Don't buy, let the car dealers eat cake.

@seadoo4life127

9 ай бұрын

The problem is, so many people are so stupid and they just don’t care about money anymore.

@Cobratate723

9 ай бұрын

yum

@LFOD1776

9 ай бұрын

Eat shit is more like it.

@ilkhomkhodjaev3050

9 ай бұрын

YESSSSSS, damn yes 🎉🎉🎉🎉

@nicemarmot666

9 ай бұрын

I agree, and don’t vote for anyone who wants to bail them out.

How the Hell did we get to the point where a damn pick up is 70 + grand. INSANITY!

@DennisCoffman-dd8ok

9 ай бұрын

You should really ask how we got to the point of $70k+ for American full sized pickups. Tacomas are no where near that price and are a good option. The truck in this example is probably near the top of the trim level with all kinds of bells and whistles. That's what you are really paying for. I call those trucks poser trucks. Someone's going to buy them, but never use them as they are intended. Hauling stuff, getting the bed dirty, etc. My wife and I use our Tacoma to haul mulch in, etc. If it gets dinged up a little, it gets dinged up. It's a truck. As long as it has AC, power windows/locks, and a towing package, we're good. We don't need heated/AC seats (nice, but not needed). Or auto start. Or a special appearance package. Or a lot of the other junk that people throw on.

@user-gz4ve8mw9l

9 ай бұрын

Even luxury german 4 door sedans used to cost Under $40k for non entry level back in early 2020. Fast forward to today they are charging $50k-$90k for lots. Cars that cost $38k in 2020, this is insane levels of greed. Nowadays the cheaper cars are no longer inexpensive. So many 'less expensive' vehicles have sticker prices of $25k-$45k+. Most trucks are costing upwards of 6 figures easily, especially brand new ones.

@ourtube4266

9 ай бұрын

It’s no longer a work vehicle, it’s a luxury commuting vehicle for people who think that going hunting or camping twice a year justifies paying half their income in diesel, mechanics and vehicle loans.

@Upliftyourbrothers

9 ай бұрын

We will Build back better

@dwaynemauk566

9 ай бұрын

You have way too many people who not only don't "need' a truck, but want all the bells and whistles on it, that have nothing to do with it being a truck. Wifi - Bluetooth, seat warmers, digital radios, you name it. Watch ads, especially if a woman is driving in the ad - she's carrying on about how the leather seat warmer is warming her psoterior, or how smooth the steering wheel is. All I want to know is how much power, and what load can it haul.

The dealers screwed people. They were charging $200 for air in the tires. They called it special air, but it was just ordinary nitrogen the same stuff we breathe. My company purchased four or five trucks, every four or five years. The dealership wanted close to $100,000 each to replace them. I walked out. The dealership I have dealt with for over 25 years has called me back three times and said they can do a lot better. I said I am no longer interested and I am going to maintain my present vehicles. They deserve exactly what is happening to them.

@Eric721.

9 ай бұрын

Good for you.

@coastalhillbilly3419

9 ай бұрын

Better to spend money with hard working, honest independent mechanics than greedy dealerships.

@dreysbimmer

9 ай бұрын

It’s not regular nitrogen. It’s concentrated nitrogen. The benefit of it is that the pressure doesn’t get affected by temperature like regular air. Most of us get a tire light after summer ends and colder temperatures set in. Nitrogen filled tires tend to not do that. I also had a Jeep Wrangler on 37s and going up to Tahoe from Sacramento I was running late and drove it like a sports car. The flexing of those sidewalls heated up the air inside and between the air heating and expanding it took the tire pressure from mid 30s to 54PSI. Making it even more dangerous. This is an extreme example as no body should have been driving like I was on a car like that but nitrogen filled tires would have prevented that.

@rbiddy5893

9 ай бұрын

@@Mymenagerie714 hilarious...blinker fluid i love it🤣

@DennisCoffman-dd8ok

9 ай бұрын

@@dreysbimmer in the end, though, how much does it cost to refill tires, say 4 times a year (it's free if you have a costco membership as their tire refill stations are not manned). Even if it is, say $5-6 bucks, you're paying $20 to air up tires. It'll take you 10 years to break even. You can try and justify nitrogen in your tires all you want, but normal air already has 78% nitrogen... You're not getting much more nitrogen and I bet you probably aren't going to make a special trip to the dealership to air up with nitrogen. And, by the way, if you financed that $200 nitrogen (at time of purchase), you're paying more long term with the interest rate. It's garbage. Any way you want to slice it, utter garbage. Your example is maybe a less than 1% chance of ever happening.

The dealerships thought they were screwing us, and they did for a little while but what they have really done is screw themselves for the long term. I am disgusted with them.

@athletikonaol

9 ай бұрын

Hidden behind the pricing model of these vehicles is a secret new "Carbon" economy. Gas vehicles are being penalized according to size and power, and EV's are awarded "Carbon Credits" probably worth more than they are... in this criminal underground economy. Manufacturers must have the EV credits if they hope to stay in the gas model business... THIS is why they're boneheadedly making EVs no one wants. This is apart from the direct subsidy EVs get, and the CAFE standards which are CRUSHING gas models and from which EVs are exempt. Yes, the dealerships deserve what they're getting, but the psycho pricing is in part thanks to the Eco-Psycho Demonrat party.

@Saytheodd

9 ай бұрын

I am sorry. I was in the industry while dealers were and it was horrible hearing the horror stories of price adjustments and basic greed.

@emptypocketsjobs3545

9 ай бұрын

Until you get a job and can afford a car.

@jerrypolverino6025

9 ай бұрын

@@emptypocketsjobs3545 What?

@rodger7029

9 ай бұрын

😂😂😂😂😂

My brother in law has three business which all require good durable trucks, it is so much easier to hire two good mechanic's to maintain his 43 trucks pay those men very well, than to buy any new vehicles, down here in South West Texas he says they have all lost their minds. He uses the word pinche dealers allot, and I quote "We will watch the starve". People have had enough of the stealerships BS.

The problem is people are willing to pay these outrageous prices.

@zachjones2346

9 ай бұрын

Exactly. The market determines the price.

