Ask a Car Salesman Thread

[gniknave]

I think there's a few of us around. I know there's a couple of Nissan salesmen, and myself as an Infiniti salesman. Just figured we could make ourselves available to the people considering buying the brands we sell, or even another brand.

Ask away!

[Repo Man]

I have a 450 beacon score, am 10k flipped in my trade, my chapter 7 isn't quite discharged yet and I make 19k per year.

Can you get me done on a new Titan with 22's?

[gniknave]

I have a 450 beacon score, am 10k flipped in my trade, my chapter 7 isn't quite discharged yet and I make 19k per year.

Can you get me done on a new Titan with 22's?

I don't know about a Titan, but I know a guy in Indy that could probably get you into a new Escalade on 22's. I hear he does SPECIAL finance

[Repo Man]

Sweet.

[MattB]

During my summer and winter breaks from school I sell Hondas and used cars, so if anyone wants a Honda I can help out with information.

[gniknave]

I got the first up!...

[audtatious]

Why do dealers want to know before hand if you have a trade-in? Why do they always low-ball the hell out of trade-in's?

[gniknave]

Why do dealers want to know before hand if you have a trade-in? Why do they always low-ball the hell out of trade-in's?

It's something that's really good to know up front. Reason being, if you have reverse equity in your trade, it would be nice to be able to help you get into a vehicle that can help eliminate some of that reverse equity. I'll use part of what Andy said earlier in this thread as an example:

I have a 450 beacon score, am 10k flipped in my trade, my chapter 7 isn't quite discharged yet and I make 19k per year.

Can you get me done on a new Titan with 22's?

In this situation I'm first doing an interview with the customer. What are they looking for? What is their motivation? What features matter? What colors do they like? How do they plan to pay for this vehicle? How soon are they going to make this decision? If by this point they haven't told me they're trading something in, then I'll look at their vehicle outside and say "Oh, I see you drove up in a Blazer, you must be adding another vehicle to the fleet huh?".

At this point my trade-in question is answered without me ever asking. Moving on, it sucks not only for the salesperson, but also for the customer, to waste time getting all pumped up about a car you like (and I want to sell you), then only to find out that you have 10k in reverse equity and we really have no way of getting you in the vehicle you really want.

Andy maybe you can help me with this, but I believe most banks & credit unions will only finance 110-120% of the vehicles MSRP. Meaning, you can potentially hide 1-7k worth of reverse equity in a new car depending on factory rebates, or incentives on that particular vehicle. This is why people will tell you that its easier to put reverse equity into a new car vs. a used one (unless it's a certified used car)... because banks feel more comfortable lending money towards a car with a full warranty vs one that doesn't have one, or one that isn't certified (meaning reconditioned to 'As New' condition with an extra warranty).

I know I'm going way beyond what you asked but the short answer is, we do it to save you, and us from wasting time with something that may or may not be possible. As a consultant, it's easier to know as much as possible up front so I can trailor my presentation to fit your wants and needs in your situation.

Now, this does not mean that I'm doing a trade appraisal on your car before we even get to you picking out a car on our lot first. In my opinion, that's doing things backwards. I don't want to know what we can give you for your car until I know that we have one that you're willing to drive off with as a replacement.

As far as low balling, they don't necessarily do that. Most consumers use Edmunds or Kelly Blue Book to access their trade in value, and expect to get exaclty that. Most don't consider the cost of the dealer doing a safety inspection, then having to fix anything they might find wrong, then having to make sure there's enough of a profit margin left for the dealership AND the salesperson to make something by selling it. Also, dealers like us actually call an auctioner and find out exactly what the vehicle goes for (on average) at wholesale auctions. We do the market value.

If that doesn't make sense, consider this... If you look up an S13 240sx on Edmunds or KBB, you see an average value of $1500-1900. But You know the street value is actually more like $2500-3000 because of the average price they sell for. Well, that's the same thing a lot of dealers do. I mean, you can do an evaluation on an F150 and the customer see's it's worth $21000 according to Edmunds. However consider how many SUV's that dealer has on the lot that they haven't sold, consider the gas chrisis as well. Market value isn't exaclty going to be what you see on Edmunds at that point. Sure, there are times they'll try to squeeze an extra bit of money from the trade, but try to see it from your eyes. Would you have a problem buying a car for less than it's worth? I'm sure you'd take it and run with it.
Modified by gniknave at 5:54 PM 12/1/2006

[Jookmasta]

well if all goes right, i'm going to be looking into a gto in the near future. now this would be the first car that i'm ever purchasing and my credit should be good. and yes, perhaps i will be buying the car cash (or i have the funds to do so). now any hints or helpful suggestions as to what to ask or do that yall have seen while on the clock?

