dealer invoice & blue book values

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  #1  
Old 11-16-07, 11:26 AM
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dealer invoice & blue book values

I made a deal with an Infinity dealer to pay $100 over invoice. Invoice includes $100 for "Warranty Supplemental Cost Recovery". Is this something I should pay for? Also, the dealer MUST be getting something back as far as rebate or dealer cash, otherwise how could he sell a car for $100 profit?? There is a note on the invoice that says "Collections: 1.5% of MSRP". Is this a rebate?

Also dealer offered me $4,800 for my 2001 Nissan Maxima with 170k miles - I almost fell over. I may as well have, b/c he called me later and inadvertently appraised it with 70k miles, and it's blue book is $2,500 (although KBB states 5-6K in good condition) but he would give me $3,200 for it. I feel I could get $5K selling it privately, but would be content with $4,500. Does it makes sense to just trade it in and take the loss for the convenience? How much could the dealer get for it, and should I talk it up to $3,800-$4,000 ??

Thanks.
 
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Old 11-17-07, 08:17 PM
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Having worked in the car sales industry a while back, I would not pay for a Warranty Recovery Cost.

As for $100 over invoice... It depends on what invoice they show you. I have found some dealerships will have 2 or 3 invoices. They are going to make a profit on the sale of a car. It's a business, not charity. I would talk up your trade some. However, it might only bring what they offered.

Try using Edmunds.com. The TMV values figure in what your type of vehicle has been selling for in your area. I've found it's pretty accurate however, some don't like it because it can be lower than what they would want. I would not expect any less than TMV on your vehicle. Also, I wouldn't pay more than TMV on your new vehicle. Use the website to talk your deal too.

Stick to your guns at a dealership. They need to make money and to make money they have to sell cars. If they miss your sale there's thousands of dealerships that would be happy to pick up were they left off.
 
  #3  
Old 11-17-07, 08:23 PM
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2001 Nissan Maxima SE 4dr Sedan (3.0L 6cyl 5M) True Market Value Pricing
Trade-In Private Party Dealer Retail
National Base Price
$6,007 $7,095 $8,099
Optional Equipment
$111 $132 $168
4-Speed Automatic Transmission
$111 $132 $168
Color Adjustment
Silver
$14 $16 $18
Regional Adjustment
for Zip Code 08527
$20 $23 $27
Mileage Adjustment
170,000 miles
$-1,842 $-1,842 $-1,842
Condition Adjustment
Average
$-1,279 $-1,482 $-1,643
Total
$3,031 $3,942 $4,827


$3,031 would be a fair trade in for your car. However, I didn't know what options your have.

I would try to get $3,800 for your trade in, but if not take there offer. No Warranty Cost. Your car has no warranty to recover. Also, let's check what the value for the new car would be. Post up.
 
  #4  
Old 11-18-07, 05:25 AM
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I used Edmunds for researching invoice prices on the new car (infinity G35X) and these prices matched the dealer's invoice to the penny, except for the Warranty Recovery Cost, so I am confident they are showing me the correct invoice.

With options on the trade in, with options, value increases about $200 in average condition. How would you determine average condition compared with clean? I would say it is some where inbetween, which would call for a trade-in of $4,477 and private sale of $5,621.

I did notice that kbb shows much higher values, so I actually feel more comfortable using edmunds.
 
  #5  
Old 11-18-07, 10:54 AM
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Having sold cars in the past, the dealers I have worked for will show you the original invoice, granted some invoices are pretty generic in their content ie no logo or brand name. GM is like that. Others invoices have Brand logos etc and are "ornate" compared to others.

I do not know what the Warrenty Cost thing is

As far as your old car is concerned, Since you are paying $100 over invoice, I think what they are doing is giving you what is called "Actual Cash Value". Your car has over a hundred thousand miles and generally cannot be financed with that amount of miles. So for them to sell it, it would definatly be a "niche" buyer to take it off their hands. So they have found a wholesaler to take it off their hands for cash and probably it would be going to 3rd world country to die.

If you paid full sticker for the car you want you probably would get KBB or better for your trade.

All manufacturers give what they call "holdbacks" to dealerships, what that means is that a percentage of sticker price usually about 2% is reserved for dealers use for advertising and the interest that the dealers pay as most dealerships do not buy their inventories outright.

If you can decipher an invoice you can see what the holdbacks are, usually they are not negotiable and if the unit stays on a lot too long the holdbacks are used up. It sounds like the "collections of 1.5%" are the holdbacks.

Hope this helps,



Mark_ms
 
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