Ok,We have had a huge discussion on our Impreza site about cars being sold over MSRP. The discussion got started when one person went to go buy a STi and was informed the price would be $2,500 over MSRP. I know this has happened with the 350Z cars when they first came out. I am sure most top of the line cars and limted editions probably suffer from this when they are new.
So, what is your opinion on car dealerships selling cars over MSRP? Is it ethical or unethical? Is it stupid to buy a car over MSRP?
Car Prices over MSRP
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lessthanjakejohn
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EZcheese15
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Re: Car Prices over MSRP
Cold_Zero wrote:Ok,We have had a huge discussion on our Impreza site about cars being sold over MSRP. The discussion got started when one person went to go buy a STi and was informed the price would be $2,500 over MSRP. I know this has happened with the 350Z cars when they first came out. I am sure most top of the line cars and limted editions probably suffer from this when they are new.
So, what is your opinion on car dealerships selling cars over MSRP? Is it ethical or unethical? Is it stupid to buy a car over MSRP?
I think it is unethical. Is it stupid? Well, let me just say I regret it. I payed $2k over MSRP for mine, and now I'm like $4k upside down. But oh well....if you want something badly enough, then go for it....but you will regret it later (like me).
Only in America
Cars are a commodity, if they are overpriced PPL wont buy them.Is it annoying?Does one feel taken for a ride?Yes and Yes.But sometimes dealers take a hit so sometimes they make it up.
Extreme example of mark-up:
I was at a louisville toyota dealer in early April(or late march) this year (for an envirolution engine flush) and on the showroom floor was a sparkling new Celica GTS (or GTS-R or whichever the highest trim is)
It was a sharp little car with a, 4 cylinder engine+ 6 speed manualThe MSRP was somewhere around 27,000's I think.But the "final price" was $$35800.
When investigating this sticker more I found a coupel of options and I found a line that saiad: "loan value $8000"
So I asked a nearby salesman. what that was (following conversation is still verbatim in my memory or very nearly so):
Him: " that's the loan value"Me :" So the loan value of the car is only $8000?" (incredulous)Him:" No thats what the bank says they will loan you money for on the car"Me: "So the bank will only loan $8000 on this car that MNSRP's for 26000?"Him: " No they will loan more"Me: " so why does it say loan value is $8000?Him:"Because they will loan more than the MSRP, thats what they loan over MSRP"Me: "So why is it on the sticker?"Him: "We wanted to show that"Me: " So the car is $27000?"Him: " thats the MSRP"Me: "then why does it say <final price $35800>?"Him: "thats how much more the bank will loan on it"Me:" So is that what i would pay?"Him "thats what the bank will loan up to"Me: "What does that have to do with anything I can just give you 27000 or so right?"Him: " No the loan value is added in" ( the plot thickens)Me: "If its the loan value, then why is it written in here, where they add the options?"Him (squirming): "Just to show it"Me: "so how much does this car cost?"Him: (pointing at MSRP)Me: (pointing) "then why does it say $35800 here, where it says <your final price>?"Him: "because that's how much we need to get for the car"Me:" you are telling me, you are charging almost 36000 for this celica?"Him: (squirming) "$35800"
Fred...
Extreme example of mark-up:
I was at a louisville toyota dealer in early April(or late march) this year (for an envirolution engine flush) and on the showroom floor was a sparkling new Celica GTS (or GTS-R or whichever the highest trim is)
It was a sharp little car with a, 4 cylinder engine+ 6 speed manualThe MSRP was somewhere around 27,000's I think.But the "final price" was $$35800.
When investigating this sticker more I found a coupel of options and I found a line that saiad: "loan value $8000"So I asked a nearby salesman. what that was (following conversation is still verbatim in my memory or very nearly so):
Him: " that's the loan value"Me :" So the loan value of the car is only $8000?" (incredulous)Him:" No thats what the bank says they will loan you money for on the car"Me: "So the bank will only loan $8000 on this car that MNSRP's for 26000?"Him: " No they will loan more"Me: " so why does it say loan value is $8000?Him:"Because they will loan more than the MSRP, thats what they loan over MSRP"Me: "So why is it on the sticker?"Him: "We wanted to show that"Me: " So the car is $27000?"Him: " thats the MSRP"Me: "then why does it say <final price $35800>?"Him: "thats how much more the bank will loan on it"Me:" So is that what i would pay?"Him "thats what the bank will loan up to"Me: "What does that have to do with anything I can just give you 27000 or so right?"Him: " No the loan value is added in" ( the plot thickens)Me: "If its the loan value, then why is it written in here, where they add the options?"Him (squirming): "Just to show it"Me: "so how much does this car cost?"Him: (pointing at MSRP)Me: (pointing) "then why does it say $35800 here, where it says <your final price>?"Him: "because that's how much we need to get for the car"Me:" you are telling me, you are charging almost 36000 for this celica?"Him: (squirming) "$35800"
Fred...
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Cold_Zero
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Fred,It sounds like the guy was trying to mislead you. It almost like getting nickled and dimed when you go to buy a car at a set price and they add in everything else.
I still dont understand what a "value of the loan price" is. A car loan is a simple loan. I would have called Toyota of America and complained about that. Mark up is one thing, misleading customers is another.
I still dont understand what a "value of the loan price" is. A car loan is a simple loan. I would have called Toyota of America and complained about that. Mark up is one thing, misleading customers is another.
