Car dealers: on the strength of my recent car-buying attempts, I sometimes wonder if they really want to sell us their fabulous used wares.
That’s right, I’ve been out buying cars and it never ceases to depress me these days. Let’s focus on the big boys. Major dealers have every possible advantage: the facilities, the cars, the warranties and the pot plants to pull off most deals. Even if you are after a motor at the Bangernomics end of things, they should be able to help. Then again, if they are really good, it is possible they might convince you to bundle up your micro-budget into some sort of manageable PCP deal. Sadly, most are not that creative.
Got a used car question for Ruppert? Then email autocar@haymarket.com
I just did not find them very proactive. If they don’t have the make or model in stock, they should be making an effort to find it within the dealer group. Or they should make an interesting suggestion about an alternative based on the information I have told them.
I’ll stop ranting there in case it gets boring. Instead, let’s just look at the kinds of cars I could have bought.
Mercedes-Benz Approved Used is plugging the Mercedes-Benz GLA at the moment. The showrooms are full of them. A 2014 200D AMG Line with 45,000 miles is £17,995. Rather more interesting is an S320 CDi with 76,000 miles up at £9900. It is quite a shock to find something that old at a main Mercedes dealer. It is pricey, but one assumes that it is spot on. More main agents should sell higher-mileage cars like that one, because it proves they are confident in their mature products.
Click here for used Mercedes-Benz GLAs on PistonHeads
Main dealers are chock-full of dealer demonstrators. Some of them will be the genuine, one-careful-salesperson keeper, or possibly ex-hire. Others are minimal-mile pre-registereds. Certainly a Hyundai i10 1.0 is pretty much the perfect town runabout these days and a 2017 example with 5000 miles saves you £2500 on the list, meaning you shell out about £7200.
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I can only reccomed trying to do some work experience in a car sales environment to understand why this is somwhat amusing to read and to understand better the other side of the coin.
Once you understand how low the margins are, and how fussy said used car customer is, you would begin to understand the lack of enthusiasm!
I think people think dealers make thousands per unit when the reality is very, very far from it. Then when the customers start complaining that their 6 year old used car doesn't operate, feel or look like a brand new one and they feel entitled to some sort of remedy, you'll start to understand why if you come accross as that kind of customer before you've bought it, the salesperson might try hard to make sure you don't become a future headache and swerve your custom. I could talk all day about this.....
fhp111 wrote:
A very cynical view but also probably accurate as customers/general public are a pain no matter what business you are in, problem is though, without them you aren't in business so you really ought to treat them the way you want to be treated. I often find smaller used car places more helpfull and knowledgeable than main dealers for used cars.
APR %
Not make any margin!? No matter how good l have looked after a car when trading in I always get the bottom book price and then the car you are buying is usually around 10% APR... Bought new last time with 0.89 APR finance - cheaper than buying used!!
Yes your co
When looking at part exchanges i to get frustrated by the managements lack of flexibility when it comes to the condition of your car. Bottom book or less is what they bid for the cars typically because they are being driven down by the pricing of what the market will say a car is worth.
I feel there is little science to it but just the phrase “to be competitive we will need to sell the car for bellow retail price” in a race to the bottom where the best car is the cheapest and not the best example being the most expensive.
But to say your getting ripped ripped off because you’ve always been given bottom book is wrong I think it’s more like the system is wrong because if it was a normal process it would be buy them cheap sell them high but what’s actually happening is I can only sell this car for below retail so the most I can pay for it is this artificially low price but I can understand why you as a customer would think like that.
As for Apr rates this is a source of income for most dealers standard rate is 11.9% which would generate a lot of commission an there in lies the problem if company wants to they could base there whole business model on seeing cars at the lowest possible price but with highest rate of finance going and sell shed loads of the worst kinda stock at the lowest prices compounding the above problem
similarly if your getting 0% Finance your almost Certainly paying too much for the car your buying as that interest rate is paid for by way of getting a reduced payout on the amount borrowed
moral of the story is look for as low aS is possible circa 5.9% is usually the break even point between gaining or losing something. Nothing is for free but a good retailer will be happy to make a decent profit selling you a car rather than relying on arranging high interest bareing Finance
If the deal is a manufacturer backed deal then new cars will often be cheaper than buying a 2/3 year old so in many cases new cars are more suitable for people who don’t want to buy the vehicles outright and the finance deals are great for encouraging buyers who have disposable income rather than capital to spend on a car.
This has obviously proven to be good for the market as a whole as it allows more people to access more expensive better equipped an maybe safer cars than they would normally be able buy but also keeps feeding the young nearly new used car market with plenty of choice and variety. With substantial savings from the new price which seems to suit cash buyers better than finance in account of the non supplemented finance deals
nothing I’m saying is new information but I think the notion that dealers are making huge margins are a real misconceptions that punish the smaller franchise dealers the most almost to the point of extinction and when the expertise and the methodology of a smaller family business goes then there a slippery slope right to the bottom.
I say support the dealership that best meets your needs on all aspects of car onwership at the fairest price or clearest price.
After all we are all conditioned to by the latest smartphone every year or so at what ever price they decide a they can get away with and no one asks for a discount. Despite their margin being huge
Someone say the icar is coming and who would blame them If they can make us pay £1000 for a telephone that you have to carry around so god how much would you pay for a box that can move you around between town and countries in comfort apeedily and in safety
Sales Pro activeness
my concern with many dealerships is that even when you express a clear interest and the money/will to buy it feels like there is a lack of enthusiasm to engage. On many times I have had to do most of the work to find a deal/suggest cars that might work when it really should be the other way around.
