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View Full Version : Getting $ off new polo.



schty006
12-05-2010, 09:47 PM
Well we just ordered a 77tsi with DSG and floormats in pepper gray and got $700 below rrp. Is this any good? Quite a few dealers werent prepared to budge on the price considering these cars will 'sell themselves' and waiting lists that are developing. I am interested to hear how other people are going getting a deal?

MK532
14-05-2010, 02:18 PM
Hi schty006.

I've posted this reply against your first post also:

I bought my wife a 77TSI on Monday. We weren't able to get any discounts from RRP but I am hoping for Corporate Plus discount to be approved before we settle the purchase. The dealer was not prepared to negotiate on price at all.

I have heard from a "reliable source" that the margins on these cars are very very low and given the discount you're talking about, you got the car for less than cost.....

Josh.

team_v
14-05-2010, 02:47 PM
I have heard from a "reliable source" that the margins on these cars are very very low and given the discount you're talking about, you got the car for less than cost.....

Josh.

I really doubt that.
If it was below cost the dealer would have just said no sale.

MK532
14-05-2010, 04:27 PM
team_v - You're most likely right, but the "reliable source" I spoke about mentioned that a particular dealership sold two Polo's on Saturday (launch day) and only made $150.00 from the sales - and I'm pretty sure those sales were at RRP. In any case I think the margins are a lot lower than with the previous Polo, as the quality is a lot better, the specs are higher and the RRP is a little lower.

If the information I received is true, then I guess the dealer must be literally 'banking' on the customers to return to them for the ongoing servicing of their vehicles.....

Josh.

team_v
14-05-2010, 04:40 PM
If the information I received is true, then I guess the dealer must be literally 'banking' on the customers to return to them for the ongoing servicing of their vehicles.....

Josh.

Or they could be banking on customers paying for expensive options like park assist which they will only ever use 4 times a year or so.
Or upselling them to a bigger engined car or even a golf instead.

schty006
14-05-2010, 05:09 PM
Wow that is interesting! The car i traded received what i would consider to be a fair trade in at the top end of the red book price. The deal was initially done at $200 below rrp for the standard 77tsi with DSG with floor mats and the comfort pack included however due to availability of cars with the comfort pack and not wanting to wait 3 months the dealer deleted the comfort pack and subtracted the $500 for the comfort pack leaving it at $700 below rrp price with the genuine floor mats worth $218 thrown in.

I was certainly bargaining hard and was told no discount by 4 other dealers but these quys were keen to sell cars!

Allegiance
14-05-2010, 05:39 PM
I got offered a 77TSI, DSG, Sports Pack, Metallic Paint for $28,600 :bsflag:. I got him down to $27,500, but this is still above the RRP prices that are on the VW website.

schty006
14-05-2010, 06:20 PM
Well as i wrote in my into thread i just found out by doing more research that i could have got a 10% discount through the AMA but i am guessing that would have been off the RRP. Its a pity the paperwork has been done and a deposit paid otherwise an even better deal could have been had.

noone
14-05-2010, 06:22 PM
There is NO WAY that VW would sell a new car for only a few hundred profit, makes no sense. They have to warrant the car for a start, so any major issue and they'd be going backward. They have to cover rent, fees, commission, admin, the stupid TV add with the beards, etc. If they are saying its only a few hundred after all these costs, well thats just some number based on some other numbers and does not mean much.

They don't have to negotiate on price as there are going to be more interested people than Polo's in the country for a while, when they cant move any more because the market is saturated, then they will discount... Early adopters and frugal budgets don't work well in the same wallet.

Gti Dave
15-05-2010, 02:41 PM
Hmm I might wait a little longer til the Gti comes out before I make the decision to upgrade or not. Must say though, I've had my fair share of problems with my current pog and the issues are still ongoing!!! Arghhh!!! On the other hand, I do kinda enjoy driving my wife's new Fiesta and I saw a sexy 3dr one in white last night in Chapel St. Hmm.......then again one's sporty with POWER and plenty of modding to be done but troublesome and the other less power but better package all round and much cheaper and made in Germany. So confused now. *Sigh*

Jetta5
17-05-2010, 12:39 PM
I managed to get a 77TSI DSG with metallic paint, sports package, bluetooth & mats for $27K flat.

That was almost $1900 off, but the advertised driveaway price at this dealer was $500 more than the Volkswagen website calculator (dealer delivery of $2000 instead of $1500).

phaeton
17-05-2010, 01:38 PM
I'm looking at getting a 77TSI (man) next year around this time in Silver with the comfort pack.

SA pricing for that ORC = $25,012 without discussing discounts.

Corey_R
17-05-2010, 01:42 PM
There is NO WAY that VW would sell a new car for only a few hundred profit, makes no sense. They have to warrant the car for a start, so any major issue and they'd be going backward. They have to cover rent, fees, commission, admin, the stupid TV add with the beards, etc. If they are saying its only a few hundred after all these costs, well thats just some number based on some other numbers and does not mean much.

