Should vehicles just have a set price?

[jIM_Ohio]

Originally Posted by GREENBACK

Maybe the haggling/negotiating game will one day be a part of the finance classes that are taught in school(I know, I'm dreaming for the moment). Would be helpful.

Most of it is personal comfort.

My wife was cringing when I used the car negotiating techniques I mentioned in another thread.

If you don't feel uncomfortable, you are not negotiating hard enough. That is the advice which made me a better negotiator.

[disneysteve]

Originally Posted by tripods68

The problem of the fixed pricing concept and why it wouldn't work, it doesn't allow dealers to expand profit margins based on market conditions

For instance, if they are making profit on certain models they probably won't discount those models (remember Prius last summer).

Just because there is a fixed price, doesn't mean they couldn't put certain models on sale, have rebates, put coupons in the Sunday paper, etc.

If a certain model is hot, don't discount it. Set the price higher. If other models aren't moving, put them on sale.

[tripods68]

Originally Posted by disneysteve

Just because there is a fixed price, doesn't mean they couldn't put certain models on sale, have rebates, put coupons in the Sunday paper, etc.

If a certain model is hot, don't discount it. Set the price higher. If other models aren't moving, put them on sale.

I already addressed those questions in my comments in some way which by the way I agree with you:

"The longer the cars seats on the lot, the more it cuts in dealearship profits. They either have to discount heavily or sell it at a invoice price which by the way is a loss."

if they are making profit on certain models they probably won't discount those models (remember Prius last summer)."

[jIM_Ohio]

Originally Posted by disneysteve

Just because there is a fixed price, doesn't mean they couldn't put certain models on sale, have rebates, put coupons in the Sunday paper, etc.

If a certain model is hot, don't discount it. Set the price higher. If other models aren't moving, put them on sale.

The problem with rebates is it then discounts the value of every car already sold. Granted it was a honda salesman which explained this to me... but there is a reason honda rarely if ever gives a rebate.

GM sells the 2007 cavalier and I am guessing it "sells new" for 13k in 2007. If the value of the car 2 years later is 7k, it lost 6k from depreciation.

GM sells the 2009 cavalier for 14k right now (guessing). It offers a rebate of 2k to bring its value down to 12k. The value of all the used cavaliers went down a fraction of the 2k rebate as well (why buy used for 7k when a new one is 5k more and will only depreciate 6k in 2 years).

[GREENBACK]

Originally Posted by disneysteve

Just because there is a fixed price, doesn't mean they couldn't put certain models on sale, have rebates, put coupons in the Sunday paper, etc.

I think they currently do some of this anyway so why not use this to their advantage. Their whole culture is commision driven and I'm not saying that's wrong. I'm simply looking at it from a different angle and a lot of them probably have as well and decided it's not the most profitable way to operate the buisness.

I think you could fix the price where the salesman gets his share and everyone else gets their profit and they attract a lot of customers because they don't play the same old tired game.

I personally will haggle for a good price with the best of them if that's what it takes but as stated in my original thread, it's not a very attractive system to those lacking the skills to negotiate. I feel that they could attract a pool of customers that are seeking (new buzzword)......transparency. They already know the price point where the deal ends anyway so why play games.

[tripods68]

This reminds in 2007 when were about buy Nissan Xterra 07. The rebates was only $1250 rebate but they were willing to sell it to me $500 over invoice. Then last November the rebates went up to $3500 at selling at Invoice. But then again, we already changed our mind to stick on what we have.


Jim,
Honda do offers rebates on certain bigger items like the pilots, or Odyssey. They don't quickly move out from inventory especially in today's market. Civic and the Accord remain their top selling cars. Therefore, you will hardly find rebates in those models. But the notion that rebates reduced the value of a car isn't right to me nor would believe what a car salesman tells me. Honda and Toyota has always been on top when it comes to resale value market because of their reliability, quality, and consumer satisfaction over the years. It has nothing to do about rebates. Their reputation in the resale market what keeps up their value consistently more than most domestic and european made cars. But i do agree domestic cars like a cavalier losses about 50% of its value the moment you drive it away from the lot.

[cschin4]

Automakers have tried that in the past as a marketing tool but it didn't seem to catch on. Everybody likes to think they are getting a "deal". It panders to our ego. The truth is if you drove it off the lot, they made money. Which isn't a bad thing. But, nobody is getting a car for nothing like I sometimes hear people bragging.
I think that smaller priced items such as lettuce, etc, adding in the time factor of haggling over all those things would eat away any profit unlike haggling on larger items. But, there are many items you can haggle over from furniture, jewelry, real estate. And, you can go to yard sales, flea markets, ebay, or private sales and haggle away. It may uncomfortable but that is just part of life. My dad hated to haggle so he just shopped around and bought what he wanted without the haggling. And, he probably paid too much for some things but said he just didn't want to be bothered and he didn't care. So, you have to decide what it is worth to you. As for being "fair", I don't know what that means. If you haggle a price that you both agree upon that is just as "fair" as paying a set price.

[snafu]

Often several dealerships are owned by the same group of investors. This is particularly noticable if they share the same driveways. I've learned that most things sold by commission sales staff is open to a polite request for a discount or special service.

With the current economy business wants to sell and we wonder whether or not to buy. Perhaps it's a good idea to sharpen our neogitating or bargaining skills. Bargaining is common in many other countries. Maybe their system better meets consumers needs.