Buying 2005 Honda Accord EX V6 Sedan - Invoice price good?

I'm buying a 2005 Honda Accord EX V6 sedan. The MSRP is $26,800 & invoice
price is $24,024. The dealer is selling the car for $90 under the invoice
price. I'm financing the car over 60 months at 2.9%. I'll be putting $2,500
down on the car so the monthly payment including the 2.9% financing & 7%
Ohio sales tax is $411.08 a month. Does that sound like a fair price or do
they have slack to come down more? I wouldn't think there would be as much
room on a Honda as some other cars to deal but figured I'd get a second
opinion before I say yes to the deal.

Thanks,

John

 

John,

Honda has a 3% holdback applied against the base MSRP. In your case the
dealer will get about $804 from Honda on the EX V6 sedan. If the dealer
is giving you $90 under invoice he still has a potential profit of $714.
If it was me I haggle for a lower price.

For holdback info see:

http://www.safecarguide.com/gui/neg/holdback.htm

Best of luck.....Bob

 

John,

Honda has a 3% holdback applied against the base MSRP. In your case the
dealer will get about $804 from Honda on the EX V6 sedan. If the dealer
is giving you $90 under invoice he still has a potential profit of $714.
If it was me I haggle for a lower price.

For holdback info see:

http://www.safecarguide.com/gui/neg/holdback.htm

Best of luck.....Bob

 

Yeah, they got room. They could forgo the few dollars holdback they'll
receive after they sell you a car for a $90 loss. And yeah, they could give
away the few dollars they make on the financing. What the hell, why allow
them to make anything? You'd do the same in your business wouldn't you?

 

Yeah, they got room. They could forgo the few dollars holdback they'll
receive after they sell you a car for a $90 loss. And yeah, they could give
away the few dollars they make on the financing. What the hell, why allow
them to make anything? You'd do the same in your business wouldn't you?

 

Howard,

No one is forcing the dealer to give the car away. They have the
choice; either make the "deal" or not. Do you really think they
wouldn't sell it for MSRP if they could get away with it? Undoubtably
the car dealers favor the negotiating process of purchasing a car. If
not they would set price and stick to it.

Bob

 

Howard,

No one is forcing the dealer to give the car away. They have the
choice; either make the "deal" or not. Do you really think they
wouldn't sell it for MSRP if they could get away with it? Undoubtably
the car dealers favor the negotiating process of purchasing a car. If
not they would set price and stick to it.

Bob

 

Thanks for the responses everyone. I figure the dealer is probably making
$500-1000 on the average sale of a vehicle or they wouldn't be in the car
business. Sounds like the deal isn't too bad.

John

 

Thanks for the responses everyone. I figure the dealer is probably making
$500-1000 on the average sale of a vehicle or they wouldn't be in the car
business. Sounds like the deal isn't too bad.

John

 

Bob,
I don't really disagree with you. My point is, how low can a person in a
business be expected to lower their prices and still remain in business.
There's a reason for the MSRP. I don't know what the overhead for a dealer
is to sell a car, but it always sounds like someone is trying to steal
something when they buy a car. When you go to a high end audio store where
your purchases might be in the thousands, do you lowball the purchase, do
you go online and find the dealers cost, do you search for any incentives by
the manufacturer, do you bargain for the delivery or the install?
I think it's degrading to both the consumer as well as the dealer the way
auto sales are conducted. The price should be on the sticker, and that's
what you pay. If you think the percentages are high, check what the markups
(percantage) are on some other products. The problem with autos is the
percentage is on a reasonably high figure. Why should it be different for
autos?
Say the dealer paid $24,000 for that car. Sticker is $26,800. He sells for
even $100. over invoice and he gets a holdback of 3% (I heard it was 2%)
$720. He's got $820. What about transportation charges, cleanup charges, and
technicians PDI labor(Pre Delivery Inspection - required), floor planning,
advertising, rent, electricity, personnel, etc. OK, so cut the $820 in half
(very conservative) and he doesn't have even 2% profit. How many businesses
do you know that thrive on 2% profit? I know, they make more on financing,
so now let's raise that up to even 10%. Still, a very modest return in a
retail business. Let's exclude parts and service, because with a pre-set
attitude about the dealer ripping you off you know you're not going to go
back there, besides that's a separate purchase.
I know most dealers are not hurting unless they're selling Oldsmobiles these
days, but they are still entitled to make a living and a decent profit. We
live in a land of free enterprise and free competition. If you don't like
price, go somewhere else.
Besides, Caveat Emptor!
Howard

