The Art of Haggling and Other Questions About the Civic Hybrid

[Chopface]

Even at the prices these cars sell for, both Toyota and Honda lose money overall on every hybrid they sell.

Would you view it as an investment that will pay off for them some day? How does the economics of licensing work out for Toyota? Don't they sell their technology to Ford and/or others?

Also, if gas were as much in America as it is in Europe, I imagine the demand would only increase. Maybe we would see more older, smaller displacement cars fixed up (mechanically at least) and on the road.

By the way, I have no idea how much gas is taxed in Canada, but I have travelled there in the past. I don't remember it being significantly higher.

Mark

 

[Matt (4)]

Hello All!
My wife and I are very close to purchasing an '05 or '03 Civic Hybrid. Although this is not the first car my wife has purchased, it will essentially be the first I have purchased. I was wondering if anyone can offer any tips on haggling with the Honda dealership. We feel this is an important but somewhat unsavory part of purchasing a car. (I know that some people view haggling as a sport - I hope they will sound off here!) There may be some general rules of thumb to follow, but I don't know them and would like any tips anyone could give. We'd like to get them to come down off the price a bit - I think the sticker on the '05 is around $20,000.

I was also curious to see if anyone knew the answers to the questions that the salesman couldn't answer, specifically:
- What happens to the batteries after they are replaced? The ecofriendly nature of this car is a big selling point for us. But the fate of dead batteries is unknown to us right now. Would hate to think they'd end up in a landfill or something.
- Has anyone any expereince with problems in extreme weather conditions? (tough starts in extreme cold, for example)
- Can some one explain, in as plain a language as possible, under what circumstances the auto stop feature occurs in the engine? My wife and I read a little about it in the manual on the test drive, but we're a bit confused still. Do all of the conditions listed in the manual have to be present before the engine shuts down? Or just one or two?

Any feedback at all on this car is appreciated. Just for reference, both of the cars we're looking at have the CVT transmission.

Have great day,
Matt

 

[y_p_w]

Hello All!
My wife and I are very close to purchasing an '05 or '03 Civic Hybrid. Although this is not the first car my wife has purchased, it will essentially be the first I have purchased. I was wondering if anyone can offer any tips on haggling with the Honda dealership. We feel this is an important but somewhat unsavory part of purchasing a car. (I know that some people view haggling as a sport - I hope they will sound off here!) There may be some general rules of thumb to follow, but I don't know them and would like any tips anyone could give. We'd like to get them to come down off the price a bit - I think the sticker on the '05 is around $20,000.

The basics are simple. You have to be willing to walk out of a dealership emptyhanded if you don't like the initial results. I've been pressured with, "what can I do to see you walk out with the keys". Then I shopped around, got some more quotes, walked back to the dealership and got my price after looking around.

The other thing is that you can now use Edmunds or any of the auto services to contact multiple dealers for quotes. The Civic Hybrid doesn't have options, so quotes should be. And don't forget that financing is very important, unless you plan on paying cash. Once I took an advertised factory financing special, and the financing manager told me he was a bit miffed about it. Something about not making anything off of it, when normal financing deals net them decent profits.

 

[Matt (4)]

those tips sound very good - i appreciate you taking time to answer! any other tips from anyone would be appreciated.

 

[jmattis]

First, this is not a "gotta-have" car. It's just one of several you're looking at. And this dealer is just one of several you're visiting. It's a mindset -- communicate it to every salesman that you talk to.

Never be afraid to say the deal isn't acceptable & head for the door. They hate for you to leave because your deal will probably be cut at another dealer. If they want to negotiate, they'll ask you want you want, and may actually listen more than before. Then you use the good info obtained from Edmunds.com and elsewhere to outline the deal you want. If you're not prepared, you'll get screwed or be wasting everyone's time, including your own.

Don't be afraid to leave an e-mail or phone # with the dealer even if you walk out. Often they'll give you a call, or the manager will call. Listen to what they have to say; research anything that sounds fishy. You don't have to commit -- ever -- and that's your ace card. Sometimes these contacts can go on for months.

Leading up to, DON'T BE IN A HURRY. Communicate to the dealer that you have all the time in the world. They don't. They have rent to pay, and more cars arriving daily. They've got to sell them at some point, and that point isn't too far away.

Be prepared to hear the truth -- the dealer may actually be honest, when telling you a particular vehicle is in such high demand that they've already given you their best price. Sometimes for a specialty vehicle, it's true. It's your choice at that point whether to pay MSRP or many thousands above it.