@MrAlvarez23

9 ай бұрын

Bingo

@USMC6976

9 ай бұрын

People are buying a payment, not a vehicle

@zzanatos2001

9 ай бұрын

I don't see how they do it. I make very good money and have almost no debt - but I can't afford an $80K pickup truck.

@USMC6976

9 ай бұрын

@@zzanatos2001 They buy payments. You don't buy payments. You buy a truck and when you see how much the truck costs, you realize it is a bad use of your money.

Reached out to a dealer 100 miles away….to inquire about a dodge Charger scat pack that has been sitting for 6 months. THEY NEVER MOVED FROM MSRP. I reached out to them at the end of every month for the last 3 months. Never moved from msrp. Reached out to them yesterday….they stated that “it was sold”. I would not be surprised if they moved the car to another dealer to reset the days on the lot number.

As a former sales manager, the dealer isn't the only one feeling the pinch. The sales manager and general manager also get bonuses based on the profits. No profit, no bonus.

@jerrylundegaard2592

9 ай бұрын

Oooooh, are we supposed to feel sorry for car dealer sales and general managers? We think not. Those sales and general managers are the people trying to screw customers.

@subaruamazon

9 ай бұрын

sold cars in college. they get a cut of EVERY car sold.

@melvinjacobs2328

9 ай бұрын

I wasn't talking about the cut on every car, I was talking about the monthly bonus.@@subaruamazon

@paulburket

8 ай бұрын

I’m sure the bonuses during Covid car bonanza was enough to spread out over a few years.

@ianbelletti6241

8 ай бұрын

It's their own fault if they are trying to bilk money out of customers to earn their bonuses.

The car market over the past 2 years has only shown how stupid most people are with their money.

@dpd2k105

9 ай бұрын

Buying these overpriced cars is bad enough but financing at these rates is another level of stupidity

@zzanatos2001

9 ай бұрын

I saved up a huge pile of money to buy a new Lexus, but when 12-month CD rates hit 5.8% I invested every dime I have. There's just no way I can bring myself to spend $80,000+ on a depreciating asset when I can make nearly $5,000 by leaving that money in a CD for a few months. My 2004 4Runner will be my daily driver until dealerships come back to Earth.

@sheldondrewett4123

9 ай бұрын

Then they Blame capitalism instead of their dumb purchases

@naomipinckney

9 ай бұрын

😂

@aim-for-greatn3z947

9 ай бұрын

If you live in America this is NORMAL. American consumers have NEVER NEVER been smart!

I had a dealership call me today, saying they saw I was interested in buying a vehicle over a year ago, and wanted to know if I was still interested…… I chuckled and said NO!

A little payback time. You know you're cutting deep during negotiations when the sales manager had to come out to add their weight to the deal and complains about making a profit. Just look them in the eye and ask him/her if they really want to sell! They're probably counting on the F&I person to get a bunch of add-ons and the extended warranty. I think dealerships make the whole purchasing experience as painful and time wasteful as possible. Be strong and stick it to them, they deserve it!

@loseerich493

9 ай бұрын

To me personally, the F&I stuff is BY FAR the most miserable portion of the car buying experience. I absolutely loathe it & is a major point in trying to not buy another vehicle from a dealer as long as I possibly can.

@chefgarrin

9 ай бұрын

I have only purchased one new car in my 60 years, the first was a Camaro when I was naive and they took almost $6000 from me which I only realized 6 years later. I absolutely HATE, yes a strong word, HATE dealerships and the sleazy pr@cks who run them.

@loseerich493

9 ай бұрын

I literally don't know how some of them sleep at night. I have a step son who's been a service writer for dealerships for over a decade. When he recently went to buy a car for his wife at a dealership outside of where he works the dealership ran a Mt of B.S. on him, mainly thru the F&I process... this was with them knowing what he did for a living. You can't make up just how sleezy these people are@@chefgarrin

@subaruamazon

9 ай бұрын

fol, oh a slimy dealership, how unusual lol.

@smileychess

9 ай бұрын

I rolled a dead car into a dealership and they knew i was captive. After hours there, they kept sneaking extra fees on the paperwork, and I kept refusing them. Eventually I looked at my buddy and said “Mind if we take the bus home?” That got their attention, and bingo all the crap was removed from the paperwork and I made a purchase.

I received a great deal on a Tundra a few years ago because it had cloth seats and it sat on the lot for over six months. My purchase price was $32K and the MSRP was $41K.

@MrAlvarez23

9 ай бұрын

Awesome

@josepepuriostegui8471

9 ай бұрын

The tundra nowadays would cost you about 55k

@DabsDad

8 ай бұрын

@@josepepuriostegui8471 and no longer available in V8

@johnharris6655

8 ай бұрын

What was the actually Dealer Invoice. MSRP is a number made up by the Manufacturer required by federal law on every sticker. The Maker sends the car to the dealer and says we want this much when you sell it, that is the True invoice. It is often 30% below MSRP or more.

@rustybyrd6030

8 ай бұрын

I bought tundra 2008, 2000 dollars and sold it for 7000 dollars.

I worked for a floorplan company for 36 years. It was my job to go to dealerships and account for all the inventory that my company purchased for that dealership. The program was basically pay as sold meaning once the dealer sold a vehicle they need to pay the floorplan company for it. Floorplan rates are typically 1-3 points over the prime rate. Most manufacturers will typically give a Dealership a free floorplan period which can range 5 days to 3 months give or take. Where a Floorplan company makes the most money is when a dealership turns a vehicle over rapidly. The floorplan company may have been paid 3 months interest up front by the manufacturer and if a dealer turns the vehicle right away the floorplan company has made 3 months interest and got their money back in say a week. A dealership that is on top of things will dump that vehicle before the free floorplan runs out even if they have to cut into their holdback which most manufacturers give the dealer after a sale. The whole purpose of my job was to make sure Dealers were not floating their payments back to my company. Meaning sitting on the funds of the sale while the inventory was still under the free floorplan period.

@bella3008

9 ай бұрын

So, what's happening with regard to floorplan now and what should buyers know about it?

