[Matts435coupe]

So I had ordered a 2010 335 with Msport, red coral leather, and ipod. I was told the car would not be available until the last week in January. They told me, there would be a chance I would not get the holiday cash by the time it was built. I decided to go down to the dealership and see what they had coming in.

They had a 2010 BSM 335coupe M Sport, prem, ipod, sat radio, comf access and the car was at the port and about to be shipped. The only issue was they were adding the BMW perf package 4500 value. I think the car is fast enough, but I took one out for a spin with the package, I really enjoyed it and went back in to talk numbers.

Here is my deal The car lists for 55,225. They are giving me 3500 off sticker, 2500 holiday cash and 1500 off the perf package, so selling it at cost.

The lease is 36 months 15k miles
4,000 down 658 tax in.

My last 2009 was about 4500 down and I was paying 550.00 tax in and that car listed for 49k.

Sounds pretty good to me. But lets hear your thoughts.

[Matts435coupe]

is this in the wrong place?

[Mech_Man]

First, there are a lot of variables and unknowns in what you presented. It's really not enough to say if it's a good deal. And paying any attention at ALL to "List", "Sticker", and "Cost" is a waste of time. Those numbers were made by the marketing dept, and don't have any correlation to real street market value.


Most guys I know would take more time researching and choosing a plasma TV by features and prices than what they will spend choosing a car. [shrug]
This is a complicated decision - expect to invest hours of research and deal-making. If you do, you could spend THOUSANDS of dollars less, get the specific car and features you want, (and maybe save enough to get that plasma!)

Here is the process I worked out when I got an e92 last summer. I typed it all up neat and tidy a while back for another forum thread. I hope it's worth the reading time:

Also, this is used to come up with only the Cost of the Car. The lease arrangement and any trade-ins should each be handled as separate additional financial steps, AFTER you have the final car drive-out cost.



BACKGROUND:
I did the whole "eMailing every dealer for three states, to find one who'll work a deal up from Invoice, rather than down from MSRP".
I ended up at about $9,000 below the final, all-included MSRP. [HAH!] ... Paying a reasonable dealer profit and NO extra fees ... and I knew where every penny was. But it took me hours to do all that research, and luck in finding a really great sales associate and dealer: Myrtle Beach BMW (previously Fowler Motors, Conway, SC).

CAR PURCHASE FORMULA (with BMW-specific terms):
Over the last few years, dealers have recognized that car buyers have gotten smarter, and have better sources of info, so just buying "Invoice" plus profit won't work. They have adjusted by adding "fees" to the cost, AFTER the 'invoice'. So the trick now is to get ALL the costs into one formula.
_______________________________________________

Invoice
The factory set cost of the basic car, without any factory options or dealer accessories.

+ Factory Installed Options
Sum of the invoice cost for each of the options you wish to have, should be available from the same info source as the car's bare-invoice cost.
Use the actual option codes for all your choices, so there are no mistakes. Invoice pricing available in the Car Ordering sub forum.

+ MACO
Variable cost, non-negotiable: advertising co-op fee that varies from dealer to dealer, from $0 to about $400, I paid $0

+ Training Fee
Fixed, non-negotiable, I paid $180

+ Destination & Handling
Fixed, non-negotiable, I paid $775, (see note below about the PDC delivery option.)

+ Dealer Profit
This is the only real number that should be negotiated with the dealer. Surf message boards to determine what the specific car style and major options, in your specific area, at your specific point in time, should cost, as a net-profit. My own opinion is that it should vary from:
$100 for an ultra-simple deal on a car that is commonly found, to
$500 for something like a common convertible, to
maybe $1,000 for a hard to find 'vert in a choice color selection with unusual options .and is a new release, selling out everywhere.
Your sales advisor will do several hours of work, maybe even getting others to help. They are a business and that's what they do and deserve a reasonable profit.

