The real Koon's deal

[ThirtyOne]

Maybe not where you live but in Illinois doc fees are absolutely considered part of the taxable sale price.

Sorry. You are correct. It varies by state.

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[RussJeep1]

You missed my point on this.

Quite possibly so, and maybe due to my lack of acumen in the subject area, it remains to be the case.

FFP: friend and family buying plans, correct?

My point is that it is a general practice for incentive programs to not include doc fees in the calculation.

Noted. My point (pardons if I beat a dead horse here, let alone that you may agree with and know) is that if I pay "it" and the dealer controls its cost (directly or indirectly by raising and lower other charges in the deal), call the charge whatever you like, but comparison shopping needs to factor it. Zero profit costs collected (not charged) uniformly by all dealers (taxes) can be left out of the calculus, but all other charges, fair though many are for dealers to charge, serve as profit to the supply chain (FCA, dealer, people who FCA buys from, etc.)

Let me put it this way. Does MSRP include doc fee? No. Does Invoice include doc fee? No. These are the two prices that selling price gets compared to.

I admit, in my ignorance, that while what you say is true, that I'm not sure how it affects the buyer. Maybe you are trying to bring up points related to dealers being justified in these charges. If so, okay; fair.

Here's my thing: Dealers are much, much more experienced at pricing vehicles than most buyers. Some can sneak profit in at various stages in the sale, from purchase price, to financing, by adding complexity to the deal, and making it hard for the consumer to truly understand its cost. Such tactics also wear customers down to give in to deals that may run significantly short of ideal.

Kudos to dealers like Koons who not only offer very competitive terms, but simplify them. I think there's a part of me, (and other buyers too) that would rather do a deal they understand, than an enormously complex one that only after careful present value calculations on an HP Financial calculator, proves slightly more advantageous.

(I have no reason to suspect you disagree.)

Dealers have learned that in order to stay out of trouble they need to charge the same doc fee to every customer and stay within the norms for that state. So if you shop within a state there is generally little variation in doc fees.

Point taken. My point is that dealers have learned that in order to stay competitive and profitable they need to charge different doc fees, if not on paper, then by fluctuating other fees in the pricing model. My point is that people may delude themselves into thinking that they got a great deal or ripped off on such charges--a determination that can only be made when examining the final before tax purchase price.

By example I know you must appreciate: "Wrangler dealers, I will guarantee you a stream of customers willing to pay $1500 in doc fees. The catch is that I get to structure the rest of the deal for them in ways that make it very competitive and attractive to them by lowering vehicle price paid, interest rate, loan terms, and other factors, all while still giving you dealers your fair profit."

(Sorry if I sounded like Kevin O'Leary from the TV show Shark Tank.)

Honestly, I think this thread only exists because you don't live in Virginia and you are considering buying a car in Virginia.

That could be a factor 31. But I'd like to think that this thread exists so that people know not just that, but why the Koons deal is a good one (money saved and relative simplicity). There's nothing about Virginia specifically, for me at least, that affects this deal other than considering my own personal value of getting there from my home locale from a distance, time, inconvenience and travel cost perspective.

If nothing else, Koons has provided us with the service, for free, of motivating our local dealers to be more competitive. Thank you Koons.

Pick any dealer in Virginia and ask them their doc fees. Most likely $599. Koons is only getting singled out because their prices are lower!

I don't think Koons is getting single out, and if it is, I would hope it is being singled out favorably (maybe that's what you're saying.) My take all along is who cares what Koons or any other dealer charges for other things. It's the before tax cost of all these things that we need to hone in on.

And if the dealer is pushing financing, it's the before tax present value of the cost of all these things that we need to hone in on.

Apologies 31 if my ignorance (said humbly, not coy) in vehicle purchasing frustrates you. When dealers start fee antics on me, I suggest that their fees are too little, not big, but, if they want to charge those fees, "this" is the far lower price they need to sell the vehicle at.

 

[J.R. Quimby]

Correct me if I don't understand, the price is FWP then -5%, then +699, tax and tabs. That's lower than MSRP to begin with, let alone FWP. The deal is quite good by my understanding of it.

 

[RussJeep1]

Correct me if I don't understand, the price is FWP then -5%, then +699, tax and tabs. That's lower than MSRP to begin with, let alone FWP. The deal is quite good by my understanding of it.

Correct Jake. FWP is factory wholesale price, or what the dealer pays FCA--in other words "Invoice Price."

One thing you missed, that I'll include because you sold Koons short: net $150 savings if you present them with a Tread Lightly discount code.

