patnic517

I don't know the history of Lexus pricing, but read a lot here.

I went into the dealer today and told him that I'd be willing to wait until December unless the price is right. And I got "corrected" and he told me the summer sales event is better. Is that even remotely true?

DavidZ

The truth is, they will say anything to get you to buy a car right now.

Anyone with a brain can tell you that the deals on 2019s will be better after the 2020s are out. However, the selection of 2019s are much better now.

patnic517

Sorry if this is a dumb question, but you wrote "15-16% with purchase cash only." So does that mean 15-16% off the MSRP or 15-16% off the MSRP plus the Lexus rebate for paying with cash. My first quote was 9% off MSRP, but with Lexus cash rebate it is 13%.

patnic517

That's why I thought, I just wasn't confident enough to correct him or laugh at him.

Although, you are right, in my area the Lexus I want is thinning out. I really don't want Navigation and most out them out there seem to have it.

patnic517

DavidZ - you seem to have a lot of knowledge - so can I pick you brain? I agree with your early August statement that I quoted above. My current price for a base is 10% off MSRP less discounts. I've talked to two dealers so far - one dealer - I made 2 visits and they gave me 9% and the other dealer I started with their internet department and shared the 9%, so that quoted 10%. Both before any rebate. I've going to call another dealer on the other side of the state as well.

So I have the motivation, but do you have any "skills" or tips you can give me? Do I basically let these people bid it out? Best to go in or all by phone? What works for you?

DavidZ

The rebate is worth about 4.5% to 5%, so you're already in a very competitive 14.5% to 15% off range. Each 1% is about $500. It depends on how important a few hundred dollars is to you. I would look at non monetary factors at this point -- color, options, reputation and convenience of the dealership, etc.

You've done pretty well all by yourself so far.

Once i got the competitive bidding started, I did it all by email. Once I decided on a dealer, I called them to make arrangements to come in to buy/pick up the car.

Also, before you decide on the dealer, ask them (by email) for a preliminary bill of sale for the car. That's to give you some degree of confidence they won't hit you with surprise "dealer fees, etc." when you get there. If they do that (and that's always a possibility with car dealers), then you whip the drat bill of sale and say "no dice, we had a deal" and stand your ground. Keep your options open to go back to the other competitive dealer who perhaps won't pull that stuff on you.

lesz

Below, I am pasting a post about a car buying method that I've posted here before. The key to finding out where the current market is and what the best prices available are is to get as many dealers as possible competing for your business. I've used this method with my own recent car purchases and, also, to help others who were buying cars. The results have been excellent every time. This is a fairly long read, but, for those who are now shopping for a car, I think it is worth taking the time to read it.

"I would start by selecting all of the Lexus dealerships within, say, 200 miles of your location. Even if you would be reluctant to travel that far to buy the vehicle, starting with a larger number of dealerships allows you to begin with more negotiating leverage. Then, send identical emails to the internet sales departments of all of those dealers.

In the email, make several things clear. First, tell them, in as much detail as you can, what vehicle you are looking for, what packages you want, and what major options you are interested in. Then, let them know that you are sending the same email to all of those dealers, that you are prepared to buy immediately, and that you will buy from the dealer that makes the best offer.

You will likely get proposals from most, but possibly not all, of those dealerships. Take the best offer, and send that to the other dealers that responded to your initial email, and ask them if they are interested in trying to beat that offer. Then, take the best of those second round offers and repeat the process. After repeating the same process a couple of times, within a couple of days you should have a very good idea about where the floor of the market is.

When you get down to 2 or 3 dealers, that is when you need to start looking at the offer proposals that they sent you very carefully to make sure that doc fees are reasonable, that processing fees for the title and license are reasonable, and that there are no hidden fees, dealer add-ons or options, etc.

If you have a trade-in, you should even be able to get a firm offer for that trade-in. First, use the websites of Edmunds and KBB to determine a fair value for your trade-in. Then, send pictures of your car to the dealership. If that dealership is really interested in getting your business, they will make a fair and firm offer on the trade-in. It is important, though, that you do not bring the trade-in into the discussion until after you have locked in an offer on the new vehicle.