I think that you're forgetting that there are numerous companies involved here mate.
First there is Volkswagen "Germany", the head office, and presumably they cover the manufacturing etc. Then there is Volkswagen Group Australia, who purchase the cars from the factories/headoffice. VGA also take care of the TV ads etc. Then you have the dealers, who are not even related to Volkswagen and are independantly owned.

There could genuinely be only a small margin for some of the dealers (obviously this would vary, as all dealers would have different operating costs). Warranty claims etc could actually be claimed back through Volkswagen Group Australia, and even back to Volkswagen Germany Head Office. Who knows what the exact process is. I don't. I and KNOW from your comment that you don't. So...

:D

RSwag
18-05-2010, 07:31 PM
I think that you're forgetting that there are numerous companies involved here mate.
First there is Volkswagen "Germany", the head office, and presumably they cover the manufacturing etc. Then there is Volkswagen Group Australia, who purchase the cars from the factories/headoffice. VGA also take care of the TV ads etc. Then you have the dealers, who are not even related to Volkswagen and are independantly owned.

There could genuinely be only a small margin for some of the dealers (obviously this would vary, as all dealers would have different operating costs). Warranty claims etc could actually be claimed back through Volkswagen Group Australia, and even back to Volkswagen Germany Head Office. Who knows what the exact process is. I don't. I and KNOW from your comment that you don't. So...

:D

I can assure you that a dealer claiming he has only made $150 NETT from a new car sale at RRP is treating clients like FOOLS. As you rightfully pointed out the warranty and advertising are two completely separate issues and have no involvement from the dealer other than the warranty which they give up retail time in their workshops to facilitate. This time is obviously reimbursed along with the parts and labour costs by the manufacturer.

To make the claim that they are running multi million dollar operations with anywhere between 30-100 staff on $150 profit is just insulting to peoples intelligence, it is also a clear attempt as disguising the truth. Most dealers sell around 100 new cars a month sometimes more sometimes less but this is about the average for most majors be that either jap or euro. If we were to be generous and say that they made $500 per car on average then they would have you believe that they are running these massive facilities on $50,000 per month before wages, utilities, detailing equipment, petrol etc and this would just be scratching the surface in relation to costs involved in multifaceted business's e.g. service, parts, administration, sales, customer relations.................................

It is common knowledge that all manufacturers pay kick backs and bonus for things like volume and customer surveys but consultants cant work with nor give away the bonus's that the dealer gets. These amounts are varying and you and i will never know whether its hundreds more or thousands.

Anyway if they are charging $2,000 delivery fee then given VW have it as $1,500 on the website there is at least $500 here you ca claw back.

And on this note i thought it was illegal under trading terms for a franchisee to charge more than what is determined to be the RRP by a franchiser. Dealers may have a question to answer here f they are listing the sale price hire than what has been determined by VW Australia to be the RRP :confused:

Billecartz
18-05-2010, 08:56 PM
I believe that when they say they are only making $150.00, this is in commission on the sale. The sales people in most dealerships only make a commission percentage based on how much profit they make on the car. I have it on good authority that due to the shortage of stock that most dealers are not discounting, other than what has been ordered or in manufacture or on the water, I am told that it will be October/November for new orders?

We bought a 77 TSI DSG, with all options for a bit over 31K for my wife, we ended up with around a $1200 discount, this was about 5-6 weeks ago. Our car arrives on Sunday and we should get it the first week of June, it will be one of the only cars in Australia with leather/alcantara.

Jetta5
19-05-2010, 01:58 PM
Yes. I got the impression a fresh factory order would arrive September or later. It seemed like there was fairly limited availability of Polo's already in the pipeline, plus there are so many combinations of transmission, colour and optional packages that it's unlikely you'll find exactly what you want.

RSwag
19-05-2010, 05:36 PM
I believe that when they say they are only making $150.00, this is in commission on the sale. The sales people in most dealerships only make a commission percentage based on how much profit they make on the car. .

Even if this is what the consultant meant this isn't reality either, no one running multi million dollar complex's would allow individual sales consultants to dictate the level of profit a vehicle is sold for and in what numbers just so they could make as much as possible in their annual income.

The law would be set down by VW and then headed up by the dealer, the consultant is at best a lacky, by this i mean they are really there to serve you and ensure you have a good experience and settle on their particular product.

I think you will be surprised about the commissions , as some of the dealers how much they make on a minimum deal its probably closer to $50 or $100 before tax. They would only be earning $150-200 on full grossing deals. From what my brother tells me they are reducing margins as much as possible so consultants don't give away lock stock and barrel out of pure laziness. He's with Honda but kows VW guys who say its similar.

I thin more to the point (as you stated) its a closed market and a hot product. Dealers have the upper hand for now but as supply increases this will change. Just like the Golf 118kw, World Car of The Year, Australian COTY, more technology/build quality and standard equipment than a BMW 320i (roughly about the same real world space inside). All this and they would give you around $4,500 off the price in their current drive away program and are even doing similar deals on the GTi, this is why i think paying top price for the Polo just to be 3-4 months in front of everyone else is a little silly.

But if you are happy with the car and feel the price is justified just go for it!!