Try alternative contacts at the same dealer: call the fleet manager up (just tell the receptionist you want to talk with "the fleet manager"). Frequently they'll give you a good price, pretty much non-negotiable in some cases, and cut through all the b.s. If they even ask if you've been dealing with one of their salespeople, just say no. (It helps if you haven't been to the dealer in a few weeks.)

Once you agree to buy the car, you'll be thrown into a new pit:
dealing with the "F&I" or Finance and Insurance guy. He is not your friend. For that matter, some females I've seen in this position are even more cold-hearted if that is possible.) If you brought your own financing (and why didn't you?) ask if they can beat it. Sometimes they will. Every slug of an F&I guy makes $80,000+ U.S., and does it by screwing as many customers as possible. Know the best rate you can get before you walk into his office, and be prepared to say 'NO' to every fabric treatment and undercoat deal they insist that you buy. "You should be getting this and protect your Investment -- are you Stupid, or what?" I actually had someone tell me that. She was very, very pretty.

I wouldn't worry about battery disposal too much, I don't think that they are particularly toxic. No lead, mercury, cadmium. Why don't you worry about the ton of disposable diapers your kids are going to put into that landfill?

JM

 

[TeGGeR®]

There may be some general rules of thumb to follow,

There is one big one: Have the willingness to walk away. That's the one and only weapon they have zero answer for. Don't use this tactic as a bluff. It won't work. You have to really mean it, and that takes some guts.

Just remember, they see people like you every hour of every day. Every tactic you'll try, everythng you say, they've heard it all a dozen times over. You will not fool them and you will not say anything new. Walking out is the one thing they can't control and cannot fight, except by dropping their price.

If you decide to walk away, be firm and don't look back. Don't hesitate. Don't vacillate. You might just find a call from the salesman on your answering machine when you get home, or you will be physically pushed back into your seat, meaning you're going to get your price. If they let you walk, your price was unrealistically low.

Having said all that, you've also got to be realistic in your expectations. If a car is a hot seller, the ball's in their court and you will be unlikely to get any sort of break on the price they want for it. If you get up and walk out because you can't get your price on a hot seller, they'll let you go.

If at all possible, avoid financing and trade-ins unless you have no choice. Those two things are where they get most of their money. Do your homework, then walk in with a set, ON-THE-ROAD price, and stick to it, asking the salesman "what can you give me for that price?". On-the-road means the final bill after ALL charges of ANY kind are added in. Don't budge, and don't let them tack on other charges to your on-the-road price at invoice time. If they do, get up and walk out.

The above approach gives the salesman the impression you're serious, that you have the cash, and he will be hard-pressed to let you leave without finding something that will fit the check amount you'll write.

He's more likely to hunt around for you for something to fit your price. You may end up with a less-than-popular options package, or an unpopular color, but at least you've got your price.

Oh, and one more thing: Forget this "below invoice" nonsense pushed by some consumer groups. It's a mug's game and you won't win it.

 

[John Ings]

My wife and I are very close to purchasing an '05 or '03 Civic Hybrid. Although this is not the first car my wife has purchased, it will essentially be the first I have purchased. I was wondering if anyone can offer any tips on haggling with the Honda dealership.

Others have given good advice in this thread. Here are some warnings about sly tricks.

If your wife is with you and the salesman leaves you alone in a little office while he "checks with the sales manager", watch what you say. Dealers have been known to bug such places so they can get hints about how ready you really are to buy and what your price is.

Watch the guy with the adding machine! Re-check his totals. They've been known to tell you they're knocking $ off and slip them right back in again. Not so important if there aren't a lot of options.

Don't be a rug merchant. Haggling is all very well but don't be too greedy. Know what the car is worth and don't ask for too large a price cut.

Make sure your bank or credit union can't do better for you than their finance guy. If you have cash from a personal line of credit at your bank, don't tell the dealer. He may be giving you a deal on the car with the intent of screwing you on the financing.

With hybrids, don't forget to factor the cost of replacement batteries into the maintenance costs.

Then there's that 'extended warranty' business which I'll leave others to comment on.

 

[Bucky (3)]

I was wondering if anyone
can offer any tips on haggling with the Honda dealership. We'd like to get them to come down off the price a bit - I think the sticker on the '05 is around $20,000.

All of the negotiating tips were good, but I don't know if they'll be that applicable to hybrids. According to all the media reports, hybrids are in extremely high demand. Some dealerships are selling above MSRP because people are willing to pay that much.

 

[TeGGeR®]

All of the negotiating tips were good, but I don't know if they'll be that applicable to hybrids. According to all the media reports, hybrids are in extremely high demand. Some dealerships are selling above MSRP because people are willing to pay that much.