 

Bob,
I don't really disagree with you. My point is, how low can a person in a
business be expected to lower their prices and still remain in business.
There's a reason for the MSRP. I don't know what the overhead for a dealer
is to sell a car, but it always sounds like someone is trying to steal
something when they buy a car. When you go to a high end audio store where
your purchases might be in the thousands, do you lowball the purchase, do
you go online and find the dealers cost, do you search for any incentives by
the manufacturer, do you bargain for the delivery or the install?
I think it's degrading to both the consumer as well as the dealer the way
auto sales are conducted. The price should be on the sticker, and that's
what you pay. If you think the percentages are high, check what the markups
(percantage) are on some other products. The problem with autos is the
percentage is on a reasonably high figure. Why should it be different for
autos?
Say the dealer paid $24,000 for that car. Sticker is $26,800. He sells for
even $100. over invoice and he gets a holdback of 3% (I heard it was 2%)
$720. He's got $820. What about transportation charges, cleanup charges, and
technicians PDI labor(Pre Delivery Inspection - required), floor planning,
advertising, rent, electricity, personnel, etc. OK, so cut the $820 in half
(very conservative) and he doesn't have even 2% profit. How many businesses
do you know that thrive on 2% profit? I know, they make more on financing,
so now let's raise that up to even 10%. Still, a very modest return in a
retail business. Let's exclude parts and service, because with a pre-set
attitude about the dealer ripping you off you know you're not going to go
back there, besides that's a separate purchase.
I know most dealers are not hurting unless they're selling Oldsmobiles these
days, but they are still entitled to make a living and a decent profit. We
live in a land of free enterprise and free competition. If you don't like
price, go somewhere else.
Besides, Caveat Emptor!
Howard

 

My heart really bleeds for the poor dealers. [not]

When demand is high for an especially hot model, dealers can & do sell
them for well over the MSRP, sometimes $1,000's more. It's supply &
demand, if you can negotiate the price down, only a fool wouldn't. Let
the dealer worry about his own ass (just think of the profit from the
service & parts depts).

Wal-Mart has no scruples about throwing its economic weight around, does it?

 

My heart really bleeds for the poor dealers. [not]

When demand is high for an especially hot model, dealers can & do sell
them for well over the MSRP, sometimes $1,000's more. It's supply &
demand, if you can negotiate the price down, only a fool wouldn't. Let
the dealer worry about his own ass (just think of the profit from the
service & parts depts).

Wal-Mart has no scruples about throwing its economic weight around, does it?

 

It's completely artificial. For starters, the MSRP makes no account of
any holdbacks the factory is offering dealers.

Please, the dealers' only source of revenue is *not* just from the sale
of new cars. If you're going to cry "fair" on new car sales, how about
used car sales, parts & service? The dealer has economic muscle far in
excess of anyone buying just one car. What sort of deals do you think
Hertz & National get when buying their fleets?

 

It's completely artificial. For starters, the MSRP makes no account of
any holdbacks the factory is offering dealers.

Please, the dealers' only source of revenue is *not* just from the sale
of new cars. If you're going to cry "fair" on new car sales, how about
used car sales, parts & service? The dealer has economic muscle far in
excess of anyone buying just one car. What sort of deals do you think
Hertz & National get when buying their fleets?

 

Used car sales is where ALL the money is.

 

Used car sales is where ALL the money is.

 

QED

 

QED

 

I bought a 2004 Honda Accord EX-V6 last May for $800 UNDER invoice.
Granted, it was somewhat later in the model year than your planned
purchase, but the message is clear. Honda manufacturers ALOT of
Accords, and dealers do not need to get a great deal of profit per
car in order to make a good return on investment. The price that
dealers really pay for the car is not the invoice price, although that
is a good point of departure.

I suggest you get some quotes from internet capable dealers.
Edmunds.com is a good place to start. I am guessing that you can
do hundreds of dollars better.

--
Harvey J. Cohen, Ph. D.
-------

"The difference between fiction and reality is that fiction has to make
sense." - Tom Clancy

------------------------------------------------------------------