+ Other Fees
This is the way that "Stealers" add to their profit without you knowing it. Examples are: Handling Fees, Cleaning Fees, Full Tank Fees, Processing Fees, or I've even seen a line cost "Additional Dealer Profit", etc, etc, etc. These are all bogus, or for actions that should actually be covered in the sellers-overhead, Do NOT allow any additional fees to be added, or if you do, then deduct that amount from the Dealer Profit line.
____________________________
= "CAR COST (pre TT&T)"
My experience is that this is the number that I negotiated, but I required all the above fees listed too, and worked backwards.


+ Tax
Fixed, non-negotiable, set by the state where the dealer is located.

+ Tag + Title
AKA Doc Fee, or documentation fees. The cost you pay the dealer if you decide to have them handle the paperwork of applying for a license tag, and a state title. You can do all this yourself and ask the dealer to drop these fees. Check your state's DoT website for what the actual chargers are, and decide if you want to hassle with it yourself. I paid the dealer $200 and was happy to not have to stand in a very long line at the local DMV during business hours to still pay out about $155.

+ After Factory Accessories
Sum of dealer installed accessories, including tax, such as HD radio, Dealer installed factory alarm, etc
Be careful as these numbers are what the market will bear. I got a final pre-T,T & T estimate, then and only then told the dealer my after-factory accessory wishes. I chose a few, declined a few, and elected to have some done by a 3rd party. (I got a factory alarm that was installed at the dealer so it would be covered by the whole-car warrantee and be fully integrated with the car, and the CD changer in the trunk --- ditto, but did window tinting by someone else, later). Treat this negotiation like you were negotiating separate deals with separate car mechanic shops - as that is what you really are doing anyway. If you are in a strong bargaining position, try offering to pay their parts price, but only if they will install it for free, at THEIR convenience, (when they have slack time in the shop), That way it actually doesn't cost them anything so they may agree, just to close the deal.

- Rebate
aka Option Credit, aka Dealer Credit, aka Trunk Money.
This is subtracted AFTER tax, not before.
This was the hardest piece of info to find, and I searched the net, and several boards. But I found over $1,200 in Trunk Money, so it was WELL worth my time to do the research. Another comment: I understand that many dealers will quietly take this credit for themselves, as extra 'hidden' profit, unless you let them know about it and ask for it. As they are under no obligation to turn it over to you anyway, all I can say is make sure you know what's out there, and put the numbers into the formula, either as a credit on your side, or an extra profit on the dealer's side.

___________________________
= Final Price (AKA "check price" aka "drive-out price")
Total cost to you. or what your one check is made out for.

Again, this doesn't count any trade-in credits or lease figures. The above number is a single cost you should now plug into those negotiations.

NOTES:
If you can schedule a week or two, consider doing the ED (European Delivery). I haven't so check it out elsewhere. However, if you do, then the MACO and Training/Destination fees are not added.

For US delivery, you can elect to do a PDC delivery (Performance Driving Center delivery option instead of having the car shipped to your selling dealer), You don't get a refund on the price of the Destination & Handling, but if you can find the time to go meet your car, and can work out the 1-way travel, do it, it's incredibly worth it.
If you do this, then it really doesn't matter from who you buy it. You could make the purchase with a dealer on the other side of the country. Or even better, look around this forum for dealers here. The driving school, factory tour, death trail test-drive of the x5, and museum were all just as incredible an experience as they said it would be.

Good Luck!

[r0cketman]

Thanks for all the great info Mech Man! As you can see I am getting real close to getting a BMW and want to close by year end to take advantage of 2500 cashback and the fact dealers might be more aggressive on pricing when close to month end and especially year end. Otherwise, I definitely would not be surfing this forum on Christmans Day. =)
Everyone makes it sound so simple. Just decide on price over invoice to pay and if dealer doesn't take it, walk. It's not this simple. I've emailed multiple dealers to get their initial pricing, gone to edmunds.com, truecar.com, kbb.com, etc.. to see invoice vs msrp pricing. Hopefully I can negotiate with the dealers as they are using the 2500 cashback as incentive for me to buy so their quote is $1K well over invoice. One dealer claims the website invoice that I see does not include $500 advertising fee so their price to me is only $500+ over invoice. Is this BS? I'll keep looking for answers.