Then you're screwed, as is anyone lusting after an item that is selling very well and/or is in short supply.

At this point you may want to consider whether paying a premium of thousands of dollars is worth the small savings in fuel dollars you'll get with a hybrid.

Overall, it may be that an ordinary Civic will cost you less in the long run.

If cost is not the issue but environmental correctness is, then you have no choice but to bite the bullet and pay for the privilege of being pious.

Even at the prices these cars sell for, both Toyota and Honda lose money overall on every hybrid they sell.

 

[SoCalMike]

"You should be getting this and protect your Investment -- are you Stupid, or what?" I actually had someone tell me that. She was very, very pretty.

heh... they wanted my girlfriend to buy an extended (7yr, only 4 were additional) warranty for...

"only $30 more a month!"

hm... 12 mos, times 5 years, times $20. $1800? i laughed.

 

[SoCalMike]

Others have given good advice in this thread. Here are some warnings about sly tricks.

If your wife is with you and the salesman leaves you alone in a little office while he "checks with the sales manager", watch what you say. Dealers have been known to bug such places so they can get hints about how ready you really are to buy and what your price is.

dont buy based on monthly payments

dont fall for the "up to" scam...

salesman: how much can you afford a month?

you: bout $300

saleman: up to?

you: well, maybe $350.

theyll figure out a way to work the deal, but itll be in their favor.

 

[SoCalMike]

Even at the prices these cars sell for, both Toyota and Honda lose money overall on every hybrid they sell.

i dont believe thats true any more for the prius. i think theyre finally in the black with this generation.

 

[TeGGeR®]

Would you view it as an investment that will pay off for them some day? How does the economics of licensing work out for Toyota? Don't they sell their technology to Ford and/or others?

Toyota has aggressively marketed their technology to other manufacturers, and that is with the aim of recovering their costs for what is definitely a superior system.

At the end of the day, it's still debatable whether or not Toyota will actually end up making more than they spent on hybrid technology. And Toyota ain't sayin', except to state that if "development costs" are NOT counted, then they're "breaking even". That's straight from a Toyota press release of a couple of years ago.

If there's one thing definite about "green" technology, it's that the word "cheap" does not describe it.

Also, if gas were as much in America as it is in Europe, I imagine the demand would only increase.

Of course. But gas in Europe is far, far more heavily taxed than it is here, and taxes account for ALL the price difference. The "environment" doesn't get that tax money, the government does.

Diesel and propane are all the rage in much of Europe. Not because they're inherently cheaper, but because tax policies leave consumers with no economic choice.

Maybe we would see more older, smaller
displacement cars fixed up (mechanically at least) and on the road.

By the way, I have no idea how much gas is taxed in Canada,

Not much more than in the US. Our gas is almost exactly the same price as that paid by those in California, but is more than that charged in Pennsylvania. Today I paid 78¢ per liter for 87 octane, which is about $2.65 per US gallon. However, if you factor in our lower standard of living, I paid more like $3.53 US per gallon. The Brits pay about $5 per US gallon.

 

[Sskb]

If cost is not the issue but environmental correctness is, then you have no choice but to bite the bullet and pay for the privilege of being pious.

Even at the prices these cars sell for, both Toyota and Honda lose money overall on every hybrid they sell.

I wonder if Honda is losing money on the Accord hybrid. In any case, not all hybrids sell at a loss. I think Ford makes money on the Escape.

 

[Sskb]

dont buy based on monthly payments

dont fall for the "up to" scam...

salesman: how much can you afford a month?

you: bout $300

saleman: up to?

you: well, maybe $350.

theyll figure out a way to work the deal, but itll be in their favor.

That is a great tip. 48 month loan stretched out to a 60 month loan. I've even heard 72 month loans but this was on a certain brand of 'luxury automobile'. Financial insanity.

 

[Dan Beaton]

There is an excellent book on negotiating, called "You can negotiate anything" by Herb Cohen. (http://www.herbcohenonline.com/) I see from his web site he has a new book out. Time and information are two of the major keys. Time being the amount of time you are willing and able to put into it. If you want the car by this weekend, you will pay more. If you are willing to visit many dealerships and ask many questions, you will get a better price. Obviously your time is worth something, so there is a trade-off to be made. Information includes what other dealers are selling the car for, what their inventory level is, etc., etc.

Good questions about the batteries. I don't know the answer, but I would be very surprised if Honda doesn't have a plan. Whether that plan is carried out is another matter.

