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Price difference buying the stock vs ordering

Discussion in 'Dealers & Pricing' started by texasshawshank, Jun 9, 2016.

  1. texasshawshank

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    I am looking to buy a 2016 Prius Three with Touring package, but surprisingly out of the 5,6 dealers I talked to I am not able to find a single one.
    So it looks like I need to order one. Out of my surprise dealers are much tougher on price ordering, and much more open for the cars on the lot.
    Is it their sales trick or there are good reasons on the higher pricing?
    In march we bought a MB GLC and dealer did push us to buy stock, we went ahead and ordered one at the same price nonetheless.
     
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  2. bisco

    bisco cookie crumbler

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    how can you order one at the same price if they don't have one to give you a price on?

    generally speaking, dealers are looking to move their stock. i think your best bet is to email as many dealers as possible, asking them for their best price on the order.
     
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  3. Caniac

    Caniac Active Member

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    When we were looking to buy our '15 we went to our preferred dealer and asked them if they could get the one we wanted from another local dealer. The way they explained it to us is that they have to pay the invoice just to get it from them. It was made pretty clear to us that our negotiating power was weakened because their wiggle room was much smaller. So we ended up going to the local dealer ourself and paid well below invoice. That wouldn't have happened in the other scenario.

    Not exactly the same as ordering one outright but an example.
     
  4. texasshawshank

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    Ordering a car is like buying an option. You pay in advance a deposit for the option to take the car at a negotiated price for a piece of commodity. The negotiated price is largely based on the same, existing, available commodity. The negotiated price would be lower if the projected price tends to be lower by time of delivery, and vice versa.
    When I bought my MB GLC, I first negotiated for a discount, then we found the car I was looking for had to be built in Bremen Germany. You are right dealer wants to move the stock, he pushed me on taking a similar car and I declined. Then we proceed with ordering without reopening the negotiation.
    I just can't think of a good reason (execuse?) why ordering will cost thousands more then taking on on the lot.
     
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  5. Kenny94945

    Kenny94945 Active Member

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    Dealers inventory cars on credit (incurring interest) ...this is termed flooring.

    So, yes they are more inclined to move the cars they have in stock.

    If dealer orders for you, you could still reject the car when it arrives and the dealer is "stuck" with your (perhaps) undesirable slow selling special optioned model.

    As for price...ordering a car can still have an attractive negotiated price.
    There is not enough info in the OP post to define "tougher"...$1000 dollars or $250 dollars?

    Anyway, good luck finding your perfect Prius!
     
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  6. bisco

    bisco cookie crumbler

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    i've never heard of a dealer negotiating a price on a car they didn't have. maybe mb does it a little differently?
     
  7. bhtooefr

    bhtooefr Senior Member

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    Ordering a car, rather than buying off the lot, does three things to hurt the dealership's profit:
    1. They assume higher risk, because if you back out of the order, they're stuck with a car, potentially in a configuration that they'll have trouble selling later (this is why a lot of cars are very, very hard to find in manual transmission or interesting colors)
    2. They don't remove a car from their lot to make room for another one, meaning they have to sit on their existing inventory for longer, and don't get as favorable allocations for future inventory
    3. The manufacturer owns the inventory on their lot, and is therefore sitting on those assets, and wants to get them off their books. Incentives are used to encourage that, whereas an ordered vehicle doesn't help that aging inventory move, so less incentives are available. (Note the fine print on things like the Toyota customer cash and 0% offers - "must take delivery from dealer stock", and those are Toyota offers, not dealer offers.)
     
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  8. bisco

    bisco cookie crumbler

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    otoh, it's worth shopping, because if all the dealer has to do to sell you a car is order it from the factory, and he realizes you're not taking one off his lot, there should be very little cost to him, and someone should be willing to work on a reasonable margin.
    when i was in business, we always took less profit to drop ship an order from the factory. our only cost was financing, and that was very small.
     
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  9. wrprice

    wrprice Active Member

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    Discussed on another thread, but I bought from an out of state dealer from their current inventory for exactly this reason. I got a fair price, and much lower than I'd have expected from my locals. They'd all have had to order since the configuration isn't stocked in my region.
     
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  10. ETC(SS)

    ETC(SS) The OTHER One Percenter.....

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    I'm extremely surprised that you're not able to put your fingers on the car you want in your area.
    You have to remember that Mercedes is a top shelf car and (much as people like to think otherwise) Toyota isn't.
    In other words, Mercedes dealers already employ a low volume/high profit model that makes ordering versus buying one off the rack more attractive.
    Cast a wider net.

