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Cost Price Promotions


cwl
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I've been invited to a dealer promotion (as a valued costumer!) where I can get a new car at cost price. Im after a Yaris for the wife. Does anyone know what sought of savings I can expect?

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Sounds to good to be true.What is cost price? What they pay Toyota for the car and therefore make no profit. I doubt it unless they they get a big bonus for cars sold in July. No harm in seeing what price there offering.

Check out car brokers on the internet before you go, to get some idea if it is a wonderous deal. For instance, Yaris 1.33 TR 5 door £12418 saving £1151. See if they can beat that by a big margin.

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Generally I think cost price promotions are often used to clear existing stock of cars held by a dealership or dealer group. This isn't to say that a dealership will make no profit from any sale - as profit will probably be made on accessories bought, finance, service plan, and extras like paint treatment, GAP insurance, etc. Not forgetting manufacturer promotions to the dealers.

Some dealers may use the fact it is a cost price sale to reduce part exchange values.

So before agreeing a sale, as always, make sure you've got the full picture and compare it with what is on offer elsewhere.

Gap insurance, if this is something you would consider, can invariably be bought elsewhere for less than the dealer's cost (as an example have a look at www.ala.co.uk).

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Cost promotions are just another way of driving traffic to the showroom, we have done them in the past, even given customers a copy of the purchase invoice from Toyota to show they are actually getting it cost price. The problem is people always think there is a catch!

The dealer will sell the car at cost price but dont expect to get all the other services on offer at cost price, such as finance etc, it will be the car only

Your dealer MUST reach target at the end of a quarter otherwise he wont make profit, regardless of how many accessories GAP etc etc are sold. I always find it incredible that we have to sell stock at cost, in order to hit a target and make a few quid. There cannot be many business's in the world that sell at cost in the hope of staying in business, weird!

The thing I always tell people is its the COST TO CHANGE that matters, no point in buying a car from a broker for £500 less if you cannot finance it at a low rate or have to faff around selling your own car with all the advertising costs and hassle of owning two cars at once. As Frosty says, review your options, get quotes from several sources and go armed to your dealer with written evidence of a better deal. There is an assumption there is a massive margin on new cars..........there isnt

Kingo :thumbsup:

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With respect I was not suggesting that one should use a broker, just that it will give you an idea of the discounts already available.

More ammunition when visiting the dealer.

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Thanks for all your advice. It sounds like I will be disappointed when I go on Friday. I have looked at prices quoted by dealers and brokers on Auto Trader.

For example at UK Car Discount

TOYOTA YARIS HATCHBACK 1.33 VVT-i TR 3dr £11,032.35 (saving £2,137.45)

I would want it for less than that so it might be a short visit!

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Currently Toyota are offering 1 years free insurance on the Yaris (excluding the T2) and, depending on how you're going to finance the car, 0% finance (think through a PCP). These are for Yaris registered between 1st July and 30th September. So these could be something else to throw into the melting pot.

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Thanks for all your advice. It sounds like I will be disappointed when I go on Friday. I have looked at prices quoted by dealers and brokers on Auto Trader.

For example at UK Car Discount

TOYOTA YARIS HATCHBACK 1.33 VVT-i TR 3dr £11,032.35 (saving £2,137.45)

I would want it for less than that so it might be a short visit!

I think you need to be realistic as to how much profit is in a TR ;)

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Update on my visit to the main dealer

I enquired on a new Yaris 1.33 VVT-i 5dr TR. The cost price was only £850 less than the normal price. (£13,774 OTR)

However I was shown some pre registered cars. The one I looked at was a red 1.33 VVT-i 5dr TR with sat nav for £11,499

It has 5 miles on the clock and was registered in June so only a few weeks old. Im going for a test drive next week (if its still there)

Anyone have any comments on this deal?

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That sort of reduction n the new 1.33TR is indicative of what Parts Kings said re the small amount of profit on new cars.

List price is £13,770. Depends what the cost to change is. Are you part exchanging something? Finance?

Seems OK, but without knowing more detail (which you may not wish to provide), it is difficult to give an opinion.

At the end of the day, are you happy??

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