QuestionThanks for taking the time to read this. My wife and I are looking at an 07 Hyundai Santa Fe. The dealer is asking $27,700 and I noticed the invoice is 23,000. What is a reasonable price for this? Is it true you can get the dealer to drop the price if it has miles on it from numerous test drives??
AnswerHi John,
In my book I tell readers that what's reasonable for
First, let me say that the bottom line is what's reasonable to you and what you're willing to pay. As I wrote in my book "$ave Thousand$ Buying Your Next Car: Confessions of a Former Car Salesman", (www.Make-Me-Smarter.com) this is one of the main reasons that car dealers want to negotiate with you. You may be willing to pay $23,000, but the next buyer might pay $27,000 and think it's reasonable.
Second, based on invoice price alone with no options added to the vehicle (which should always be calculated separately), I give some recommended offer guidelines in my book that buyers can follow. These are not guarantees in any way, only suggestions that buyers can work from. For vehicles in the $15-$25,000 (invoice price) range, 2-4% would represent a reasonable profit, in my opinion. Keep in mind that what the dealer accepts depends on a number of factors such as how much inventory they have, how popular the vehicle is in the market, how much potential profit they've built in with dealer added options, and if you're going to finance with them or not.
Finally, many dealers will reduce the price of vehicles that have miles on them, but this is at their discretion and again, depends on how badly they want to sell that particular car. But it's definetly worth asking for.
I hope this helps you, John.
Ron
