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2Addicts | BMW 2-Series forum BMW 2 Series (F22) Forum 2 Series Pricing, Ordering, European Delivery What is a "good deal"?

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      08-06-2016, 10:27 PM   #1
wtfbrah
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What is a "good deal"?

I decided on an M240i today. A dealer has offered a 47k MSRP car with a "savings" of $3,200 and a "rebate" of $1,000...

But the thing is, this "savings" is applied to the 47k, and then the sales tax comes into play, and with that plus "fees" the car comes out to a little over 47,000 which means that the discount really means nothing, it just covers sales tax and I still pay MSRP.

Is this a ripoff? When people say a 7% discount is normal, does that mean pre-tax?

What should I expect to pay for a 47k 240i?

Edit: I should add this "deal" was for a 235i left over from 2016.
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      08-06-2016, 11:11 PM   #2
rainfall
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Dealers usually have cars on the lot that are loaded with options we don't really want.
I think it depends on how much you want these options, because you can order the newer model for ~$45k (you can also bargain ~5-7% off that at the very least).
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      08-06-2016, 11:50 PM   #3
wtfbrah
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Quote:
Originally Posted by rainfall View Post
Dealers usually have cars on the lot that are loaded with options we don't really want.
I think it depends on how much you want these options, because you can order the newer model for ~$45k (you can also bargain ~5-7% off that at the very least).
That's not really what I'm getting at here though - I'm asking, when people quote these prices (like 7% off, 45k, etc) do they mean post-tax or pre-tax?

Because of MSRP is 45k, and you negotiate down to 40k, you're still paying almost 45k after taxes and fees.
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      08-07-2016, 12:26 AM   #4
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All prices are negotiated by: MSRP subtract the percentage taken off, then add the fees and taxes.

I've yet to find a dealer that will do up the final numbers including all taxes and fees. Maybe someone else has experienced this? The documents I have all clearly state the MSRP, then discount (percentage) then fees and taxes.
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      08-07-2016, 12:48 AM   #5
rainfall
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No man, basically you want do do the following math: MSRP + taxes - discount.

In Washington, sales tax is something like 10%. So if a car costs 50k, the OTD price is 55k.
You want to shoot for something like 5-7% under that 55k, not the 50k.

I've bought 2 brand new cars so far. What you want to do is to figure out the math yourself. Like, take the sticker price, remove some off (5-7% for base model, more for loaded model) and then add back taxes.

Start the negotiation with the MSRP, ask the dealer to do the math "out the door" (incl. taxes and fees) for you and see if it matches with your own math.

If it does, then try to haggle some off from it. DO NOT go to the dealership without knowing how much you are willing to pay.

Don't go with the intention of ripping off the dealer. They aren't necessarily evil people. If they are good people, they want to sell a car and you want to buy a car, right?
They usually have good margins, so asking 5-7% isn't a lot anyway.

See this video from subaruwrxfan on YouTube:

Subaruwrxfan on how to negotiate a car deal
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      08-07-2016, 12:53 AM   #6
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All dealers have a % margin and all sales are advised of how much they can or willing to cut down on the margin.

Rates & residuals and cash incentives are NOT posted by the dealer so those are not negotiable.
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      08-07-2016, 10:23 AM   #7
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Quote:
Originally Posted by siwo View Post
All dealers have a % margin and all sales are advised of how much they can or willing to cut down on the margin.

Rates & residuals and cash incentives are NOT posted by the dealer so those are not negotiable.
This is what you are always going to end up against.The dealer determines the price not the buyer. All the negotiating skills in the world won't get a buyer below the margin the dealer wants on that car. The best deals are on a car the dealer wants to move off the lot and it probably won't be the car that you want.
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      08-07-2016, 10:50 AM   #8
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Quote:
Originally Posted by siwo View Post
All dealers have a % margin and all sales are advised of how much they can or willing to cut down on the margin.

Rates & residuals and cash incentives are NOT posted by the dealer so those are not negotiable.
Really - so there's no way to move the residual?

I'm looking at a 2016 and a 2017. The residual on the 2016 is like 60%+ and on the 2017 is more like 56%.
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      08-07-2016, 12:25 PM   #9
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I don't think the residuals are negotiable. But they aren't written in stone. BMW sets it and the dealers have to push it forward.
IF bmw thinks it's too small, they will push up, but it's up to BMW, not the dealer.

You can try to haggle some off the MSRP given the smaller residual, but if the dealer wants to push their on-the-lot cars, you won't get too far.
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      08-07-2016, 01:43 PM   #10
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To your direct question. Many will quote pre tax when they say how much they saved. Just depends on the person.

Last edited by Grentz; 08-09-2016 at 12:56 PM..
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      08-07-2016, 02:13 PM   #11
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As others have said, most quote pre tax. This is actually more helpful to people not buying from the same exact dealership as taxes, dealer fees etc will all vary depending on where you bought the car. Look at places like edmunds or truecar to get an idea of dealer invoice.

Bottom line though, you have to do the math to set a limit you are willing to pay. If a dealer won't meet that, look for another dealer or reevaluate your bottom line.

Good luck
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      08-12-2016, 10:54 PM   #12
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When you go to a retail store and buy something marked 25% off, do you get that discount on the sales tax too? No.

Sales tax varies greatly by state and if the tax is net of trade or not so it could be comparing apples to oranges. MSRP is standard across the country and discount from it would be valid for comparison. For example, my state has a 3% stales tax on new car sales. If the car sold for $40000, assuming no trade, the sales tax would be $1200. So if I wanted to include a 5% discount from the dealer on tax to, it would be a whopping $60. Sure you could sweat $60, or maybe they throw in a key ring or something.

Then there are the fees, does the discount apply to those?

I think the standard quote of discount percentage is largely off MSRP because most people understand the variables, but I could be wrong.
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      09-10-2016, 08:32 PM   #13
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Quote:
Originally Posted by wtfbrah View Post
Really - so there's no way to move the residual?

I'm looking at a 2016 and a 2017. The residual on the 2016 is like 60%+ and on the 2017 is more like 56%.
You can not set the residual, this is an amount BMW decides on and changed monthly.

The reason why it is higher on the 16s is because they are trying to get rid of them since "everyone" wants a 17 240.

I got an awesome deal on a discounted fully loaded 16 instead of ordering a 17.

Any discounts would be to the MSRP. Taxes would be taken out of whatever the final agreed upon amount of the vehicle is.

Last edited by Hellrot; 09-10-2016 at 08:38 PM..
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