I work in sales though not automotive, and the customer is king; i just dont get this impression with the dealerships i have dealt with in recent years.
I don’t understand
i would love to find a bunch of customers like you that know what they want to buy and just would want me to facilitate the transaction
however typically the stumbling block is when it comes round to the cost of the car.
Most people seem to not want to pay to have a dealership to visit to browse and learn about there car or find out if there is a more cost effective soultion to the needs.
The very notion that a dealer should make a profit for giving you all of the above and more is horrifying to most people.
granted people should be wary of being ripped of by some unscrupulous dealers selling used cars without a fixed retail price but why should anyone expect to get a “deal” on a new car when it has a very clear and explicit on the road price.
Why should it be that when buying a new car should you expect to get a discount when the margin is amongst the lowest percentage of any major consumer purchased product going and isn’t it madness that the very retailers that make this small margin in percentage terms have the highest such costs for providing the goods for sale and have such high legal and regulatory costs as well as all the untold aftercare and consumer responsibilities.
There should be a profit to be made on the purchase of a car it’s the second biggest purchase most people will make and as such who would in all honesty seek out the cheapest vendor for carrying out such an important purchase if it was anything other than a car
if you were wrongly accused of a crime who would you can to help you. Would you go to the cheapest solicitor or would you hire the best most specialist in your area or the field of expertise.
Im not going to make out that dealers are all saints because most aren’t and infact there is an inherit problem with any vendor who requires to give you a price for your asset to buy another asset as it’s largely based on conjecture and hearsay but surely using a reputable firm that have a fair and honest reputation is worth paying the going rate which is no more than 10%
the manufacturers take a great deal of care in developing cars to the millimetre precision and you trust their calculations with your life and the life’s of the ones you love So why don’t you trust them when they tell you the on the road price of car. Why would you think it acceptable. To expect a discount when there is so much to the presentation preparation and aftercare of the said vehicle.
Why is it That buying from the cheapest possible bidder is the preferred route for so many people when it directly threatens the very existence of reputable vendors with invaluable experience.
Soea anyone else think like me that this madness and can’t possibly continue
I haven't even got close to discussing a deal.....
I am still at the "arranging a test drive" or "can I see the actual used car you are trying to sell me" phase..... I feel like a real nuisance..... thats when I even get acknowledged.
I wandered around the local Ford showroom , sat in a few cars, opened and closed the doors etc, not a sniff of interest......
Glad it’s not just me....
I have recently sold my Octavia vrs estate and I am trawling the dealers for a replacement.
I am open to new or low mileage recently new. £25k cash burning a hole in my pocket.
You would have thought I had leprosy by the lack of dealer enthusiasm.....
Skoda
really!!
i find it hard to believe that your unable to find anyone willing to sell you a Skoda VRS except perhaps your budget or your expectation of spec are out of kilter with what is available or that there are physically no cars to be found at any price.
I work for a dealership in the West of Scotland and I know that I for one wouldn’t let you leave my desk until i sold you a car if A one could be obtained and B that the price you are willing to pay for the car is realistic and being brutal when I say realistic i mean we have a car that’s listed for sale at an average price reflecting a typically spec’d and conditioned car
the issue I often have is people who say they have £25k burning a hole in there pocket often want a car that the market says is worth £29k and the chances of getting a similar car for £25k is impossible and so there is no way to compromise
To to be clear by compromise im not interested in saving my employer an extra £200-300 profit I’m only interested in selling you the easiest way possible which is usually on price therefore if the car is worth £29k and has cost us £27000 then your not going to get that car for £25,000 no matter how nice you are or if there’s a one at another dealer 400 miles away for £25,000 the fact is if there is one at another dealer at that price it’s usually for a very good reason if indeed it’s even a genuine listing cheapest usually means the worst particularly with high performance cars
the advent of the internet has been good and bad the good is that a scrupulous dealer will price their stock to be competitive not only in there local area but also nationally to ensure they are competitively offering cars for sale The rational is that auto trader and other portals cost thousands per month so if you price your stock to high then your wasting your time advertising it at all so all our prices are stripped of wiggle room to generate the minimum amount of profit needed to operate a viable and honest business the days of marking cars up at £30,000 when you could accept £25k profitably are thankfully long gone and responsible dealers don’t hide from making £1000 or so profit on a car that’s being prepared and warranted properly I think everyone would agree a margin of around 5% isn’t unreasonable to allow a business to pay for pleasant premises with professional and knowledgable staff that meet most reasonable buyers would expect
sorry i feel iv went off on different tangents and iv focused in on a partiqular budget as being unrealistic which is obviously a subjective term but if you take anything from this then if the sales staff haven’t been bothering with you then it’s usually because they simply can’t accomdate your specific criteria if they could get you what your after they would be snapping your hand off well at least I would be if I was a Skoda dealer
now if you wanted a Volkswagen then that would be different lol
If I wanted another Skoda I would be OK
The local Skoda dealers are all pretty good and I have no problems with them.
I have been looking at Mazda CX5, Ford Edge, BMW X2 and Honda CRV.... I may well end up going back to Skoda as these other local dealers are dreadful.