Employee Discounted Cars: Flatout BIG LIE!

sdashiki · 08-03-2005, 01:10 PM

http://www.freep.com/news/statewire/...7_20050803.htm

When I first saw this commercial touting the "employee discount pricing", I was skeptical. And I know why.

Car dealerships (not dealers, but the company itself) are out to **** you out of the most money they can. The only way to keep the dick from your *** is to haggle. Haggle the best you can. Cuz in reality they know exactly how much they paid for the car. And based on that know how low they will go ever. You can haggle all you want but you wont get them to take a loss, ever.

Anyway, telling people that the price you see is "employee priced" is sorta like saying this is the lowest price you are ever gonna get, cuz its the employee discount. And you always ask your friend at Wendy's to give you a discount on your baked tater, same thing. Only they are lying. Who knows what "employee pricing" is except the employess. And they are the people who are selling you this car, the ones trying to make the money.

Wow thats a good price

sure is, thats our discount price

yeah i can see that, but I was thinking more like a grand less

but sir this is lowest we can go, its what we offer our employees

yeah but its still kinda high

i dont think you heard me, it doesnt get lower than the employee discount!

So in essence they have eliminated haggling. The ****en assholes. And people still think they are getting a great deal, afterall it is the "employee price". And they wouldnt screw their own workers would they? No probably not. But they will screw you and basically have with this "deal".

CEO : "We are having slumping sales Johnson"

Johnson : "Well we can slightly lower our prices and tell people its the employee discount"

CEO : "And when they ask about a better deal, we can say this is the best deal"

Johnson : "Right, we can screw em and they will think that we are actually being NICER and generous!"

edrex · 08-03-2005, 01:26 PM

When I worked at a dealership the employee discount was $200 over the invoice of the car minus any available rebates. So you were getting the vehicle for anywhere from $800-$4,000 below invoice costs.
I haven't checked in on how they are coming up with the Employee Discount pricing for cars these days, but hopefully people can still spot a good deal when they see one.
And if you are ever skeptical about how good of a deal you are getting on a new car, you can always insist on seeing the actual invoice of the car. They won't want to do it at first, but when you push for it and let them know you have no intentions of staying if they don't cooperate with you they will usually bring it out.

zPilott · 08-03-2005, 02:25 PM

I think nissans emplyee price is ~500 over invoice (as of 3 years ago).

rushnrockt · 08-03-2005, 03:27 PM

Were you applying the discount to a Cavalier or something? The SUV's are and pick-up trucks have rather sizable discounts. There are several articles around explaining how this whole "discount" thing works and pointing out that the cheaper cars you are better off haggling than getting the discount, while something like a Suburban can get you nice savings.
By the way, when you say

Quote: Originally Posted by sdashiki

Who knows what "employee pricing" is except the employess. And they are the people who are selling you this car, the ones trying to make the money.

You are wrong, dealers are not employees of the company and never had the employee discounts. Employee discounts applied only to people that worked directly for GM. And since the dealer wants to get rid of the cars that have been collecting dust on the lot, they will pass on as much of the discount as possible.

kbyrd · 08-03-2005, 04:16 PM

This is long, but the method has worked really well for me twice. I got a smokin' deals and there was little stress for everyone.

Figuring what an individual car actually cost the a dealership is tough. There are various volume based incentives going on that mean they could take a "loss" (according to the invoice) on an individual car or two just to push their monthly volume into a higher category of incentives.

Here's how I've approached buying two new cars now, it seems to work really well. I don't deal with the possibility of a trade-in because I sold my old cars privately. If you do a trade-in, treat it like a separate deal. Don't even metion it before you've settled on a purchase price with a dealer. If they ask, tell them you haven't decided.

- Decide on the car you want. Options, color, everything. Write it all down in detail. Figure out what options packages are common in your area (visit dealers), you'll find that in order to get that sunroof (which comes in option package 1) you'll have to take leather seats and heated mirrors (which comes in the luxury package) because that's how all the dealers in your area order them. Some times a color you want will be rare, sometimes you can't find an automatic, etc. On your list of "the ideal car" figure out which items you could slide on and which are must-haves. Being flexible on color helps a lot.

- Figure our the invoice and msrp base price for your and for each of the options. I used edmunds.com and carsdirect.com It'll help if you have a chart containing ALL the options. That way if you find a car slightly different from your ideal (it has foglights) you'll know what the invoice on foglights should be. You should be comfortable with how much you car costs with various configurations.

