Should we expect anything better than 4-5% below invoice for now?

[ThirtyOne]

Thanks gents...dont mean to beat a dead horse...just curious. I know this dealer gets quotas from FC for each month to hit. My salesman did share that info. He has also stated they are the number one volume dealer in the area. He has never stated they are losing money. One thing too is they have a huge inventory...probably 40-50 Wranglers in stock. I also feel like he offered better pricing to me when I went to an order instead of buying off the lot. He was about 1% below invoice on a stock unit. I decided to order because of specific options and then found out the pricing was better.

They do that because every dealer only gets an allocation of so many orders. The "Sold" factory orders don't count towards that allocation. So even if the margin is low it doesn't take away from the high-margin vehicles on the lot.

Also the Sold vehicles count in the math for how big their allocation is. So selling some Sold orders get them more lot vehicles. More high-margin lot vehicles means more profit.

So some of it is direct and some is indirect.

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[Stratplexi]

They do that because every dealer only gets an allocation of so many orders. The "Sold" factory orders don't count towards that allocation. So even if the margin is low it doesn't take away from the high-margin vehicles on the lot.

Also the Sold vehicles count in the math for how big their allocation is. So selling some Sold orders get them more lot vehicles. More high-margin lot vehicles means more profit.

So some of it is direct and some is indirect.

That makes sense... I have heard that Wranglers are allocated based on units sold. There are many dealers in my area that only have 2 or 3 on the lot. This reminds me of how Harley used to allocate bikes to dealers (and maybe still do).

Anyway, thanks for all the info and dialogue. As I say, I am completely satisfied with my deal.

Thanks

 

[ThirtyOne]

That makes sense... I have heard that Wranglers are allocated based on units sold. There are many dealers in my area that only have 2 or 3 on the lot. This reminds me of how Harley used to allocate bikes to dealers (and maybe still do).

Anyway, thanks for all the info and dialogue. As I say, I am completely satisfied with my deal.

Thanks

Congratulations on your Jeep! You are getting a great deal.

 

[Scott2373]

Ok so HB puts them even further below invoice than 3%. And they get 2% back from the factory on an affiliate deal not 1%. Not saying they shouldn't make money. I'm just saying there are lots of ways they can sell 5%-6% below invoice and still make money.

I've seen several people say that the dealer gets back 2% for an affiliate deal, but of course every dealer denies that, vehemently. So I'd like to know where that info comes from and I'd like to see some actual proof that this is true. I'm not calling anyone a liar, but a lot of math and people's "inside knowledge" of dealer financials is sketchy.

 

[Scott2373]

One more thing to add. May not apply directly to the Wrangler but my dealer had a Dodge Demon in the showroom. One of a handful in the state. The only reason the had it was due to volume of sales they’ve done on Hellcats and such.

My dealer had one as well, but unfortunately it was already sold, so they wouldn't let me test drive it

 

[ThirtyOne]

I've seen several people say that the dealer gets back 2% for an affiliate deal, but of course every dealer denies that, vehemently. So I'd like to know where that info comes from and I'd like to see some actual proof that this is true. I'm not calling anyone a liar, but a lot of math and people's "inside knowledge" of dealer financials is sketchy.

You know what? It doesn't really matter whether they get 1% or 2%. That's not the point. The point is that at least some dealers can sell 4%-6% below invoice and make money and you should do business with those dealers.

I've heard 2% for years. It's not fair to the dealer guy to ask him so I'm not going to. But let's say it's 1%. What does that change?

 

[Scott2373]

You know what? It doesn't really matter whether they get 1% or 2%. That's not the point. The point is that at least some dealers can sell 4%-6% below invoice and make money and you should do business with those dealers.

I've heard 2% for years. It's not fair to the dealer guy to ask him so I'm not going to. But let's say it's 1%. What does that change?

It changes the bargaining ability and the fact that a dealer tells a potential customer that they're losing money on a deal, when in fact they are not. If the dealer is being reimbursed 2% on a deal on which the customer received 1% off, then the dealer is MAKING money, not losing it. If a dealer adamantly refuses to allow a customer to receive 5% off a deal so they can save money, yet the dealer is so greedy, they refuse to give up 1% of their holdback, then that changes whether or not I want to do business with that dealer, not to mention their commitment to their customers. Again, I don't want to do business with that dealer. I'd say it changes a lot in the eyes of a conscious consumer.

