Local Volvo dealer never sold some 2017's. Should I buy one?

Having worked dealerships for a few years, I can say this... they're offering them at a price that minimizes their losses, but will still be much higher than what they would get at auction.  They are over a barrel.  Use that to your advantage.  Lowballing is a great idea.  Do some research and see what they would bring at auction and offer them $2000 over that number.  Reveal as much of your hand as necessary.  That is how I negotiate much of my purchases from car lots.

"listen, I know you have an invoice for $X and a holdback of $Y dollars which you'll probably lose in a month when it hits the 2 year mark on inventory.  You'd get $N at auction, so I'll give you $N+2000 and save you the heartbreak."  $2k should be enough to make them feel comfy since they can be pretty sure that beats the over/under on the auction market.  They will take the sale today instead of risking getting $N +/- 2000.

My last truck purchase went something like this:  "I understand you have overhead and have to make a profit, but this is crack-smoking money for this truck.  You bought this at the auction for $1800, and if you paid more than that someone needs to be fired.  I'll offer $X."  He laughed and I walked away.  Within the week they were within $300 of my offer so I bought it.

Two trucks ago, I bided my time.  I saw an F150 on a used lot go on CL for $7999.  The truck was worth $6k tops, so I knew it would sit for a while.  In some states (like mine) if a used lot has the car in inventory for more than 30 days, they have to title it to themselves which they don't want to do.  Sure enough, on the third weekend they renewed the ad and said "this weekend only, $6999."  I went down, drove the truck, and told the guy, "look, you have to title this truck this week and you don't want to do that."  I put $4500 cash on the desk and he took it.

The key here is research and not "needing" the car.  Research the market, state your numbers and walk away (knowing you might lose the car) is the key to getting a bargain.

Sine_Qua_Non said:

Curtis said:

paging volvoclearinghouse to the dusty sage courtesy phone.

I’m pretty sure he wouldn’t touch or get near  the new Volvo’s with a ten foot pole  

 

That's kinda why I was paging him.  He would at least be good at being someone who could point out the bad parts of this idea.

All good advice above.

Look up the value (NADA, Kelly, Black book, etc) for an extra clean 2017 trade-in with say, 3000 miles.  

That's what it will be worth a couple of weeks after you drive it off the lot.  That's your starting point in this negotiation.

Your end point is what low mile 2017s are selling for (cars.com, autotrader. etc asking prices less say, 10%).

You'll need a fresh oil change and new battery, and ask for a free extended warranty if you plan to keep it a long time (just because).

Then let us know how it all worked out.

Really helpful responses! I never considered the point about insurance. I feel that I have a good foundation to start negotiating with these guys.

NADA and KBB both put the retail value of a used '17 V60 Platinum around $29-$30K. A few of you suggested using wholesale Auction values as a reference point for making an offer. I did a bit of googling but had no real luck in finding any usable data points. Maybe someone privy to dealer auction data can help me out with this?

Others suggested finding out the dealer's cost on the car and making an offer based on that. But again, I don't really know how to find that particular number. I can find the "invoice" value, but my understanding is that actual cost will be considerably less than this. If I had an exact dealer cost, I would be able to make a low-ball offer with much more confidence.

At this time, I need to decide if I will use certain negotiating points to demand a lower selling price, or rather ask for repairs/replacements flat out (battery, oil, wipers, maybe tires, etc.) 

I’m also considering the suggestion to ask for an extended warranty thrown in. 

So, you are showing that CPO is $30k and they are asking $34.9k right off the bat.   

You are not that far away from each other.  

EDIT: actually they are at $31.7k asking for the car.  The rest is taxes and fees. You're really close to each other on price!

I wouldn't ask for an extended warranty.  This car will get its full New Car Warranty if the car is truly new.  Most extended warranties are crap and they will generate a real cost to the dealer.  Just negotiate to get a real and genuine low price.  

Extra battery:  Sort of the same thing. How does the factory warranty handle a dead battery?  If this is cover for 2 years and it does need to be replaced in 2 years then that is a Volvo warranty issue.  The warranty issue does not cost the dealership the price of a new battery, it costs Volvo.  Furthermore, if it does need a battery under warranty, the service dept will get paid by Volvo to install it which makes the dealership money.  

New tires:  Expect that if you demand new tires, you are going to get the tires of the dealerships choosing.  Yes, they will be the right size but they will likely be a brand you have never heard of.  Just get to the low price on the car and budget for quality replacement tires at a sooner than normal date.  Or, buy the additional warranty for the tires and then possibly exercise that warranty if the tires develop problems.  

 I don't think you'll have much luck with wholesale pricing.  If this dealership just wanted to accept wholesale pricing they would (and still could) send this wagon off to be wholesaled.  They have had this option for a long time and have not executed on that option yet.  

I then did a nationwide search for 2017 fwd Platinum T5

Car Gurus

The mid-point for all seemed to be $32k to $26k and the one your looking at is NEW and will therefore be better than all these.  This info is also good at pointing that should you unfortunately total the car in the first week the comparables will show between $32k to $26k so you should have no real trouble if you buy the car for $30 or $31k.  

In reply to John Welsh :

That all makes a lot of sense.  NADA CPO price is $30K and the quote shows $31.8K before taxes/fees, so they are pretty close. Is it better to negotiate over the total out the door price?  I don't know if NADA's pricing includes tax but I am assuming no.  $30,000 OTD on a $47K MSRP car would be awesome but maybe $30K plus tax and fees is a more realistic expectation.

