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Discussion Starter #1
When I bought by Murano, the dealer showed me the invoice, which was the same as I got from internet, maybe except for some advertising fees. Yesterday, I helped a friend to buy a 04 Toyota Sequoia SR5 (I know, but his choice, Murano is too small to him). When the dealer showed me the invoice, it was about $1,500 higher than we calculated based on Edmunds. In addition to the amounts of base invoice, and all the factory and port options, there are MAF, DTA, 2% dealer hold back, another hold back fee, 1% financial hold back fee. I think this is a rip off, but I don't have any buying experience with Toyota, does any one have any experience?
Their invoice doesn't make any sense to me and how can they get away with this?


Thanks
 

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I believe the only legal charges to add to the invoice are the advertising charge and the destination fee. The dealer cannot charge you for the holdback, since its the money the manufacturer pays them - it would be like collecting twice on the same payment, once from the manufacturer and once from the customer! I do remember though, when we were shopping for my mom's Camry, that those Toyota dealers are very sneaky and tried to add bogus charges like the "Toyota dealer fee."
 

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The stealer/dealer can print up an ol' piece of paper and shove it in your face saying it's his 'invoice.' None of these numbers mean anything. Dealers get cars from the manufacturer at prices below what Edmunds and other sites quote as 'invoice' based on how many they sell, their holdback, incentives and so on. Conversely, their motivation to sell a particular car (and therefore the minimum amount of profit they are willing to make on it) can vary from day to day.

The bottom line is that if you are going to haggle, you have to test the waters by starting very low and be prepared to walk out of a few dealers. If they don't run after you, it means you were too low (i.e. they couldn't sell you the car for the price you wanted because they wouldn't be making enough on the deal). At the next dealer, you use that information to help you.

If you don't want to haggle, I strongly suggest using an online auto broker such as carsdirect.
 

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Toyota Dealers

I agree that they can be sneaky. After a bit of negotiating,we agreed up a fair price on a used Miata.
When the paperwork was drawn up there was an additional $350.00 charge. When I asked what it was I was told it was for a "book of coupons" which I HAD to purchase!
Needless to say....NO DEAL. I waited a year and bought a new Miata.
 

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ok, I can't stand the mis-informed chatter on this thread anymore, I came from a Toyota dealer and now work for a Honda/Nissan dealer,and I can tell you what is on the invoices. On a Toyota invoice there is a destination charge that varies by zone, a Toyota advertising charge that again varies by location. The destination and ad charges are charged by almost every manufactuer. Toyota also on the bottom of ther invoice has a holdback that is now 2 or 3% of invoice price, and a financial reserve that is paid to dealer at end of year to help w/flooplan(interest) of the grounded cars. Now if you compare any other retail items, the car has probably the lowest % of profit. On new cars the ave profit(including HB) varies between $650- $1000 per unit. Now concider that the dealer has a product costing 30K plus and has interest charges on that 30K$. WOW what "stealers" I hope none of you find out what the cost was on your furniture or watch! Also the only time dealer gets a kickback, is when there is dealer cash, which may be available for a whole week before edmunds or kelly prints how much it is, or if there is an incentive on a particlular car, which is usually passed on to the customer, due to competitive dealers, and is only passed along w/a rather high volume incentive. (this is mostly done by domestic lines). If any of you had to pay interest on millions of $$ and take the risk to inventory cars in excess of $30K++ you would expect to make more than 1 or 2%???? Now, I will not tell you that there are dis-honest dealers, I have dealt w/some myself, but after working in one for 6+ years, I was in awe as to how far off most people are as to how much profit there really is in each deal. Even Consumer Reports tells to offer between 1 to 3% OVER INVOICE, not over net.

Sorry so long
Tony
 

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Thank you Tony for your point of view. Yes it is true that dealers must make a profit or else they would they would not sell you the car. However, for the Murano and every other car I will buy in the future, I will try to get the best deal possible, factoring in all the costs to the dealer. It is the dealers choice whether to sell it to me or not, and I'm not going to buy any story about a guilt trip of them losing money over a deal. If they don't make a profit selling a car, they should not sell it.
 