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Rockenreno
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bud,
I wasnt really trying to buy the car was just waiting in the showroom when I noticed that line "Loan value $8000".
yes I agree it is intentionally misleading considering how long it took him to tell me what his dealerships asking price for the car is.
Can can imagine some folks just getting suckered in and having the difference buried in a monthly payment.
Fred...
I wasnt really trying to buy the car was just waiting in the showroom when I noticed that line "Loan value $8000".
yes I agree it is intentionally misleading considering how long it took him to tell me what his dealerships asking price for the car is.Can can imagine some folks just getting suckered in and having the difference buried in a monthly payment.
Fred...
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EZcheese15
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It's just another way of saying "how much more we can get".
Like when people call ...
a Problem an Opprotunityoran Employee an Associate or Team Memberora "sex act with a cigar" Improper Behaviororbug fix an upgrade
Is it unethical? No, it's what you call fair market value or supply and demand. If there aren't many and someone is willing to pay for it, then more power to them. I think it's more the buyers fault. There are plenty of things they do that are borderline illegal, this just isn't one of them.
Like when people call ...
a Problem an Opprotunityoran Employee an Associate or Team Memberora "sex act with a cigar" Improper Behaviororbug fix an upgrade
Is it unethical? No, it's what you call fair market value or supply and demand. If there aren't many and someone is willing to pay for it, then more power to them. I think it's more the buyers fault. There are plenty of things they do that are borderline illegal, this just isn't one of them.
Torry:
So was I.But I vouch for this story's truthfulness.It was the celica GTS or GTS-S or GTS-R (or some such am not a toyota guy) whatever the most hi end version is (or was earier this year)..
I am sure they were unable to sell it at that price, but they certainly made a valiant attempt, to mark it up a lot and sneak it in with smoke and mirrors.
Fred..
So was I.But I vouch for this story's truthfulness.It was the celica GTS or GTS-S or GTS-R (or some such am not a toyota guy) whatever the most hi end version is (or was earier this year)..
I am sure they were unable to sell it at that price, but they certainly made a valiant attempt, to mark it up a lot and sneak it in with smoke and mirrors.
Fred..
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Bubba1
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Wow. Certainly not illegal, but very short-sighted. It's a bad strategy for cultivating repeat customers. If a dealer is going try to start over MSRP, they should at least be honest about it. But I would never buy from a dealer like that, nor would I ever pay MSRP or MSRP+ for a new car. Never have. Scary how sneaky some dealers are.
Bubba1 wrote:Wow. Certainly not illegal, but very short-sighted. It's a bad strategy for cultivating repeat customers. If a dealer is going try to start over MSRP, they should at least be honest about it. But I would never buy from a dealer like that, nor would I ever pay MSRP or MSRP+ for a new car. Never have. Scary how sneaky some dealers are.
Some vehicles are thought to be in such demand at the time that dealers will try and sqeeze as much money from people as possible. Take the Ford Mustang Cobra R as an extreme example: this was a few years ago so bear with me... a local dealer was stickering one at roughly 54K, with an "adjusted market value" of $39K. grand total of $93K. sick. what working man would pay a nearly 40 thousand dollar premium for a car. The more recent Mustang Cobra SVT had an "adjusted market value", or dealer mark up, of roughly $15K. Rich old guys will still line up to buy these cars though. I think the same holds true for the STI and EVO, as younger buyers with deep pockets line up to get them.
Rex wrote:Is it unethical? No, it's what you call fair market value or supply and demand. If there aren't many and someone is willing to pay for it, then more power to them. I think it's more the buyers fault. There are plenty of things they do that are borderline illegal, this just isn't one of them.
I totally agree with this. Fair market is the reason car makers strive to deliver better and better products. Otherwise we'd all be driving late-model '71 Beetles. As far as ethics is concerned, charging more than MSRP used to bother me. But if the dealership didn't charge more for a hot car, I guarantee you that scalpers and "opportunists" would.
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EZcheese15
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palmerwmd wrote:Torry:
So was I.But I vouch for this story's truthfulness.It was the celica GTS or GTS-S or GTS-R (or some such am not a toyota guy) whatever the most hi end version is (or was earier this year)..
I am sure they were unable to sell it at that price, but they certainly made a valiant attempt, to mark it up a lot and sneak it in with smoke and mirrors.
Fred..
That would be GTS. There are two trim levels. The GT has a 140HP and the GTS has 180HP.
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SDRonEbay
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I decided to stay out of this discussion. I feel kind of like Frankenstein's monster sitting in with the angry mob. "It's not my fault, I was born a monster!"
I completely agree that vehicles should not be sold over MSRP. Personally, I believe in fixed everything. Fixed prices and no APR whatsoever. I don't have a large enough income to pay more than I want to pay and then pay some more in market value and some more yearly. But we live in a society that has to place value on everything and boost it, simply because we can. Manufacturers realize that someone is always willing and able to pay more. That someone probably doesn't represent the majority, but these values aren't designed by the majority. They are designed by the manufacturers who know that someone is willing and able to pay more.
Funny how that works, huh?
I completely agree that vehicles should not be sold over MSRP. Personally, I believe in fixed everything. Fixed prices and no APR whatsoever. I don't have a large enough income to pay more than I want to pay and then pay some more in market value and some more yearly. But we live in a society that has to place value on everything and boost it, simply because we can. Manufacturers realize that someone is always willing and able to pay more. That someone probably doesn't represent the majority, but these values aren't designed by the majority. They are designed by the manufacturers who know that someone is willing and able to pay more.
Funny how that works, huh?
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nissanrcer240
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