“Wow, You Know What You’re Doing”
This one is long, but for 3 cars with lots of negotiation between 2 dealers.
We had always planned our vehicle purchases carefully. We try to have our two main vehicles with a separation of 60,000 miles and 5 years. That way, we buy a new car every 5 years when the oldest has about 120-140k miles on it. Also, since the kids were about 5 years apart, we would have a hand-me-down auto to give them when each was ready to start driving. Or, that was the plan, anyway.
Our 1999 Chevrolet Lumina was given to David in 2009. We were planning to replace it in Dec 2014. It had over 155,000 miles on it. David called us at 11:30pm on June 3, 2014 during a downpour near the Kaw River, “I drove into some standing water I couldn’t see and the car died.” We had it towed to our mechanic at Firestone. He first checked the air filter. It was soaked with water. Then he checked the air intake to the engine. It had water in it too. The car was totaled. Fortunately, it was only worth about $1000 and he learned not to drive into standing water unless he sees other cars get through first. Better to learn that now than with a $20k vehicle. The best salvage shop gave us $400 for it.
In June, I did some research on prices, invoice amounts, rebates, costs, etc of a new Honda Accord LX. List was $23,545. Invoice was $21,828. I started contacting some dealers via phone and email in June before planning to make some visits in July and August. David would get our 2005 Honda Accord with 120,000 miles.
I first contacted Legends Honda vie email/internet. I didn’t think internet pricing would be very competitive compared to actually visiting. I was expecting quotes over invoice price. I was surprised that my first quote from Legends was for $21,500. I got an internet price from Jay Wolfe. Their price was $21,223.
On 7/8/14, dealer cash rebate increased from $500 to $1000 on the Accord and this stayed in effect until 9/2/14. I continued to monitor inventory levels and emails from the various dealers during July. I put them off from making any test drives that month. At the end of July, I notified some dealers that we’ll be making some test drives next week.
On 8/1/14, we visited Frank Ancona and test drove an Accord. Tony notified us that they had some light hail in April and they’re giving some great discounts on their new vehicles. Their price on the Accord we drove was $19,999, and also included the All Season Protection Package (splash guards, mats, trunk tray). We didn’t want an Accord with hail damage (even only 1 or 2 dents), but this gave me a new goal for a new Accord under $20,000! On 8/2/14, we visited Legends (Ren Patterson, Internet manager) to make a test drive. After all that, he asked what it would take for us to buy today. I said I would buy today for $19,000. He clarified $19,000 plus the documentation fee of $299. I said that’s right. He was gone for awhile and came back and gave us a price of $19,691 + doc = $19,990. We told him that’s good but we’re not ready to buy today. I thought we were done, but he got Chevis Reed, the internet manager of Legends Honda. Chevis brought the dealer invoice and showed me his bottom price, Invoice $21,628 less kickback $796 less rebate $1,000 = $19,832 ($19,533 + doc $299). After further discussions we thanked him and told him we would definitely be in touch.
Right after this test drive, my daughter Kristin mentioned that their 1997 Accord was needing some work and they were thinking about buying a new Honda CR-V. I asked if she wanted to go in with me on my negotiations for our Accord. She said sure. The CR-V she wanted was the LX AWD with a list price of $25,200.
On 8/4/14, we went back to visit Tony at Frank Ancona Honda. We had Krsitin and Justin with us and we told him what we were doing. “We are now in the market for 2 new Hondas, an Accord and a CR-V. We’re visiting several dealers and will be giving our business to the dealer that has the best prices.” He said, “Oh, you want to buy 2 cars. You know what you’re doing!” He told us for the CR-V, he can give as a price of $22,896 if financed and $22,396 for cash. I asked if he can give us a better price for the Accord. He said $19,999 was the best he could do on that.
I also heard back from Diane at Jay Wolfe Honda. She had a new LX that had been titled as a loaner car. It was never used as a loaner car so the miles were the same as new but it had to be sold as used since it was previously titled. Her price on that was $19,999.
On 8/5/14, I called Ren back at Legends about now buying a CR-V in addition to the Accord. He gave us a price of $21,990 (+ doc) for the CR-V.
Of course, during the next few days, we continued to get calls and emails from dealers wanting our business, even more so now with 2 cars on the line. When Kristin’s mother and father-in law (Keith and Sandee) heard that they were buying a car with us, they mentioned that they wanted a CR-V too, and would it be ok if they joined in. I said sure! That upped the stakes quite a bit. I was determined to see what I could get for 3 new Hondas!
On 8/9/15, we visited O’Neill Honda. Keith and Sandee previously test drove a black CR-V there and we were back to get prices on 3 cars. Their price on the Accord was $19,890 (+ 270) and for the CR-V’s was $23,053 (+ 270). We said thanks but we’ll continue our shopping. They said get your best price and come back and we’ll match it or give you $500. We told them thanks but we want to reward the dealer that gives us the best price up front by giving them the business. “Do you want to lower your prices?” They declined. Also on 8/9, I called Lees Summit Honda for the first time and talked to Dennis, who had 14 years of sales history with Honda. I explained that we are talking to 5 dealers and will reward the dealer with the best prices with our purchase of 3 cars. I said I generally visit personally at this point of the negotiations but wanted to know first by phone if Lees Summit was interested in participating. He said yes and he understood and we can handle it by phone. He told me a story, “A guy form the Iowa border called 15 Honda dealers to get the best price. He got the best price from Lees Summit Honda. It was only $6 less than a dealer 100 miles closer but he believed, like you, to give the business to the dealer with the best price so he drove the extra distance to buy the car from us.” He gave us prices of: Accord $19,800 (+ 199), CR-V $21,800 (+ 199). Dennis asked and I told them his price was better than Legends on 1 vehicle and worse on the other. He asked what he could do to get our business. I said if I let you quote again then I’d have to let the other dealer do the same.
