2008 Prius puchasing advice needed

[rodbuster]

I am looking for a 2008 Prius in the Chicagoland area. The best deal so far is $200 under invoice, which breaks down thus:

Retail
$22475 Vehicle base model
$ 4550 Package #6
$ 660 Destination
_____
$27685 Total


Dealer
$20022 Vehicle Base Model
$ 4095 Package #6
$ 660 Destination
$ 400 TDA
$ 10 Gasoline
$ 449 Dealer holdback
$ 224 Whsl. Financial Reserve
______
$25860 Total

I am being quoted a price of $25660 plus $150 for doc fee, plus plates, title and tax, which brings it to $27664.78 out the door.
I wonder about some of the fees listed under the dealer (invoice) column, and get the feeling that I may be able to get a better deal.
Does anyone have an opinion on this "deal".
Thank you in advance, rodbuster.

[JimN]

Originally Posted by rodbuster

I am looking for a 2008 Prius in the Chicagoland area. The best deal so far is $200 under invoice, which breaks down thus:

Retail
$22475 Vehicle base model
$ 4550 Package #6
$ 660 Destination
_____
$27685 Total


Dealer
$20022 Vehicle Base Model
$ 4095 Package #6
$ 660 Destination
$ 400 TDA
$ 10 Gasoline
$ 449 Dealer holdback
$ 224 Whsl. Financial Reserve
______
$25860 Total

I am being quoted a price of $25660 plus $150 for doc fee, plus plates, title and tax, which brings it to $27664.78 out the door.
I wonder about some of the fees listed under the dealer (invoice) column, and get the feeling that I may be able to get a better deal.
Does anyone have an opinion on this "deal".
Thank you in advance, rodbuster.

Not sure what TDA is. I believe Toyota pays the dealer for the gas. The car should be delivered with a full tank of gas at no charge. The dealer holdback & financial reserve is what the dealer gets from Toyota once the car is sold. At least 3 of these 4 are "screw the buyer". Verify the taxes & fees your state collects. I'll bet the $150 is BS and the legitimate fees & taxes are overstated. IMO the dealer is lowballing you. He is actually offering the car at $1083 over invoice or $1825 under MSRP. You will have to shop around to see if you can find a better price. The only advantage to paying less for the car & more for the fees is that your state may not collect sales tax on the fees.

[joyride]

I want to buy 2008 prius touring pkg 6.
and try to get quote from internet but the price is high,I guess.
Longo toyota give me 27960 .Is this cheapest price I can get?
I am first time buyer,so I don't know how to deal with this .
Can anyone give me some advice to get a good deal.
I live in LA .

[priusenvy]

Originally Posted by rodbuster

I am looking for a 2008 Prius in the Chicagoland area. The best deal so far is $200 under invoice, which breaks down thus:


$ 400 TDA
$ 10 Gasoline
$ 449 Dealer holdback
$ 224 Whsl. Financial Reserve

TDA is the advertising fee. I consider this a legitimate fee to add-on, as they really do pay a per-car fee into the regional advertising fund. Other people disagree and say that it is the dealer's cost of doing business. It should be identical for all dealers in your area. Regardless if whether you consider it a legit fee, what is important is that you use the same definition of "invoice" when comparing prices relative to invoice. Either that, or compare out-the-door prices.

The last two are totally bogus. "Real" dealer holdback is included in invoice. Those last two items are there so the salesman can tell you he's making you a deal at $200 under invoice, while actually selling you a car for $500 over invoice (some would call this $900 over invoice, I call it $500 over invoice). In your quote, his profit includes the standard 2% holdback already included in the invoice on all Toyotas, plus an additional 2% they are adding on. I'm guessing they made it identical to the published 2% figure to fool you, this way they can claim, "Oh, our invoice prices don't include dealer holdback, that's why we add the 2% holdback you read about on the Internet." That's BS.

This might be a good deal, but you're not paying $200 under invoice. Take a look at the attached worksheet (from a couple years ago for a Subaru I bought). When the CarBargains service gives you a quote relative to invoice, this is how you figure the price before sales tax and license. Note that the only add-on fee is the advertising fee, there is no "holdback" or "financial reserve". Ok, there is a $45 documentation fee, but that's all. On this car there was a $1500 rebate too, so I got it for $1750 under invoice (or $1475 under invoice if you think he dealer should eat the advertising fee).