    $1000 means a lot to me.
    Like.....enough to drive three or four states away to save that much money, and the difference between buying a G4 off the lot and ordering one might well be more than $1000.
    Besides.....what better way to get to know a new car than a road trip?

    Good Luck!
     
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  11. Eastside

    Eastside Member

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    The local lots are overflowing.
    One dealer's lot is so full they are renting parking space from a nearby shopping center.

    No wonder they want to sell from stock.
     
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  12. texasshawshank

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    It is indeed frustrating. Revealingly enough I changed my zip code from texas to san jose california --- bomb!
    Number of Threes with ATPs jumped from Zero to 143! So there are plenty of vehicles around!
    I called Toyota America and found out, toyota's local distributor Gulfcoast States Toyota controls the vhicles delivered to the region, they think there is no demand for ATP and thus don't ship any in, and they don't work with other distributors except south east region. Why they don't think ATP is not attractive is beyond me, and this monopoly has made it very hard for me to find one with in reasonable distance.
    You made a good point about different brand's profile model, maybe toyota doesn't encourage ordering. At this point I think I will have to settle with a three touring, with some feature I seriously hate....
     
  13. DonDNH

    DonDNH Senior Member

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    Gulf States Toyota is an association of 154 dealers in the five states of Arkansas, Louisiana, Mississippi, Oklahoma and Texas.

    Really, don't settle for something you don't want. If you do, you'll never really be happy with the car. Find what you do want, look in NM, AZ, or CO and take a long weekend road trip to pick it up if necessary.
     
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  14. texasshawshank

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    I went to Fred Haas Toyota this afternoon and had a chat with a nice sales guy.
    He told me most of the Prius buyers in Houston opted for basic Prius Twos and Threes. I was the FIRST one asking for a AT package on a Three. Sales on Three touring and Fours (tourings) are slow as well. In contrast demand for optional add-ons on higher lines, such as Sequoia, etc. is pretty high.
    Among all the places I have been to, Houston probably has the highest percentage of MBAs (Mercedes, BMW and Audi), second to their home country - Germany.
    With Houston being an booming oil town in the bigger Texas, people either want a luxury, or a gas guzzler 3 row SUV or pickups. For the tiny 1% remaining, they just want a basic Prius for commute, and I am not even of one of them.
    I think that explains why I am in such a position....
     
  15. wrprice

    wrprice Active Member

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    That's the narrative they want (you) to believe, and it's a self-fulfilling prophecy. They don't really know how many people buy elsewhere due to the forced unavailability, but I imagine there are plenty that do settle for something on the lot instead.

    I don't know what percentage of Houston Prius drivers are on PC, but here the two of us are, with desires unmet by their pessimistic inventory.
     
  16. texasshawshank

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    You might be right about the story the dealer told me. The reason why I thought differently is that dealer is really special, from most of what he said seemed to be honest, not like most others. For a couple of times he even told me something don't work for their benefit. Describing a car dealer as honest will be regarded as a joke generally after all.
    As to 2016 Prius sightings, I've yet to to seen a single one on the street of Houston yet. There are many older models, purchased when oil price was high.
     
  17. bhtooefr

    bhtooefr Senior Member

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    Well, and most people buy off the lot, so if what they want isn't on the lot, they settle for what's available. (And, if they don't know a feature exists, they won't ask about it, so if someone just comes onto the lot to look at Priuses, they won't get told about the missing feature, because the dealer has no interest in selling someone on a feature that they don't have available.)
     
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  18. JamesBurke

    JamesBurke Senior Member

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    Willing to take a road trip?
    Toyota inventory for Joplin, MO 64801
    #12 for 3ATP and #13 for 3T
    Toyota inventory for Wichita, KS 67210
    #10 3ATP and #8 for 3T
    What's on the local dealers lots vs. spread out across the state requires a more detailed search for the features you want.
    $1,500 cashback till 7/5/2016 in this region but not sure if it's only for the Pkg2 or all Prius.

    How about Mobile, AL? Yes its the evil SET region but just maybe there is 1 without all the extra crap they add.

    Production is still slow do to the earthquake but ships are coming.
     
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  19. wrprice

    wrprice Active Member

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    $1500 cash rebate through July 5 applies to all trim levels.
     
  20. KimPrius3

    KimPrius3 Member

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    I live 30 minutes from a small dealership. and an hour + from several large dealerships and so far haven't seen the Three with Advanced Tech in their inventory at any lot. Please tell me how you shopped out of state dealers? I keep getting sent back to locals when on the internet. I'm willing to travel in order to get the one I want. Someone also mentioned something about out of state emission laws. . . .