[nissansalesman_wtx]

As far as low balling, they don't necessarily do that. Most consumers use Edmunds or Kelly Blue Book to access their trade in value, and expect to get exaclty that. Most don't consider the cost of the dealer doing a safety inspection, then having to fix anything they might find wrong, then having to make sure there's enough of a profit margin left for the dealership AND the salesperson to make something by selling it. Also, dealers like us actually call an auctioner and find out exactly what the vehicle goes for (on average) at wholesale auctions. We do the market value.

Now here in west texas we have a huge issue with this people will look up values of their trades with Kelly Blue Book or NADA or whatever but what they don't realize is out here in the desert of texas our market is controlled by the wholesellers. Which means to you the consumer that our values on trades are what that vehicle is selling for in our area at that time. It is not a fun objection to deal with....

[audtatious]

It's something that's really good to know up front. Reason being, if you have reverse equity in your trade, it would be nice to be able to help you get into a vehicle that can help eliminate some of that reverse equity. I'll use part of what Andy said earlier in this thread as an example:

Modified by gniknave at 5:54 PM 12/1/2006

Way too much, but it is appreciated.

First, if you have negative equity in a car, the most stupid thing you can do is trade it in. You keep the damn thing until the value equals out (either via owner sale or trade-in value). This is a big issue with most cars as they take a huge dive in value when you purchase it and it usually takes around 3 years for everything to catch up. Adding "reverse equity" to a car loan does nothing but hang you out to dry and ensure you will return to a dealer for a new car purchase if your desire is to trade-up every couple years. In these situations you had better hope you don't total it as an insurance company is only going to reimburse you the worth of the car and paying the remainder is your problem. Being an idiot and going for a 72 month loan is similar as it takes longer for the car to equal the loan value.

Reverse equity and extended loans are simply ways to entrap those into purchasing a car that is above their means and moves dealerships more towards the tactics that credit card companies use to increase profit while stomping on the little people (altho the little people are the idiots that agree to the purchase).

In my situation, there is no reverse equity issue. If a salesman asks about a trade-in, they immediately stop negotiations to have the car checked out and it gives them some "pull" because the customer is there with "car in hand". IMO, a person who walks in the door with no trade-in and "cash in hand" or pre-approved financing can get a better deal on the actual car value. Once some initial numbers have been discussed and are agreeable, THEN you flip the trade-in in the picture. If the dealership comes back with different figures, you simply walk out the door.

What is the difference? With a trade-in sale, the saleman and dealership have more control over the vehicle price and they know the customer is ready to "deal" in order to drive out in a new car. My way, the customer will be the driving factor to get the dealership to offer the car at an agreed upon price before bringing up the trade. At that point, the customer is still controling the purchase.

[gniknave]

In my situation, there is no reverse equity issue. If a salesman asks about a trade-in, they immediately stop negotiations to have the car checked out and it gives them some "pull" because the customer is there with "car in hand". IMO, a person who walks in the door with no trade-in and "cash in hand" or pre-approved financing can get a better deal on the actual car value. Once some initial numbers have been discussed and are agreeable, THEN you flip the trade-in in the picture. If the dealership comes back with different figures, you simply walk out the door.

What is the difference? With a trade-in sale, the saleman and dealership have more control over the vehicle price and they know the customer is ready to "deal" in order to drive out in a new car. My way, the customer will be the driving factor to get the dealership to offer the car at an agreed upon price before bringing up the trade. At that point, the customer is still controling the purchase.

My main motivation (not speaking for ALL salespeople) in asking about a trade-in, is to overcome all potential reverse equity issues by pointing them to the right car or the right situation. You may think the worst thing some people can do is trade out of a car with reverse equity, but you'd probably be surprised that 65% of the people I deal with are in a reverse equity situation... and I don't do business int he ghetto either.

There are some situations where maybe a couple has a 2-door, and suddenly are expecting a child and need to get something with more size. A lot of times, leasing is an excellent way to get out of reverse equity and still have a good affordable payment. On our '06 Beetle convertibles, we had $3000 cash back on those, allowing that to be a car we could easily get someone into if they had some reverse equity. On that car, if someone had $3500 in reverse equity, we could actually put $3000 of it into the Beetle, and then discount the car $500 and it would look like they paid just below MSRP for the car. Situations like that are why I like to know about a trade in advance.