[priusenvy]

Originally Posted by joyride

Can anyone give me some advice to get a good deal.
I live in LA .

Consumers CHECKBOOK CarBargains

Remember, walking away is the only leverage you have over the dealership.

[arf1410]

I really hate myself for taking the dealers side on this, but it is normal practice at Toyota dealers to include the 2% dealer holdback and 1% wholesale financial reserve in the invoice price. And if you actually see a printed (by toyota, not the dealer) copy of the invoice, those fees are listed. I'm willing to bet ALL toyota dealers will include those two charges, along with the advertising fee (TDA) and delivery/ destination charge in the invoice price. Can they be negotiated off ? Sure - offer a dealer $2000 over invoice, and they'll waive lots of fees...Or if the dealer is making a profit on a trade-in, or on financing, or some other way, he might negotiate also...but generally speaking, don't count on it, as that 3% is his profit in an "invoice" deal...

remember "invoice" does NOT equal dealer cost...If it did, they wouldn't sell at that price...

[richard schumacher]

The only thing that matters is the total amount you have to hand over to get it out the door. Get the same statement from multiple dealers and compare the bottom lines, and don't waste effort thinking about how each of them gets there.

I wouldn't hope for much discounting. The dealers see gas prices rising same as we all do.

[priusenvy]

Originally Posted by arf1410

I really hate myself for taking the dealers side on this, but it is normal practice at Toyota dealers to include the 2% dealer holdback and 1% wholesale financial reserve in the invoice price. And if you actually see a printed (by toyota, not the dealer) copy of the invoice, those fees are listed. I'm willing to bet ALL toyota dealers will include those two charges, along with the advertising fee (TDA) and delivery/ destination charge in the invoice price.

I've seen those sheets listing the same fees from multiple Toyota dealerships in different geographical areas, so I believe you are correct. I also believe tacking those additional fees (duplicate dealer holdback and wholesale financial reserve) was done due to pressure from the dealerships in response to better informed customers. Customers come in wanting to pay just a few hundred over invoice (or under invoice for slower moving vehicles). So now every dealership is telling the same story about how their top-line figure doesn't include these two costs, when in fact, one of them really is included (the holdback) and is being charged twice, and the other is at best their cost of doing business, and at worse, an outright lie (the wholesale financial reserve). They can offer you a deal for $500 under invoice, and still make their full dealer holdback, plus a few hundred more, and unless you're well informed, you think you paid less than invoice when in fact, you paid a few hundred over.

Take away those two bogus fees and only leave in the advertising fee, and the dealer is still making a profit on the car, due to the holdback already built-into the invoice price (what they are now calling "cost"), and other unpublished factory-to-dealer incentives.

If all you are doing is seeking the best price available now, follow the advice above and compare out-the-door prices and don't worry about how you got there. If you're just looking now, and wondering what might happen to the price in the future when supply catches up with demand, or if gas prices drop for a sustained period, then you'll want to know how the price was arrived at, so you can estimate how the price might change. If you're paying a thousand over invoice, there is clearly room for the price to drop a lot when supply is plentiful.

[arf1410]

Originally Posted by priusenvy

Take away those two bogus fees and only leave in the advertising fee, and the dealer is still making a profit on the car, due to the holdback already built-into the invoice price (what they are now calling "cost"), and other unpublished factory-to-dealer incentives.

I was originally suspicious too, and edmunds.com didn't really clarify, so I paid Consumer Reports $14 for their cost data, and it also confirmed that those fees are as "legitimite" as any other charge..so unless you think C.R. has also been fooled, you are only paying those fees once, not twice...now whether wholesale financial reserve is legitimate is a discussion to better have over a few beers, as I too think it is simply a cost of doing business, and should be included in the base price...but one can make that arguement too about advertising, delivery charge...

[priusenvy]

The reason I think the holdback is bogus is because every other manufacturer includes holdback in their invoice price. I understand how you arrived at your position, and I'm not be 100% I'm correct on this. I'd be interested in hearing other's opinions on this, as Google searches I've done leads me to believe there is a lot of disagreement on whether holdback is included in Toyota invoice prices.