@jeffsingleton88

8 ай бұрын

Yea. What she said. Whats the point?

@stevecolombe4446

8 ай бұрын

The point is mentioned in the video. Watch for when a vehicle that you are interested in arrives at the dealership. After it has sat on the lot for a considerable amount of time, look for the dealer to drop the price substantially before the free floorplan period ends in order to avoid paying high interest on the vehicle. Sometimes they are willing to take a small loss in the short term rather than taking a larger loss down the road.

@linkfeeney8873

8 ай бұрын

I never heard of this floorplan before... so you guys purchased it for the dealerships?? and I thought the dealerships purchased the allocations from the makers? I wish I can understand in more details... like DETAILS... this is very interesting...

@glamdring0007

8 ай бұрын

Lets say a manufacturer has 10 new trucks for a dealer cost of 100k each. That would be a cool million...most dealerships can't fork over a million for 10 trucks to sell. Essentially they use a bank entity as a middle man between themselves and the manufacturer and secure an interest only loan of say 60 or 90 days on the 10 trucks. To help the dealers the manufacturer might even help them make the interest payment for the first few weeks as an incentive to keep the factory output to dealers humming along. After that grace period is over the dealer has to start paying the bank entity the interest on their own. If they sit on one of those trucks long enough they will start to owe principle as well. So when the vehicle has been on the lot for 90 days or more the dealership will really want to get out from under the loan before they start bleeding profits. Large monthly interest payments to the bank entity for a truck sitting on a lot long term can quickly equal the entire profit the dealership stood to make in the first place. @@linkfeeney8873

And they're even asking exorbitant amounts of money for older cars with high mileage like over 100,000 it's absolutely ridiculous

I looked at some vehicles and the dealers had these local market additions. One added $1999 to the price in extras like life time free oil changes, ceramic treatment,and tire rotations. Other dealers had lifetime window replacement/ repair. The sales person told me that I could not opt out of the extra $1999. The manger tried to hook me by taking the $1999 in extras off of the price.

Due to several bad dealer experiences, I only buy from private sellers who have detailed maintenance records.

@hokie9910

9 ай бұрын

Smartest man on this chat.

Those 3 examples are American vehicles being way too overpriced for anyone who is looking. Drop prices by 30% and maybe maybe they won't have inventory sitting for 6 months or longer.

@quackula9190

9 ай бұрын

40%

@mitchaser5159

9 ай бұрын

@@quackula9190140%

@gavnonadoroge3092

9 ай бұрын

50%

@kenshinhimura9387

9 ай бұрын

Even if they drop prices by 50% majority of Americans still could not afford these cars

@corydodge1691

9 ай бұрын

There is no reason for a new, mid level F150 to cost as much as a top tier diesel 1 ton 4 years ago. The price needs to come down at least 50%, to make sense.

Over simplification. They've gouged prices so drastically over last 3 years they know they have dozens of thousands of profit built in to stomach units sitting

I used to work for a lending institution that did for plan loans. In addition to the interest carry cost, after 60 days of a vehicle, being on the floorplan, we would require principal paydown of that vehicles fraction of the loan. Our dealers were very motivated to move stuff before it hit 60 days.

@subaruamazon

9 ай бұрын

es, can u break that down?

@iwasntlooking87

8 ай бұрын

@sub, I think he's saying, at the 60 days mark. The lender will require a portion of the principle loan. So like as an example, if that truck is still sitting there at the 60 days point, the lender will ask for 1/10 of the $75,000 principle loan on the vehicle. I could be wrong, but it doesn't seem like they're going to reply.

Lots of these dealers are too stupid to get it. They try to make you believe that IF you do not buy it at their ridiculous price today, SOMEONE else is going to come and buy it tomorrow! Well, I have had that happen, where I walked out and 3 months later that exact same vehicle was still there! I had bought something else in the meantime and kind of enjoyed the thought of KNOWING they have floor plans, costing them money and them losing money on that vehicle! Stupid gets as stupid does!

@pendeltonthecook

9 ай бұрын

I was looking at a vehicle about a month ago. I got all the financing numbers and trade in values from the dealership and said Ill have to go home and think about it. I had an email with a price drop of 1500 before I made it home, a 25 minute drive. Its not the pandemic anymore, the lots are full again, supply has caught back up to demand. Dealerships just dont want to give up the easy money.

@memphisraines8118

8 ай бұрын

Was helping my dad look for a lexus. Went to test drive one. Guy said 0 negotiations that it was a hot suv blablabla. We walked out. Very next day guy called and said ok come back and they were willing to deal. Called every day asking my dad to come back. Sure enough 2 weeks later we found a better deal at a different dealership 😂

I work for a floorplan company. When I bring that up in conversation at the dealership, the course of the negotiation changes instantly.

@gavinpercy.

9 ай бұрын

How so? What insight can you provide

@tood6459

9 ай бұрын

@@gavinpercy. they know that I understand how the dealer makes money, and that I know how the car I'm negotiating for costs them more money the longer they keep it. At that point, they're more willing to come to a fair agreement. And if not, I walk.

@cyclopsvision6370

9 ай бұрын

@@tood6459 It doesn't matter if it costs them money to sit on their lot if they can get someone to buy it tomorrow.

This is one of the most informative videos I have seen from you guys. Great work.

We had our first child October 2021. We all couldn’t fit in our Subaru crosstrek. So the local Subaru dealer as next to the VW dealer. We checked out a crossport and it fit. We went through every dealer red flag and made the worst car deal ever. $7k market adjustments, talked about payment and got a $5k down payment on a lease, and every single finance add on for another $1600. Just left a sour taste for the last 2 years. And I’m so glad I found your channel. We are in the market again for a second car and I’m using all the tools you teach to grind every dealer that contacts me. I won’t quit until I get at least $5k off MSRP and no dealer add ons.

@subaruamazon

9 ай бұрын

car salesman here in college. the cost of the car is high. A corolla may list for 25k but the dealership may only have 1500 to play with. ie own it for 23,500 or 22,500. I dont know but you have to be realistic. If they cost is 22500 and it lists for 25,500 if they gave you 5k off, they are in the red 2000. you have to be realistic. low end cars they may only have 1200 to play with.

