Author Topic: How much discount I should try for 2005 Honda Accord?  (Read 2104 times)

Offline patty

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How much discount I should try for 2005 Honda Accord?
« on: May 19, 2005, 09:54:02 am »
Hi everyone, I plan to buy a 2005 Honda Accord DX. Is it possible for me to buy it at the dealer's invoice price at GTA? I told the sales person that's my target price. But he said it's impossible.I'm not sure whether he told me the truth. If he's right, how much percentage of mark-up should I offer based on the invoice price? Thanks a lot for your advice.

Offline hondasalesguy

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How much discount I should try for 2005 Honda Accord?
« Reply #1 on: May 19, 2005, 10:01:40 am »
what is in it for the dealer to sell you at invoice? Even APA suggests that a $500 - $700 profit is fair for both parties. You must have made that salesmans day when you told him your "target price". Hard for a dealer to pay a commission when there is no gross profit to divvy up...

Right now you have the best interest rates of the year, a $1350 credit off your bottom line (or a gas card, your choice) so if you get the car for $500 over dealer net is that not still a damn good deal?

Offline patty

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How much discount I should try for 2005 Honda Accord?
« Reply #2 on: May 19, 2005, 10:14:08 am »
Thank you, Hondasalesguy. You've already been helpful. What I'm thinking is the dealer's cost is actually lower than the invoice price. They have the holdback, or maybe the floorplan assitance or factory to dealer incentive. So even I pay at the invoice price, they still have enough profit margin.

Offline hondasalesguy

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How much discount I should try for 2005 Honda Accord?
« Reply #3 on: May 19, 2005, 10:44:03 am »
Warning: This may sound like a rant...

Holdback is actually there to offset all the interest he pays for the 100 or so cars he stocks at any given time. Factory to dealer incentive is plain to see, it is the $1350 Gas Card credit. Anything else that was available, would be public knowledge thanks to APA, Car Cost Canada, and that Mohammed guy on CP24 late at night.  

I can never figure why people expect dealers to sell cars and make no money. Is profit a dirty word? Do yo work for free Patty? If you are in retail, do your customers expect to know your dead nuts cost and pay the same cost as you do when buying from you? How would you stay in business? If I buy a big ticket item from someone I am comfortable with, I have no problem with them making a reasonable margin, that way I can expect them to be in business the next time I am shopping again..If you buy from a car salesman and grind him down so that there is next to no money left in the deal, and then a year later you refer a friend to him and he is no longer there, the reason is likely that he couldn't make a decent living thanks to customers like you. If I do a good job and sell 15 cars in a month, do you think making $100 a car is reasonable compensation? A skinny deal here and there is not a big deal, but too many close to cost deals make my business the way it is, tons of turnover, poor customer service and lack of professionalism.People want professional service but don't want to pay for it... Is $200 going to make a difference in the big picture when you are spending $30,000???

Offline ovr50

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How much discount I should try for 2005 Honda Accord?
« Reply #4 on: May 19, 2005, 10:50:00 am »
I agree w HSG and I'm not in the business in any way. I don't know why ppl expect auto dealers to sell their product for real, bare bones cost. No other business or professional is expected to do that. It goes along with the "WalMarting" of NA I guess.
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Offline hondasalesguy

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How much discount I should try for 2005 Honda Accord?
« Reply #5 on: May 19, 2005, 10:53:55 am »
wow a letter of support. I may frame that one. Thanks ovr50.

Offline wing

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How much discount I should try for 2005 Honda Accord?
« Reply #6 on: May 19, 2005, 11:50:22 am »
I think a lot of the problem is the cost of new vehicles, they are getting SOOOO expensive that people are fighting to get the lowest price they can.  Now if the manufacturers would drop the price by $5k on an accord, I bet you would see this less often.

Especially in Canada, with huge taxes and fees on every purchase.  When I can go to the US and buy the exact same car for $10,000 less there is a pricing problem!


Offline weebl

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How much discount I should try for 2005 Honda Accord?
« Reply #7 on: May 19, 2005, 11:51:02 am »
It does have to be balanced - the customer wants a good price, the dealership deserves a fair profit.  If the profit margin is too high, customers feel like they are being ripped off and go elsewhere.  Profit margin too low or non-existant, and the dealer has no incentive to be in business.  A happy medium can be found by the informed customer who is reasonable with his/her expectations on price with a dealership willing to be fair, and both sides are happy.
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Offline patty

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How much discount I should try for 2005 Honda Accord?
« Reply #8 on: May 19, 2005, 11:55:15 am »
Thanks guys. Actually I do want to offer a reasonalbe price to ensure the dealer get the profit they deserve. I expect the invoice price because I knew from the auto website most Americans paid less than invoice price for their Honda cars. Acoording to what you suggest,I guess the market situation may be different here in canada.

