Toyota Truck with Lemon Stickers & Giant Sign

[bigtmac19]

I did love my Jetta at first but it has cost me a LOT of money since I've had it, the bloom has kind of worn off. Thank goodness the diesel is cheap.

[psicodude]

I remember back 20 years ago to day 1 of Future Shop sales training and they made a big deal of the "break it down to the smallest dollar amount possible". The average person gets really excited when purchasing something new and will fall for the bi-weekly payments thing in a second. I would suggest that the majority of consumers don't even really pay attention to the details of the sale, just the bottom line monthly payment. They do a quick budget in their head and figure "yeah, I can afford that!".

[photon]

Originally Posted by Dion

I'd like to know if it's really working in making car buyers think they have smaller payments when in reality they don't. Maybe it's just a way to get the car buyer into the showroom where the sales person has a chance to sell his product.

http://en.wikipedia.org/wiki/Psychological_pricing

Not the exact same thing but I think it's the same phenomenon.

It's not so much as people thinking they have smaller payments, it's that the psychological impact of $199 bi-weekly is smaller than $431 monthly so when making a decision the $199 hurdle is mentally easier to overcome.

And as you say, all advertised pricing is to get people into the store where the real price is different (if nothing else because GST wasn't included or whatever).

[PIMking]

Originally Posted by Hack&Lube

Is it worth worrying about where your car was manufactured? People often say that Toyota's quality started to dip with their foray into building them in American plants instead of Toyota city in Japan. I've heard people recommend buying a Lexus because they are stlil built in Japan.

These days you can buy Japanese cars built in the Americas and even Mercedes has plants in Alabama, India, etc.

Mercedes also builds cars in south Africa

[PIMking]

Originally Posted by Dynamic

My father in law has a 2004 tdi jetta and every time I see him I ask him which light burnt out today. He can't keep a tail light from burning out and his radio illumination lights are completely gone.

Not a bad car to drive but stupid little things like that would infuriate me to no end. I make my living fixing and maintaining industrial equipment and nothing makes me happier than a machine that runs perfectly without the uncheduled breakdowns. I like my cars to do the same.

My first car was an '87 Audi 4000cs Quattro and it was an electrical nightmare.

Fiance's dad has a '13 TDI sportwagen and it's amazing, just feels like everything has such a nice tight fit, quiet and just a nice vehicle. Fiance's '12 Civic is a joke and my '09 Versa is a lot of meh

[btimbit]

Originally Posted by pylon

The pre-City edition MKIV's were incredibly tight cars. Those cars revived VW in North America no doubt. You could put the fit and finish of them up against anything, and they held their own.

The GLX VR6 Jetta was just an awesome car, almost like a baby 328i, but they were 37-40k! The stupid thing is, I remember selling them back then at full retail (especially silver ones) @ 7.9%...... and it was like fishing with dynamite.

Now you tell a customer a new 220 HP MKVII GTI is $34900 @ 1.9% and they react "OMG11!!!1!!1 Your interest is so HIGH and carz so expense!1!1!!!!1"

My old '03 GLI VR6 is still the best car I've ever had. I miss it almost every day.

On the note of price, I have an 05 cavalier I bought to flip. Has the original window sticker with it. This car has no options. Manual windows, manual locks, no A/C, $17995 + tax and delivery when it was new. That surprised me.

[pylon]

Originally Posted by photon

http://en.wikipedia.org/wiki/Psychological_pricing

Not the exact same thing but I think it's the same phenomenon.

It's not so much as people thinking they have smaller payments, it's that the psychological impact of $199 bi-weekly is smaller than $431 monthly so when making a decision the $199 hurdle is mentally easier to overcome.

And as you say, all advertised pricing is to get people into the store where the real price is different (if nothing else because GST wasn't included or whatever).

Bingo. Unfortunately though, it is now the way it is, and it won't be changing. Once one guy is using it to his advantage, everyone else has to so the playing field is level. However I do a lot of my stuff semi-monthly, as for whatever reason, my brain just handles splitting up the payments a little better for whatever reason. I find it easier to manage. I even remit my credit card payments on the 15th and 30th. It just seems to keep your spending in check better.