@subaruamazon

9 ай бұрын

you can always ask to see the invoice. if they say no. move on.

Here in Florida, Japanese car dealers just keep selling their vehicles as soon as they arrive

@mitchhedberg4415

8 ай бұрын

Still waiting lists here for Honda/Toy

"I have a "Floor Plan"... It's called paying CASH for a 94 Celica and not having a Stupid car payment, because if you can't afford to pay cash for a vehicle, you can't afford the vehicle in the first place." Scotty Kilmer

@lisag18

9 ай бұрын

I love Kilmer but A. He works on cars B. In his own garage C. In his own house. Not everyone has all his advantages and have to travel to work and need a vehicle. If one lives in a rural area and/or work overnight shifts, t's not like there are busses at 11pm or 5am. If something goes wrong with his car, he works on it. Why do think he bought that Celica? Not just because it's a great vehicle, he knows how to fix it and he works from home. No travel.

FYI, one of the hardest vans to find is a new Sienna. I had two calls this week with dealerships having a new one to offer me, and the local lot had five sitting on the lot (not sure if they were all new). I have not seen this in a year of searching for one.

@aheadoftheclass1718

8 ай бұрын

For a Sienna you're going to have better luck reaching out to a dealership in a small town because they're not moving them at a high rate & you won't have to worry about Market Value... I went 3hrs away for mine.

Remember if you buy an older (sitting on lot) vehicle to get a scan or print out of items like brakes, tires, and battery condition. If you have a car sit up for 6 months and then sell it, if there is no dealer or retailer “lot maintenance” the vehicle may not operate at its best or have some noises and or issues you might not want to deal with.

@subaruamazon

9 ай бұрын

is that permanent?

The other issue is while the dealership has floor plan costs, however the customers interest rate is much higher making sone of these $70K-$80K vehicles prohibitively expensive for the customer

Over the weekend I checked Toyota RAV4 Prime plugin hybrid, and now the dealers are ready to sell at MSRP without any markups, addons... Things are definitely changing... Hangin there good deals are around the corner

@ChicagoRob2

9 ай бұрын

Not my dealer- not even close. They went from 225 cars in 2017, to 5 cars in 2023. One of them is a RAV4 Prime plug-in hybrid. It has a $5K market adjustment, plus an extra $5K accessory sticker. The car has been sitting there for five months.

@ripler16

9 ай бұрын

Buying at MSRP isn't getting a deal. People have been conditioned to think buying at MSRP equates to getting a good deal.

@rajivsingh101991

9 ай бұрын

@@ripler16 I agree with you 100% The definition of deal is changed post covid... we are made to think that MSRP is the deal now....

I really wish we can buy directly from the manufacturer. They tried putting me through the grinder on a used vehicle. I told them I wasn't having the add-on bs and if they kept pushing it I was walking out the door. That was back in 2018 before things went crazy.

If they sold at or slightly below msrp, they would sell cars upon delivery and owe zero interests on their floor plan loans. So it's obvious that they have some kind of benefit like a tax write-off if they rack up debt from loans. Debt and loans help the rich and corporations thanks to tax and bankruptcy laws that benefit the rich and corporations. Loans and debt are only detrimental to working class or the poor.

@pipi7731

9 ай бұрын

I was just thinking of the same thing. One thing that crossed my mind was storm damage. Insurance pays off and they dont need to sell anything. They simply sell them off at auction. I am seeing used car dealers with lots of new cars on their lots and I base this on mileage.

@hothmobile100

9 ай бұрын

@@pipi7731 exactly. The rich and corporations have a thousand ways to make money based on our laws that are created by special interests/corporate PACs to legislators.

@cyclopsvision6370

9 ай бұрын

The dealers don't need to sell at or below MRSP when inventory is tight. If you are not going to buy the vehicle today, someone else will buy it at the asking price tomorrow, next week, next month, etc.

I usually order vehicles and also usually do well on price because I shop multiple dealerships. If I do buy off of the lot, I will look for holdovers or vehicles that have been sitting like you talk about in this video. I always bring up flooring costs if they try and play hardball. My dad was an F&I guy at a dealership and I learned from watching him haggle with salesmen. It was like a game with him and he actually enjoyed it.

@brianperry4815

8 ай бұрын

Haggling is an art. My Mother had a friend who was a Master at it. When buying something she always ask what are you throwing in?? A toaster of some other thing. Also flea market swap meeting ect... go around see something and say Nice but another booth has same thing for x less. Will you match??? The fun of it all.

Great teachers make learning easy. Thank You.

Thanks again…you both are awesome!

Other thing to consider is cars sitting on lots for months to years is not good for them... I highly doubt the dealerships do much in terms of taking care of them. Plus if they get enough "test drives" your looking at a lot of miles put on the car before it even gets sold, you leave it there for long enough and it might even have enough to qualify as "used" imo.

It isn't just the dealers. It's also the banks that approved the loans for people who were on their stimulus packages, rather than qualifying them the traditional way - No job/work. No loan.

Having managed and operated car dealerships for many years, I can clarify that the concept of flooring doesn't necessarily compel dealers to sell cars at lower prices. When a vehicle is sold, it is promptly replaced by the manufacturer, and the dealership continues to incur flooring costs for the new inventory. While I may not be well-versed in the intricacies of accounting, I believe such expenses can typically be tax-deductible. The real impetus to move older stock comes from the manufacturers themselves. If a car stays on the lot for an extended period, we often receive calls and subtly urgent emails from our factory representatives encouraging us to expedite the sale. To address this, we might incorporate these units into our "rental or courtesy, also known as service loaner" fleet, which effectively marks them as "sold."

@Scotty_in_Ohio

9 ай бұрын

I agree! Dealerships/ dealer groups have gotten high off of their own supply (profit) over the past 3 years and have become "stubborn" - as long as walk-ups continue to pay (sometimes way) above MSRP they feel justified (even emboldened) in their business practices.

