GET BIG DISCOUNTS off MSRP at Car Dealerships 2020 - Expert Auto Advice on Vehicles

welcome here to the newsroom Northwest Initial News I'm Kevin Hunter with Kyle Ferguson and we're going to talk about how to get big

discounts

on MSRP, which is the manufacturer's suggested retail price at your local car dealership, so Kyle has several photos for you. Share it with us as we go and we'll help you better understand what we're talking about specifically. Anyway, let's start by sharing with people what a window sticker looks like. This is one of the common manufacturers you find on a Ford car lot. So usually you'll see a window sticker like this and a lot of people look at this window sticker and unfortunately some people think this is where car negotiations start so we're going to educate people and help them understand better. of what happens behind the scenes and how to achieve somewhere close to 20 to 25 percent off MSRP when all is said and done, some of the

discounts

I'm going to share with you today or ways to save money Some Some of them can't be used at the same time as other discounts, but if you know all the different ones out there, it means everything to you to come up with a final price that is the fairest for you, the buyer, so start talking about the invoice. from the dealer, this is very different than the window sticker, so this is actually what the manufacturer bills the dealer, so on this particular one, Kyle's Mike is covering the final number down there, but you see that The MSRP on this particular vehicle is thirty thousand eight hundred and sixty dollars, so that's the number that you would see on the lot window sticker, yeah, and the number next to it is the actual invoice from the dealership, which is twenty-eight thousand. 504, that's a difference of twenty-three fifty dollars or so now there's another thing that comes out of this MSRP before, so we're talking about what is the actual dealer cost, in this case this particular vehicle that had an MSRP of thirty thousand and eight is the actual cost of the the distributor is twenty eight thousand 5:02 and then there is also a holdback, so let's show the holdback graph now, this just gives an approximation of what the holdback is at some of the various manufacturers out there.

The holdback is really an amount of money that the manufacturer gave to the dealer at the end of the month based on all the new cars they sold there and you look at exactly 2% of the base MSRP made here at the bottom, in fact, behind off my shoulder, see Ford there. 3% of full MSRP, so on that Ford window sticker that we showed at the beginning, you could see an invoice that you know was two thousand three hundred and twenty-five less than what the window sticker is and then Ford has 3% of MSRP total and so on. In the particular example we were talking about, it's another nine hundred twenty-five dollars, so the dealer's actual cost at an MSRP of thirty thousand eight sixty was reduced to the dealer invoice by twenty-eight 502 and another nine hundred twenty-five dollars is deducted from that for retention, so now you know what the real cost is to the distributor from the manufacturer.

Now let's look at another topic that comes into play here, Kyle, and that is manufacturer rebates and dealer incentives, so here, when we look at this graph, we have Here, of all these different discounts that apply to these

vehicles

, you need to know what are the manufacturer rebates on a new car that you're buying because they're actually rebates from the manufacturer to the dealer, but that's because that's your money as a car. buyer, then when you need to know what those rebates are, because whatever when we mentioned what the final cost was to the dealer, these rebates are also coming from that number now, so in addition to the dealer invoice and the retainage from the dealer, these rebates come from the manufacturer.

That has nothing to do with anything else that is coming out, it is simply what the manufacturer is discounting and discounting to the dealer that goes to the customer. You can see things like this on Windows all the time, so the MSRP of this particular vehicle was 36,000. 680 now, the SAV 7000 is actually a combination of rebates and a dealer incentive. There and then they have this bonus t which can be several different things. You always have to ask what these extra bonuses are here, but you notice a thousand dollar t-bonus now this vehicle is for sale at 28,000 680 which is a 22% reduction from MSRP.

Now what you should know as a potential car buyer, do you think this is the end of the negotiations? You're going to pay for the car, I think as an average person, so yes, if you're not a very good negotiator, the answer is yes, because another dealer somewhere else will have the same thing written in pencil on their car window, on somewhere we end up getting to this, but you start pitting these two dealers against each other and you watch that number go up to 28, maybe 20 75 whatever, so that's not the end of the negotiations and like We said at the beginning, you can get somewhere between 20 and 25 percent.

Outside of MSRP, this is just one of the examples of how that happens, so there are a couple more things that come into play besides dealer rebates and incentives. You can also have things like an ex plan or an employee purchase program if your company is one. a supplier to the manufacturer or you are an employee anywhere in the manufacturer's sphere of influence, also ask about employee discounts or things that are also known as ex plan discounts, be sure to ask about them, so now let's talk about a different topic and moving on to Brand Loyalty now you might ask what brand loyalty discounts are and how they come into play.

Take a look at some of the manufacturers that are on this list here. These are the people at the top of the list. Here is Subaru 67.7. The percentage of people who bought a Subaru generally returned to Subaru to buy another Subaru which is a testament to the quality of the vehicle and how people like it, but there is another way these brands gain this type of loyalty which is they provide. You have a little incentive to come back, so not everyone does, but if you're aware of the fact that brand loyalty exists, many manufacturers have discounts for them, don't be surprised if you've had a Dodge as an example for five or ten. years and you buy another Dodge again, don't be surprised if Dodge offers an incentive where you get another $500 off the truck you're buying because you've owned a Dodge for the last five years, 10 years, whatever. be, so be sure to ask about brand loyalty discounts.