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I agree that you should get the best deal possible! And if they lose $ on the deal then, shame on them. However it seems most of the posts here make dealers out to be crooks, and that is far from the truth, the satisfaction ratings are very high for most dealers. And anyone can get costs etc. so they know if they are getting a good deal or not. Way too hard to put one over on an informed consumer.
 

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Discussion Starter #8
Toyota Invoice

Thanks, Tony D,

Finanally there is someone in the know explained what are in a Toyota invoice. Your explanation is in line with what I actually see in some dealers showroom. I understand that a dealer should make a profit for saling the car to customers, that's why we pay hundreds of dollars over invoice. However, you didn't explain why Toyota's invoice includes dealer's hold back, whereas no other dearlers do that? For example, my MO's dealer invoice is basically the same as from the internet. But Toyota's is more than a thousand. Is this not cheating? How can they get away with this? They charge customers for holdback, and get paid the same amount again from Toyota. How nice to be a dealer! I'll never buy a Toyota just for that!
 

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Re: Toyota Invoice

wheeling said:
Thanks, Tony D,

Finanally there is someone in the know explained what are in a Toyota invoice. Your explanation is in line with what I actually see in some dealers showroom. I understand that a dealer should make a profit for saling the car to customers, that's why we pay hundreds of dollars over invoice. However, you didn't explain why Toyota's invoice includes dealer's hold back, whereas no other dearlers do that? For example, my MO's dealer invoice is basically the same as from the internet. But Toyota's is more than a thousand. Is this not cheating? How can they get away with this? They charge customers for holdback, and get paid the same amount again from Toyota. How nice to be a dealer! I'll never buy a Toyota just for that!
I'm not quite sure that was what Tony D is saying, that Toyota dealer can charge twice for the holdback. Technically they should not be able to charge customers for the holdback at all, since its something thats between the dealer and manufacturer. If Toyota dealers are indeed double charging the hold back, that sounds to me like a suspicious business practice!
 

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I had a dealer in Dallas tell me that his new car operation only made 1 or 2% profit.
Look, I don't mind a dealer making money.
I don't mind him making a lot of money.

But knock off the BS.

He had no answer when I asked him if he was a mental midget for taking a business model that made no money............and replicating it at 2 other dealerships. Or was it possible he was BSing.......

What is not brought out in these discussions is the ROI.

Sure they may actually only get 2% net profit.
But if the inventory is replaced every 6 weeks, that's 16% per year..........and that is a damn nice profit.
And if it is 3% and the turn is 4 weeks............

And having sold cars (Berge Ford, Tempe AZ), let me tell you that never in the recorded history of mankind has a successful dealer ever sold a car at a loss.
Do some people get better deals than others?
Sure.
Are there different kinds of houses?
Sure,
Some places you can do your homework, go in, give them a fair offer and drive out in an hour.
Take the same deal to a "grinder" house tho, and they will be trying to get that last $25 out of you 3 hours later.
What about in house financing? Do they get any money back from the Bank/finance co?
What do you think? Of COURSE they do.
And watch what you pay. The oldest trick in the world is do what they used to call, "run him through the mouse house".
In other words take the customer and baffle him with bull**** about what he was really paying, and talk about monthly payments. "Yes you can have the NAV package for only $20 a month!". Sure you can, If you finance it for 10 years.

As to invoices, there are no laws regarding invoices (other than FTC truth in advertising laws).
It is not like the Monroney.
If Toyota wants to show the Holdback as an expense instead of an income, that's their business.
Is it illegal?
no.
Is it immoral?
Hell yes.


If the business is so bad, how come more and more dealers are MULTI dealerships and how come there are always people wanting to get into the business?


Having said all that, there are many, many honest dealers.
Abd many, many dealerships where you can get a good fair deal.

Now if you want to talk about getting screwed on the deal..........then talk about the service departments!
That's where the real hosers work!