@dreysbimmer

9 ай бұрын

@@Scotty_in_Ohio yeh but dealers can’t survive off walk-in alone. They have to be competitive to keep the factories off their backs. So if the supply catches up with demand things will be back to normal. BTW at the moment there are still many hot cars that demand a premium over msrp like hybrid Toyotas… so I don’t think we are out of the woods yet.

I worked as a Porter when I was in high school in the 1970's at a large Pontiac dealer. I remember at least once per month, two well dressed gentlemen from General Motors Acceptance Corp. would come in and actually walk around the lot with the General Manager of the dealer and review the "book" of the floor plan. This is when gm was GM and there was tremendous pressure to sell vehicles that were getting stale from sittng around the lot. It wasn't a problem with hot selling vehicles like the Grand Prix, Firebird or TransAm. Usually vehicles like the Pontiac Sunbird were the issue. Good video and I agree with the points. Thank You!

The consumer wins. Just wait out both the cars and housing market.

@PinkTaco99

9 ай бұрын

Lol okay. What if you need a car? People have been saying to wait for the last year? How long do you wait lol hilarious post

@hokie9910

9 ай бұрын

@@PinkTaco99seriously? 90% of cars being purchased are wants not a need. You blow a transmission put a new one in and buy yourself several more years. Who really needs a new car….not many people.

@PinkTaco99

9 ай бұрын

@@hokie9910 disagree. Ur engine pops in an over 20 year Honda accord with over 220k miles, ya ain't dropping over 3k imo for a new engine. I agree with what ur saying but for us in this position, people are saying wait prices will go down, prices will go down bla bla which they have not in over a year.

@hokie9910

9 ай бұрын

@@PinkTaco99 If the Honda is in good condition I would absolutely drop 3k, that’s only 3-4 months of payments on a new car, and after those 3 months your back in good. Prices will go down, just like it did in 2000 in the stock market, and again in 2008 with real estate and the stock market. Bubbles always pop, always. We are already starting to see cars sit on lots, the dealers are throwing their little tantrums right now, but the people are starting to pull back and the dealers at some point will have to drop prices. They can only pay huge interest rates on millions of dollars every month for so long before they relentlessly. It’s a game of chicken right now, please don’t be the first to blink.

@SGavin

9 ай бұрын

​@@hokie9910 Agreed, it's cheaper to keep an older car of it fits your needs. I am the original owner of a 2007 Honda Element with about 182k miles, and it just keeps going with regular maintenance. No plans to get a newer used car for probably another 3 years or more, and even then, it will likely still be a good running vehicle.

I tried to buy a 2023 ford f350 tremor today and the salesman said it had been slow. However the dealer did not come off of sticker enough to sell me the truck. There going to have to sit on the until December I guess or until huge factory rebates come down from ford.

The market prices have been goofy since covid. Inflation doesn't help one bit. A correction in the retail market (autos, consumer goods, housing) is going to be painful and prolonged. My guess is the "big three" are banking on government bailouts.

@SchoolforHackers

9 ай бұрын

Just nope. Not again.

@jeremytaunton8813

9 ай бұрын

@@SchoolforHackers the leadership in DC has been there a long time

@matthewronson5218

9 ай бұрын

It's not called "Government Motors" for nothing. When the government can fire a CEO and install their choice, that's all you need to know to see it was a steals nationalization of what remains of U.S. auto manufacturer.

@Bigfoothawk

9 ай бұрын

The government is broke too. Actually $-33 trillion

@marksmith1784

9 ай бұрын

Totally agree. Privatize profits, nationalize losses.

Your argument is very well thought out, completely logican and makes perfect sense to consumers. The time we are in right now in a tough economy also underscores how logical your points are. BUT where it goes off the rails is this: Todays companies have never been as delusional as they are now. There is NO such thing as dropping prices or anything that could lower profits, even if that makes more profits in the long run. Recession hits, and instead of lowering prices they raise prices to offset the financial hit. Then when things return to normal, prices stay high. Companies will never lower a price.

Excellent information!!!!!

With the present costs of new vehicles being outrageously high, and now the big three OEMs giving in to 30% pay raises going forward, either they start producing their vehicles south of the border or they will certainly face bankruptcy within five years.

They left out like two major cost. The cost of the property they sit on, including property taxes, the other is the cost of insurance on these auto's. Average Joe can not afford 100k trucks, that is insane. The manufacture need to cut cost big time. These dealer markups were insane also. You got to win the Powerball to be able to afford these.

Amazing video, thank you for sharing.

I find this so interesting. The dealer used to refer to something - PAL or something, it was an abbreviation - recall thinking they called it a lot fee. I asked once, and they said it is nothing to worry about the accounting distributes it around to cars.

So correct,i cant tell you the huge gross averages my buddy as a manager in a Ford store put up.Numbers were insane.

I got a 2019 Ram Laramie new within months coming out for $12,000 off at $42,000! They haven't changed a thing since then and now you can barely get a Big Horn/Tradesman for that price.

@josepepuriostegui8471

9 ай бұрын

Yeah, a tradesman is about 50k! Those were Laramie prices not too long ago 😢

"It's not a Museum, move that metal"

You need to go into the details of how the floor plan works. My understanding was the dealer paid interest by the month. Not by the day. Take two vehicles with the same dealer cost. One sells on the third of the month, the second on the 28th of the month, the floor plan costs are the same - because the floor plan interest is paid on a monthly basis. Therefore if you wait till the end of the month to buy, you’ll have a lot more leverage because if the vehicle isn’t sold by the end of the month it will incur a full month of floor plan costs effective the first day of the next month.

Yes, it is a avoiding financial loss incentive for dealerships to sell a vehicle soon and not having it sit on the lot too long. But having no cars on the lot, and creating bs excuses like supply chain issues, covid, my dog ate my homework..., and making more on each unit has become the new greedy and sleazy norm. Not to mention when buying over priced American made vehicles that don't last making this process of bending over and buying a vehicle happen more often in a lifetime than it would if our manufacturers built better stuff that lasted. Good stuff guys. I always enjoy your straight shooting no bs segments. Thankyou

A car is a piece of equipment. If the car is maintained and decent from the start, it should function indifinetly. I own a 1997 Honda Del Sol Si. I purchased it new. I have maintained it. It has 219,000 miles. It is my only car. It has been very reliable. It is fuel efficient. It handles beautifully. The engine easily Reeves to 7k. For A 1600cc Vtec motor it is responsive and would easily cruise 100mph. After 26 years of driving it, I have no intention of selling it. I may put classical recaro seats in. The handling of this car is fantastic. Financially I am very far ahead. I have not had a car payment since 1999. Driving experience for a two seater convertible with a trunk is great. Some people have said it is a thinking mans convertible. I Agree.

