Buying a Prius

[Frugality_of_Apathy]

Was Saturn's no-haggle policy a success in any measurable way?

-ERD50

I think the fact that they are the only domestic car company to start up and become successful (at least until GM decided bought them out and and then in 2000 decided saturn wasn't running things the GM way(profitably?) and they had better engineering employees and manufacturing plants so they might as well just slap a saturn badge on some GM cars) it worked pretty well.

 

[samclem]

It's easier to show the customer the invoice and agree on a price from there.

I guess that might work if the invoice was the dealer's true cost.

 

[Bestwifeever]

Wouldn't it be nice and easy if everyone knew exactly what they wanted, paid list price as soon as they walked in.

I don't always know what I want before I go into a showroom to buy it (I thought that was what showrooms were for, so show us what the merchandise looks like to help us decide what we want?), but for everything other than cars and homes people expect to pay the price that is on the item--furniture, computers, carpeting, appliances, furnaces, whatever, all infrequent purchases just as cars are.

I'm sure some people haggle over some of the above item but it is not the standard way of doing business like buying a car always is.

I look at the current "red tag" ads for Chevies, where a Malibu for example is tagged at $2,000 below the MRSP and think, what does that red tag price even mean? Are the dealers still planning to come down a little to get the sale? I don't know. And now you tell us the salespeople themselves don't even know what a car's price is.

Like others I would love to go into a car dealer, look at the cars, point at the one I want (and one reason I like Hondas--I know other mfrs. are the same--is that you don't have a lot of options to consider and price out), look at the price on the car, hand over the check, and pick the car up when it is ready. That's the way we buy everything else.

I have a lot of sympathy for anyone working in the auto industry, 73ss--and the method of car buying (prices not set in stone, process takes a long time, a lot of layers of staff get involved) probably isn't going to change, unfortunately. It's too bad when the process, which you're telling us is justified, becomes an obstacle and causes a customer who was ready to buy to just walk out the door, like Andy did.

 

[ERD50]

73ss454, thanks for the reply.

It appears to me though, that this confirms that time is wasted on both sides. It's not very efficient to negotiate a deal, when you don't know what authority you really have as a negotiator. Having 'some idea' what the price limit is, and throwing in the moving target of all those factors you listed on top of a vague estimate to begin with - it just does not make good business sense.


AS far as paying list price when you walk in - it happens all the time on very many high ticket items. The car industry created this problem, you can't whine that the customer now expects it, when that is what they were trained to expect.

I've done the 'fleet sale' thing before (IIRC, my Credit Union sponsored it). I knew full well I could probably negotiate a better deal, but I really liked walk in, get a price based on a list of pre-determined costs, write a check, drive away. I'm certain I'm not alone.

So, who would a dealer lose to a no-haggle policy? The guy who wants to undercut everything and will go to the chain for his oil changes and service? Doesn't sound like any big loss.

I'm getting the impression that those in the auto business can't see the forest for the trees.

-ERD50

 

[73ss454]

If the salesperson is going to make the $50 or $75 when they sell the car they wouldn't really care what the car sold for. So the price is determined by a manager who has to make sure the salesperson doesn't give the car away.

Every dealer in the world would love a no haggle policy. In NY where I worked it was called price fixing if all the dealers got together and agreed on a firm price.

ERD50, you say the car industry caused the problem of haggling. I disagree, the customers are the one's who demanded lower prices not the dealers. The dealers just had to do what they had to do to sell the car.

Every dealer is trying to get the edge over the the other dealers in that area. One opens up on Sunday they all open up on Sunday and so on. But as I said it's against the law to price fix so this process will not stop until the law is changes.

It would be a wonderful business if things were sold at list price and the dealers couldn't negotiate the price.

 

[73ss454]

Bestwifeever, if you are retired why don't you have a little fun. Go down to your local dealer and apply for a salesjob. It's easy to get the only requirement is that you can fog a mirror.

Stay there for one week and let's have this talk again.

 

[samclem]

Every dealer in the world would love a no haggle policy. In NY where I worked it was called price fixing if all the dealers got together and agreed on a firm price.

That's just dumb. "Fixed pricing" is not "price fixing." Yes, if all the dealers collude to set a price, that is illegal. If one dealer tells its mangers that prices are not negotiable, then that's "fixed pricing." Same as we do on home appliances and 90% of the rest of the stuff we buy.

 

[73ss454]

That's just dumb. "Fixed pricing" is not "price fixing." Yes, if all the dealers collude to set a price, that is illegal. If one dealer tells its mangers that prices are not negotiable, then that's "fixed pricing." Same as we do on home appliances and 90% of the rest of the stuff we buy.

If one dealer in an area of other dealers set a fixed price he/she would be out of business in just a few months.

 

[Frugality_of_Apathy]

If one dealer in an area of other dealers set a fixed price he/she would be out of business in just a few months.

Only if the other dealers are willing to always haggle below that price.

 

[73ss454]

Only if the other dealers are willing to always haggle below that price.

With all due respect, are you kidding me.

 

[cantlogin]

If one dealer in an area of other dealers set a fixed price he/she would be out of business in just a few months.

That might be true because the dealer can make up for low margin sales that increase volume by making more profit on sales to less capable buyers. It’s also true that business transactions are often not “fair”.

 

[ERD50]

If the salesperson is going to make the $50 or $75 when they sell the car they wouldn't really care what the car sold for. So the price is determined by a manager who has to make sure the salesperson doesn't give the car away.