Homer
 

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Ok, I see what we are talking about now, all manufacturers have a holdback. If you bought a new car at invoice price the dealer still makes profit the amount of the holdback. You are not being double charged, it reflects the true "net" price on the car. The dealer pays invoice minus holdback for the car, plus any interest on the inventory $$$. Now there are dealers that will take "front end" losses on the car in order to hit objective based dealer cash, but then again the savings is passed to the consumer, by dealers doing what they have to do to hit the #. Now most dealers will tell you that the new car sales do not make up the profit center of the dealership, the used car/ "fixed" or service,parts,bodyshop, and F&I depts, are the profit centers. The new cars put up the sign and allow dealers to have all the other depts. Just a quick note, Toyota actually has a low % of holdback, when compared to many other brands, the Toyota store I worked at also carried Chrysler products and thier holdback was 3% of MSRP! instead of 3% of holdback. So if you paid invoice for a Neon, the dealer still made up to $750. If you paid invoice for a same priced Corolla the dealer made maybe 450$. Be assured if you paid invoice for your Murano, there was holdback, and the dealer did make some profit. And if your credit is enough of an issue to have to use the "in-house" financing, then I don't know what to say, because there is tons of risk on the dealers part to offer this, which is why most don't. That is why they make $ on the interest, because if there is a problem w/the car people like that just stop paying. Sorry again for being so long, but I hope this helps. By the way if anyone is looking for help on the true cost of a Nissan product I would be happy to help, just promise to at least allow the HB as profit.
 

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Discussion Starter #12
Holdback yet again

Your are off the point! Let me give you an example. Two cars for the same $30,000 invoice based on the web, dealer agreed to sell for $500 over invoice, destination and ad fee totaled $1000 for both cars.

Now, the Nissan dealer will show an invoice totaled $31,000, and you pay $31,500 and drive away. Dealer makes $500 plus holdback.

However, the Toyota dealer will show an invoice of at least $31,900, you have to pay $32,400 to get the car. Because the Toyota dealer's invoice included 2% HK and 1% financial hk. They are clearly listed on the invoice, plus other fees that are not on Nissan's invoice. The Toyota dealer makes at least a $1,400 profit from the sale, plus the 2% HK from Toyota. Now you tell me this is legitimate practice. He obviousely double charged the customers for the HK.
 

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obviously you have never seen a Toyota invoice, the holdback and fin. reserve are listed at the bottom separate from the other charges. They just happen to name them at the bottom, where the other companies code or run all the #'s together. The holdback is not added in twice. The dealer pays the ad and destination fees as well, which is why they list it on the invoice side. If I can have the Toyota store fax me an invoice, I will scan it along w/a Nissan one and you will see that all the same charges are there. Now I have no reason to lie about any of it, I don't even work for the Toyota store any longer. I will say that Nissan ave.is 2 times more gross than the Toyota store did per unit! And some of the most educated and "anal" shoppers in the country buy Toyota after Toyota w/no issues like what you are describing. They are just more up-front and list every charge on the invoices. The reason the all knowing web doesnt list the charges, is because Toyota charges different ad and destination fees for every area in the US. Therefore it woud not be accurate.
 

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Discussion Starter #14
I started this thread after seeing two Toyota dealer invoices. They all included the HKs as invoiced item, not separate items. I don't understand what are you trying to say? Defend Toyota or what? I know Toyota has some hot vehicles, they may get away with charging twice for the HK, don't tell me every dealer is doing the same thing!
 

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All I'm saying is the invoiced items are dealer advertising and some sort of freight charge, the holdback/financial reserve are located on the bottom left separate. Now if a dealer is printing somesort of their own then I guess you could be getting screwed. I am just saying that don't think you are getting hammered because these charges are only listed on the invoice side. They do that to show that the dealer also pays these fees, after all the original idea of the invoice was to show dealers the costs of inventory, and turned out to be the point to where car deals are started because the consumer has access to the costs. Ask a furniture dealer to see the invoice to your leather couch, he will laugh you out of the showroom.
I truley hope everyone gets a great deal on any car purchase, that brings refferal deals etc. and I am not calling you a liar. I just want to point out that consumers were not intended to see and interperet the invoices, so they all are structured a little different. I'm also not sure what you mean by Hk?
 
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