On 8/12/15, I allowed both Legends and Lees Summit to submit reduced bids. These were the only two dealers remaining and they knew who the other was. The prices (with doc fees) for the CR-V’s were $21,999 (Lees Summit) and $21,989 (Legends) and for the Accord was $19,499 (Lees Summit) and $19,532 (Legends). Once again, one dealer was better on 1 vehicle and worse on the other. However, the total difference on the three vehicles was only $13! This made me think that they both reduced their prices to cost. Legends reduced their prices by $300 each which I believe was their remaining profit (doc fee).
Legends didn’t have the black or blue CR-V in stock, which were the two we wanted. However, Ren assured us that he would find the right CR-V’s from other dealers with no more than 100 miles on the odometer. On 8/13/15, we awarded the business to Legends with the stipulation that they find
CR-V’s that we want with less than 100 miles and that none of them come from Frank Ancona (due to the hail damage chance).
Early on 8/14/15, I talked to Dennis at Lees Summit and told him that we have given the business to Legends. He called me back and told me his general manager, Curtis, has given us another $1,000 off to get the business (Wow!). I told him sorry, that I have accepted Legends bid and it’s up to them to come thru with what they promised. I’m leaving it to Legends now.
In the afternoon on 8/14/15, Ren called me to tell me about the 2 CR-V’s that they have found for us. For the black, they had to go a little over 100 miles, from Jefferson City to get it. “It’s only about 175 miles.” For the blue, it’s from Frank Ancona. “They assured me that there is no hail damage.” I was livid. I said, “THERE WERE ONLY TWO THINGS I ASKED YOU NOT TO DO. WHAT DID YOU DO?” I said I’m going to have to talk to the other buyers. I told him later that we appreciate their effort and up front pricing but have decided to give Lees Summit the opportunity to fulfill our needs.
Dennis was glad to get the business. We told him we wanted the additional $1,000 off to be applied to the 2 CR-V’s. That brings them down to $21,489 each (doc incl). Dennis said, “I don’t know what’s going on, but I have never sold a CR-V for this low before.” On the morning of 8/15, I asked Dennis, “since Lees Summit is a Missouri dealership, are there holes drilled into the front bumpers to hold the front Missouri license plate?” He said, “Oh no, they’re held on with clips.” I said, “Oh good, cause we don’t want holes in the front bumpers.” Ren from Legends called me back on 8/15/14. He said Duce, the general manager, told him to do whatever it takes to make it right and get the business back. He found a blue CR-V in town and will find a black one with under 100 miles as promised. He is also including cargo covers for the CR-V’s and another $500 off the Accord. This brings the Accord down to $19,032! I told him, “Thanks for the additional offers. As you probably guessed, Lees Summit had additional (quite good) offers as well to try to get the business but at the time it was in your hands so I had to refuse. I stick to my word and it’s now up to Lees Summit Honda. I have to refuse your offer. If there’s anything not quite right with the Lees Summit transactions and they fall thru, then I’ll be giving you a call back.” Shortly thereafter, Chevis from Legends sent me an email with lower prices still, CR-V for $21,350 and the Accord for $18,625. I truly thought that was the end of our correspondence. I later found out that there was an additional $500 rebate on the Accord ($1500 total) starting that day 8/15, helping to lower the price.
At noon, Dennis called me back, “There’s a small issue. Holes are drilled into the front bumpers when the cars arrive at the dealership. But, we can plug them.” I told him we don’t want bumpers with holes or plugged holes so we don’t want to buy our vehicles from Lees Summit. He asked what we would do. I told him we’ll figure out something. About this time, general manager Curtis at Lees Summit called me. He was talking about the selling process and lamenting that there’s not much lower the two of us dealers can go without losing money. He said he never thought holes in the front bumper would cause loss of a sale, let alone three sales. He said he thinks that Legends is counting on a month-end bonus from Honda if they meet certain sales levels in August. I think I found out later that they didn’t make those quantities.
I called Ren back at 1:00. I said, “I didn’t really think I’d be calling you back but here’s the situation. Lees Summit has the two CR-V’s in stock that we want but they have holes drilled in the front bumper for the license plate and we don’t want holes drilled in the bumper. So, if you can get the vehicles we want at the prices Chevis emailed me this morning, then you can have the business back.” They came thru for us this time. He got the CR-V’s from other dealers (one in Missouri but there’s “no holes in the bumpers”) and the Accord from their stock.
When the salesman brought the final paperwork to Keith and Sandee, they teased him a bit. They said solemnly, “We’re NOT going to buy this vehicle.” Then after a pause added, “Until…. we test drive it first.” This black CR-V was actually the same one that Keith and Sandee test drove at O’Neill Honda a few days earlier.
This sequence of events would probably never happen again. But there’s more to the story. During my negotiations, I found out that Duce (general manager at Legends) and Curtis (general manager at Lees Summit) both grew up in the same city and that they worked at the same dealership 10 years ago. It appeared that there was some friendly competition going on between them those days.
Bottom line: Accord LX, list $23,545, price $18,625, 79.1% of list
2 CR-V LX AWD, list $25,200, price $21,350, 84.7% of list
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