They definitely play with the numbers. Anyone who got an exceptional deal on their trade probably left more on the table for the car. Anyone who didn’t get what they were hoping for the trade probably squeezed the dealer for all they could and they didn’t have any room to work.
Even if you pay below invoice (not MSRP), there is holdback and on top of that there could be factory to dealer incentives. Also typically the dealers start paying interest to the company’s that provide their floor plan after 90 days which gives them more incentive to move inventory and then there is the end of month trying to hit the numbers if volume is low.
On top of that there is the dealer add ons and spiffs they will try to sell you, doc fees, glass etching, alarms, etc...
Then of course there is the back end on the financing for going through the dealer as opposed to bringing your own financing which is essentially a cash deal to the dealer.
So yeah, they have places to move money. [emoji3]
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I got $37,500 for my GMC and they have it for sale right now on their lot for $39,900. That trade in was fair and I didn't expect to get "retail" price versus trade in. Now, if I were buying that used GMC..........I would negotiate down into the $38K range. I know you say they always play with the numbers, but they didn't with me. I got exactly what I was expecting for my trade and I got my 19 ram between Employee pricing and Friends and Family pricing before any discounts. We didn't even discuss my trade until we finished discussing my Ram....and they didn't play that game where they ask what you owe on the trade in before valuing. Then I added another 1500 miles on that GMC while waiting on my truck to get built and they didn't re-evaluate. You are 1000% correct.....they got their dealer holdback along with doc fees. I didn't have any dealer add ons....I ordered it, it came, they washed it, handed it to me......no alarms, glass etching, etc.
I went pre-approved through my local credit union I've been with for 26 years. The day I picked up my special ordered Ram....I signed the purchase order and left with my key. The dealer sent it to my bank, bank sent them a check and all is well.
I'm no wall street journal guy (lol) ........but I negotiate million dollar contracts every day.......I expect the dealer to make some money and I expect to be treated fairly. So they can have their dealer holdback, those doc and admin fees and whatever they make on my GMC ..........I got a special ordered truck below invoice BEFORE any applicable discounts.........and no negative equity applied from my trade. Negotiation is supposed to be win/win.