How much over dealer invoice price is reasonable?

Reasonable = the lowest price you can get. :o)

I help lots of friends buy cars and trucks. My approach is this:

Decide exactly what you want, go in, take out a credit card for a deposit and offer invoice minus any incentives. If they refuse to sell at that price, ask for their best offer, advising them that you will be leaving to check other dealers (They probably will take invoice right then). If not, take that price with you and see if you can beat it. But I've always gotten invoice, including on my girlfriend's 2001 Camry purchased at a one-price dealer! This should be easy and fun.

I would double-check the invoice prices at

or just to be sure.

By the way, have them take a printout of the prices with them, along with a calculator and several copies of a chart with three columns: Blanks for the item (base price, options, etc), retail and wholesale. As they go through the dealer's lot and see Camrys with different configurations, the chart will help them figure out the invoice price for any particular vehicle (dealers may not have the exact configuration they are looking for). They can compare the retail listed on the printouts with the retail prices on vehicle sticker (Maroney sticker), such to be sure they have apples and apples.

Good luck.

The price that a dealer will accept varies widely based on supply and demand factors. Supply and demand varies by model and other factors such as time of the year, or time of the month (salesman have month-end quotas they try to achieve). If you can get it at $300-$500 over dealer invoice you are doing fairly well (sometimes you can do a little better and sometimes a little worse). Don't forget that dealers in large cities have higher costs for real estate and labor than dealers in rural areas, although higher sales volumes "may" offset that. I would look for a high volume dealer for the best price.

Dealers buy the cars from the Toyota Regional Distributor (some of them not owned by Toyota) and not directly from Toyota. Don't forget to account for options added by the dealer or the distributor (like pinstripes, etc), but some of these extra options should be highly discounted. Try not to pay for certain dealer or distributor added items on the window sticker such as advertising, undercoating, or a clear-coat (sometimes it's hard to avoid these depending on which Toyota Regional Distributor your dealer buys from).

Toyota dealers usually get a 2% rebate from the manufacturer for each car sold (if they meet certain sales quotas, which they almost always do). That is why they can sell the cars close to the invoice price. But the dealer also has to pay for advertising costs and for interest charges for the time the car is in their inventory before it is sold. Rebates vary by manufacturer, but this info is available at several web sites.

Anthony gave great advice. That is almost exactly how I bought my 2003 Tundra down the spread sheet with the blank col, dealer cost col and MSRP col. I would add, get the $12 Consumer Reports vehicle fax (by mail, email or fax) so that you have all the dealer costs for every option along with the dealer cost for the base model. Also, I like to tell the salesman up front, "I'm gonna buy a vehicle today; the only question left unanswered is where" - and I'm not lying when I tell 'em that! Don't let them rush you or get you side tracked with financing and trade-in questions. Determine exactly what you want and go get it!

good luck.

Norm

Do you believe the dealer invoice price is real? How could the invoice price of my LE I bought two months ago be forteen hundred bucks more than yours? There is $1000 customer rebate currently. You may ask the dealer to take $1000 off the invoice price to get a fair deal.

Yup. I have heard dealers with high sales volume probably have better prices. My parents are thinking about purchasing a car from Longo Toyota which is one of the biggest Toyota dealer in Southen California.

I will probably do more research on the web site to see how and where to get the best prices.

Jason

The invoice price I got from

is for the base LE model with manual transmission and standard equipments only. If the price I posted is accurate then perhaps the higher invoice price you got is for a LE model with slightly different configuration or with optional equipments.

$1000 off the invoice sounds like a lot. Nevertheless, I will ask my parents to ask the sales people to do that.

Jason

I have an uncle whos is a Toyota dealer. He told me this secret. All the Toyota authorised dealers get upto $500 payment per car from Toyota as parking and handling charges (depending on model and upto

1000 for a Lexus). The dealer gets new shipments almost every month and so has to get rid of the previous month models in the same month they received. If not, than due to limited parking space within the dealership, the dealer has to spend the $500 on an alternate parking site plus the additional insurance cost for parking the vehicle off-site. If the dealer sells his car in the month he receives it, he can pocket the $500. So even if the dealer sells you the car at the invoice he will be making a profit.

Also with the current recession on, fewer people are buying cars. Most of the dealers already have their dealership lots full and are trying to get rid of the older shipments to make way for newer shipments and avoid additional costs. The dealers already have a commitment to Toyota for a certian number of cars per month which cannot be reduced/changed all of a sudden because this screws the Toyota manufacturing schedule.

I have a Corolla LE and a Camry LE and both were purchased at prices lower than the invoice.

Another tip is to go to the dealer at the end of the month when he is under pressure to get rid of his cars and reach his monthly target/goal.

The $500 rebate to the dealer is not for specifically for parking and handling. The rebates are called "dealer holdback" and are 2% for Toyotas. This holdback is used by almost all auto manufacturers, but the percentage varies. The holdback is a tool for the manufacturer to give incentives to dealers to sell higher volumes, because they depend on certain sales quotas being met. Perhaps not coincidently, the holdback is also one more tool the industry uses to hide the true invoice cost from the consumer.

Although I am sure what you said about your uncle's dealership is correct with regard to parking, many dealers do not have that problem. Obviously, some dealers in densely populated areas have limited real estate on which to store vehicles. However, the dealer is charged interest on his inventory if he keeps a vehicle on the lot past a certain length of time, and the holdback rebate helps pay for that..

In just California, its the biggest dealership on the planet! I know they have over 60 techs alone.

It's a combination of volume vs. fixed cost of the dealership property, plant, and equipment. The higher the fixed costs, the more vehicles need to be sold (or higher profit per vehicle) to cover the fixed costs.

So you can sometimes get good deals at a rural dealership with low fixed costs, even if their volume is not the highest in the area.

Toyotas these days carry an average of over $1000 in factory rebate. The dealers may not tell you exactly how much it is for the model you want.

snipped-for-privacy@ucla.edu wrote:

Don't worry - ask for the amount of the rebate off the invoice. That doesn't affect the dealer's profit, usually, as it's paid by Toyota as an incentive for you to buy that car.