- These are month to month sales organizations, be ready to buy your car at the end of the month. Don't screw around, be actually ready to buy. If you are financing it from a bank or credit union, get that as lined-up as possible. I chose the Tuesday before the final weekend of the month.

- Make the dealers compete against each other not haggle with you. I rounded up a large (10-15) list of dealers "near" me (I was willing to drive pretty far).

- Don't walk in to the showroom to buy your car. Get contact info from the fleet/internet Manager or the sales manager. I called all the fleet/sales managers and told them something like this:
"I'm ready to buy a <insert car here> right now, I want to have the deal done by Saturday. I've done my homework and I have a good feel for the invoice price of the car. I'm calling many dealers and asking them all for their best out-the-door price. For the ones that give me a price, I'll call them all back and givem them one chance to beat that best price." Now give them the description of your car (color, options, etc.) Some dealers won't care, they say that no one has to make deals on that car, it's too hot. Thank them for their time and move on. Some will say, "I won't give you a price, but I'll beat whatever price you get, call me back." Say no, thank them for their time, tell them you're only calling back those who give you a price, and move on. Some will laugh, some "sales managers" will actually just be the on-call salesman of the day, whatever. Thank them, move on. Do not haggle or negotiate. Many will ask about your trade-in. Tell them you haven't decided yet, just assume you're not trading-in. Get an out-the-door price, tax, license, etc. Do NOT argue with them over anything, holdbacks, documentation fees that look bogus, whatever. It doesn't matter. The only thing that matters is that final price. If they want to sell you a car for invoice minus $1000 then tack on a $500 doc fee. That still beats the guy who will sell it to you for invoice minus $300. Most dealer will probably not give you an actual price like $21,412. They'll say, "invoice minus $200", that's ok, explain how much you think "invoice" is (from step one) then ask what other fees would be added to get it out the door. Don't argue if they tack on some dealer prep fee, just write down the total (say invoice - $200, + destination charge + tax + licence + $5 California tire fee + $75 doc fee). If they ask if you want to finance tell them you haven't decided, unless it gets you a better deal. Just get a price, write it down, agree to call them back in a day or two. Set a firm deadline, like you'll call back by Wednesday 2pm.

- You'll probably only get a few actual prices (maybe 5?). You'll figure out pretty quickly who wants your business or not. While you were doing the above step, you'll also figure out what cars are actually available. Often you'll have to compare dealer 1's car with option A to dealer 2's car with option B. This is tough. You decide which option you want more or less, whether the nav system is worth it since it's the only one in the color you want. You'll probably get a better deal if you are more flexible on the exact configuration.
Some people will need some time to search for the car, figure out a price, whatever. That's cool. Give them the same deadline as everyone else.

- Now call everyone who gave you a firm price (or something like invoice minus X) and tell them your best deal ("My best offer was invoice minus $300"). Then shut up and wait. They may ask who it was from, tell them if you want, I said it was none of their business. This is a simple conversation. For me, all but one dealer said "no". Many of them said "good luck, that's a good deal". So, the lowest original quote I got was the guy I purchased it from.

- Now, you've got your car. Be paranoid. Set a time to go pick it up. You are NOT going to the dealership to shop. Decide over the phone on any extras you want (aftermarket alarm, sunroof, rust protection, I'm-a-sucker-fee).
You are going to exchange some money for a car. There should be no surprises. Before you leave, get a final out the door price for your car, tell them you're writing out the check ahead of time you need the price now. Go over all the details (options) of the car. Be sure it's the one you talked about earlier. Get a VIN number. Write it down. This does't really protect you from much (do you care if your VIN is different but it really is the same car when you get there?) but it makes you look anal and paranoid. The sales guys joked with me about being so meticulous. None of them got the commission for my sale, I dealt with the Sales Manager directly (he answered when I called). If anything is "off" (oh, your car was sold in the meantime, we have this one, but the deal is different), walk away.

That was long, I hope it helps someone. For me, it makes the buying experience fun again. Everyone I dealt with was pleasant, up front, no tricks or games, nothing. The ones that didn't want to deal with my just said so and that was that.

JaymzRR · 08-03-2005, 05:19 PM

Didnt read all the replies but I can tell you dont know what you are talking about.

EVERYTHING aside these are AMAZING sales and almost **** me off I bought my used Monte Carlo a few months ago. The deals ARE simply amazing. And like someone said it depends what you are looking at, you can only save so much money on an 12k dollar car... Oh and it also is apparently working since GM broke their previous sales record which was placed in the 80s.

