealer because that is just how it works in my experience. They know that the tax advantage is there and easy for them to make extra because the deal nets the same to me. The extra $1K would have been nice but I was not at all surprised.....

 

Well sure, any dealer will try to give you less than it's worth. I mean, you're trying to buy our truck for as little as possible, we do the same thing on trades! My point is, what did you gain from not sharing that information? If you had a written $26k offer, that's probably the ACV... so by not sharing your justification for more, and assuming they wouldn't give you more because they counted the tax savings towards your value, you probably missed out on a few hundred bucks. Since you EXPECTED them to give you less, you gained nothing by keeping the "none of their business" information. I actually had a couple do something similar to me a few months back. We gave them an offer. We were holding like $500 bucks on it. They agreed to my deal on the new car, only if my price was good with or without the trade. Then they signed most of the paperwork and said they'd be back after "lunch". Really they went to carmax and got the extra $500. They actually lost on the tax advantage, I don't think they knew about it. If they had only shared with me that they wanted a little more for their trade I would have given it to them. Only I'm more than happy not to have a trade, so I didn't press them when they said they would just "keep it". So real work example from my perspective where all the customer had to do was ask.

 

No, I missed out on almost exactly $1,000. I asked them to match the $26K but they said they were going to wholesale the truck and that was the best quote they got (they are not a big volume used dealer so I took their word)........guess where the truck is now? Sitting on their used lot.......surprise, surprise.....they lied.

To be perfectly clear, I accepted the deal in the end and other than the fact that they lied about wholesaling my trade, I have no ill feelings toward the dealership. I brought it up because you are portraying dealers and salesman as getting the %$#@ end of the stick from customers....and I find that truly laughable.
I suggest we agree to disagree and move on........

 

So here is a statement of fact..mabey it's not an attack where you come from but in the wrong places here they'll be no need to explain the definition ..just defend your self...