Dealer Markup?

[Fats25]

Sorry - tried using search function but not working. I know there was a thread discussing this before, but I cannot find it.

What difference should I expect to be seeing from dealer to private sales?

I have finally decided on which car to buy (only taken a year) and have been seriously looking only in the past week. Very specific spec/options that I am looking for (is a 123D either 5 door or coupe), so there are lots of cars I am not interested in as not got the options I want.

I have found a few privately, but unfortunately all too far away for me to get to at the moment due to other things going on. A few dealers have them as well, however the markup seems to be about £2500 in dealers than privately. Dealer prices are pretty much uniform across different regions. The dealer prices I am comparing are in comparison to the private cars I have seen in same region (hope that makes sense).

e.g. I saw a car today that was private for £16995, saw same spec car (more miles) from BMW Approved within 25 miles of the advertised private car, and was up for £19500.

I called, got the details, some more photos and made an offer of £18000. I have no problem driving to pick a car up from dealer after leaving a deposit, but not happy doing this with private. I was expecting a bit of a haggle, and get the car I want for somewhere between £18250/£18500. The guy shot me down in flames, stating (more or less) I was wasting his time with such a low offer. I asked what was the realistic/best price he would considering letting it go for. He said £19500.

Obviously I know that a dealer has to make their money, and I expect the price to be higher through a dealer. Not a problem with that at all. However I expected the difference to be more like £1000 between them. Am I being completely unrealistic? Do I need to change my target price? Should I be expecting advertised price is what I am going to pay through a dealer?

[plg]

Fats25 said:

Sorry - tried using search function but not working. I know there was a thread discussing this before, but I cannot find it.

What difference should I expect to be seeing from dealer to private sales?

I have finally decided on which car to buy (only taken a year) and have been seriously looking only in the past week. Very specific spec/options that I am looking for (is a 123D either 5 door or coupe), so there are lots of cars I am not interested in as not got the options I want.

I have found a few privately, but unfortunately all too far away for me to get to at the moment due to other things going on. A few dealers have them as well, however the markup seems to be about £2500 in dealers than privately. Dealer prices are pretty much uniform across different regions. The dealer prices I am comparing are in comparison to the private cars I have seen in same region (hope that makes sense).

e.g. I saw a car today that was private for £16995, saw same spec car (more miles) from BMW Approved within 25 miles of the advertised private car, and was up for £19500.

I called, got the details, some more photos and made an offer of £18000. I have no problem driving to pick a car up from dealer after leaving a deposit, but not happy doing this with private. I was expecting a bit of a haggle, and get the car I want for somewhere between £18250/£18500. The guy shot me down in flames, stating (more or less) I was wasting his time with such a low offer. I asked what was the realistic/best price he would considering letting it go for. He said £19500.

Obviously I know that a dealer has to make their money, and I expect the price to be higher through a dealer. Not a problem with that at all. However I expected the difference to be more like £1000 between them. Am I being completely unrealistic? Do I need to change my target price? Should I be expecting advertised price is what I am going to pay through a dealer?

Find a different dealer.... there has to be *some* movement - even if if ends up being not much. Starting at 10% below sticker isn't a bad place to go from. He can only say no. It's just surprising there was no counter offer - say £19250 - or a conversation around finance...?

[goldblum]

I wouldn't expect too much movement from VAG,BMW or Merc.

Sometimes the markup for dealership cars is astonishing.Recently saw a nice lowish mileage

Audi and upon enquiring if they were prepared to budge a bit because in a few months it would need tyres etc

and having pointed out that private similar deals were over £3000 cheaper the salesman suggested I 'go and buy

one of those' then.If you're p/x ing to them they'll offer nothing for it on the grounds that there's a glut of them

at that time,even though when you bought it the very same dealership guaranteed the cars rarity in order to

justify the heinous sticker price!

...Currently looking at taking a trip to Audi Preston next week.Lol.