Now, on the rare occasion I get someone like yourself Matt, that have no reverse equity, I'm perfectly fine with you negotiating the price, then bringing up your trade. While I'd still rather know these things ahead of time to make for a much quicker and smoother transaction, if you'd prefer to go the "wait it out" route, then so be it. I said before, some dealerships do things differently, but regardless of whether you're in a reverse equity situation or not, our trade-in appraisals still work the same.

With the way manufacturers are decreasing profit margins in vehicles, it's now extremely hard to make much of a profit just selling a car, it's key for the salesperson to help the F & I Manager sell warranties, accessories, and other services so they can make an additional bonus that way. Don't go into a dealership thinking salespeople are making a lot of money. Some do make a decent living, but most don't make all that much money at all. If you saw my payplan, you'd wonder how the hell I manage to eat everyday.

[gldman]

Help with used car purchase? I wish to purchase a used car that is safe, has an engine that is wimpy, can take a few nicks, and will be low in maintenance costs. This will be my son's first auto. I have no experience purchasing a used car. I think a new car for a new driver would be a mistake. Can any of the salesman point me in the right direction.

Thanks in advance for your help.

[audtatious]

My main motivation (not speaking for ALL salespeople) in asking about a trade-in, is to overcome all potential reverse equity issues by pointing them to the right car or the right situation. You may think the worst thing some people can do is trade out of a car with reverse equity, but you'd probably be surprised that 65% of the people I deal with are in a reverse equity situation... and I don't do business int he ghetto either.

My deal is that people need to get a grip on their financing and not do something so stupid. Can't afford a new one? Buy a 1-year old with low miles and avoid the whole issue completely. Don't take this as bashing you or all dealerships either (not my intent at all). As we all well know, want > need is the norm today. No wonder so many people are in financial issues.

There are some situations where maybe a couple has a 2-door, and suddenly are expecting a child and need to get something with more size. A lot of times, leasing is an excellent way to get out of reverse equity and still have a good affordable payment. On our '06 Beetle convertibles, we had $3000 cash back on those, allowing that to be a car we could easily get someone into if they had some reverse equity. On that car, if someone had $3500 in reverse equity, we could actually put $3000 of it into the Beetle, and then discount the car $500 and it would look like they paid just below MSRP for the car. Situations like that are why I like to know about a trade in advance.

Of course, if they were never backword in the first place it would not be a issue. I had two kids and drove a Celica coupe because that is what I had and I could not afford another car at the time. I dealt with it just fine. I can't say I am perfect either as my X-wife traded in a '96 Sentra on a '98 Quest and we went into the reverse equity issue. Of course, the assumption was to keep the vehicle for 3-5 years. Two years later she talked me into an upgrade to a '00 Villager Estate and we were in a double-reverse equity issue that the dealer/salesman pressed. I should have simply told her no. 5 years later, she still has that vehicle tho.

Now, on the rare occasion I get someone like yourself Matt, that have no reverse equity, I'm perfectly fine with you negotiating the price, then bringing up your trade. While I'd still rather know these things ahead of time to make for a much quicker and smoother transaction, if you'd prefer to go the "wait it out" route, then so be it. I said before, some dealerships do things differently, but regardless of whether you're in a reverse equity situation or not, our trade-in appraisals still work the same.

Not all dealerships are alike. About 60% of the ones I have dealt with will play with the numbers of the trade-in vs. car price to increase their profit margin which results in me eventually paying more for the car. Yes, I fully expect the dealership to make a profit. I have just noticed that I have more pull when I have hammered out a price then work the trade-in afterward. IMO, it is pretty simple if the vehicle is not in a reverse-equity situation. Trade-in value - remainder owed = reduction in car price. The dealer can then resale the car at a profit as well after doing a simple detail and cleanup.

Having a high 700 FICA and being pre-approved for purchasing just about any vehicle I want gives me a lot of leverage and I will simply walk out if I don't like what I see. My wife is even worse and is probably a dealers worse nightmare.

[gniknave]

Help with used car purchase? I wish to purchase a used car that is safe, has an engine that is wimpy, can take a few nicks, and will be low in maintenance costs. This will be my son's first auto. I have no experience purchasing a used car. I think a new car for a new driver would be a mistake. Can any of the salesman point me in the right direction.

Thanks in advance for your help.

Welcome to NICO gldman!

Are you considering purchasing from a dealership or private party? Either way, be sure to get a Carfax, and have the car inspected by a third-party source. There are some things that wont show up on a Carfax that may still effect the vehicle you're considering.

If you're thinking about buying from a dealership, try to get something that's a Certified Preowned. For more information about that, check out this link: How to buy a Certified Pre-Owned Vehicle .

