doubg

Yep that is correct. I checked and you can't get the incentive and special financing rate. It's one or the other.

doubg

Thanks for the response. I've heard one good way way to calculate a price to negotiate is simply to take the Invoice Price then subtract any available incentives. So current incentive is $3500, I would just take the invoice price of the car and subtract $3500 to start the negotiation. I believe invoice is right around $2500 under MSRP so that would mean $6000 (2500+3500) below MSRP. It looks like that is only around 12-14% off MSRP.

If buyers have been able to get around 18% off MSRP in previous 1-2 months, I'm thinking of starting the negotiation by aiming for 20-21% off MSRP. Is that aiming for too much?

lesz

I'll copy and paste a post that I made in another thread. It explains an approach to buying that can help you to find where the bottom of the market is very quickly and without you having to make the first offer to start the negotiations, which is never a good idea.

Find the 8 (or more) Lexus dealers that are the closest to you. Send each of them an identical email. In the email, let them know that you are sending the same email to 8 (or whatever the number is) dealers. Tell them what color, package, options, etc. that you are interested in, and let them know that you are planning to buy within a week or 10 days from the dealer that offers you the best price.

When the dealers respond with offers, take the best offer, let the other dealers know what that offer is, and give them the opportunity to beat that price. If you repeat that process a couple of times, each time, some of the dealers will drop out, but some are likely to better their initial offers. After repeating the same process a couple of times, you should get a good feel for where the bottom of the market is and for what the best offers available are. Even if you really aren't interested in traveling to the more distant of those dealerships, you likely won't have to do so because, by using the offers of those more distant dealers as leverage, you should be able to cause the more nearby dealers to bring their prices to more competitive levels.

A key part of this process is to do as much as can via internet and telephone communication before you visit a dealership. Until you walk into the dealership, you are the one who has more control over the process, but, once you do walk into the dealership, you are giving more control to the sales person.

The December to Remember Lexus sales event has started, and that is when Lexus dealers are getting their biggest unadvertised sales incentives from Lexus.

doubg

Thanks! I've used this strategy before in purchasing a car and it's worked great. The only thing right now is that there is very limited inventory on 2017 ESs at nearby dealerships. I have about 3-4 dealerships in the area; I think one has 0, others might have max 4-5 units, so it's not as easy to have them compete with each other in price. I'm fairly flexible with features and options. Since price comparison may not be doable due to limited inventory and different packages/options with each vehicle, I was thinking of using % off MSRP as a way to compare one dealership versus another. I might check the inventory of each dealership, find 1-2 units that are doable at each dealership, ask for quote and see which one marks off the most % off MSRP, then start negotiating with each of them back and forth.

lesz

You are right in saying that, when dealer inventories get down to very low levels, the dealers have no reason to cut their prices deeply when they know that buyers will come along to buy their few remaining 2017 cars at a higher price.

That said, you might want to consider a 2018. I bought my 2017 UL ES just over a year ago. While I found discounting of remaining 2016 cars at prices about 20% off from MSRP, I found that, to buy a 2017 (with a $1000 rebate), the cost would only be less than $3000 higher than the cost of buying a similarly-equipped 2016. I also figured that, during the 3-5 years that I was likely to keep the car, the re-sale or trade-in value of the 2017 was going to be $3000-4000 higher than that of the 2016. Thus, the net cost over the period of ownership was going to be close to identical between buying a 2016 and buying a 2017. So, I figured that, with the 2017, I'd be driving a "current model" for an entire year. Plus, the 2017 had the advantage of the improved Generation 9 navigation system. With low sedan sales levels, including those for the ES, I'm confident in guessing that, even though we are early in the 2018 model year, dealers are already offering deep discounts on the 2018s, and they have the unadvertised incentives from Lexus during the "December to Remember" period to help them to offer those discounts.

Also, I would suggest that you expand your search beyond the 3-4 dealerships in your area. As I said in my earlier post, even if you don't want travel any significant distance to buy, bringing more dealerships into play is what can motivate the nearby dealers to be more competitive.

PediGrief

Terrible advice.

Mike728

Says the car salesman that doesn't like competition.

lesz

Yes, his previous posts indicate that he is, in fact, a car salesman at a Lexus dealership. It is hilarious that a car salesman is commenting on what is or is not a good purchase strategy. For some reason, I suspect that he might have a vested interest in not wanting people to use purchasing strategies that will allow them to get the best prices available.

DanZ

All the more reason to follow the advice lesz outlined. In buying cars, where all dealers have identical product, the approach to seek multiple offers works great.

gmanusmc

Ha Ha - you are hilarious sir!

gmanusmc

+1

lesz - the system you describe has worked well for us for many years - on our 5th Lexus last year, it netted more than a 20% discount off msrp.

Must suck to be a bitter salesman and have to resort to such a pathetic post.

lesz

I've used that method for my last couple of car purchases, and I won't ever buy a car another way. When you go into a dealership and talk price there, the dealership has you right it wants you, and the dealership knows that you are buying in a manner that does not allow you to maximize competition. On the other hand, if you are simultaneously dealing with multiple dealerships via their internet sales people, those dealerships know that they have competition and that, to be able to have a chance to get your business, they need to be aggressive in their discounting.

PediGrief

Lol. All this time you guys spend going back and forth emailing the 10 nearest dealerships is literally a waste of time. I promise you it's not that complicated. If the dealership closest to you has the car you want, do some factual research (an anonymous person on a message board who says they got 20% off MSRP (I'd really like to see a purchase order with that discount) and make an offer.

Mike728

It's understandable that you don't like the email approach. It takes potential money out of your pocket. Luckily for you, only a minority of people will do this.

Lesz, is not implying that someone go to a dealer and offer anything, let alone a 20% discount. The whole point of the emails is to not have to make an offer at all, as you already have a quote in hand. Some people have better things to do than sit at a car dealer and waste time.

gmanusmc

I’m not sure how long you’ve been in the business, but based on the tenor of your posts, you are coming off as someone who has been brainwashed by your management on what to say to convince customers how much more knowledgeable you are than they are. When you’ve been around this forum for some time more than a month, and get to know the folks who post on a somewhat regular basis, I think you’ll realize we have a decent amount of knowledge of many aspects of these vehicles, and that includes shopping techniques which result in great deals. The internet/email approach has been around for some time now and seems to work well for both customers and sellers as evidenced by how many dealers that now have Internet Sales Departments to take advantage of this customer base. And believe me - it really doesn’t take a heck of a lot of effort to do vehicle shopping this way - It’s the only way to go in my opinion.

As the one who cited a 20% discount, I might be the anonymous person on a message board you so condescendingly referred to. I can assure you the $9500 discount (including $3500 incentive) we received on our 2016 with an msrp of $47,015 works out to 20%. I take pride in not being dishonest and I really don’t care whether you believe me or not - I don’t need to make you happy but I was very happy with this deal and the treatment we received when we took delivery (which took about an hour because the deal was finalized and agreed to in advance).