RotaryDreamer

Like the question says. There's only one dealer in my area that still has 05 Base models with no options left over. But they are sticking to a solid $6000 off MSRP which puts the car at $21,640. Would trying to get it lower be asking too much? Is that really a good deal? I was hoping to get it to $20,000 and walk out for about 22,500 or so TTL. Is that too little to ask for an 05?

dwynne

I love it when someone just plucks a number out of the air (or some body orifce) and says "that is what I want to pay!".

Forget MSRP and think about delaer cost. With an MSRP of $27,640 invoice will be right around $25,600. Holdback is 2% of MSRP or $553. So "dealer cost" is $25,047 or so.

If they offer it to you for $21,640 then that is $3,407 under cost including holdback.

I don't know what the 05 final buy down was - final discount to the dealer to help them sell remaining left-over cars. On the 2004 cars this was $4,000.

So if the 05 left overs had the same $4k buy down, then the dealer is making a little under $600 including hold back. Assuming no extra high dealer fees and a requirement to MAC finance I guess that is "fair" - they need to eat too. If you want it all, then it looks like $21,047 would be the 0 profit mark.

Again, I don't know what the buy back and other incentives are now since I am not in the market.

If you offered them the number and showed how you got it, maybe they would take it. If you just pluck a number like $20,000 and offer that - they will think you are dumb.

That said, a dealer near here is running a new 06 8 for $22,990 - this may require MAC financing and stuff, I don't know. If your dealer is stuck on $21,640 the extra money for a model year newer car might be worth it - and down the road you get more for your used 8.

I would not want the base car, however. To me the sport pack is the MININUM you should look at. For about $1,100 deal cost you get Xenon Headlights, Dynamic Stability Control, Traction Controlm and Fog Lamps. I would not have an 8 without that, at least. If can't afford $1,100 extra then you should save until you can :D

Dennis

rled

Good Post !

NgoRX8

iTrader: (1)

thumbs up for dwynne

dwynne

I noticed in another thread someone said the 05 money WAS $4,000 - so that part is the same.

Someone also said there is $1,000 in MAC financing money for 05s as well. If that is true, then you might be able to score the car for $20,047 with a MAC loan and the dealer makes $0. The MAC rate will be too high, so you will want to plan on refinancing the car ASAP to get out from under it. If your credit will not handle the re-finance, then you need to look CAREFULLY at the options. If a bank will do a much lower rate, then taking the $1k and MAC high rate may cost you MORE.

Edmund's has a calculator to help with this:

http://www.edmunds.com/apps/calc/CalculatorController

and click on the "low APR VS cash back" tab. In this case you plug the high MAC rate into "market rate", the low rate into "promo rate" and the $1,000 into the cash back. Capital1 is doing 6.25% for 60 months (for "well qualified" buyers). Let us say MAC is 9.25% (made up number). On a $21k loan with 7% tax and fees the cheap financing from Capital1 saves $11.71 per month. So if these were the RIGHT numbers, then don't take the MAC and do the cheap loan. This is if YOU CAN'T refinance.

Capital1's refinance rate for 60 months is 7.45%. So if you took the MAC money and did the refinance at this rate you would save another $9 a month over taking the Capital1 cheap rate or nearly $21 less than the MAC rate if you kept it with MAC.

Dennis

savedsol

The best site I've found is this... www.carbuyingtips.com

Hileylover

The more you get under invoice the less your car is worth at trade in time. You must think of that when purchasing. Rebates kill value. If you bought a 2005 RX-8 before the rebates and you go in to trade for a 2006 you will get around 2-3000 less than what the 2005 is going for new at that time. So if there is a 2005 still available for sale and there is a huge discount or incentive your 2005 just got devalued by the dealer and manufacturer. You save money at purchase time but you lose in the end.

savedsol

That's Mazda's fault, not the buyers. Congratulate the people who got the good deal.

dwynne

That ranks as one of the dumbest posts I have read on the board! You clearly failed "Reading with comprehension" in school. You have read the tips site but failed to UNDERSTAND what you read. Your read my post and failed to understand it as well.

I figured the holdback and TOOK IT OFF THE PRICE OF THE CAR. You take the dealer's invoice - incentives - holdback = true dealer cost of the car.

I didn't say we would let the dealer ADD the holdback and floor plan and junk onto the deal. We take the amount of the holdback OFF the invoice price to find true cost.

You DO have to keep in mind that MANY dealers consider holdback to be "protected" and will not deal into it. They may give you the car for invoice - incentives and any rebates, but they will not let you eat into the holdback.

Several other things wrong in your post.

"Floor Plan" is the term for the interest on the cars sitting on the lot. Most manufacturers will "finance" the new cars for the dealers for x months. They don't have to pay, they pay no interest. Once that free time is up (and it may vary with the volume or quality of the dealership) the dealer has to pay. If they can't pay with cash, they get a loan from the bank. The interest on the unsold cars is the floor plan. Lots of dealers will steer customers to the "oldest" cars on the lot, the ones just off the truck are interest free. I have seen some even mark the ones on bank loan with a shoe polish * on the front glass so even the worst salesman can steer you to them.

Dealers can and do use their holdback money to cover the interest on the unsold cars as well as pay sales commission, keep the lights running, the receptionist, etc. If the car sits on the lot long enough, the bank interest might wipe out any holdback so you can't say the car company pays the dealer back for the interest.