And this is done by the manager *not* telling the salesperson what that price is? I don't see how you can say this is efficient. It's ridiculous.

Every dealer in the world would love a no haggle policy. In NY where I worked it was called price fixing if all the dealers got together and agreed on a firm price.

As samclem pointed out - big difference. The fact that you don't see that is making me stand by my 'forest/trees' comment.

Every dealer is trying to get the edge over the the other dealers in that area. One opens up on Sunday they all open up on Sunday and so on.

In every other industry, that is called 'competition' and a 'free market'. It seems to work.

ERD50, you say the car industry caused the problem of haggling. I disagree, the customers are the one's who demanded lower prices not the dealers. The dealers just had to do what they had to do to sell the car.

It would be a wonderful business if things were sold at list price and the dealers couldn't negotiate the price.

So customers who buy furnaces, computers, etc, don't want the lowest price? Yet, most of these are sold at the pre-set 'tag price'. That is not 'price fixing' - Best Buy can set one tag price, and Circuit City another. But most people don't go into a big-box store and ask to see the dealer invoice on a flat screen TV and then offer them X% above that. The pay the tag price.

You just are not making sense. The difference is not the customer - same customers. The difference is the industry. How can you blame the customer, when they are the same customer?

-ERD50

 

[ERD50]

Only if the other dealers are willing to always haggle below that price.

With all due respect, are you kidding me.

Sounds like you are saying that "everybody is above average".

And that Saturn must have never sold a single car - how could they?

-ERD50

 

[Frugality_of_Apathy]

I haven't seen the carpet companies, pool/spa companies, electronics companies, appliance stores, and art galleries all going out of business even though they sell items just as expensive for a fixed price.

 

[73ss454]

ERD50, amazing that you don't understand the other side of this but it is what it is.

I think you could also use a week at the dealer.

 

[73ss454]

I haven't seen the carpet companies, pool/spa companies, electronics companies, appliance stores, and art galleries all going out of business even though they sell items just as expensive for a fixed price.

Man, you don't get it. Let me try again to explain.

If one dealer sets a firm price the others in the area will eat his lunch. Unless all the dealers agree to a one price program the dealer who set's a firm price is done.

Now, if all the dealers agree to one price that is against the law. It's called price fixing.

 

[Frugality_of_Apathy]

Man, you don't get it. Let me try again to explain.

If one dealer sets a firm price the others in the area will eat his lunch. Unless all the dealers agree to a one price program the dealer who set's a firm price is done.

Now, if all the dealers agree to one price that is against the law. It's called price fixing.

Can you come up with any valid reason this doesn't happen in all other industries?

I buy a couple million dollars worth of chemicals for my company every year and there is feirce competition, but they all charge a fixed price.

 

[73ss454]

Sorry,FOA, not a clue. I can only tell you about the car biz as that's all I did all my life.

 

[Zathras]

Perhaps this is the issue with the car companies.
They literally don't comprehend any other way of doing business?
There is some sort of disconnect, that won't allow them to learn from successful strategies used in other industries, or even car makers. In Saturn's case, they couldn't understand it, so they bought it?

 

[Rustic23]

I purchased a Honda Pilot about two years ago Went on line to Edmunds.com and figured out what people were paying for them, cost, dealers cost, discounts, rebates. Sent an email to a nearby Honda place and Toyota (for Highlander) with what I wanted and what I was willing to pay.

Now here is the sweet part. The Honda dealer called quoted $150 less than I had! I was looking for a hitch when I went to the dealer. No hitch. Told him Cash, No ext. waranties, Gone from dealer in about 30 min with new car. Car cost $150 less than what Edmunds said to offer.

 

[haha]

I haven't seen the carpet companies, pool/spa companies, electronics companies, appliance stores, and art galleries all going out of business even though they sell items just as expensive for a fixed price.

Not as fixed as you might think.

 

[ziggy29]

Not as fixed as you might think.

Especially not in a terrible economy when many businesses are desperate to make sales.

 

[FinanceDude]

Bestwifeever, if you are retired why don't you have a little fun. Go down to your local dealer and apply for a salesjob. It's easy to get the only requirement is that you can fog a mirror.

Stay there for one week and let's have this talk again.

Oh-Oh.........

 

[FinanceDude]

I purchased a Honda Pilot about two years ago Went on line to Edmunds.com and figured out what people were paying for them, cost, dealers cost, discounts, rebates. Sent an email to a nearby Honda place and Toyota (for Highlander) with what I wanted and what I was willing to pay.

Now here is the sweet part. The Honda dealer called quoted $150 less than I had! I was looking for a hitch when I went to the dealer. No hitch. Told him Cash, No ext. waranties, Gone from dealer in about 30 min with new car. Car cost $150 less than what Edmunds said to offer.

No offense, but Edmunds.com is NOT the gold standard for what cars are worth, nor is KBB or anyone else. Current auction reports or a current black book are better. Ever heard of "regional pricing"? Happens all the time. Right now, 4wds are gold around here, because we just got another 5 inches of snow. RWD pickups probably fell off the map today.......

 

[FinanceDude]

Not as fixed as you might think.

I am truly shocked on this frugal site that folks think you can't negotiate like mad at ANY retail store. Heck, I was dickering last week at Best Buy, and got close to a deal on an appliance. Right now they are duking it out with Sears. God Bless them, in the end I win, as the almighty consumer............