aggiealum

Not to mention those that get financed through the dealership. The dealer can easily make 1% simply getting you approved for 1.9% and having you take a 2.9% loan, on top of what they already get from the bank.

isles1

Well said. Most posts stating that he or she got an S4 under or at invoice conveniently leave out the details you mentioned (e.g. what incentives were applied to the sales price, what fees were added in addition to the sales price).

isles1

Unless I am mistaken, the $195 prep fee to the dealer some of us are talking about is apparently what the factory charges the dealer to "prep" the car for shipment from the factory. There apparently is some truth to this fee, as well as the 1/2% advertising fee that Audi USA passes along to at least some (participating) dealerships.

Many dealers will also try to charge a "prep" fee that is explained as covering the cost to prep the car for the end user. This is not a fee I personally would agree to. Telling the dealer you'll get it detailed yourself sure should put the ball back in its court to back off such a fee.

isles1

That is why, as someone looking to finance, you should always shop your own loan. Rest assured that will likely negate certain incentives that otherwise may apply when financed through Audi Financial.

And that is why, as a lessee, you should research the "buy rate" money factor / interest rate that apply to that month's lease programs. I've seen many posts where dealers were padding the money factor.

Tweakophyte

Agree. You give some credence to the conversation I had. He used the 1.9% in his example of his non-padded costs (and why he was holding to "profit" on the car.

Tweakophyte

I agree. The problem is they tightly segregate their "business units" and hold them accountable, so one side of the house has no incentive to discount, even though the other side will profit.

It's a dance, for sure...

roho3323

In addition to the dealership nickle and dime method to earn extra dollars, manufactures give $$ to dealers to move product = Dealer Holdback.

"Dealer holdback is a percentage of either the MSRP or invoice price of a new vehicle (depending on the manufacturer) that is repaid to the dealer by the manufacturer. The holdback is designed to supplement the dealer's cash flow and indirectly reduce "variable sales expenses" (code words for sales commissions) by artificially elevating the dealership's paper cost." -Edmunds

isles1

It has been previously discussed on this forum that Audi does not use Dealer Holdbacks.

mpatel1080

Invoice minus holdback is the dealers cost but they get significant volume incentives. The exact amount of these is probably known only to the top level personnel at the dealership. By selling to you at invoice the dealer is probably not making a whole lot of money, but if you walk in to the dealership knowing exactly you want and are not sitting there for hours testing every car on the lot multiple times then the dealership is getting a sale with minimal effort of their staff. It is also important to remember that the vast majority of customers are not as educated about the car buying process as the members on this board. Dealers will try to pull all the shenanigans they can think of when they sense this....reminds of the dealer trying to charge me holdback when I was 20 and buying my first new car. He actually argued with me for 15 minutes that I had misunderstood the concept of holdback and that it was an amount the customer had to pay. Needless to say I walked out of that dealership!

BorisSutherland

Yeah, a lot has changed in 8 years.