[hornetrider]

No movement, no sale. At least, that's how it is when I'm buying... mostly. Depends if its a good deal initially of course. I would never pay sticker price from a dealer, they always have mark up in the sticker price.

[homerjay]

I bought an 08 123d 14 months ago for 19250. Sticker was 19500

Sold it back to the dealer for 17000 12 months later.

They put it on forecourt for 18995, which is what he told me they would do.

I could have prob sold private for 18k but could be arsed with the hassle.

HTH

[SClarke]

You are comparing private cars you haven't seen that have no warranty, no back up, may not be entirely genuine, won't have been checked over before you buy them, may be stolen, cloned, etc with main dealer stock.

I have also told a few customers to go and buy their miracle cars too! There really isn't a lot of point in selling a car at a loss so why do you think that it is somehow your right just because some private person has possibly put their car up too cheap?

The salesperson has given you a price which you can either accept or decline. What is the problem here?

[/rant]

[Liquid Knight]

Depends on how many miles fall off the odometer between you dropping the car off and it appearing on the forecourt.

[Fats25]

plg said:

Starting at 10% below sticker isn't a bad place to go from. He can only say no. It's just surprising there was no counter offer - say £19250 - or a conversation around finance...?

That is what I thought. I actually offered 7% below advertised price.

However it is becoming a common theme. Hence this thread asking if I am being unreasonable expecting there to be negotiations on advertised price, or whether I am living in a different day and age!

[plg]

Fats25 said:

plg said:

Starting at 10% below sticker isn't a bad place to go from. He can only say no. It's just surprising there was no counter offer - say £19250 - or a conversation around finance...?

That is what I thought. I actually offered 7% below advertised price.

However it is becoming a common theme. Hence this thread asking if I am being unreasonable expecting there to be negotiations on advertised price, or whether I am living in a different day and age!

I don't think so. I was up at Audi yesterday for an MOT and looking at a replacement. Without volunteering an offer the salesman was giving a guide price of about 5% below sticker for a Sept sale. They lack 3-4 yr old cars to feed the lower-middle end of the forecourt, apparently.

[Wacky Racer]

I can't believe how many people think any dealer (especially main ones) should only be entitled to make around 1k on a 20k used car.

Thet have to prep it, give it a comprehensive warranty (by law), pay for sales staff, fancy showroom etc....You don't need or get any of that with a private sale....


However labour rates for servicing at over £100hr+ I do have an issue with....

[edo]

You'll get more movement face to face ideally. Rightly or wrongly many salesmen/women dont take people seriously on email/phone.

I'd say if you want to get your best bang for buck, you need to be prepared to travel to see some of the private cars. They have warranty, so your risk is minimal.

How about this one?

http://www.autotrader.co.uk/classified/advert/2010...

[plg]

Wacky Racer said:

I can't believe how many people think any dealer (especially main ones) should only be entitled to make around 1k on a 20k used car.

Thet have to prep it, give it a comprehensive warranty (by law), pay for sales staff, fancy showroom etc....You don't need or get any of that with a private sale....

However labour rates for servicing at over £100hr+ I do have an issue with....

I agree - I don't mind paying a premium (a significant one) for buying from a dealer.

I do object to a dealer not giving anything on a price - it's a psychological benefit to the buyer that gives them some "buyers satisfaction" - of whatever the technical phrase is - doesn't have to be much - but the "happiness" factor of a buyer who has had something back from the seller vs one that hasn't is significant.

[edo]

plg said:

Fats25 said:

plg said:

Starting at 10% below sticker isn't a bad place to go from. He can only say no. It's just surprising there was no counter offer - say £19250 - or a conversation around finance...?

That is what I thought. I actually offered 7% below advertised price.

However it is becoming a common theme. Hence this thread asking if I am being unreasonable expecting there to be negotiations on advertised price, or whether I am living in a different day and age!

