Document preparation fees--RIPOFF

BeeferMan · Sep 29, 2011

schoolsout said:
3% net return is great for dealerships, just so y'all know.

The computer you are typing from had more markup than that vehicle on the lot...

Due to holdback, %3 is about what they make when they sell you the car at "invoice"...

schoolsout · Sep 29, 2011

BeeferMan said:
Due to holdback, %3 is about what they make when they sell you the car at "invoice"...

Know what's crazy? We don't even keep holdback...the $1k profit or so on a medium duty purchase is exactly that...

two_bit_score · Sep 29, 2011

schoolsout said:
Know what's crazy? We don't even keep holdback...the $1k profit or so on a medium duty purchase is exactly that...

Who keeps it?

grsthegreat · Sep 29, 2011

Now wait, manufacturers used to also kick back $$$$ for volume of sales. So the vehicle cost LESS than actual invoice.
Dont they still do that?

Ductape · Sep 29, 2011

grsthegreat said:
Now wait, manufacturers used to also kick back $$$$ for volume of sales. So the vehicle cost LESS than actual invoice.
Dont they still do that?

Yes, dealers pay less than invoice.

schoolsout · Sep 29, 2011

two_bit_score said:
Who keeps it?

What do you mean, who keeps it? We don't put profit on top of the hold back...we sell the truck as if there was no such thing as holdback.

schoolsout · Sep 29, 2011

Ductape said:
Yes, dealers pay less than invoice.

No...they pay less than the invoice price they show you.

two_bit_score · Sep 30, 2011

schoolsout said:
What do you mean, who keeps it? We don't put profit on top of the hold back...we sell the truck as if there was no such thing as holdback.

So the holdback is your profit?

Mike Costello · Sep 30, 2011

Dealer holdbacks are defined as a percentage of the vehicle's MSRP that is rebated back to the dealer by the manufacturer. Each manufacturer varies in the percentage it pays back to the dealer. Thus, a car with a MSRP of $20,000 and a holdback of 3% will result in $600.00 returned to the dealer somewhere down the line. Holdbacks are considered sacred territory by most dealers and they will usually never deal to the point of invading that part of the invoice. In fact, they would prefer you never knew what a holdback is all about.

BeeferMan · Sep 30, 2011

Mike Costello said:
Dealer holdbacks are defined as a percentage of the vehicle's MSRP that is rebated back to the dealer by the manufacturer. Each manufacturer varies in the percentage it pays back to the dealer. Thus, a car with a MSRP of $20,000 and a holdback of 3% will result in $600.00 returned to the dealer somewhere down the line. Holdbacks are considered sacred territory by most dealers and they will usually never deal to the point of invading that part of the invoice. In fact, they would prefer you never knew what a holdback is all about.

The holdback may also depend on how quickly the vehicle is sold and the volume the dealer does.

Yes, they certainly would rather you thought the invoice price was their cost.

I had a rather heated negotiation with a sales guy once, he responded to my "at invoice" offer on a $30K vehicle that was being unloaded while we watched by saying they wouldn't make any money if they sold "at cost". I pointed out that even at "cost" (which was really invoice) they were making at least 3% on the vehicle, maybe more since they were turning it over so fast. I never saw a guy get so red so fast. Said they did NOT negotiate holdback! I told them I wasn't negotiating holdback, just pointing out that he wasn't being truthful, and was treating me like I was an idiot. Needless to say at that point any chance of a deal was over, so I got up, said that we were wasting each others time, and walked. Found another dealer that had five of the same vehicles on the lot (that helped!) and the sales guy fell all over himself getting us a $100 over invoice deal.