Car dealerships question

[Jazzy]

Why do car dealerships play this game with people where the salesman and manager run back and forth to discuss the price plus the financing?

 

[Castle Church]

Ugh, it is so annoying, tiresome, and frustrating. The last couple of cars I bought were through Carvana where you don't negotiate at all and the prices were fair up front.

 

[Josiah]

It's a GAME to squeeze the most money out of the buyer... and obviously it works or they wouldn't do it.

There have been attempts to change this to a non-negotiable "set" price. Saturn always did this, Oldsmobile tried it for a few years, there are dealerships here and there that aren't "dealers" but all this is rare because it doesn't produce as much profit. This goes hand-in-hand with a rapid deduction in competition. Pontiac, Oldsmobile, Mercury, Plymouth, Saturn divisions and dealers are all gone.... and gone are the days of the family-owned local dealership, most are now owned by big corporations that operate many dealerships and keep profits high.

Several groups exist to supposedly help the buyer - Consumers Reports, The Auto Club, True Car, even COSTCO have car buying programs. But typically, the savings is minimal - you can probably do better yourself although they save you the hassle.



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[tango]

As Josiah said it's a game. If the dealer can paint himself as the good guy while the manager is the bad guy he can maybe create a bit of rapport and get the customer to pay a bit more, or maybe paint a picture that the manager won't let him cut the price as much as he'd like to but if the customer pays the higher price he'll throw in some options at a reduced price, or whatever else.

Then comes the hard sell just before you sign the dotted line - would you like the extended warranty? Only $4000 for five years but it covers absolutely everything. Everything except the problems you actually have with the car, of course.