So how is the dealer making money? Don't worry. FCA has other incentive programs, some based on dollars and amount of vehicles sold that help them "keep the lights on."

The deal is very competitive for this market. Other vehicle makes and models with novelty factor or new release (Mustangs, Corvettes), although far more the exception than the rule, sometimes sell for above not only Invoice price but MSRP

And all this numbers crunching aside, which makes it a good financial deal, not a good deal, is predicated on our shared love for the Wrangler brand. That additional aspect makes it a good deal.

 

[RussJeep1]

Are you sure about that? In Indiana, the BMV seems prepared to charge us at registration if the taxes collected weren't sufficient. I've not seen any legal obligation for out-of-state dealers.

Fair point. Here's mine. Dealers, in fact all sellers hate collecting taxes (in those States that impose them.)

Not only do they make no money on them, it costs them in time and human resources, and tax cost is actually shared by buyer and seller in varying degrees depending upon the nature of the transaction (discussed above.))

 

[ThirtyOne]

I think if the thread was titled "Things to look out for when Buying out of State" or "What fees do dealers charge" then it would be very helpful.

And I should probably just let it go because we fundamentally agree we just categorize items differently - ie you think that any fee where the dealer has discretion should be included in the selling price and I think it should be categorized, well, the way the rest of the world categorizes it which is part of the out-the-door price.

Let me give you a non-car related example that happened to me when I was Christmas shopping.

I was buying a present for my wife. One vendor had it 10% off. But they charged for shipping. Amazon had it at regular price but with Prime it was cheaper to buy from Amazon with free shipping.

Now, we both agree that it is important to consider the shipping cost when determining the out-the-door price of the present and that given the shipping costs Amazon was the better value.

But this is where we disagree - in your model because the vendor has some discretion in their shipping costs that it should be included in the price, so the price is really not 10% off at all. We need to recalculate the discount considering the shipping cost.

Well, that is just not the way the rest of the world looks at it and it makes it confusing. Would it be helpful in a market where shipping costs vary and some vendors charge tax and some don't and some let you pick up and avoid shipping but you pay gas charges and all that? Maybe. And maybe someone who has never shopped online before would recognize that and think they made a big discovery that they need to share with everyone. But the rest of the world understands that the 10% off is off the selling price and not of the out-the-door price.

 

[RussJeep1]

Thank you for your clear Amazon analogy 31.

...you think that any fee where the dealer has discretion should be included in the selling price

I think, not to be pedantic, but to make a point, that any fee where the dealer has discretion should be used when comparison shopping. As to whether or not its categorized on the bill as you prefer, I don't care much either way--(unless if affects taxes,) so let's do it your way (the normal way) for argument sake, because I'm looking at that the number at the bottom first, then the ones in between.

One might make the argument that one simple price makes the deal easy, which benefits the customer. Another might say it hides fees, both legitimate and not from the consumer, which is bad, even if the deal becomes slightly more complex (generally bad too) in disclosing how the bottom line was derived. So I see and respect your point.

Certainly disclosure of fees allows me to weigh my willingness to pay them. Say one fee goes towards a "wheels for the homeless" surcharge (a good thing let's say) over the dealership owner's kid's horse back riding lessons fee (certainly a nice thing, but further away from one of life's necessities) masked as something else.

Itemization you seek gives me more control if not more to also consider. It's well intended policy but it also incentives dealers to make deals more complex to confuse and tire customers negotiating power into worse deals.

And when that happens my "Brooklyn" comes out and I suggest higher and more fees, but a lowering in vehicle cost. (Codespeak for: what's the bottom line?)

Either that or if things get really ugly (I am normally a very respectful buyer) I break out my sarcastic Brady Bunch "I'm ignoring you with headphones on" rendition of "Time to Change,"



followed by, and the bottom line is.....?

======

We agree that a dealer's argument that the cost of labor, say in L.A. is higher than in Minnesota, while valid, earns them no sympathy: just as the Amazon product with the higher shipping was the better deal.

What might earn the L.A. dealer consideration is the cost for the Californian to trek to Minnesota.

Oh--and don't get me wrong. I have my principles too, like you. Over charge me for shipping and I might walk away from a con artist seeking to hide true cost, even if his/her deal is superior, not simply because I don't trust them, but because I don't like them.

But if he tells me he prices this way (shipping: speaking in metaphors) because he gets a commission on what he charges for shipping, I may work with him because I'm all for the seller maximizing their profit in ways that don't negatively affect my bottom line (shipping plus product cost.)

Well, that is just not the way the rest of the world looks at it and it makes it confusing.