I'd agree with not wanting a new battery or tires from the dealer.  But I'd point out that these items are likely to need premature replacement compared to a newer build car and use that to get the price down.  And I'd probably put a new battery myself in it for peace of mind.  

Only thing I'd mention here is to put it on a loan and have gap insurance--assuming you can get a reasonable rate.

Out the door or not...

I think dealerships hate out the door pricing (or they like it because they hide some BS into the number.)  Look at the taxes and fees they have listed.  Are those real and genuine in California?    Lets face it, tax is tax weather you include it in Out the Door or not.  $80 Doc?  In Ohio the typical is the state allowed max of $250 but it is all dealer profit.  

Don't muddy the waters with Out the Door pricing.  Instead, get a full itemized list like they are showing above.  

I'd skip the new tires and battery demands.  Kinda funny suggestions coming from the GRM crew and knowing that we have all driven on much older tires.  :)  

The biggest thing to worry about with a lowball price is that they actually say yes.  Figure out the price that is a no-brainer for you and don't invest any more time or emotion into it.

Look for the build date on the window sticker.  It may not be as old as you think.   It's not 2019 quite yet.

Dealership in Minneapolis has 3 leftover 2017s too. I shouldn't have looked.....

Update:

Getting closer!  I may just counter again at my original offer of $30,000 out the door.  Only $1900 apart on price.  Their quote as it stands now is almost $19,000 off sticker.  Wow.  

There are two very similar cars in the area at two separate dealers--same MSRP, different colors.  This may get interesting.

Their page shows an interest rate of 5.99‰

You can likely do better than that if you have good credit.

PemFed is less than 4. 25%

In reply to John Welsh :

Thanks for the heads up.  I am approved with the local credit union.

Why is their sales tax an estimate?  I am not sure how it works in CA. The estimate they have shown is just under 8.3%  

I only point this out to be sure their not playing a game.  

Tags and registration is an estimate also???

Good question... I'll try to make sure everything is kosher before moving forward with the deal.

John Welsh said:

Why is their sales tax an estimate?  I am not sure how it works in CA. The estimate they have shown is just under 8.3%  

I only point this out to be sure their not playing a game.  

Tags and registration is an estimate also???

They don't play games with sales tax in CA. It is an estimate due to different counties having different rates.  For example, the county I live in is almost 10%. Which is what they usually estimate locally here. The county I register it in is under 7%. So my numbers they quote usually are MUCh higher, before I step foot in a dealership. They don't lock these numbers in, till a final deal has been struck, then its a matter of putting the sale price in the computer, your address in CA, and the computer spits out what your TTL will be, and they hand it to you.

Its sat for 2 years because no one wants them, just how many people do you think are asking about these cars?

Offer something stupid low, like.....18k. They wont take it unless utterly desperate. Then walk away and wait 2 weeks. I doubt anyone else will inquire about them, go back in...offer a little more. Repeat as necessary for the best deal.

Personally i would much much rather have a 2 year old car with some miles on it and maintenance than one that has sat and done nothing, cars do strange things when they sit

Antihero said:

Its sat for 2 years because no one wants them, just how many people do you think are asking about these cars?

Probably due to them coming in dead last in reliability......

mr2s2000elise said:

Antihero said:

Its sat for 2 years because no one wants them, just how many people do you think are asking about these cars?

 

Probably due to them coming in dead last in reliability......

 

And being butt ugly

I don't care about much looks.  Have you ever sat in a Volvo?  Crazy comfortable.

$18K is 38% of the original MSRP...that's 62% off.  I'd say that's pushing it...

As far as reliability.  From my research, '15.5 and '16 had piston ring issues that were recalled and remedied before the 17's came out.  Are there any other issues I should be aware of?

$30K for a brand new luxury wagon with warranty and free 3 years service is looking pretty hard to beat at this point.  Im open to alternative ideas though.  There isn't really much choice when it comes to wagons in the US.  A 3 series wagon would be one of the only comparisons.

I would low-ball them but not insult them..,...

Offer 25k plus tax etc

Problem with 18k is they might just decide to wholesale it, 

It is weird that in the SFbay area this is still sitting around, 

And how much sun damage on the dash and interior? Does it seem that it was sitting at the same spot all year ?

wirewick said:

I don't care about much looks.  Have you ever sat in a Volvo?  Crazy comfortable.

$18K is 38% of the original MSRP...that's 62% off.  I'd say that's pushing it...

As far as reliability.  From my research, '15.5 and '16 had piston ring issues that were recalled and remedied before the 17's came out.  Are there any other issues I should be aware of?

$30K for a brand new luxury wagon with warranty and free 3 years service is looking pretty hard to beat at this point.  Im open to alternative ideas though.  There isn't really much choice when it comes to wagons in the US.  A 3 series wagon would be one of the only comparisons.

Ive offered far less and had luck. The thing you need to realize though is.....its not a brand new car. Its an used car with low miles.

And you really really really want to push it, are you afraid the Volve Fanclub will mock you for offering too little? Or do you really think theres a line hoping to get their hands on this sweet ass Volvo thats sat for 2 years and apparently wasnt even really test driven with the whole 10 miles on it? The dealer is thanking his lucky stars that someone has showed any interest in his Lot Lump taking up space.

Well if they don’t accept his offer, there is 76 more in the USA he could choose from ;)