New Vehicles above MSRP?

[Boragard]

Hello all, 

Thanks for reading. I will try to keep this post short as i am typically long winded.  On September 3rd, I reported my Hyundai Sonata stolen (thanks to the Kia Challenge), On September 4th, I received a call from the police department stating my car has been recovered and involved in an accident.  The police told me that witnessess saw the juvenile offenders in my vehicle, they hit a car then hit a tree. Police stated the damage was pretty bad and probably totaled.  Fast forward, insurance totaled the vehicle.  I had a 2019 Hyundai Sonata, that was paid off in its entirety.  Insurance gave me about $4k over market price due to used car price fluctuations (No complaints on my end).

I have my eyes set on the 2023 Honda HRV EX-L in Nordic Forest Pearl.  I have gone on a test drive and like it.  However, while inside the dealership they stated new car prices are about $4k over market.  I didn't like the sound of that and walked out.  They tried to convice me otherwise.  Since then I have been calling various dealerships across the country and they all have the same sentiment.  Are car dealerships really charging $4k over MSRP? or is this just a scam to get more money.

I've asked several dealers why this was the case and they all say the same thing "low car shortage" and "the demand for new cars are high".  Another stated I got about $4k over in my used vehicle so it only makes sense to charge $4k on the new vehicle.  One even pointed out that used 2022 HRV are going for about $4-5k less than newer ones.   

Logically, it all makes sense to me but financially it doesn't because they are just "installing" things on a vehicle that would otherwise be undesirable.  Therefore, my question is does this seem to be legit or just a ploy to get more money from new car buyers?  

[FireMedic1]

This has been going on for a while. Ford for instance is not happy due to the dealers raising the price over MSRP. They've been getting on the dealers. List as MSPR or we wont send you anymore cars. I was offered 8k over what I paid for my Explorer. I said yeah right. Then what. Pay a higher price than what I paid for the same crossover?. Do I look like an idiot? Hung Up.

https://www.cbsnews.com/news/car-prices-new-used-ford-general-motors-dealerships/ 

[Laredo]

Many dealerships list the price way above MSRP but there are also many dealerships that will not have a dealer mark-up.  Even the Ford Ranger had a $10K mark-up when I was looking around.  I saw a Toyota Supra with a $30K mark-up because of the color.   The days of haggling the price below MSRP are gone.  A friend of mine just purchased a 2022 Mustang and found a dealership with no dealer markup about 100 miles away.  I purchased my 2022 BMW here in VA at MSRP.  From what I have seen, at least in this area, Ford, Chevrolet, Honda, Toyota, and Dodge all have dealer markups but BMW, Mercedes, Lexus, Cadillac, and even Subaru sell at MSRP.  It is hit or miss.  If you can get a CPO with very little miles may save you some money.  My brother is a finance manager at a dealership and he said they don't have many cars due to the chip shortage which increases demand for what they do get and so they add the mark-up.  

[LakeLife]

Not sure where you live OP, but there are MSRP deals out there.  Be careful though, some of them will try to add paint protection and garbage like that.  We sold my wife's 2016 Jeep Patriot for nearly what we paid for it in January and were able to get a 2022 Tucson Hybrid for MSRP at a dealer in Alexandria, VA.  They only added a few dealer add-ons (roof rack, floor mats, etc) but were things we would have likely wanted anyway.  It was a great deal for us all the way around, and we love the Tucson.

[cashorcharge]

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@FireMedic1 wrote:

This has been going on for a while. Ford for instance is not happy due to the dealers raising the price over MSRP. They've been getting on the dealers. List as MSPR or we wont send you anymore cars. I was offered 8k over what I paid for my Explorer. I said yeah right. Then what. Pay a higher price than what I paid for the same crossover?. Do I look like an idiot? Hung Up.

https://www.cbsnews.com/news/car-prices-new-used-ford-general-motors-dealerships/ 

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Spot on @FireMedic1 

Prices are all over the place OP.  And yes, there are likely some dealers selling at MSRP but you're looking for a 2023 in 2022, your looking at Honda which pretty much sells themselves...and you're looking at the HRV which is ALL NEW for 2023 so finding a "deal" is not going to be easy.  Where I live, Penske Dealers have made it a point to state they are "not" selling cars over MSRP so you may try that route.  That could also just be a local thing to me versus a Corporate/Public Auto Group Policy.  Best of luck...