I'm not going to go as far as recommending a car until you get the basics of buying a used car first. Let us know when you're ready for the next part...

[gldman]

Thanks. I checked the articles and prices on Carsdirect. Just for example, a 2005 Jetta is $15,995 and a new 2007 is $18,126. I checked the Volkswagen because they have the best CPO program according to intellichoice. For that minimal difference maybe I should lease a new Jetta or similar?Are there lease restrictions that would not allow a 17 year old to drive the car? Extra reason for the lease is if the car is in an accident like those tv ads, I am only out my deductible and do not suffer a value reduction on the car as well. Hopefully my son would also walk away just like the kids on the Volkswagen ads. Your thoughts about lease new vs buy used would be appreciated as well.

[MattB]

Thanks. I checked the articles and prices on Carsdirect. Just for example, a 2005 Jetta is $15,995 and a new 2007 is $18,126. I checked the Volkswagen because they have the best CPO program according to intellichoice. For that minimal difference maybe I should lease a new Jetta or similar?Are there lease restrictions that would not allow a 17 year old to drive the car? Extra reason for the lease is if the car is in an accident like those tv ads, I am only out my deductible and do not suffer a value reduction on the car as well. Hopefully my son would also walk away just like the kids on the Volkswagen ads. Your thoughts about lease new vs buy used would be appreciated as well.

I'm not sure about VCI leases, but I do know that some will put restrictions on the age of drivers.

As far as lease new vs. buy used, there are several things to consider. A leased car will always be under warranty during the lease period, but at the end you turn the car back in and have no equity-it's effectively a long term rental. If you are going to be driving a lot, don't consider a lease-over mileage penalties are awful. You also have to keep a leased car in good shape-they will charge you for excess wear as well.

And when buying or leasing a car, NEVER FOCUS ON THE MONTHLY PAYMENT. I can't stress this enough. It always amazes me how many people just tell me they want to pay $x per month, and if I can get them there they'll buy the car. Well okay, I can get you there but it will be over 72 months. This is how people get buried in negative equity. Make sure you can afford the car, not the payment.

[gldman]

Thanks, This is my situation. My wife and I want my son to have a car so we will not have drive him to and fro and so he will not need borrow our cars. Round trip to school is 5 miles and other places he will go will not be a long distance. I want a very safe auto with a low horse power engine like the Toyota Corolla I4 126hp to discourage speed. I expect he will bang up the car, Isn't that what all new drivers do? Money(what I can afford) is not an issue, but I wish to be sensible. What would you do in my shoes. Thanks.

[MattB]

Thanks, This is my situation. My wife and I want my son to have a car so we will not have drive him to and fro and so he will not need borrow our cars. Round trip to school is 5 miles and other places he will go will not be a long distance. I want a very safe auto with a low horse power engine like the Toyota Corolla I4 126hp to discourage speed. I expect he will bang up the car, Isn't that what all new drivers do? Money(what I can afford) is not an issue, but I wish to be sensible. What would you do in my shoes. Thanks.

Get him a lightly used Corolla or Civic. With a new driver a lease is not a good idea.

[gldman]

Thanks. I guess that brings me back to my original question, earlier in the thread. How do I go about getting a lightly used Corolla or Civic without getting ripped-off?

[DooReedo]

Where can you find you iPod cable? I have been looking for a while and cant find one. Also I did not get the technology package or journey package. Will that make a difference?(I have a M35)

[MattB]

Buy one that is certified pre-owned. With the Honda you'll get a 1year/12Kmile bumper to bumper warranty on top of the remaining factory warranty plus 7years from in-service date/100K total miles on the power train. Civics are extremely popular cars right now and so are commanding top prices. KBB and Edmunds are not always a good indicator-they do not take certification into account. Go into the dealership at the end of the month, that's when they are most looking to make deals. You can probably get about a 10-15% discount off sticker price. And be prepared to walk away from a deal you don't like-walking away can be a powerful negotiating tactic.

[gldman]

Matt, Why is it a bad idea to lease a car for a new driver? The lease deals are sweet and it looks like I can shift my risks to the leasing company. The prices on the Certified used cars look ridiculous next to the new cars prices and leases.

[MattB]

Assuming that whoever you lease from will let someone that young drive a leased car, young drivers often beat on their cars, which leads to excessive wear and tear, which will lead to a lot of charges at the end of the lease.

And with those new car prices and lease deals you see, be sure to read the fine print. Lease deals are often low-mileage leases wtih a fair amount of money down. The prices on new cars may be on so-called "ad cars" where they sell one or two stripped down cars at that price but don't have a lot of them.