Good luck.
Dan

(This account is not used for email.)

 

[Elle Navorski]

At the end of the day, it's still debatable whether or not Toyota will actually end up making more than they spent on hybrid technology. And Toyota ain't sayin', except to state that if "development costs" are NOT counted, then they're "breaking even". That's straight from a Toyota press release of a couple of years ago.

If there's one thing definite about "green" technology, it's that the word "cheap" does not describe it.

Are you talking strictly about the latest green technology, namely, hybrids?

Or do you mean going back across all time? If so, then is it your understanding that the substantial car emissions improvements since about the 1960s has been 'expensive'?

It seems to me, based on buying cars for a couple of decades now, that it has not been expensive.

I'm focused on small cars, because of course those tend to be the greenest.

Now maybe that's because car manufacturers were forced to mass produce certain technologies, and the mass production aspect made prices not skyrocket.

I've run the numbers in the recent past, and I agree hybrids currently are not worth the money for the consumer. Gas prices would have to go up a lot more. I haven't looked at whether the manufacturer is losing, too, but will take your and others' word (here at the newsgroup) for it now.

I welcome citations on the cost of reducing automobile fuel emissions since the 1960s.

 

[Elle Navorski]

Toyota has aggressively marketed their technology to other manufacturers, and that is with the aim of recovering their costs for what is definitely a superior system.

At the end of the day, it's still debatable whether or not Toyota will actually end up making more than they spent on hybrid technology. And Toyota ain't sayin', except to state that if "development costs" are NOT counted, then they're "breaking even". That's straight from a Toyota press release of a couple of years ago.

But from Jan. 11, 2005:
-----
The Prius and Honda Motor's (nyse: HMC - news - people ) Civic Hybrid are the two most financially successful hybrids on the market. They probably don't make large per-car profits, but they aren't among their companies' loss-leaders. Honda's odd-looking Insight hybrid, which has the highest inventory on the market, is among Honda's loss-leaders, which would seem to make the case for more conventionally-styled hybrids. .... A major financial advantage for the [Toyota Lexus 2006] RX 400h is the fact that Toyota's hybrid powertrain program began to break even midway through 2004 (a powertrain is a car's power-producing and transmitting components, including engine and transmission). The tooling for the entire program has not yet been amortized, but probably will be within a couple of years; sales of cars such as the RX 400h will help offset such costs. More and more Toyota hybrids, from this point on, will mean more and more revenue--especially if Toyota continues to put its hybrids in existing models, thus saving the cost of building new cars from scratch. http://www.forbes.com/lifestyle/vehicles/2005/01/11/cx_dl_0111vow.html
-----
and
-----
The success of the Prius has taken Toyota by surprise. The average wait at American dealerships is currently six months, even though the company increased its sales target for North America from its initial estimate of 36,000 units to 47,000 for 2004. To meet demand, Toyota announced another increase in August, saying it would push monthly global production up next year by 50% to 15,000 cars, and double its allotment for America to 100,000 units. While that number is still only one-quarter of last year's sales for America's most popular Toyota model, the Camry, it shows that consumers are willing to pay a premium for clean, environmentally friendly cars-as long as there is no need to compromise on performance. http://www.economist.com/audio/displayStory.cfm?Story_id=3422941

 

[TeGGeR®]

With this kind of demand, it's hard to believe Toyota is putting on some kind of pretense when it comes to announcing its costs to produce the Prius.

The Forbes article says what I've been saying all along, that it's an expensive way build a car.

Toyota is only just now starting to reach the break even point, so they have been losing money on the car for a long time, which is what I said. Originally, Toyota never intended that the car actually turn a profit, as it was supposed to be a "statement". Well there appear to be enough people out there with rather different priorities to turn that concept on its head. Toyota is as surprised as anyone.

Now Toyota is selling the technology, sort of like GM did with their automatic transmissions in the '50s (only then it was the tranny itself, not the technology), which helped them pay for development costs that much quicker.

"Green" technology IS expensive. Hybrids cost more than regular cars and still don't make the sort of profit regular cars do. "Green" technology is most popular in wealthy contries that already have the best and cleanest living conditions, and the longest human lifespans.

 

[Elle Navorski]

"Green" technology IS expensive. Hybrids cost more than regular cars and still don't make the sort of profit regular cars do. "Green" technology is most popular in wealthy contries that already have the best and cleanest living conditions, and the longest human lifespans.

I think I'll let the excerpts from the articles I posted speak for themselves.

People can google for more info on whether going green pays for manufacturers (and has been cheap or not for consumers) since the 1960s or so.