@hokie9910

9 ай бұрын

Your the man! Awesome, keep the ole gal going.

@subaruamazon

9 ай бұрын

james, there are a lot of lessons taken from u that the audience can glean. first off, no debt. you owe no one nothing. second, you dont need a new car and can sit with what you got at least for the time being. honda/toyotas are great. 07 camry 144k miles here. cars taken care of can last a good long time. older cars and better made than new cars. you dont have to have a new car with at 7k markup to make u a slave of ford finance. old cars can be fixed and kept. great job and great lessons learned from u.

@hokie9910

9 ай бұрын

@@subaruamazon Great advice. I actually just gave my annual talk to the graduating seniors at Virginia Techs business school earlier this week. In my 20s I took a lot of financial risk, ALOT. By 30 I had dealt with debt in real estate, I sold everything off and decided moving forward the only debt I wanted was my house. Paid my cars off and have not had a payment since, one of the best decisions I have ever made financially. All of those payments I would have made I have invested in my family’s future. Car payments are the financial killer for most households.

@mitchhedberg4415

8 ай бұрын

Maint will not overcome defective designs or assembly.

The very fact that they have inflated the prices to $80,000 puts me completely out of the market. I refused to even look at a F-150 when they were $50,000. No way I pay half of that for a crappy Ford. A $37,000 Tacoma was stretching it.

Our last new vehicle purchase was in 2007 and the last vehicle was purchased used in 2017 and they both are in great shape. If we purchase again it will be when the dealers are crying for buyers

When you find a car on a lot you want to buy how can you look up how long it’s been sitting so you can calculate floor plan cost for better negotiating.

First to comment, these prices are a house of cards that can’t last. Where are all these “up-market” buyers they keep trying to manifest??

@jthonn

9 ай бұрын

I agree, they are out of whack completely on prices. It would help if they wouldn't put a bunch of crap we don't need on these vehicles. I don't need to clap to "we are the champions" while driving. It will also cause more texting while driving, think about it.

@Bonanzaking

9 ай бұрын

People have said that since a camry used to cost 16k and since cars costed 2-4k. Yet look at where we are.

Very helpful video.

Bought a Subaru Accent on 9/30. Dealer was coming off 3700$ and got another 2500$ off. Had to jump the battery to start it. Last day of month to make quota. Came off the extended warranty also.

Just curious… How stressful is it being a Sales Manager or GM at a dealership? Based on this floor plan stuff, I would expect it to be extremely stressful, but the fact that so many high-end vehicles are sitting on lots for hundreds of days, it makes me wonder if they don’t really worry about that all that much? Shouldn’t this be a concern every day and adjust prices to move the vehicles??

@zzanatos2001

9 ай бұрын

When they're already making $8K per car at MSRP, then they tack on $15K "market adjustments," they can laugh off a $3,000+ floorplan cost on every vehicle.

@DennisCoffman-dd8ok

9 ай бұрын

@@zzanatos2001 somewhat. We walked in on a Ford dealership, interested in the Ford Maverick. Found out low supply, and they were going to "market adjust" +$5000. Looking at that price vs the Toyota Tacoma we were already looking at, we decided to just go with the Tacoma (and ended up getting a heck of a deal). So in this instance, because they tried to play that game, they lost a sale.

@kenshinhimura9387

9 ай бұрын

​@@DennisCoffman-dd8okthey don't care. A thousand more people will show up the same week and buy new cars

@subaruamazon

9 ай бұрын

they always need managers. sales people are like water. very expendible because they are one pure commission. they are free. they take a draw ie salary which they pay off with commmissions. they really make peanuts especially if they are new.

@bella3008

9 ай бұрын

Is this true? How much does a salesperson make in a year? Do they get health benefits 401k....etc?@@subaruamazon

We bought our last new vehicle 3 1/2 years ago, and have no intention of buying anytime soon. We usually upgrade about every 4 years but with what they now want and interest rates I don’t see that happening.

floor plan is how dealers buy vehicles. i used to work for a captive and we did floor planning too

I am still driving my 2016 rubicon that just hit 94k miles on it..I really want a new truck but the prices are insane and I refuse to waste me life span paying for it. So I just put new tires and some other maintenance on the Jeep and I’m gonna rock it till falls apart.

The other issue is while the dealership has floor plan costs, however the customers interest rate is much higher making sone of these $70K-$80K vehicles prohibitively expensive for the custom, i have been curious for a while, I intend retiring/working much less in 5 years and keen to know best, how people split their pay, how much of it goes into savings, spendings or investments? I earn up to $180K per year, but nothing to show for it yet

@grinjohnson6452

9 ай бұрын

A dealership call me today, saying they saw I was interested in buying a vehicle over a year ago, and wanted to know if I was still interested…… I chuckled and said NO! for someone who needs some catch-up, consider the 80/20 model. Needs and wants / Investments

@marcmiller6367

9 ай бұрын

There are a lot of people like this. Im 52 and just getting serious about retirement. Its sad because the time to get serious was 20 years ago or even younger.

@adamweah8037

9 ай бұрын

For me, I'm quite lucky exposed to financial planning at early age, started work at 21 and invested to my 401k through my employer, going forward I purchased first home at 33, unfortunately got laid-off afterwards, amid 2020 covid-outbreak. At once, I hired an advisor to help stay afloat, and as of today, I'm only 25% short of achieving my 7-figure ballpark goal after subsequents investments.

