Dealer Employee Cost Price???

Hey everyone!

I have a question for yall.

I was wondering if anyone KNEW the price that employees of dealerships get on any new cars. Specifically i was wondering the employee cost on nissan 350z or infinity g35. But any employee price would be great.

Please dont guess or tell me what you "think" the price is. I'm looking for someone who KNOWS the price an employee gets versus a customer off the street.


thanks in advance

it all depends on the owner and what he wants to sell....edmunds.com and a few other sites will list the INVOICE price which is required by law in the usa (not in canada but you can just do a conversion of dollars and cents). The dealership then also gets cash incentives and rebates from the manufacturer...consumerreports.com keeps track of this (a paid site). Generally an employee can buy at invoice or a mere percent or 2 above. there is no fixed rule for this and if you ever see websites and ads, it says dealer may sell for less...once they sell the cars to the dealership (yes i said sell, all dealerships have loans out on those cars and thats why they try to sell them so fast ,they pay money on them when theyre in the lot) the dealer can do whateever he wants with them.

So generally, invoice or barely above...now if you are top sales, youll get this, if youre a regular guy you can get it for invoice plus a few more percent because...well..the owner can tell you to get bent and pay msrp if he wanted...

Yeah, i know about invoice price. But i thought i had heard something about an employee price. Where you get the car at the cost that the company pays to build the car, not the price the dealer pays for the car.
I have no idea if its true or not. Some one out there works at a dealership and can tell me (us) if its true.

Sir Smiley has it on the nose, but I'll expand a wee bit. It entirely depends on manufacturer policy, individual dealer policy, and the car. The manufacturer sometimes has a specific black and white policy for their employees. If they don't, it usually falls to the individual dealer to decide and in that case its a straight up sale. Does the manager like you? Have you had a good month? Has your attitude reflected your abilities? How many beers did you buy him last week at the bar? I was able to score a new 96 Impala SS for $120 over invoice my first week working at the dealer. That's rare on a specialty car like that, but for the most part, any of us salespeople could have picked up a Civic, Cavalier, Malibu, Altima, or similar cookie-cutter car for invoice price.

Our dealership did offer an incentive program on demos based on how much you had sold to the benefit of the dealer. Some of our better, more senior salespeople were able to buy their vehicles below invoice, which (after dealer holdback) basically cost nothing to the dealer. Their only loss was the opportunity cost of selling it retail to a customer.

That's how it worked for the five dealerships I was directly in contact with. When I did corporate sales it was a touch cheaper since the manufacturer didn't have to ship the cars. Basically, we could drive them off the line at invoice minus holdback, plus taxes, etc.

You're thinking on the right track, but here's how it works basically. Dealers are individual contractors of sales for the manufacturer. With recent exceptions, no dealer is owned by the manufacturer. If you want to sell Chevys, you would purchase and maintain your own facility. There is financing through GM to help you get started. You get an inventory of cars based on demographics, your dealership, and your locality, and you are not responsible to pay for those cars until they are sold. If you want a specific car that is not on your delivery sheet, you can request or order it, but you have to pay for it or at least have a deposit. This is usually customer's responsibility when they special order a vehicle, but some dealers will special order a flashy vehicle to get customers on the lot. Some manufacturers require that the specially ordered vehicle be paid for in a certain amount of time, so on a rare day you can pick up one of these dealer orders for cheap so they don't have to pay for it out of their own pocket. Like I said its rare since dealers are smart and don't often gamble on specialty vehicles like that.

The manufacturer has a tally of what it costs to build a vehicle. They use that cost, plus all of the peripheral things like EPA fees, taxes, transportation, storage, and every little thing like the mortgage on the land and factory. They also look at their bottom line. (meaning, their current debt and projections) They take the build cost based on all of those factors and add on a profit that they need to make from the car's sale. To that they add a dealer holdback value. This fudge factor does several things, but the two most important things are these. 1) it establishes a benchmark whereby dealers can do those special "$100 under invoice" sales without losing money, and 2) it further provides greater profit to the manufacturer AND dealer.

Basically it boils down to this. There is a build cost which no one sees. There is a pre-holdback cost which is basically what the manufacturer gets. The invoice price is what the dealer is responsible to pay the manufacturer. Therefore, the holdback is the money the dealer gets back in "rebate" after selling the vehicle. The sticker price is a manufacturer-set retail price. This price may be $700 over invoice with cookie-cutter cars or as much as $30,000 over invoice with high-end luxo SUVs and exotics.

Multiple publications will list invoice prices for cars so you can check to see if that "employee price" holds water. Because of holdback, the dealer can sell you a car for invoice price and still make money. The manufacturer can also use the fudged prices to offer those $5000 rebate sales.

Build cost, then pre-holdback invoice, then invoice, then retail. You'll only ever see invoice and retail. Chances are, the invoice price and "employee" price are similar, but arming yourself with that invoice publication will be good for your wallet.

As you can see, if the car is already at the dealership, you will never get it for build cost. The manufacturer has already paid for the build, EPA certification, billions in R&D, transportation of the unit, and an incredible amount of bulls#!t red tape imposed by the government. Once its there, invoice is about the best you'll do.

By the way, I can't give actual numbers, nor can I divulge models or makes, but I'll give you a representative example.

A domestic luxury/sport car with a sticker price of $26,000 US broken down.

Sticker price $26,000
Invoice price $21,500
Dealer holdback $2400
Manufacturer's income at invoice (21,500 - 2400) $19,100

Cost to build $11,100
Peripheral costs $6400
total cost $17,500.

This particular car, the manufacturer makes $1600 on the sale of the car. Although it appears that the peripheral costs are inflated, keep in mind that this takes into consideration the fact that it cost $43.6 million to R&D this car that was planned for a run of 336,000 units over three years. The "cost to build" figure is the actual amount that it takes for parts and labor to assemble one car.

Look at your the two numbers that you were speaking of... invoice and cost to build. The invoice price is $21,500 while the cost to build is $11,100. Huge difference. Hence why I said, once it reaches the dealer, the best you'll do is invoice. Those costs have already been incurred. Once the dealer gets the car, the manufacturer requires a certain amount of money for the sale... end of story. It doesn't matter if the owner of the dealership buys the car. The manufacturer requires the invoice price for it.

If you have a name like Rockefeller or Kennedy, you could probably contact the manufacturer directly and swing invoice minus dealer holdback and get that $26,000 car for $19,100, but since you are an average joe like me, you'll be bucks ahead of the world if you just take it at invoice.

wow,
well that settles that..... :)
thank you curtis73 and sirsmiley