I don't think so. I was up at Audi yesterday for an MOT and looking at a replacement. Without volunteering an offer the salesman was giving a guide price of about 5% below sticker for a Sept sale. They lack 3-4 yr old cars to feed the lower-middle end of the forecourt, apparently.

I know an Audi dealer that will give 13% on most models.

[XB70]

Wacky Racer said:

I can't believe how many people think any dealer (especially main ones) should only be entitled to make around 1k on a 20k used car.

Thet have to prep it, give it a comprehensive warranty (by law), pay for sales staff, fancy showroom etc....You don't need or get any of that with a private sale....


However labour rates for servicing at over £100hr+ I do have an issue with....

Thoughts on this.

http://www.classiccarsforsale.co.uk/classic-car-pa...

1996 CL600 (but actually is an S600 coupe) registration N969 RGB which is being offered for the utterly hilarious price of £8995 by this trader.

Lo and behold it was purchased for £4620 at H & H Auction in Buxton in July: http://www.flickr.com/photos/homer----simpson/4817...

So, there is roughly £4300 of "profix, warranty, sales staff" etc?

Not only is that price off in the clouds with the pixies and fairies but you see this time and again.

It is one thing to make a profit and it is another to take the p.....

[volumeone]

What is the problem in leaving a deposit on a private car after speaking to the person and doing a HPI? You don't get a warranty hence they are cheaper but that really is about the only difference. Where do you think the dealers get their cars from?

PayPal him some money and if the car is a total wreck you should be able to claim your money back.

Oh, and never buy an ex-management vehicle.

[plg]

volumeone said:

What is the problem in leaving a deposit on a private car after speaking to the person and doing a HPI? You don't get a warranty hence they are cheaper but that really is about the only difference. Where do you think the dealers get their cars from?

PayPal him some money and if the car is a total wreck you should be able to claim your money back.

Oh, and never buy an ex-management vehicle.

I hope the first point is a reference to the Xeno thread....

And agree on ex-management cars, or even an ex-fleet management car.

[Piersman2]

A few years back I had a Boxster, bought new, was 2.5 years old and I wasn't using it so decided to get rid to pay off the finance.

At the time they were retailing on dealers forecourts at £32K 'ish. Sold it to a swansea dealer eventually for £26250, just enough to pay off loan.

So using those numbers, Porsche were looking at making £5K (minus cost of warranty to buyer) on that car. Maybe a bit less if the buyer was going to haggle, but I would expect at least 3K of straight profit for them.

[Mattt]

I've always had BMW dealers offer around £1k off sticker fairly easily when looking - the last 2 we bought were around that mark.

[goldblum]

Take your car to a dealer to p/x and complain about what they've offered you.

At which they open Parkers and point out they've offered you a spot on p/x price.

However,when you show them that the car on their forecourt is £2000 above the cars dealer price

according to the same book they shrug their shoulders and say they can charge what they want!

I understand what overheads dealerships have,and I understand it's a business like anything else,

I also understand when someone's taking the Michael.

I have had a lot of good dealings with traders though to be fair.

[edo]

volumeone said:

What is the problem in leaving a deposit on a private car after speaking to the person and doing a HPI? You don't get a warranty hence they are cheaper but that really is about the only difference. Where do you think the dealers get their cars from?

PayPal him some money and if the car is a total wreck you should be able to claim your money back.

Oh, and never buy an ex-management vehicle.

The OP is looking at cars under 3 years old, so still in their manufacturers warranty.

You pay your money and take your choice.

We just sold an A4 and bought a TT.

This is what I could have done:

Audi Dealer A
Offered £12.5k for the A4, and "screen price" for a 2008 TT (£22.5K)

Cost to change of £10k.

Actual scenario.
Sold A4 privately for £15k.
Bought a 2008 TT with the same spec and nearly half the miles for £20,700. This still has 6 months manufacturers warranty, which we can extend, it was taxed and had just been serviced by a main dealer. So net loss 6 months warranty, but gain half the miles

Cost to change of £5.7k.