Personally, I give my clients both options though. Our client base is around 80%+ college/university educated, and they will call you right out on it. Some dealers like to play games, especially sub-prime specialists that 'guarantee approvals' (yeah right, $10k for a miled out Cobalt they paid $2k for with a low down payment of only $2500).

But even a lot of professionals are paid bi-weekly, and they prefer the payment to fall on payday, where as the 15th/30th payday guy, usually just opts for monthly.

[pylon]

Also, if you want to get a straight up monthly pmt from a bi-weekly ad, just multiply it by 26, and divide it by 12, and it is within pennies. Dealers don't use accelerated bi-weekly schedules, so there is very little interest savings to factor into the equation.

Pmt * 26 / 12

[pylon]

Actually, any payment advertised now, has to be attainable, and has to be on a vehicle widely available or on stock. AMVIC watches ads like hawks, and fines dealers for misleading ads, and missing fine print now. And the fines are huge.

Most people however, don't just take the car bare, with nothing. Usually they add something like an extended warranty, some accessories, maybe some loan insurance.... or any combination of the latter. If I were to guess on my experience, the average buyer extends their payment another $35-40/mth after they are done with me in the finance office. But I get the odd guy that walks in, and sees a $89 bi-weekly payment on a Jetta, and wants that and nothing more.

[Table 5]

I know more than a few people (some within my extended family) who only care about that monthly payment and nothing else. Term? Interest rate? Residual Value? Who cares, Im getting my car for $200 per month and that's all I need to know. I'm pretty sure my MIL didn't even know the total price of her car when she bought her new one.

[Dion]

Originally Posted by Table 5

I know more than a few people (some within my extended family) who only care about that monthly payment and nothing else. Term? Interest rate? Residual Value? Who cares, Im getting my car for $200 per month and that's all I need to know. I'm pretty sure my MIL didn't even know the total price of her car when she bought her new one.

I used to work with guys who would walk into a dealership and say "I can afford $350 a month in lease payments, what can I get for that?" Price of the vehicle didn't matter to them.

[Table 5]

Yeah, those guys probably make your average car salesman froth at the mouth, hah. I mean you can get a Ferrari for $350/month if you work the numbers. You'll be paying for it for 40 years, but hey...check out that monthly!

[cam_wmh]

ahh! you guys are making me think twice about selling my car

[GoinAllTheWay]

Originally Posted by Table 5

I'm pretty sure my MIL didn't even know the total price of her car when she bought her new one.

I work as an insurance broker. As such, I get calls almost daily (especially this time of year) from people wanting to add a new car they just bought to their policy.

It's a rare thing indeed when asking "what was the purchase price of the vehicle" where they know the answer. Usually the response I get is "uhhhhh, I'm not sure".

Really? It's one of the most expensive things you are ever going to buy and you don't know the purchase price?

[Hack&Lube]

^ Judging by all the comments about financing, I wouldn't be surprised if financing and servicing were actually 90% of dealership profits.

[DownhillGoat]

Originally Posted by GoinAllTheWay

It's a rare thing indeed when asking "what was the purchase price of the vehicle" where they know the answer. Usually the response I get is "uhhhhh, I'm not sure".

That's scary. Even if you're basing what you can afford on payments I find it hard to wrap my head around people not knowing what they paid for a vehicle.

[GoinAllTheWay]

Originally Posted by kunkstyle

That's scary. Even if you're basing what you can afford on payments I find it hard to wrap my head around people not knowing what they paid for a vehicle.

If you think that's bad, the number of people whom by older homes (25+ yrs) that actually get an inspection done? Maybe half?

I think they should be done regardless of age myself.

[mrkajz44]

Originally Posted by GoinAllTheWay

I work as an insurance broker. As such, I get calls almost daily (especially this time of year) from people wanting to add a new car they just bought to their policy.

It's a rare thing indeed when asking "what was the purchase price of the vehicle" where they know the answer. Usually the response I get is "uhhhhh, I'm not sure".

Really? It's one of the most expensive things you are ever going to buy and you don't know the purchase price?

I wonder how close they would be if they tried to ballpark it. I doubt they'd come within a couple thousand.

[GoinAllTheWay]

odd double post...

[pylon]

For many people leasing cars, they don't care what the car is worth. They just want a payment to fit a monthly budget, as they have zero intention of keeping it past the lease termination date.