Yes, there are various factory to dealer incentives and you use places like Edmunds to find these out. For example, we know (but many places do not show) that Mazda gave the dealers $4k buy down on the left overs, same as last year.

I like getting good deals, but you can't expect the dealer to lose a lot of money selling you a car. For one thing, when you have a warranty issue they will be close due to poor management

On these left overs, no profit is probably a fair deal. They don't get to make anything, but they don't lose either.

Deciding what can be a fair price can be tough and you should check lots of sources for incentives, invoice price, etc. But being an idiot and just making up a number is worse - since the dealer will decide you are not worth their time.

Dennis

Design1stCode2nd

Does anyone know for sure that 2005 models have a 4k buydown and a 1k Finance bonus?

dwynne

Someone else posted this in another thread, but I have no idea if that is correct or not.

Except: the prices being offered would make you think the $4k buy down was the right number and that is what they did last year with the 04 left overs.

Generally, a lot of dealers will be honest about the rebates as a way of closing the deal. For sure, do not sign ANY rebate forms unless you are either being handed a check or the rebates are reflected in the price you pay (invoice - incentives - holdback, maybe - rebates = your price). Otherwise, the dealer will rip you off for that money. Also, the tied to MAC deal will be obvious since the rate will be really high and you are not likely to take it unless you DID get more off. Calculate it both ways or just plan on refinancing the car ASAP and take the money.

Dennis

dwynne

Ding, ding, ding! We have a winner. A post even dumber than savedsol's!

News flash: the car will be worth the same amount at trade in or selling time no matter if I buy it for over MSRP (as some did back in '03) or if I get it for $4,500 under invoice (as you can do with a left-over car).

The difference is you pay less now so you lose less money and have lower lease or loan payments - or more cash in your pocket.

Mazda made a car (actually, more than one truth be told) that they can't sell. We like them, so we take advantage of the fact that they can't sell them and get them "cheap". We DO have to understand that future value will be bad going in, but that is not our fault. Mazda designed and priced the car and did both in a way that they can't sell as many as they produce. Their screw up is out gain, at least buying the car.

The 8 is a bad lease car since the lease guide residual is SO BAD (compared to the Z or S2000, for example) but the captive lease from MAC can be a good deal. Think think/hope the residual will be better, so if you couple that with below invoice deals you can get a decent lease deal. Then you don't worry about what the car is worth in 2 or 3 years since the bank is taking the risk. If, by some miracle, the car is worth MORE than residual you sell it and pocket the extra. If, as I expect, if will not be worth residual you can just turn it in and get something else, or try to haggle the price down with the bank. They may be so happy to see you keep the car they will cut you a nice deal.

Pay full price is for folks that just can't wait or for suckers

Dennis

RotaryDreamer

Wow, so much more info than I thought I'd get. GOOD!

So Dwynne, you're saying that if I brought them the deal that is (invoice price - $4K Mazda incentive - Holdback - any other rebates = 0 profit) they might bite. Am I getting this straight or do I have anything mixed up here?

dwynne

Once the factory gives the buy down money, there are usually no more rebates. There MAY be a MAC finance one, you would have to ask about that and decide if the money was worth the (likely) high rate. What folks have done in the past is make a payment or two and then refinance, then they have the money taken out of the price of the car and a decent rate.

My point is, they are not likely to want to lose money on the car. If you take invoice - $4k - holdback then if there are no other incentives/discounts/rebates that is about it. Before I got my 05 a dealer near me offered me a left over 04 for that very price - he trotted out the invoice, took off the $4k and holdback and then took off the doc fee (to be added back on the contract). The result was $0 profit. There was no MAC finance money on the 04s at that time.

It was a good deal, but I got my 05 for $500 under invoice, free spoiler, $2,000 in MAC rebates, and $500 in Gerber rebates (Gerber could not be used on 04s at that time). So I was looking at a new 05 (w/spoiler) for $3k under invoice or an 04 for $4,500 or so under. I could pick any 05 on the lot and get the same deal and the 04 had stuff on it I did not want (appearance pack, etc). So I got the 05.

You should be able to get invoice - $4k easy, minus holdback might be possible too - it depends on how many unsold 8s they have and how much they want to move one. Just don't sign any rebate papers unless they go BELOW what you figure it should be - or the dealer will get your money.

Dennis

savedsol

Well, I'm not too big to say, my apologies. I read your post too fast and mistook "minus" holdback for adding it back into the equation. My jump to conclusions has to do with experience of every dealer's song and dance during negotiations. Although not entirely inaccurate, I withdraw my post.

dwynne

No problem.

I have HEARD of dealers putting the hold back on the contract in the deal (which really makes no sense) but I have never seen it. The big thing around here is the "doc fee" which can run from $150 up to $500 or so. They have this pre-printed on all the deal sheets and contracts so they can say "nothing I can do about it, it is already printed on the page". Yeah, right.

I bought a Contour SVT from a "country" dealer several years back. I was getting a smoking hot good deal and was concerned there would be a catch so I asked the sales guy did they charge a doc fee. "Doc fee? What is a doc fee?". I told him it was a charge the "city" dealers stuck on to cover the cost of the paperwork, they said. He chuckled, then he hollered at his boss: "Hey Bob, can you believe those dealers charge folks extra to do the paperwork?". My kind of dealership


Dennis