Allegiance
19-05-2010, 07:05 PM
I got a 77TSI, DSG, Sports Pack, Deep Black Metallic for $27,100. I did get $800 more for my trade in than I had been offered at other places. Plus I also got a tint for the front windows thrown in. Also I take delivery of the car around the 15th of June :banana:

Billecartz
19-05-2010, 08:40 PM
I know many sales consultants are hopeless, but there are also some good ones that I have found and buy my cars from them. On average we buy a new car every 18 months either for myself or wife. We have done this for the past 25 years and generally have to tip some money into the deal for the shortfall. If having what we want when we want it costs a bit more, that's ok as I am in the fortunate position that I can afford to do so. I always manage to get a better price than average as I buy often and establish a good relationship with the sales consultant whom is happy to help me. If you treat them like fools, expect to get the same back and most probably not the best deal. The Polo for my wife is the 33rd VAG group car that I have owned mostly 50/50 new and used, this includes VW, Audi & Porsche. So you can most likely say that I have a little experience buying cars :-)

If you want to buy exactly what you want it costs more, if you are prepared to compromise then you generally pay less. Sometimes you can just be in the right place at the right time, although this is unusual and requires patience. I acheived a $1200 discount on the Polo and even if I waited another 6-12 months when the hype cools off I might be able to get another $1000 -$1500 or so, as remember these are low margin cars. Not a lot of money in the big picture over life of the car, maybe $500 a year over 3 years for us.

Life's short, then you die!

victaa
27-05-2010, 11:33 PM
Just factory ordered a 77TSI DSG with sportspack for 26.7K, mats, tank or petrol and front side tints were included too.. dealer wouldn't budge on the price of the car at all...

Billecartz
28-05-2010, 01:38 PM
What colour did you order?

phantomcamel
28-05-2010, 01:48 PM
There is NO WAY that VW would sell a new car for only a few hundred profit, makes no sense. They have to warrant the car for a start, so any major issue and they'd be going backward. They have to cover rent, fees, commission, admin, the stupid TV add with the beards, etc. If they are saying its only a few hundred after all these costs, well thats just some number based on some other numbers and does not mean much.

They don't have to negotiate on price as there are going to be more interested people than Polo's in the country for a while, when they cant move any more because the market is saturated, then they will discount... Early adopters and frugal budgets don't work well in the same wallet.
Margins in the POLO are very small for the dealership. The manufracturer makes most of the money. Dealership covers costs by charging a "dealer delivery" fee. There is rally not much in it for dealership with entry level cars, so $700.00 off is pretty good for a car just launched new.

phantomcamel
28-05-2010, 01:52 PM
If the information I received is true, then I guess the dealer must be literally 'banking' on the customers to return to them for the ongoing servicing of their vehicles.....

Josh. that is absolutely true, most dealeships make their money on service!

phantomcamel
28-05-2010, 01:55 PM
Or they could be banking on customers paying for expensive options like park assist which they will only ever use 4 times a year or so.
. not much margin in VW options - they are equaliy expensive for the dealership. People always have the perception that options cost say 50% and the delaership collects the other 50% - totally unfounded I am afraid.

team_v
28-05-2010, 02:43 PM
not much margin in VW options - they are equaliy expensive for the dealership. People always have the perception that options cost say 50% and the delaership collects the other 50% - totally unfounded I am afraid.

Just from my experience, protection package form the dealer valued at $1100, actual cost about $300.
Asked for just the tint, best they would do was $550, tint place down the road will do it for $245.

This may be more relevant to the protection package but i do know that a brand new 2.5k RNS510 can be had for a bit over 1k so they make a big margin there too.

Obviously some options like leather (including electric seats and heating) would be closer to the actual cost price but i doubt that amost all optins are barely allowing a profit.


As i said above though, just my experience.

phantomcamel
28-05-2010, 03:02 PM
Just from my experience, protection package form the dealer valued at $1100, actual cost about $300.
Asked for just the tint, best they would do was $550, tint place down the road will do it for $245.

This may be more relevant to the protection package but i do know that a brand new 2.5k RNS510 can be had for a bit over 1k so they make a big margin there too.

Obviously some options like leather (including electric seats and heating) would be closer to the actual cost price but i doubt that amost all optins are barely allowing a profit.

You are absolutely correct - I was talking about genuine factory options; aftermarket - such as tint, protection packs have fairly good margins. Pricing also depends on quality though. The more expensive products have life time waranties rather tan limited x amount of yeras warranty. If you get a protection pack you can quiet often get the tint "thrown in" (I can feel the steely glare of all "after- care consultants" glaring down on me...)

Corey_R
28-05-2010, 03:18 PM
phantomcamel - You may want to fix up your quote tags there :)

phantomcamel
28-05-2010, 04:17 PM
phantomcamel - You may want to fix up your quote tags there :) done...thx :)

RSwag
28-05-2010, 07:34 PM
phantomcamel - You may want to fix up your quote tags there :)

I think it may also be appropriate that you change your call sign to show you are a dealer, your posts clearly show that you are.

The information you have supplied is incorrect, no one would believe that at $700 off the dealer is making nothing and the client is getting a good deal. Thats why large corporates build $25 million dollar complex's in Melbourne and Sydney, to make $100's of dollars per $19-27k item.......................not believable in the slightest.