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SMS

On 8/10/2011 8:50 PM, zzzzzzzzzz wrote:

I'm not even sure it's true for cars anymore, either. With the recession,
used car prices have gone through the roof.

I was quite amused when shopping for a new Toyota to see the dealer
asking more for a one year old model than they were advertising "all
model 2532 in stock at this price" for the current year model. The "all
model 2532 in stock at this price" price was more than $1500 under
factory invoice and more than $3700 under MSRP.

The dealer still makes their money of course since "invoice" bears
little resemblance to what the dealer actually pays the factory for the
vehicle. As far as I could figure (and it was really immaterial) the
dealer had a $400-500 margin after all the kickbacks (factory to dealer
incentive, ad fee, holdback, etc.) were factored in, and hoped to make
the real money selling financing, warranties, fabric guard,
undercoating, glass etching, alarms, and a host of other WAOs (worthless
add ons), including my favorite "the gold package."

Of course the used one year old vehicle was quite a bit less than the
MSRP of the new one, and that's how they find buyers for those used
cars, the people that think they have to pay MSRP for a new one because
the salesman tells them so.

However used Hondas and Toyotas fetch prices beyond logic, while it may
not be the case for Ford and GM vehicles.

No doubt in the case of the original poster, the dealer will try to
portray the $4.5K rebate as the only applicable discount, though some
dealers do distinguish between the MSRP, the dealer discount if any, and
the factory rebate. Of course the "dealer discount" is usually
negotiable as well.