[gniknave]

Matt, thanks for your help here. I've been tied up all weekend. Good to see this forum FINALLY getting some proper use!

Thanks. I checked the articles and prices on Carsdirect. Just for example, a 2005 Jetta is $15,995 and a new 2007 is $18,126. I checked the Volkswagen because they have the best CPO program according to intellichoice. For that minimal difference maybe I should lease a new Jetta or similar?Are there lease restrictions that would not allow a 17 year old to drive the car? Extra reason for the lease is if the car is in an accident like those tv ads, I am only out my deductible and do not suffer a value reduction on the car as well. Hopefully my son would also walk away just like the kids on the Volkswagen ads. Your thoughts about lease new vs buy used would be appreciated as well.

I'm going to answer the Volkswagen part since I sell them too. I have plenty of people that lease brand new Jetta's for a first time driver. Now, I haven't had the question about lease restrictions for 17 year olds come up before, so at the moment I can't answer that. However I can tell you that you're right about VW CPO cars. They do have the best CPO program out there, and they're also one of, if not the safest car on the road. The only thing is even though there isn't a huge performance aftermarket for them, they actually have a decent amount of power out of the 2.5L 5-cylinder. If you want to prevent racing or aggressive driving, you might want to look at an alternative.

Assuming that whoever you lease from will let someone that young drive a leased car, young drivers often beat on their cars, which leads to excessive wear and tear, which will lead to a lot of charges at the end of the lease.

And with those new car prices and lease deals you see, be sure to read the fine print. Lease deals are often low-mileage leases wtih a fair amount of money down. The prices on new cars may be on so-called "ad cars" where they sell one or two stripped down cars at that price but don't have a lot of them.

^ditto^

Where can you find you iPod cable? I have been looking for a while and cant find one. Also I did not get the technology package or journey package. Will that make a difference?(I have a M35)

I think not having tech or journey will make a difference. When I get to work tomorrow I'll find out and post a sure answer.

[MattB]

Matt, thanks for your help here. I've been tied up all weekend. Good to see this forum FINALLY getting some proper use!

I'm going to answer the Volkswagen part since I sell them too. I have plenty of people that lease brand new Jetta's for a first time driver. Now, I haven't had the question about lease restrictions for 17 year olds come up before, so at the moment I can't answer that. However I can tell you that you're right about VW CPO cars. They do have the best CPO program out there, and they're also one of, if not the safest car on the road. The only thing is even though there isn't a huge performance aftermarket for them, they actually have a decent amount of power out of the 2.5L 5-cylinder. If you want to prevent racing or aggressive driving, you might want to look at an alternative.

No problem, I'm glad to be able to help out.

One thing to consider power-wise when looking at a VW is that the pre-05.5 (Mk4) Jettas have significantly less power from the base engine...the 2.0 I4 makes only 115hp IIRC vs. 150hp on the current Mk5 models.

A word of advice though: don't buy an underpowered car. You don't want to give your kid something with so much power that he will get into trouble but you don't want something so slow that he'll get hit just trying to move out into traffic.

Another model I'd suggest is a 2001 or so Nissan Altima (previous body style) in addition to the Jetta. Cheap, reliable, doesn't have too much power, and puts more metal around you than a Civic or Corolla. And if you can find an SE it will be a cooler first ride than a Civic by far.

[gniknave]

No problem, I'm glad to be able to help out.

One thing to consider power-wise when looking at a VW is that the pre-05.5 (Mk4) Jettas have significantly less power from the base engine...the 2.0 I4 makes only 115hp IIRC vs. 150hp on the current Mk5 models.

A word of advice though: don't buy an underpowered car. You don't want to give your kid something with so much power that he will get into trouble but you don't want something so slow that he'll get hit just trying to move out into traffic.

This is true. Also consider a VW Rabbit. They use the same engine as the Jetta, but enter at a lower price point. However they tend to not lease as well due to their low production - good selling numbers.

[gldman]

Thanks, I would like to know if Volkswagen puts any restrictions on the age of a driver for their leasing program. I appreciate the help.

[MattB]

This is true. Also consider a VW Rabbit. They use the same engine as the Jetta, but enter at a lower price point. However they tend to not lease as well due to their low production - good selling numbers.

Another thing to consider is that stripped down models of any car may not lease out as well as better-equipped models that retain more value and are more popular.

[gniknave]

Thanks, I would like to know if Volkswagen puts any restrictions on the age of a driver for their leasing program. I appreciate the help.

VW requires anybody on a Lease contract to be 18 or older.