Now there is another one that a lot of people don't know about and that is the regional

auto

shows that are going on now, this is not something that the Auto Show itself is doing this, it is something that the manufacturers are doing and where you commonly see these shows It's in the spring, so the

auto

shows in your region might be held in February, March, April sometime in that time period, so they usually do these auto shows in the spring and when you're in the Auto Show or when you go to it, let's say you find a car here that you really like and you go shopping at one of the local dealers and ask them if there are rebates at the Auto Show that are going on.

Right now, because most manufacturers will be spending extra money on the car while car shows are going on, be sure to ask about a car show discount. Other discounts to consider if you are a student at college and/or university. Graduate, these are great things to keep in mind because they can be any number, they can be 500 dollars, is that him in this one? This is one managed by Toyota in this particular time period. $750 refund. These rebates in most cases are added on top. of the other rebates that are already available on the car, so you will need proof from the schools, so make sure you have it.

You don't have to have college transcripts, but have information from your school and your university that shows your student may be a student ID that helps each manufacturer have a slightly different burden of proof for you to prove that you are a college student, but be aware of the fact that if you are in school or recently graduated from school this may well apply to you and you got another discount. What about veterans? Veterans there is also a veteran and/or active military and this particular one as you can see is offered by Ford, many of the manufacturers have these so don't talk about current or veteran service either and again you will need some proof that it is a veteran if they got a copy of their dd-214 and/or an active military card, generally that's the burden of proof, but always talk to the dealer and find out what that particular manufacturer wants, but again, another cash appreciation or a refund that goes to someone who is a veteran.

Now let's say you're a veteran and also a recent college graduate, that manufacturer may have Both discounts in effect at that time, you may only qualify for one or the other, so don't be surprised if that happens now. Here's some good news for first-time buyers if you've never bought a car or specifically a new car. If you've never had a car loan in your name before, you might qualify for the first-time buyer program. Now there are a couple of different ways this can be beneficial to you, it could be not only in terms of a cash rebate or discount, but also in terms of financing terms for first-time buyers that are specific to someone.

You're a first-time buyer, so now let's talk about some of the things that are really outside the scope of manufacturer discounts per se, but are things that impact the dealership itself, first let's visit the old inventory. Now this is also a bit associated with the manufacturer, but look at this, your final event, why do you think it's the best time to shine with a new car? The best month. of the year is December and the worst month of the year is January. Do you have any idea why this might be so? New cars are discarded at the beginning of the year.

There are new cars on the lot. They have no idea what the sales outlook is. going to or anything else about those new cars, but when the end of the year comes, they still have models on the lot and they're gone, hey, we still have, you know, we're in 2018 right now, there are 2017 models, even to these heights. the year there are there are models from the previous year sitting in the car There are many available if you see the model year from the previous year I even tell people, go to if you have been shopping at a specific dealership, search and you are looking at a model specific, let's use pickup trucks as an example, if you have the previous year model and the current year model on that lot at the same time, that really works in your favor on that previous year model, so there won't just be incentives. from the manufacturer, but the dealer is an incentive to take it off their lot, so if you have the previous year's model and the current year's model on the lot at the same time, December is usually always the best time of year to buy a car a couple of things that relate to time in terms of purchasing at any time during the year the best time is to buy a car at the end of the month the dealer receives incentives for the volumes of cars that are moved in a given month the priority they get from the manufacturer and how many new cars they can get or new car models that might be in high demand are based on sales from previous months, for example, if a dealership is at the point where one or two additional sales make a difference on the number of cars they can order in the next month and maybe it influences the amount of money they will receive from the manufacturer in terms of retention and other things that they will be much more inclined to do. to sell you that vehicle and much more motivated to negotiate with you at the end of the month, the other small adjustment to this is that let's say it's now the last week of the month, my recommendation as far as days of the week is Tuesday. and Thursday when it is or Tuesday Wednesday, more like mid-week when it is slower at the dealership, because they have more time to haggle with you number one and you know that sales really increase on Friday and not on Saturday.

I like to spend hours working on a deal with you on the weekends because they have a lot of clients that come in there and Monday tends to be the first day of the week where they are tying up all these car deals that happen over the weekend. week and even people who never showed up on Saturdays and who might have been buying cars on a Saturday or Sunday while no one was around show up on Monday to make car deals, so Mondays are generally not really good days for negotiations long, but if you don't mind passing the time, show up on a Tuesday or Wednesday at the lastweek of the month and tighten the screws, which tends to work in your favor and go back to the old inventory again.