Happy Holidays!!

[Mech_Man]

Originally Posted by r0cketman

Thanks for all the great info Mech Man! As you can see I am getting real close to getting a BMW and want to close by year end to take advantage of 2500 cashback and the fact dealers might be more aggressive on pricing when close to month end and especially year end. Otherwise, I definitely would not be surfing this forum on Christmas Day. =)

Everyone makes it sound so simple. Just decide on price over invoice to pay and if dealer doesn't take it, walk. It's not this simple. I've emailed multiple dealers to get their initial pricing, gone to edmunds.com, truecar.com, kbb.com, etc.. to see invoice vs msrp pricing. Hopefully I can negotiate with the dealers as they are using the 2500 cash-back as incentive for me to buy so their quote is $1K well over invoice. One dealer claims the website invoice that I see does not include $500 advertising fee so their price to me is only $500+ over invoice. Is this BS? I'll keep looking for answers.

Happy Holidays!!

Sure, and good luck!

You bring up a great point that I didn't cover - timing. (I was replacing a wrecked car and getting out of a rental so I had to get one ASAP and couldn't delay). But some dealers are pressured a bit to sell by the end of the month, to reduce in-stock numbers for sales records, and all the dealers are pressured quite a bit to sell before years end, to avoid having to pay taxes on remaining stock. So your getting a car before the years-end will take advantage of the sellers additional motivation to lower their minimum profit line-item.

I really empathize with you about how so many make it sound simple and easy. But I think that's for the ones who leave themselves open to getting ripped off. Those are the ones who will put ore time researching and shopping a plasma TV than their car. As for me? I emailed over 20 dealers (every single one in my state and the two surrounding). Only a few responded in a way that was useful. (about half ignored me, about a quarter tried to get me to come into the show room so they could do their sales pitching to me in person).

You are spot on in using those websites like truecar to get a feel for what is currently a good profit number. (Again, you gotta ignore all the talk about Over Invoice. That method doesn't work anymore as the dealers dilute the deal with the extra fees). These forums, and the other similar ones, usually have a chatter on what people paid, and if you focus on the profit number and not invoice number, you should be able to get a pretty close range.

Once you have the Dealer Profit, then you hold them hard to the fees that are truly proper, and keep them from getting their hidden profit from bogus fees like Prep or Dealer Additional Documentation. <grrr, that burns me>.

RE: the advertising fee. When you are requiring the dealer to list all the costs so you end up with the drive-out cost, also ask them if this advertising fee is also called MACO. I bet it is, and therefore it's a non-bogus, but also could be avoided by going to a different dealer.
MACO is an advertising co-op of dealers. The pass the fees on to you, but how much varies by what they themselves pay in. So the number changes from dealer to dealer, but is non-bogus and non-negotiable. (You can't talk it out of the deal). For my purchase, I was fortunate to find a dealer who didn't participate, so that saved me an extra few hundred as that line-item was "$0.00".

Happy holidays to you too!

[HFe92]

pretty good deal

[tbui]

Also, another good tip is to negotiate the price then ask for the rebate. When we bought our 335i we got them to give us 5000 off but that included the rebate. So I told the dealer no the rebate is from BMW not from the dealer. So we re-negotiated the price and got 4500 off msrp and the 2500 spring credit. Lastely, they can sell you the car below invoice because they get dealer incentive. If you can try to get 1000 below invoice.

[capo1m]

not alot of miles for 3 years

[BMW Fanatic]

Originally Posted by Capo330i

not alot of miles for 3 years

i would say its 15k a year

[tonykk]

Hi Mech_Man

I'm new to this forum and negotiating with a dealership on a 2010 328i 6MT with PP, Value, NAVI, Bluetooth, BMW assist. I worked down from our budget point and finally came to $33750 plus tax/license, according to Edmunds, this is about $2000 below invoice, but with the current $2500 incentive, do you think they can do even better? although we think we have a good deal already since 6MT is not easy to find locally.

