I was told that Toyota dealers don't negotiate the price any more. So what I heard is just a rumor, is it?
Seems to me its a rumor. I felt discourage when I was interested in buying the Yaris. I read Edunds' website from top to bottom and learned a couple of tips on how to buy a new car. I sent out a few emails stating in my exact words,
"Hi, what's the purchase price on a
2006 YarisHatchback 5 Door RS (Auto Trans., Package
B)?"
I received two responses,
"ON THE ROAD PRICE:
$23,130.00 PLUS LIC. FEE" and
"YOUR PRICE WITCH INC FRT,PDE,A/C TAX,REG FEE AND ALL APPLICABLE TAXES.
PLUS LIC FEE IS
23,000.00"
On the Toyota website, the MSRP after taxes is $23,963.75 and this includes admin fees. I hear some people pay as much as $400 for admin fees.
On the road price of $23,000. How amazing is this? I was going to save $963.75 right off the bat. This was too good to be true. I felt skepticle about this offers. I compared it to the Dealer Invoice Cost I received off the internet.
MSRP VS. Dealer Invoice Cost
| | M.S.R.P | | Dealer Invoice Cost |
2006 Toyota 5-dr RS Hatchback Base Price | | $17,615.00 | | $16,500.00 |
B-package: air conditioning, power windows, keyless entry | | $1,200.00 | | $1,008.00 |
Transmission: 4 speed automatic | | $1,000.00 | | $933.00 |
Freight+PDI | | $1,060.00 | | $1,060.00 |
Air Tax | | $100.00 | | $100.00 |
Administration Fee | | Included | | |
Sub Total | | $20,925.00 | | $19,601.00 |
| |
15% Tax | | $3,138.75 | | $2,940.15 |
Tax for fuel conservation rebate | | -$100.00 | | -$100.00 |
Total | | $23,963.75 | | $22,441.15 |
M.S.R.P has a ~7% markup over the Dealer Invoice Cost
I made a comparison with the offer I received of $23,000 from my email response. To help fill in the table, I made an assumption of a 2% markup over the Dealer Invoice Cost and assumed admin fee was $$117.14.
Email Offer VS. Dealer Invoice Cost
| | Email Offer | | Dealer Invoice Cost |
2006 Toyota 5-dr RS Hatchback Base Price | | $16,830.00 | | $16,500.00 |
B-package: air conditioning, power windows, keyless entry | | $1,028.16 | | $1,008.00 |
Transmission: 4 speed automatic | | $951.66 | | $933.00 |
Freight+PDI | | $1,060.00 | | $1,060.00 |
Air Tax | | $100.00 | | $100.00 |
Administration Fee | | $117.14 | | |
Sub Total | | $20,086.96 | | $19,601.00 |
| |
15% Tax | | $3,013.04 | | $2,940.15 |
Tax for fuel conservation rebate | | -$100.00 | | -$100.00 |
Total | | $23,000.00 | | $22,441.15 |
Now, I needed to test my numbers with a real dealership. I went to Dave Nicholls Toyota and sat down to negotiate. I ask for there best offer and the best they gave me was MSRP. I told them another dealership offered me $23,000 and I want a better deal. Off course, they laughed. I gave them my home number and left. During the negotiations, they gave me the sales act exactly as described on Edmunds' website. As I got home, there was a message on my answering machine to call them back. Now I felt the ball was in my court. I called them and ask for $1,500 off the final price. The salesperson wanted to give me the $23,000 offer and additional discount and extras (all season floor matts and cargo net) thrown in but wouldn't commit for the $1,500. I knew if I went back, they would assume I couldn't get a better deal anywhere else and I would have to settle for a $23,000 final price and some extras. I told the salesman I would come in later in the day but I had no time because of some obligations. The salesman wanted my credit card number to put a deposite for good faith. I declined and promised the salesman I would be back to make a deal.
I knew my best offer is $23,000, plus extras. This disproves the rumor, that Toyota dealers don't negotiate their prices.
I called Maple Toyota and settled with a final price of $22,575.49 and plus an additional $500 Graduate Program Rebate. This rebate doesn't cost the dealership anything because it comes direction from Toyota. I will receive the rebate as a check in the mail. My receipt looks like this,
Total Sale Price | | $18,893.17 |
Freight | | $410.00 |
Federal Air Conditioner Tax | | $100.00 |
Tax For Fuel Consumption | | |
Administration Fee | | |
Protector Plus Registration Program | | $249.00 |
Total Vehicle Price | | $19,652.17 |
| |
Tax GST + PST | | $2,947.82 |
| |
Fuel Tax Conservation Rebate | | $100.00 |
| |
License Fee (New plates) | | $75.50 |
Total Purchase Price | | $22,575.49 |
I'm still surprised how good of a deal I got. I believe the Dealer Invoice Cost just represents the cost of one car purchased directly from the manufacturer. If the dealership orders many cars then they should receive the cars at a discount price. In the end, Maple Toyota is making some money off the car or from the service they provide to order the car.