An important part of the process is to get a price locked in for the new vehicle (and trade-in) via email and phone discussions before you set foot in the dealership. Until you have set foot in the dealership, you are the one who is in control of the situation. Once you are at the dealership and have started to negotiate a price at the dealership, you have given up a good portion of that control to the dealership.

I've found that dealerships are quite competitive with regard to internet sales. I've bought my last 2 vehicles using the method described above. I've found that that method is less stressful, and it has yielded prices that I could not have gotten by physically visiting multiple dealerships and negotiating pricing at the dealerships. I've come to believe that, with more traditional methods of buying a car, it isn't likely that I would ever know how low the floor of the market is. I'll never buy another car any other way."

ddaapphh

I'm a Lexus salesrep.

The customers that get the best deals are typically repeat buyers, ones that are local, and will spend money in our service department.

Too many times we get internet leads, calls and emails, I go to the desk asking for pricing, and I do send you the pricing you requested, but it's not our BEST deal, especially if after we sell you the car we never see you again. Less chance of referrals and repeat business later on.

irishbrahm

This confirms my experience. When I've returned to the same dealership (Lexus, BMW, etc.) to buy a car, I always see a screen pop up that shows every vehicle, service, or parts purchase. Indeed, the screen shows every dollar that I've spent at the dealership!

DavidZ

That hasn't been my experience at all. In my experience, the only time a car dealer will take more than a few dollars off of their asking price is when they are made aware that they in a competitive bidding situation.

lesz

In the past here on the CL boards there have been a few times when, in pricing threads, sales personnel from dealerships have chimed in to say that car shopping via the internet, getting offers from as many dealerships as possible, etc. doesn't work. They have suggested that, instead, buyers only need to come into the dealer to get the best pricing.

Considering the source of those kinds of suggestions, I'm skeptical, and I'd guess that they have reasons other than getting customers the best deals possible for trying to steer customers away from using the internet to generate competition between dealers.

DavidZ

Yeah, they HATE IT when that happens.

ddaapphh

Everyone's idea of a deal is different. Say we offer $6k off, how will the managers know he or she wouldn't have closed at $5k off?

Don't get me wrong, there are instances with internet customers that they do get our best deal up front, but the best example I have of that is they forward me the quote from the dealer that is south of us and only a 5 min longer drive. So we beat their price.

A general rule of thumb I tell my friends and family when they are car shopping is that their out the door should be less than the MSRP. If after taxes and fees you are paying over sticker, there's greater probability of negative equity in the future.

coolsaber

I appreciate your honesty, since most dealer reps browse these forums anonymously. In regards to your personal experience of giving repeat customers better deals, I think thats quite noble, as very few dealer reps I have dealt with take that into consideration, since the service side profits never actually materialize into Dealership customer sales staff paychecks.

I unfortunately still believe that the best advice when purchasing or leasing is being as close to equal grounds in regards to the information surrounding a deal. Walking into a dealership without any knowledge of lease/finance rates, established pricing rates, and dealership only fees (some states have some ridiculous fees) is not the best thing to do. At the end of the day, a customers best interest is served best by the customer. While this may sound like a pretty terrible thing to say, I think it also in the best interests of sales rep as a) no time wasting time on educating a customer. b) customers dont have inflated expecations c) more time to spend on dealing with on the floor customers.

Those are dealer discounts + purchase cash that Lexus is giving if you do not use Lexus Financial Services

DavidZ

That illustrates the challenge well. Your job is to get the customer to pay the highest price possible and still make a sale. The inside lingo is -- you try to maximize "yield."

The customer wants to pay the lowest price possible. However, the customer is at a significant disadvantage when it comes to knowledge and complexity of the transaction.

I think that's way too simplistic because it doesn't take into account many factors including how hot the model car is and whether you're at the beginning or end of the model year. When a manufacturer is offering a rebate, that's a loud and clear signal that the model car is not moving as fast as they'd like. In that situation the deals are going to be much better. There were no rebates/incentives when I bought my 1997 and 2004 ESs. And accordingly, I got much more off of MSRP on my 2019 than I did on my previous 2 purchases. When I bought my 1987 Acura Legend Coupe, it was the hottest thing around and everyone was paying MSRP. With some hard negotiating, I got $500 off of MSRP.