I see your breakdown below and was amazed If you can just give me a 2cents, will be greatly appreciated!

Thanks anyone!!

Originally Posted by Mech_Man

First, there are a lot of variables and unknowns in what you presented. It's really not enough to say if it's a good deal. And paying any attention at ALL to "List", "Sticker", and "Cost" is a waste of time. Those numbers were made by the marketing dept, and don't have any correlation to real street market value.


Most guys I know would take more time researching and choosing a plasma TV by features and prices than what they will spend choosing a car. [shrug]
This is a complicated decision - expect to invest hours of research and deal-making. If you do, you could spend THOUSANDS of dollars less, get the specific car and features you want, (and maybe save enough to get that plasma!)

Here is the process I worked out when I got an e92 last summer. I typed it all up neat and tidy a while back for another forum thread. I hope it's worth the reading time:

Also, this is used to come up with only the Cost of the Car. The lease arrangement and any trade-ins should each be handled as separate additional financial steps, AFTER you have the final car drive-out cost.



BACKGROUND:
I did the whole "eMailing every dealer for three states, to find one who'll work a deal up from Invoice, rather than down from MSRP".
I ended up at about $9,000 below the final, all-included MSRP. [HAH!] ... Paying a reasonable dealer profit and NO extra fees ... and I knew where every penny was. But it took me hours to do all that research, and luck in finding a really great sales associate and dealer: Myrtle Beach BMW (previously Fowler Motors, Conway, SC).

CAR PURCHASE FORMULA (with BMW-specific terms):
Over the last few years, dealers have recognized that car buyers have gotten smarter, and have better sources of info, so just buying "Invoice" plus profit won't work. They have adjusted by adding "fees" to the cost, AFTER the 'invoice'. So the trick now is to get ALL the costs into one formula.
_______________________________________________

Invoice
The factory set cost of the basic car, without any factory options or dealer accessories.

+ Factory Installed Options
Sum of the invoice cost for each of the options you wish to have, should be available from the same info source as the car's bare-invoice cost.
Use the actual option codes for all your choices, so there are no mistakes. Invoice pricing available in the Car Ordering sub forum.

+ MACO
Variable cost, non-negotiable: advertising co-op fee that varies from dealer to dealer, from $0 to about $400, I paid $0

+ Training Fee
Fixed, non-negotiable, I paid $180

+ Destination & Handling
Fixed, non-negotiable, I paid $775, (see note below about the PDC delivery option.)

+ Dealer Profit
This is the only real number that should be negotiated with the dealer. Surf message boards to determine what the specific car style and major options, in your specific area, at your specific point in time, should cost, as a net-profit. My own opinion is that it should vary from:
$100 for an ultra-simple deal on a car that is commonly found, to
$500 for something like a common convertible, to
maybe $1,000 for a hard to find 'vert in a choice color selection with unusual options .and is a new release, selling out everywhere.
Your sales advisor will do several hours of work, maybe even getting others to help. They are a business and that's what they do and deserve a reasonable profit.

+ Other Fees
This is the way that "Stealers" add to their profit without you knowing it. Examples are: Handling Fees, Cleaning Fees, Full Tank Fees, Processing Fees, or I've even seen a line cost "Additional Dealer Profit", etc, etc, etc. These are all bogus, or for actions that should actually be covered in the sellers-overhead, Do NOT allow any additional fees to be added, or if you do, then deduct that amount from the Dealer Profit line.
____________________________
= "CAR COST (pre TT&T)"
My experience is that this is the number that I negotiated, but I required all the above fees listed too, and worked backwards.


+ Tax
Fixed, non-negotiable, set by the state where the dealer is located.

+ Tag + Title
AKA Doc Fee, or documentation fees. The cost you pay the dealer if you decide to have them handle the paperwork of applying for a license tag, and a state title. You can do all this yourself and ask the dealer to drop these fees. Check your state's DoT website for what the actual chargers are, and decide if you want to hassle with it yourself. I paid the dealer $200 and was happy to not have to stand in a very long line at the local DMV during business hours to still pay out about $155.