Offline hondasalesguy

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How much discount I should try for 2005 Honda Accord?
« Reply #9 on: May 19, 2005, 11:57:25 am »
but 5 years ago the opposite was true, in fact people were buying here and grey marekt exporting them to the U.S. The gap is nowhere near $10K, I read a report on this recently, it varies car to car and manufacturer, it was worse on high end sports cars, on everyday cars it was maybe 5 to 10% higher than a converted U.S. price... Do you think an Accord should start at $19K? Good luck with that when you pay $19K for a Hyundai Elantra.

If you figure all the safety features that are on cars these days, the performance and fuel economy, and the manufacturers incentives, the cost adjusted price is better now than it has ever been. All cars have so many standard features as well because nobody wants a car without cruise, A/C, power everything, ABS, CD player, etc. Putting these on at the factory is more cost effective, but it puts the start price higher, so now you just don't have to add stuff piece by piece which is insanely expensive.

Offline ovr50

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How much discount I should try for 2005 Honda Accord?
« Reply #10 on: May 19, 2005, 12:42:29 pm »
I don't think it has much to do with the prices in Canada vs US because: 1. above point by HSG, and 2. the US buyers are just as paranoid if not more so about getting the bare bones cost price.  

I think part of the mentality is: 1. due to the ease of information on the internet (not all of which is true; some posts are totally bogus with the poster trying to prove how smart he/she was in getting "x" price) and, 2. the long term reputation of auto dealers in general who have earned (somewhat deservedly) the rep of being cheats, hardnosed negotiators and commission-driven (do anything for a sale).

Offline wing

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How much discount I should try for 2005 Honda Accord?
« Reply #11 on: May 19, 2005, 01:05:26 pm »
$12,000 difference on the S2000.

Although I agree it would be silly to price an accord at $19k if an elantra is, but then I'm saying price the elantra at $15k.  Cars are bloated, sure you get more performance but do you NEED it?

The average family sedan costs WAY too much these days, IMO.

Offline ovr50

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« Reply #12 on: May 19, 2005, 01:31:44 pm »
So do houses, groceries and gasoline. Still no reason to try to buy cars at cost and buy retail for houses, grocs and gas. Right?

Offline Shnak

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How much discount I should try for 2005 Honda Accord?
« Reply #13 on: May 19, 2005, 01:35:31 pm »
Hmm I don't know about you, but most people bargain when they buy a house. Which is why people always advertise their house a fair bit higher than their target selling price to allow them to "bargain" with the buyers. Same thing with cars... they price them a tad higher than their wanted selling price.

I don't feel sorry for salesman... if he's not happy with the bargained price, he just has to say "no" to the customer and move on to the next customer.

Offline safristi

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How much discount I should try for 2005 Honda Accord?
« Reply #14 on: May 19, 2005, 01:36:56 pm »
NO Mickeys are selling 2 Sundaes fer $2:22...BUT if ya dicker wif Ronald he'll SUPER_SEIZE ya!!!!
THERE IS NO CURE FOR "LOTUS"......ONLY TREATMENT.....

Offline wing

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« Reply #15 on: May 19, 2005, 02:31:30 pm »
I bargoon on everything :-)

Offline Snowman

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How much discount I should try for 2005 Honda Accord?
« Reply #16 on: May 19, 2005, 02:40:54 pm »
Exactly…….No pain in asking.

Offline ovr50

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How much discount I should try for 2005 Honda Accord?
« Reply #17 on: May 19, 2005, 03:54:29 pm »
Shnak - of course, we all negotiate on a house deal, even on new ones although there is less room to do so. BUT, we don't feel like we have to get it for builder's bare bones cost and we don't ask to see his costs proven to us. There is a large difference in the attitude of the buyer when buying a car vs buying a house. Besides, you pay "market value" for a house, regardless of cost. The big diff is that houses usually appreciate in value, cars always depreciate in value.

Offline inco

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« Reply #18 on: May 19, 2005, 04:34:06 pm »
In Toronto you don't negotiate down on house prices - you negotiate up! Yup it's crazy here in many areas where desirable homes are going for more than list and you have bidding wars.

Offline safristi

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« Reply #19 on: May 19, 2005, 04:43:11 pm »
Serious BID'ness...the "GREATER FOOL THEORY" in full action!!!!