[increasingmyfico]

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@Boragard wrote:

Hello all, 

Thanks for reading. I will try to keep this post short as i am typically long winded.  On September 3rd, I reported my Hyundai Sonata stolen (thanks to the Kia Challenge), On September 4th, I received a call from the police department stating my car has been recovered and involved in an accident.  The police told me that witnessess saw the juvenile offenders in my vehicle, they hit a car then hit a tree. Police stated the damage was pretty bad and probably totaled.  Fast forward, insurance totaled the vehicle.  I had a 2019 Hyundai Sonata, that was paid off in its entirety.  Insurance gave me about $4k over market price due to used car price fluctuations (No complaints on my end).

I have my eyes set on the 2023 Honda HRV EX-L in Nordic Forest Pearl.  I have gone on a test drive and like it.  However, while inside the dealership they stated new car prices are about $4k over market.  I didn't like the sound of that and walked out.  They tried to convice me otherwise.  Since then I have been calling various dealerships across the country and they all have the same sentiment.  Are car dealerships really charging $4k over MSRP? or is this just a scam to get more money.

I've asked several dealers why this was the case and they all say the same thing "low car shortage" and "the demand for new cars are high".  Another stated I got about $4k over in my used vehicle so it only makes sense to charge $4k on the new vehicle.  One even pointed out that used 2022 HRV are going for about $4-5k less than newer ones.   

Logically, it all makes sense to me but financially it doesn't because they are just "installing" things on a vehicle that would otherwise be undesirable.  Therefore, my question is does this seem to be legit or just a ploy to get more money from new car buyers?  

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  So wait... you're getting $4000 over for your dearly departed car but the dealer is running a scam for charging $4000 over for a new car? I get that paying as little as possible is the goal, but be realistic. There are some dealers selling for msrp, but it will depend on location and the vehicle. The higher in demand a vehicle is the more likely for there to be a market adjustment. That's the reality of the current market. You have picked out a good car that will retain value so you're okay there. 

[mavric]

Hey .......  This web site has list of dealers ,that IS NOT charging MSRP .    YAA.con  

   I have only looked at it , Hav'nt used it , Lookes like you can save a lot of money there.

[DSTforlife]

The deals are out there, but they are few and far between. You have to look for them.  

just today, I finalized a deal to purchase a brand new 2022 BMW X3 and I paid 3k BELOW MSRP...no frills and no trickery in the deal.  Before I agreed to the deal, a friend connected me with a friend of his that's BWM sales person. He looked at the deal sheet and let me know if it was good. 

on the other end of the spectrum, I was quoted an out the door price on a GV70 that had 10k in mark-ups and mandatory "protections".  I quickly ran from there! 

[RobynJ]

If you can,  buy a cheap used car for a year. The prices are going to crash so for 2 reasons. 1- The rate increases so less people are going to want to buy (supply and demand) and 2- the chip shortage will be over soon as Covid is on its last leg. Once the chips are replenished the deals will be back. So buy a 10k car with higher milage to beat around for a year and then purchase. This is of course if you are not ego centric and can't be seen in an older model. 

[increasingmyfico]

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@RobynJ wrote:

If you can,  buy a cheap used car for a year. The prices are going to crash so for 2 reasons. 1- The rate increases so less people are going to want to buy (supply and demand) and 2- the chip shortage will be over soon as Covid is on its last leg. Once the chips are replenished the deals will be back. So buy a 10k car with higher milage to beat around for a year and then purchase. This is of course if you are not ego centric and can't be seen in an older model. 

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    Not quite... cheap cars have also exploded in value. Used car price increases have actually been more extreme than new cars. Paying slightly over msrp will shake out as the better way to go when values start to slide. There isn't likely to be a crash though. Supply is still tight. Plenty of cars just got wipe out (new and used) by Hurricane Ian. Also at this point I don't see the manufacturers ever going to back to producing as many as they were before. They will likely control supply to keep things close to where they are now. They aren't having to spend hardly any money on incentives. This has been a lesson for them and they took good notes.