@angelinaborris7884

9 ай бұрын

Let them Sink! bravo, this is striking! mind sharing info of the advisor guiding you pleas? i'm in dire need of growing my reserve

@adamweah8037

9 ай бұрын

My advisor is Laura Grace Abels, a renowned figure in portfolio diversity. I recommend researching her further on the web, she's well established with over two decades of experience in her line of work.

Good video guys. Thanks. Another piece of info in my arsenal for me to take to the dealership. Thanks. I knew i could negotiate a car that's been sitting for over 6 months but now i will use "Floor Plan" :) Imo I think car dealerships either will have to come up with a strategy to get rid of all these cars sitting on their lots for months and maybe years with huge incentives Or do something illegal. Let's see how they play it out. I don't wish the dealerships bad ill or to go into debt. They have families too. But man, they have a tough fight ahead of them. There's a CDJR dealership in Paris KY with over 105-109 Challengers on their lots. Just Challengers. "HOLY CRAP". I smell bankruptcies.

A possible explanation for dealer markups to cover this cost?

In the early 2000's Mitsubishi use to jam cars down dealers throat and randomly add hundreds of thousands of dollars to the dealers floorplan. Not sure if there has been protection added for franchise owners now.

Even with the high floor plan costs - theres 10k profit - so if they spend 3k on it sitting - thats 7k profit to realize. This is why trucks and SUVs have such a high markup. Some people will pay it, and if they have to discount a thousand or 2 (and people in todays market will think thats a great deal) they still have 5k profit. Dealers aren't hurting - the consumer will never "win" against dealers/manufacturers.

Thanks so much for your time and fine analysis 😊

I still see several 2022 Ram 1500's in my area, I've contacted a couple dealerships, and they will not budge on price. Unbelievable !!

As a former dealership tech, I buy cars off of Facebook Marketplace or other private sellers. 11 fake fees the dealerships also want to tack right on in the finance office. I walk away from deals. I'm too exhausted to go to new car dealers anymore. They are a bunch of strokes. I remember working at a dealer watching sales people eating King Crab Legs. They stroke their customers.

@Cptboss

8 ай бұрын

I can't figure out why people hate to see other people doing well in life. What should they eat beans and rice? People claim they love capitalism over communism but all I'm reading is hate. If a company is providing a service that is costing millions of dollars to maintain and is employing Americans in all sorts of capacities so they can maintain their families, purchase homes, pay taxes, put their children thru school etc. the jealousy is unreal.

@The-You-Doober

8 ай бұрын

@@Cptboss There is a KZread channel called Kevin Hunter The Homework Guy. He is a former Sales Manager in car dealers who exposed the ripping off of customers buying cars. Watch the video called " 11 fake fees" 👍

2020 I walk into my dealership for a normal maintenance routine on my vehicle, when I was greeted by a salesman. He asked me if i was looking to trade in my car, asked him if he could do better than my current car payment. He asked me what it was and I told him less than $500 and that was with GAP/Full coverage insurance. The audacity of this dude to tell me that what I was paying was the average of a car payment alone, I knew I didnt want to be like every other average American. Im hoping to stick it out for another 8 months here, save what I can and jump on a better opportunity but if not then id be sitting pretty on a pile of cash to buy a house instead. Lets see what the future looks like.

I’ve been looking at 4Runners and was shocked I had a dealer give me a price 8.6% under MSRP while other dealers I contacted wouldn’t budge a penny or were at MSRP + $1500 for fluff they added. Since I somehow became an old man I realize this will be the last new vehicle I ever purchase and want pretty much exactly what I want. The 4Runner didn’t have black wheels which I really like so I finally let the dealer know I was going to pass. His price was so much better than the other dealers I could have bought the 4Runner and black wheels on the side and still been cheaper than the other dealers. I just didn’t want the hassle of trying to then sell the OEM wheels. I might kick myself tomorrow but oh well, I’ll blame it on old age.

@coastalhillbilly3419

9 ай бұрын

They are use to starry eyed shoppers that they can get to fixate on “how much can you afford a month”

@damageman

9 ай бұрын

You won’t regret it.

@zzanatos2001

9 ай бұрын

I'm driving an '04 4Runner that I bought new for $36K, and I'm starting to think it might be the last new vehicle I'll own.

@crazeguy26

9 ай бұрын

so far i gotten all my cars of of Facebook market place or second hand.

@DennisCoffman-dd8ok

9 ай бұрын

Why didn't you just ask for the "black wheels"? I mean, it doesn't sound all that hard to swap them out from another vehicle to me... Or am I missing something here?

That Dodge Ram - a mere 7 years ago was 1/2 that invoice price you're quoting! My brother-in-law bought a brand new 2016 for $35K - ONLY 7 YEARS AGO! So these MSRP / Dealer insanity prices ARE JUST THAT: INSANE!!! Nobody in their RIGHT MINDS would pay this - even if you're a Billionaire - it's a RIP OFF!

@subaruamazon

9 ай бұрын

billionaires are so chinsy they will buy your brother in laws for cheap lol.

@RedEyeC

9 ай бұрын

@@subaruamazon - how do you think they become Billionaires?

@subaruamazon

9 ай бұрын

@@RedEyeC I think there has to be a balance. If you made all this money and cant spend it, that is an illness.

@RedEyeC

9 ай бұрын

@@subaruamazon - philanthropy - giving the right way is a beautiful thing.

Guess I'm confused on how floor plan assistance from manufacturers became a "profit center" when there was no inventory to assist during covid. During the height of covid I saw a high volume Toyota Dealer with exactly ONE new lonely Corolla on the lot. Our local Chevy dealer MAYBE had 2 trucks and a couple of Malibu's. I will say that Dealers are getting a taste of their own medicine and with the 25% wage increase agreed with the UAW...prices are about to put the majority of average consumers out of reach (if they aren't already!!). If you told me in 2016 when my wife bought a brand new Tahoe LT with Lux Pkg for $58K that the same vehicle today would be north of $85K, I would have called you crazy. Not only is it that, but will be much more once these new wage increases hit MSRP.

@DennisCoffman-dd8ok

9 ай бұрын

Sounds like during that time, manufacturers were still issuing the checks regardless of how long something was on the lot. So if a vehicle gets on the lot and is immediately sold, they still got the check. At least that's how I interpreted what they explained.