You can ask questions at any time. the year you can ask questions hey can you show me a couple of new cars that you have on your lot that have been here for a few months and you are interested in moving and I would like to get started. Maybe it's ideal. The vehicle for you has been in that parking lot for 90 days, 120 days or more and they are motivated to move it, so ask about that. Let's also talk about holidays. Now there tends to be a lot of details and promotions around the holidays. but here's Memorial Day, you know, next to me, there's some 4th of July stuff in there, by Kyle, you can also expect to see things like this, maybe around Easter, Thanksgiving, Christmas, etc., usually I see all kinds of balloons and flags and everything is like that flying around. these

dealerships

at these times, so be aware of that, the holidays could be a very good time of year to buy cars, another weather category, now here's a description of, you know, maybe in the Midwest or somewhere place where it snows a lot.

I'll tell you what when it's cold or It's been raining a lot and the weather is not very good, but there are a lot of people who are not buying cars, which means that the

dealerships

are slow, so during cold weather, bad weather and bad weather rainy, it's not a bad idea to go out and pay a visit if not. It doesn't matter if you're willing to sell out during a bit of this weather punishment, go out and have a little car show during the bad weather. You'll be surprised because here's a finance guy who, don't you know, may not have spoken to a client. in several hours because sometimes they do several things a day sometimes maybe I haven't talked to these last clients yesterday now it's one o'clock in the afternoon at noon and you show up and they say, hey, let's get something going on this and make it happen. things happen man we're ready we're ready to make deals you know they'll tell you and yeah it's because of the weather so make sure you like it.

I said if it's cold or rainy, think about going car shopping. that particular day, now let's talk about some of the things that now that you learned a little about these dealer bill discounts to retain manufacturer rebates brand loyalty car shows discounts for college graduates discounts for veterans first time buyers old inventory not even vacations etc., what does this really boil down to when it comes to metal studs? I can use all of this information if you've made these purchases at a few different distributors, you pit the distributors against each other, you have the distributors negotiate with each other, so we have the distributor.

A over here and dealer B over here, you know what gets dealers talking about the same vehicle, the same truck, the same SUV, whatever vehicle you're looking at, buy a few different dealers, have them go up against each other. We showed you a deal here a moment ago on the screen where this particular vehicle is 22% off MSRP, we'll take that same take a picture of the whole deal, go to another competing dealership and say, "Hey, This is a vehicle I can outperform." Here, with this deal, what can they do for me? Pit the two dealers against each other.

Don't be surprised if they go down a little more, the other guy goes down a little more and gets you into a bit of a bidding war. ready to leave guys who sit guys and girls who sit in the finance office and start talking about numbers immediately know that you are much more interested in buying a car and leaving than in negotiating don't sit there that finance office is You sit at the sales desk with a salesperson and say let's get down to business and see what you can do and when you're done, get up even if you plan to buy the vehicle there.

Say you already know what we're going to have for lunch, we'll compare apples to apples and see what we come up with, don't be surprised if they call you while you're out for lunch and say, "I'm going to offer you a few more dollars, you can use that time also to call the other deal and say: Hey Kyle, you're at XYZ dealership. I just finished visiting Jim, here with your competitor, now there's only twenty left. six eight seventy we're a little thin and we're going on that management, let me know if there is anything else you can do before we finish lunch and go back and buy this other car, don't be surprised if you get another cheaper offer from them.

Also, joking, the dealer's offer to each other. My final point here is that it all comes down to negotiation so you can be aware of all these offers, all these rebates, all these incentives, you may have done all this research, don't be the person that gives up when it's important, you know, here There's a husband and wife dealing with a finance guy you meet at the desk, hold your feet to the fire and you know something, you're going to have to be willing to get uncomfortable and make the person cross. your desk is a little awkward too because you know what I've heard and seen happen so many times, Kyle, it all comes down to the car buyer having done all their homework, figuring out all these rebates, all the discounts, everything that They approached them, you know, they went and bought their own credit at their own bank so they know what they qualify for.

They're in a really strong seat and this type of finance is like the whining dog, you know, it gives you the puppy. -dog eyes and come on guys, you have to give me something here now you don't know, no, you don't have to give them anything and when you get into finance, if you are buying a car just for yourself and you are the only buyer. Hey, it's your information. The dealer can't tell you that he can't have someone else sit next to him while they review your financing on their terms or anything else. Bring someone with you who you trust. and you know, when it comes to the end of this, in this particular image, we see a couple sitting in front of the... man's desk, when it comes time to make your final decision about what you're going to do, this is what What should you do.

You say: would you kick the guy out of his own office? You say, would you mind giving us a little time? Get out of the office and let us talk. Kick the guy out of his own office. Make him leave and you two sit down. and decide what you're going to accept this is like I said, it's hard, it may make you uncomfortable, it may make the finance guy you're dealing with uncomfortable, but this agreement is about the best and fairest deal for you as Customer, don't waste all this homework and all these great ideas that we've already given you, don't waste them when it comes to the finance office, so those are our tips on how to get 20 to 25% off MSRP.

In addition to your next new car purchase, there are all sorts of other tips we have regarding financing all the different fees you might incur, etc. You can find them here on this channel or look for additional Northwest news each week. making programs to help car buyers get the best fairest and most transparent car deals you can while you're car shopping, that'll do it for us here at Northwest Edition News. I'm Kevin Hunter with Kyle Torgeson until next time, stay safe.