That's were we may respectfully disagree. I seek to clear that confusion with my, "and the bottom line is...." focus on customer outlay. Fact: dealers know more about selling vehicles on average than customers. And many dealers use that fact to make the deal more complex so it becomes harder for the consumer to understand, (and if they're being taken for a ride), and more likely for the customer to cave in on negotiation due to exhaustion.

Would it be helpful in a market where shipping costs vary and some vendors charge tax and some don't and some let you pick up and avoid shipping but you pay gas charges and all that? Maybe.

I'm confused. I thought you were the advocate for categorizing these costs, I'm not.

But the rest of the world understands that the 10% off is off the selling price and not of the out-the-door price.

On this we may disagree. Or better put, to be fair, you may be correct that consumers understand why X% off isn't often really X% off, but they may not know specifically why, or where in the price, or how this is done, and if they are getting a good deal. And my proof comes in that fact that deals become complex in part, and exist, because they make dealers money.

But is your way the norm--absolutely. We need look no further than defunct Saturn dealerships pseudo-single pricing models for that.

Cheers 31.

 

[Macaw1]

Just a few notes, you can buy at Leman in Bloomington, Il at 3 and 4% below Invoice and pay $172.50 DOC Fee and they will collect the Tax and License Fee and do all the work for that $172.50 DOC Fee.
That is what a DOC Fee is for.
You can buy a car from California and they charge $57.00 for DOC Fees.
They don't do the out of state taxes and license for you but for that fee they do FedEx your paperwork over night each way and then send you the Title the same way.
If you own a house in another state but want to license your Jeep in say Illinois, you can mail your paperwork to a processor in your state and they will do the Title and License work for $22 Bucks.
Good Deal

Point is you don't have to travel to Koon's to get a better deal and pay $600 in fees.
That said, my next Jeep will come from Idaho at 8% under invoice and I'll use their financing for 6 months and then switch to my Credit Union at 1.99% out to 84 months.

The Best Deal Going !
If you look at their website right now you will see loaded up 2018 JK's for $9,500 off sticker.

BTW.. Tread Lightly will get you 1% under Invoice but the Dealer gets paid 2% for using it.
If you call your Dealer and tell them you are ready to order today and ask for 3% they will go there.
If you tell them you have Tread Lightly you will probably get them down to 4% without much struggle.
If you are a Veteran and order the 1st of September and your Jeep will come in around Veterans Day and you will be able to stack another $500 on top of your discounts.

BTW 2... I spoke with the owner of Moore Jeep in Peoria AZ, and he said he would do the 3 and 4% deal all day long.
Get to a Manager instead of a Salesman at your local dealer if you are serious about getting a deal.
You don't need to travel across America to get a Good Deal.
I'll go to Idaho for the deal and I have friends near Boise and because MOAB is on the way to my home in AZ.

 

[Wanderingwheelz]

I agree. Tomorrow I pick up my first Jeep- a 2 door JLS soft top with only AC, Automatic, Window Tint and Mats. Very basic. Even factoring in all dealer fees, tag and title work, (including a small county tax that I wouldn’t pay if I bought practically anywhere else) I’m at exactly 5% under invoice. It’s so close that I have to believe the dealer intentionally made the deal so my bottom line is 95% of invoice, since they knew I was educated.
The only thing I’m not factoring in is my state sales tax (4.25%), since that’s not an “out the door price” in my state because we are allowed a tax credit on the unused portion of a vehicle when we sell it or trade it in. So the car I just sold PP a few days ago was for more than the new Jeep is costing me. So there’s no state tax on this car purchase at all, just the very small county tax where the Jeep is being purchased.
Also, my 5% under invoice deal is on the Jeep with the $500 lower Base Price too, since we are all aware of the FCA price hikes on these things. (Try finding a 2 door on the lot at the old price.) So that’s $500 in free mods as far as I’m concerned.
I’m buying out of state, which I don’t normally do, but my local dealer wasn’t able to get close, especially considering their 2 door Jeeps all have the higher (current) Base Price and the 2 doors they have are all equipped with options I don’t need, like the Trail Rated Kit, XM and Anti-Spin.
I’m only traveling 2 hours so it’s not a huge problem riding over there with my wife and having two cars coming home. I’m a cash buyer so there’s no worry about any financing games.
So, even at the famous Jeep dealers that are often mentioned here on this forum you can get 5% under invoice, even accounting for all of the fees and costs layered onto the “price”, which we all know isn’t normally the real price in 2018.
Be patient and negotiate.

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