QuestionHey Jeff,
Yeah, the deal I cut on the 06's included the $4500 plus a little bit more , i think there must be some dealer cash floating around too.
As far as depreciation goes, we're pretty well decided that if we do go with the '05 that we are going to drive it into the ground. Not only because of resale value but also because of the marketability of a stripped unit.
Good point on the warranty, I'll call and ask tomorrow.
One more quick question if you don't mind, I "overheard" on the phone today that the unit would be going to auction on Tuesday. I don't know if this was an honest mistake, or if they were trying to light a fire. What are your thoughts? If the unit is legitimately going to auction next week wouldn't it strengthen my bargaining position considerably?
again,thanx...Steve
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Hey again Jeff,
Relative to your question about the size of the dealership,it is the largest in a mid-sized town(40,00-50,000). There are several other dealerships in near by smaller communities.
I appreciate your thoughts on the situation. To be honest, the information you have given me is the only thing that has thus far kept me from jumping on the deal. The price they are quoting is significantly lower than the deal I was able to make on two '06 Town and Country vans,(two separate dealerships) and I'm pretty sure that both of those deals were close to invoice. Their number on the '05 is lower than dealer retail for a used vehicle booked in excellent condition with comparable miles, and is only slightly above private party value.
It would definitely kill the deal if it were the only '05 on the lot, but the story I'm told is that they have two vans,part of a fleet deal that fell through, both comparable with similar miles.
I'm at an impasse, because the deal looks good, and it sounds good,(they're even offering the full 7/70-3/36 that was offered on the '05)but I agree that letting a car sit idle for 17 mos. without changing the oil or operating the trans-axle is no good for the internals.
I'm still tempted, but you've given me a lot to think about. Any other thoughts you might have would be greatly appreciated.
Thanx again, Steve
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Hey Jeff,
Thanks for the advice, it all makes sense when you think about it. I spoke to the dealer again to get the particulars on the vehicle. He says that it is a late'05 delivery and that it has approximately 100 miles on it, do either of these variables make a difference in your opinion? Also, is there a way to determine the manufacture or delivery date by the vin?
Thanx again, Steve
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Hey Jeff,
We're looking at purchasing a "new" untitled 2005 Chrysler Grand Caravan. I would like to get the best price I can on the vehicle,and finance it privately.
I'd like to here your thoughts on how best to negotiate the price on a two year old, new vehicle as well as any information you might have on financing a two year old, new vehicle ( can I get the same rate, and term as a new vehicle...). Any wisdom or advice you can offer would be greatly appreciated.
Thanx,Steve
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First, I very rarely make black-and-white statements, as there are so many variables in buying a new vehicle. BUT- this is one of the few times I will make a blanket statement and tell you that you need to run from this vehicle, and as fast as possible. No auto manufacturer designs a vehicle to NOT be used. In this case, the Grand Caravan has been sitting on a dealer's lot for nearly 2 years. Not driving it in that time allows many seals and gaskets to dry out, causing numerous leaks. I'll also bet that the oil has never been changed, and all the driving this vehicle has seen is a few test drives and been moved around the lot numerous times. That put more wear and tear on the engine and transaxle than 20,000 miles of highway driving. This vehicle will prove to be a mechanical headache.
Furthermore, DaimlerChrysler is no longer offering rebates on 2005 models, but they do have up to $4500 in rebates on the 2006s. Even if you paid a little more for a 2006, the higher rebate, not to mention significantly higher resale value, makes the 2006 a much better buy.
As for financing, take the rebate (DO NOT take the lower finance rate offered by Chrysler), and finance the vehicle through the dealer. DO NOT tell them you plan on arranging your own financing. Dealers make more money by handling the financing than they do by selling the new car! Negotiate the price of the vehicle, and let the dealer handle the financing. The higher the rate you pay, the more money the dealer makes (they get to mark up the rate), and the more willing they'll be to discount the price of the vehicle. Then, a month or two after you take delivery, get your own financing at a lower rate and pay off the first loan. You should be able to get the same rate as a new-vehicle loan, and you'll save a ton of money in the long run. Oh, and DON'T tell the dealer you'll be paying off the loan they arranged for you; they'll lose the markup they made and won't be willing to offer you a great deal. Don't be afraid to ask more questions if any of this is unclear- I'm happy to help in any way I can.
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The month and year of manufacture are listed on the vehicle's data plate, which is usually on the jamb or pillar of the driver's door. The dealer's service dept. could give you the actual production date, but month and year are close enough for our needs here.
I know you're looking at this as a new vehicle, but the 2007s are out, so it is 2 years old, no matter how you shake it. To determine what you should pay for it (assuming you want to go ahead with this, which I highly advise against), you need to do 2 things. First, look through the local ads and see what dealers are getting for a comparable used 2005 with low miles. Then, go to Edmunds.com, and use their Used Car Appraiser. Put in the year, make, model, and all the options on the van, then put the miles as zero. Look at that value, average it against the used '05s, and that should give you a pretty good idea what you should be paying. I would still shop around and see what kind of deal you could get on a 2006. Even if the 2006 is say, $500 more, you're so much better off because of the higher resale value. When you go to trade in that 2005 in 4 years, you're really trading in a SIX YEAR OLD vehicle. But the mechanical problems you'll have with that 2005 are enough to steer clear of it. After 20 years of selling cars, believe me, I've seen enough of those come back and haunt the service department to know what I'm talking about. BTW, is this a small-town dealer you're working with?
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Steve, I can't tell you what to do, I can only advise you from my perspective. You say the price on the '05 is significantly lower, but does the '06 price include the rebate? Here in NY, you can't include the rebate in the negotiated price, because the rebate is subtracted AFTER the sales tax is calculated. But, if the rebate is factored in, you've done all your homework and you feel the '05 is the best way to go, then so be it. I would suggest two things: this '05 is going to drop in value like a rock in water, so you better be prepared to keep it for a long time. Second, if this van was part of a fleet deal that went bad, I'd check with the service department BEFORE you purchase it to see if the warranty has already started. Make them give you a computer printout that proves the warranty starts the day you purchase it, if that's what they're claiming. I've got a feeling that the reason the price is so low is that the dealer may have already reported it sold in order to get a substantial fleet allowance from the factory. If the warranty has been running for 17 months, well........
AnswerIt would be extremely unusual for a dealer to take a brand-new vehicle to auction, unless it was high-end and very desirable (Ford GT40, for example). If you "overheard" it, I'm sure it was for your benefit, and you're right- they're trying to light a fire under you. What will help your bargaining position most is the financing aspect I mentioned: let them finance it for you, so they can earn the interest kickback. Then, in about a month, pay it off with your own lower-interest loan. But DON'T tell them what you're doing; just finance it with the dealer for 48-60 months, then re-finance through your own bank for the 24 months you initially wanted to do.