 

[Saejin]

I think we also need to distinguish between greedy dealers and dealers who are just adjusting to market conditions. To me greedy dealers are the ones who give buyers false info such as saying they are losing money when they are not, negotiating monthly payments versus out the door, lowballing trade values, giving ultimatums such as this deal is only good until we close, etc. Honest dealers are mostly transparent, but that doesn't mean they will show or tell you every way they are making money on a deal. I think it's the customers responsibility to be as informed as possible especially prior to making a $35k+ purchase decision. Good dealers provide a fair price according to market conditions which to me is anywhere from 3-5 percent below invoice on Wranglers now. That may change when the diesel comes out or the new power top or turbo hits the market or special editions are made, etc, etc, etc. For Hondas, market value on the CR-V is $500 below MSPR...for Pilots, its invoice, etc. Also, location dictates market. I recently sold a truck in Maryland to a dealer at about $2k less than I could have gotten in Florida...the reason being it was RWD only.

But in the end, you can't blame dealers for everything. If some uninformed customer walks in and is willing to pay MSRP or higher for a new JL Wrangler, you can't expect the dealer to walk away from that deal or tell the customer they are paying too much and as the dealer we'll sell this to you for 5% below invoice. That's why it's called negotiations. The dealer starting point should be MSRP...F the dealers who start at over MSPR by adding a bunch crap or "market adjustment". When I find those I tell them to remove it or include for free. If they don't I walk. The buyers starting point should be informed by research. If the vehicle they are looking at is averaging $1,000 below MSRP as an example, the buyer won't get very far if they start off by asking for $3000 below MSRP. The dealer knows they can get more and will pass on the deal if the buyer won't budge.

Bottom line, we're getting great deals on the new JL. Use this forum to find the best deal whether that's local to you or if you're willing to drive/fly to save money. I think this thread provided all the info it can about dealer pricing and then some.

 

[Scott2373]

At any rate, I still want to know if that's true, for the sheer reason of knowing and not speculating and spreading falsehoods.

 

[ThirtyOne]

At any rate, I still want to know if that's true, for the sheer reason of knowing and not speculating and spreading falsehoods.

This is as close as i can get to an official answer which quotes from the Program Rules. Program Rules are not public so no way to confirm.

http://www.jeepforum.com/forum/f165...y-tread-lightly-sale-1338053/#/topics/1338053

Dealers are not greedy assholes if they won't sell at 5% below invoice. Dealers are allowed to make profit. And guess what - there are a bunch of other programs and costs you know nothing about that impacts their profit. You can't know exactly what a dealer makes off your purchase. That's not the right strategy. You should know what a good deal is in the market and find a dealer that will give it to you. If a particular dealer wont then go to another one.

 

[Scott2373]

I simply enjoy being an informed consumer. Like anyone else, I hate the game, but I sure as hell want to know how to play it. I expect the dealer to make a profit; I understand they're not in it for the sheer enjoyment of selling cars to make people happy. I also don't like being lied to and I don't like being ripped off. I'm all for a fair deal, but when one dealer is telling me that the Wranglers are on restriction and there's not a dealer in the country that will sell one for less than MSRP right now (Marina CDJ in Webster, NY; aka SHYSTERS!) and another dealer that's offering 5% below invoice all day long, there has to be a middle ground, which I'm happy to meet at. I'll settle for 4% below invoice happily, but when the dealer is telling me that they absolutely CANNOT, as opposed to WILL NOT, then that's how I decide who I'm buying from. I appreciate all the replies. Thank you!

 

[Stratplexi]

Its pretty obvious from what I have read here, there are some high volume dealers selling below invoice and making money. Its impossible to know every nuance of exactly how and how much they make, but its happening. The dealers and POCs are listed on this forum. Save yourself the debate with you local dealer that cant do it, pick one who is willing and order one. Call Dave Dennis in Dayton, they are doing 5% off if you mention this forum. When your new JL arrives, pick it up and visit the USAF museum while here. They are next door to WPAFB. Its a win-win! If you have never been there, you will be amazed and its free to visit.

 

[FUHL]

If your looking for a screaming deal on a JL, Get a Hold of our Jeep Specialist Roland and let him build and price you a jeep. Also don't forget to ask him about our lifetime power-train warranty. Roland can be reached at the following. But please include a zip code and a first and last name so he can get you the right pricing.
Roland
[email protected]
(208)459-7405
Make sure to tell him you are from the JL Fourm

Happy Trailing!!

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