All the dealers in my area SE of Phoenix have a ton of cars. The overflow lots are filled, which makes me guess people are not buying a lot of cars now.

I agree with this information total just wait it out , I use to work for Honda dealers

Wow, very interesting segment, thank you.

I've heard you guys talk a lot about domestic auto brands and their inventory, UAW strike, etc. How do these series of "current events" correlate or parallel with non domestic makes ie Mini, Porche, Mercedes, BMW, etc?

My local dealer and I are about 3k apart from making a deal. I plan on upgrading my 18 Tacoma 4x2 for a 2023 same model but 4x4. They are willing to take my truck and finance 15k. The numbers I had in mind were 11-12k becuase 4x4 is about 4k more.

@hokie9910

9 ай бұрын

Do you need 4wd or do you want

If you go to a dealer and they have 40 trucks at a 125K and no one can afford to buy them what happens next. Do they put them up for auction?. I am waiting for a good answer.

@MadDestructionChaos

9 ай бұрын

I'd like to know too. They do eventually disappear....

@lewisshock615

9 ай бұрын

That has been exactly the question I have been waiting to be answered. Clearly all of the folks who could get a loan for these super high-priced vehicles have already been through the system. Now what? These dealers may have overpaid for these vehicles but at what point will they just sell them at cost or cost plus whatever interest load they have already paid out?

Why does it matter if you have $2000 floor plan expense, when after you sell it and replace it, you are paying the exact floor plan expense on a vehicle? So it could be $1000 on 2 vehicles, or $2000 on one vehicle. Or is the hope that you start turning them and making an offsetting profit on the sale, and the dealer floor plan assistance? I guess I answered my own question. While the expense on 2 vehicles could be the same, the revenue increase after you sell the first car for a profit/floorplan assistance.

Excellent insight

Wow, what a flawed model for everyone involved. No wonder Elon went with direct sales, no one needs all that overhead just for floorplan!

Got an NX 350H Premium for 50K OTD. Sticker price is 51.25K. Stay strong and don't budge. Talk to multiple dealers and get the best deal. They were not ready to go less than 56.5K 2 weeks ago.

@williamdozier5190

9 ай бұрын

and you still got ripped off.

What a lot of consumers don't realize, you hold all the power. The salesman's job is to close the sale and not have the sale walk. If you walk, there is no sale.

@mitchhedberg4415

8 ай бұрын

Yeah, ask them what the commission is on you walking away? When the salesman says things like "you want to buy my car" Call them out on it, "These are not YOUR cars, you are just a salesman"

People think dealerships are hurting, but in my area there are 3 new dealerships being built and others going through major renovations.

The last new vehicle I bought was in 2004 and it was a GMC Canyon I got it for $11,000 because of my grandpa's GM discount I paid $2,000 cash on it and owed $9,000 it was paid off in less than 4 years. Now the same type of vehicle a Chevy Colorado would be at least 40 Grand and there is absolutely no way in hell I am paying 40 grand for a truck.

@subaruamazon

9 ай бұрын

at least u bought anew car. i have never done that and may never do that.

I think what we are seeing with these $80K to $100K behemoths is the modern-day Edsels sitting on the lots for 2 years.

There’s a type r at the dealership near me 10k mark up slowly they’ve knocked 2-3k off every other week now it’s 50k even still a mark up but not 56k anymore I’m waiting for it to drop further and I might get it

i dont think the dealerships care, dont forget many of these entities received ppp loans that were forgiven. a quick public records search shows that one of the dealerships that you featured here today received a $3.9M one then another for $1.1M totaling $5M. This could possibly be used to off set a floorplan with ease.

I’m looking at Silverados and the msrps are about 56-57k dealers are still asking 51 for them . There is no way I pay that for a mid trim truck and all the dealers want that as well , a decent price would be 40 so they are way off

The exact reason capital one pulled out of floor planning.

Where I'm at dealers aren't budging off their ADM's. It's insane, they want $10K over MSRP and won't budge. Car's are already insanely priced, if the UAW gets their raise nobody will be able to afford them and the interest rates make the average half ton truck payment $1500/month. If the union gets their raise that will be north of $1800/month.

I used some of your tactics yesterday on my purchase of my used car. First of the month so not the best time to go, however, I got them down 3 grand.

@subaruamazon

9 ай бұрын

former car salesman here in college. last of the month is the best. may have two "teams" competing they are anxious to be the winning team. winner taken out to eat steak. loser eats franks and beans at the same restaurant. this really happened. what a sick management. be ready to walk. i did this when i was looking at a used car at two new car dealerships. even with my experience, i felt weird but did it anyway. finally, i luv the private market. you can talk to the owner which is priceless and the prices are much lower. and hey, new and used car dealerships may not guarantee that used car. and if they do, it is a crappy warrenty, an insurance policy, that can deny the claim.

I honestly want to know what they are paying for these vehicles. What’s their mark up to us ?? Also, you said the bank can give us say 4% interest but there’s a sheet you said about the bank giving them a different interest then keeping the difference ?? Do we have the right to ask to see that sheet ?? Thanks so much

Sy Symms used to say when he was alive "An educated consumer buys from him." Unfortunately, there's more dummies than educated individuals.

Does the build date of the vehicle directly relate to how long the vehicle has been in dealer inventory?

My 2011 Infiniti has 178,000 miles on it and I decided it was time to buy a new (used) car. I started watching your videos, decided on my budget and researched the current value of my Infiniti. When I saw how much it was going to cost me to upgrade my ride and get some additional features that my car doesn’t currently have, I decided to keep driving the Infiniti. I remember when I bought the car. The Infiniti dealer told me that he knew of several customers that were still driving their cars with 300,000 to 400,000 miles on them. I’m hoping mine lasts that long. In the meantime, I ended up splurging on new floor mats and some touch up paint to fix a few small door dents. I’m feeling pretty good that I just saved myself $50k. When it comes time to buy another car, I feel like you have prepared me for talking to the salesperson, in addition to not getting ripped off (my biggest fear). Thanks for your help!

Great job guys as always.