RoyN · 08-03-2005, 11:52 PM

sdashiki is on a roll with the ranty posts

Stealth97 · 08-04-2005, 05:21 AM

Quote: Originally Posted by rushnrockt

You are wrong, dealers are not employees of the company and never had the employee discounts.

I call BS. I used to work for a ford dealer, and bought my truck on an emplyee discount. Do to this, I had to get authorization from ford (not the dealer). The employee price is set in stone, and theres nothing the dealer can do about it.

I bought a new, $20,000 truck with 8 miles on it for $14,000.

Now wheter or not the deal they are offering now is the real thing or not... thats another story.

sdashiki · 08-04-2005, 12:18 PM

My point was, no one outside the corporation knows what the "employee discount price" is.

yes a good deal is a good deal, take it if you can, but they can make up any price that is lower than before the deal started, and it looks like a good deal.

Another point was that this can take away from people being able to haggle a car price because its "the best deal we have, ITS THE EMPLOYEE PRICE BUDDY!". When it could be that the price is still way over invoice but they wont budge on the price because its a sale, and they still need money.

Who knows, a good deal on a car is an awesome thing, makes you feel all warm and fuzzy inside.

JaymzRR · 08-04-2005, 02:32 PM

ANd beleive it or not most people don't WANT or like to haggle.

MatrixPC · 08-04-2005, 05:11 PM

Usually I just call them or go to the dealer for a test drive the car I want. Give them my ODD price. If they okay, I take the car, if not, thank you and I go to the next dealer. 5 of our new car/van was purchase that way.
Most the time, the saleman just ask to come inside as he ask his manager/supervisor. I said okay and give them 5 minutes. I start counting at the watch at the end of my words.

JaymzRR · 08-04-2005, 05:26 PM

I am usually a good haggler (I guess most experience from buying fireworks lol) but when it came to my car shopping seeing as how my choice was from about 11 monte carlos in the NW (only a few of which were SS's) I didn't have much room to haggle.

Needless to say we got my SS (1 year older but less miles) for about a thousand over the LS we were about to buy so I think we did good =P SS + High sport appearance package and premium sound mind you =P

gameboy · 08-04-2005, 07:14 PM

when i was at a ford dealer ship as a salesperson, i can state for a fact they do not make hardly any money at all on "NEW" cars/trucks, all the money is made on "USED" vechiles.

another interesting thing, invoice price is NOT what the dealer pays for the car, there is what is called "dealer withholding" which is a discount off the invoice price to what the dealership actually paid for the car, this can be anywhere from 500-2000$ on different stuff that i have seen

as far as employee pricing, ford is prob handing out the B- or X- plan stuff, not too bad, but the really good pricing is A-plan(although only ford corp employees/immediate family) can get this. and incase u are wondering, the dealership still makes money off these(even though they are much much less then dealer price minus withholding. ford pays them a flat rate for a-plan sales)

rushnrockt · 08-04-2005, 07:36 PM

Quote: Originally Posted by gameboy

when i was at a ford dealer ship as a salesperson, i can state for a fact they do not make hardly any money at all on "NEW" cars/trucks, all the money is made on "USED" vechiles.

another interesting thing, invoice price is NOT what the dealer pays for the car, there is what is called "dealer withholding" which is a discount off the invoice price to what the dealership actually paid for the car, this can be anywhere from 500-2000$ on different stuff that i have seen

as far as employee pricing, ford is prob handing out the B- or X- plan stuff, not too bad, but the really good pricing is A-plan(although only ford corp employees/immediate family) can get this. and incase u are wondering, the dealership still makes money off these(even though they are much much less then dealer price minus withholding. ford pays them a flat rate for a-plan sales)

Ford introduced their own "employee discount" program too, I just got a letter from them advertising it.

sdashiki · 08-05-2005, 09:41 AM

Quote: Originally Posted by JaymzRR

ANd beleive it or not most people don't WANT or like to haggle.

but where is the fun in buying a car? I love having frends parents ask me to go with them to haggle, cuz im such an *** to dealers who arent doing what they want.

Like not honoring an advertised newspaper add, the model was the same, the vin was the same and yet they told me its not the same car and it costs more than the advertised price. I said I dont give a ****, you said its going for this, I want it for this. But then again if you are selling THIS car for THIS much, but I dont want this option or this option, it should be cheaper.... well sir actually we dont sell Air Conditioning without power package. Yeah but I dont want power seats, just windows and locks. Well we cant find a car with that configuration sir. Well then gimme this car with all the bells and whistles and since I dont want what you are giving me, I aint paying for it.

They dropped the car $1500 off the newspapers price.

My mom was ready to take the car as it was.

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