All-new '05 Avalons are starting to appear at dealerships.

I took a ride in a silver '05 Avalon Limited. Very nice, but pricey at $37K. My midwest dealer is selling (offering) at full sticker list! How long will it take for prices to drift down to acceptable discounts, do you think? And what is a good price to ay for an Avalon that stickers out at $37K? Norskey

Reply to
Norskey
Loading thread data ...

Ask them to show you the invoice, or look it up on edmunds.com and then pay

100-500 over this invoice... thats all i pay, and i buy new cars every 5 years... My last car was a 2005 Toyota Sienna limited 4wd with nav and dvd entertainment system. The sticker was $41,000 I paid $36,500. I was originally looking at the Honda Odyssey, but the guy would not budge on the MSRP. Dealers that dont budge, or gauge people never get my business.
Reply to
Dan J.S.

Car-buyers like me remember when dealers try to take advantage with added profit scams. It may be just a coincidence or my imagination, but the few cars I've seen dealers trying to milk ADP from all seem to turn out to be weak in sales, given time. Good case in point is the newest Ford Thunderbird. I vaguely remember car dealers adding extra profit to small cars furing the 70's gas squeeze. Can you imagine, in retrospect, paying above sticker for a Ford Pinto or Chevy Vega? I know that supply and demand dictates some of the prce, but dealers also contrive shortages by using terms lke "allocation", suggesting scarcity when none exists. BC

Reply to
BleuChien

It is common for shortages of new models to exist, mostly because it takes time to ramp up production speed and to produce enough to send to dealers.

It is not that easy for a dealer to "contrive" shortages because a consumer can usually see what is on the dealer's lot. If a dealer has dozens of a particular model on the lot, the "shortage" is obviously not as severe as if there is only 1 on the lot.

Toyota's allocation system is designed to equalize days supply among dealers in a region and among regions, so that theoretically, every dealer in the country will have a similar days supply. Days supply is a way to measure a dealer's inventory. If dealer A sells 60 cars a month and he has 60 cars on the lot, then dealer A has a 30 days supply. If dealer has 30 cars on the lot, he has a 15 day supply, and so on. Days supply is calculated for every series and model. When vehicles are allocated, the aggregate days supply for the region including the new ones in the pipeline is calculated. Once the new days supply is calculated for the region, then each dealer is allocated enough of each series, by model if possible, to bring the dealer up to the same days supply as the region.

Whether sales of a vehicle are strong or weak, if every dealer sells vehicles at the same pace, and no more vehicles enter the pipeline, they will all run out at roughly the same time. When a model is in short supply, dealers can "earn" more vehicles than other dealers by selling vehicles at a faster pace than the other dealer. The methodology should theoretically discourage dealers from "packing" a car that is hot and in short supply because a higher price would slow down the sale pace and the dealer would earn fewer replacements. In reality, if the dealer knows that replacements are a long time coming, he will be more tempted to mark up the MSRP.

Reply to
Ray O

snip

Gee...I always thought that MSRP meant Manufacturer's Suggested Retail Price...didn't notice when they rescinded that AND changed the spelling of Dealer to Mealer.

Reply to
Gord Beaman

Thanks to anti-trust laws that prevent price-fixing by manufacturers, dealers are free to charge whatever they please for the products they sell.

Reply to
Ray O

Ok...while I'm all for free enterprise why do they call it "Manufacturer's Suggested...." then allow retailers to change it? ...sounds misleading to me...

Reply to
Gord Beaman

The manufacturers can only suggest a retail price. As I understand the background, Monroney labels (window sticker) are required by federal law to prevent dealers from trying to rip off consumers.

Since the retailers buy the product from the manufacturer and not on consignment, the retailers own the product and are therefore free to sell if for what the market will bear.

Reply to
Ray O

And they are also free NOT to sell it if no one wants to pay their price. We have a dealer down this way that won't budge an inch and so most people here just go up to Chicago for a better deal. He's mad all the time but it's his own fool fault. I told him that 12 years ago. He doesn't understand the Henry Ford/Sam Walton concept of selling: Product sitting on the lot makes no profit. He had, back in 1999, BRAND NEW, practically 0 mile 96 Corollas he was still trying to sell for sticker with no discounts of any kind. Well, it's a new car. So, check the Blue Book, it's now 3 years old without moving a fender. Sure low mileage is a plus, but not enough to bring it back up to sticker. I get worried about cars that have sat that long. What's wrong with them, that they didn't sell them in 1996?

(I've been walking out to my car once a week and starting it and let it run for 5 minutes. I'll be able to drive in 3 more weeks!)

Charles of Kankakee

Reply to
n5hsr

Of course dammit...I'm not arguing THAT Ray, as I said, how can a dealer, who is not a manufacturer, change an MSRP? You say that MSRP is used to prevent dealers from ripping off the public, but that makes no sense IF dealers are ALLOWED to CHANGE MSRP's themselves?...sounds like false advertising to me...

Reply to
Gord Beaman

Well, this is splitting semantic hairs, but dealers are not actually changing the MSRP. They are changing the actual retail price (ARP?) in accordance with what they perceive as what the market will bear. The manufacturer's suggestion is still unchanged.

Reply to
Ray O

"Ray O" wrote: snip

OH!...sorry...I mistook your statement to mean that the dealer was actually 'changing' the MSRP. Here's your statement:

quote: In reality, if the dealer knows that replacements are a long time coming, he will be more tempted to mark up the MSRP. unquote

(I took "Mark up the MSRP" to mean that the 'dealer' was increasing it...)

Reply to
Gord Beaman

Upon re-reading my post, I can see that it was not communicated clearly. Sorry!

Reply to
Ray O

Hmmmmmmmm? What does the acronym MSRP mean? ;)

mike hunt

Gord Beaman wrote:

Reply to
IleneDover

You're saying that you don't see my point Mike?

Reply to
Gord Beaman

I was simply asking a rhetorical a question, since IF the price was set by the manufacture it would be a violation of federal price fixing laws ;)

mike hunt

Gourd Seaman wrote:

Reply to
IleneDover

That's probably true Mike...I suppose they get around it by calling it a Suggested price, eh?...

Reply to
Gord Beaman

Some dealers don't know how to move product. They think that product sitting on the lot is making him more money than product moving through and generating income.

We have a dealer that will not budge an inch from MSRP. In 1999, he still had BRAND NEW 1996 Corollas on his lot he was trying to sell at sticker with no discount at all for age.

C'mon, it's RETAIL. You don't make any money if you aren't selling anything.

Charles of Kankakee

Reply to
n5hsr

Some dealers don't know how to move product. They think that product sitting on the lot is making him more money than product moving through and generating income.

We have a dealer that will not budge an inch from MSRP. In 1999, he still had BRAND NEW 1996 Corollas on his lot he was trying to sell at sticker with no discount at all for age.

C'mon, it's RETAIL. You don't make any money if you aren't selling anything.

Charles of Kankakee

Reply to
n5hsr

Fortunately, those dealers that do not know how to move product tend to go out of business.

Reply to
Ray O

MotorsForum website is not affiliated with any of the manufacturers or service providers discussed here. All logos and trade names are the property of their respective owners.