+ After Factory Accessories
Sum of dealer installed accessories, including tax, such as HD radio, Dealer installed factory alarm, etc
Be careful as these numbers are what the market will bear. I got a final pre-T,T & T estimate, then and only then told the dealer my after-factory accessory wishes. I chose a few, declined a few, and elected to have some done by a 3rd party. (I got a factory alarm that was installed at the dealer so it would be covered by the whole-car warrantee and be fully integrated with the car, and the CD changer in the trunk --- ditto, but did window tinting by someone else, later). Treat this negotiation like you were negotiating separate deals with separate car mechanic shops - as that is what you really are doing anyway. If you are in a strong bargaining position, try offering to pay their parts price, but only if they will install it for free, at THEIR convenience, (when they have slack time in the shop), That way it actually doesn't cost them anything so they may agree, just to close the deal.

- Rebate
aka Option Credit, aka Dealer Credit, aka Trunk Money.
This is subtracted AFTER tax, not before.
This was the hardest piece of info to find, and I searched the net, and several boards. But I found over $1,200 in Trunk Money, so it was WELL worth my time to do the research. Another comment: I understand that many dealers will quietly take this credit for themselves, as extra 'hidden' profit, unless you let them know about it and ask for it. As they are under no obligation to turn it over to you anyway, all I can say is make sure you know what's out there, and put the numbers into the formula, either as a credit on your side, or an extra profit on the dealer's side.

___________________________
= Final Price (AKA "check price" aka "drive-out price")
Total cost to you. or what your one check is made out for.

Again, this doesn't count any trade-in credits or lease figures. The above number is a single cost you should now plug into those negotiations.

NOTES:
If you can schedule a week or two, consider doing the ED (European Delivery). I haven't so check it out elsewhere. However, if you do, then the MACO and Training/Destination fees are not added.

For US delivery, you can elect to do a PDC delivery (Performance Driving Center delivery option instead of having the car shipped to your selling dealer), You don't get a refund on the price of the Destination & Handling, but if you can find the time to go meet your car, and can work out the 1-way travel, do it, it's incredibly worth it.
If you do this, then it really doesn't matter from who you buy it. You could make the purchase with a dealer on the other side of the country. Or even better, look around this forum for dealers here. The driving school, factory tour, death trail test-drive of the x5, and museum were all just as incredible an experience as they said it would be.

Good Luck!

[Mech_Man]

I can't address if your numbers represent a 'good deal' as I don't know the variables, (the line-item costs that the dealer sets).

My whole point is that if you split the math up into the formula I listed and plug in the non-variable costs. That eliminates all discussion except for the variable costs: Their "acceptable profit", and any "other costs". Working Down-from-Sticker, or Up-from-Invoice both represent methods that don't work any more. The bad dealers know how to insert additional fees on top of the invoice that will have you paying thousands more than you should.

Negotiate out (refuse to pay) any unacceptable "other fees", and this leaves only the "acceptable profit" (for the car, and as a separate line item, for the post-factory accessories that you want the dealer to install).

And then you need to decide if their idea of "acceptable profit" is similar to the numbers being chosen in YOUR area, for YOUR car, at THIS time.

I know I got a good deal, my dealership got a good profit, and I drove off knowing I'd not been ripped off, but rather had been treated as a savvy customer who will probably come back the next time. But it took me well over 30 man-hours of research over several days to figure it all out.
(Well worth it as that process revealed a $1,200 savings via Trunk Money), so it was like earning 40 $/hr to know how to get the best deal!!

Then I contacted every single dealership in my and the nearby 4 states, and only had 3 reply indicating they would negotiate this way. The one that was willing to treat me with respect (Myrtle Beach BMW in Conway, SC, previously Fowler BMW), and that's the name that went on the check I wrote.
I did have the advantage of not needing to worry about delivery as I live close to Spartanberg, SC and took delivery via PDC. (A fantastic experience).