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Old 01-05-2019, 02:47 AM   #1
GrayYaris
 
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Buying a New Toyota- Understanding Fees Listed On Invoice

Hey YW,

I'm helping a family member pick up a new 2018 RAV4. During a dispute about invoice pricing, the dealer pulled out the "I'll show you the invoice" routine to prove they are "losing money" on the sale.

Listed on the invoice was the base price of the car plus $1045 destination, $11 fuel, $471 TDA and a $260 FIE fee.

Does anyone have any insight into the TDA fee or FIE fee? My understanding is the TDA fee is something Toyota "passes on" to the buyer to account for advertising cost (or is the dealer being reimbursed by Toyota for local advertising?) and the FIE fee (as explained by the sales person) is the aggregate of random accessories in the car- In this case the rear hatch tonneau cover, floor mats and some other random junk.

What I find suspicious is that the invoice did not list holdback- Which should be ~2% of invoice. The vin matched the car we were looking at, but I thought holdback is usually spelled out on the invoice.


Thanks for any insight you have!
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Old 01-05-2019, 10:16 PM   #2
Kaotic Lazagna
 
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Back when I sold Toyotas, I do remember the TDA being there. FIE I don't remember. Accessories and options would be individually listed in the invoice and would not be clumped together.

https://www.edmunds.com/toyota/rav4/...s/?legacy=true

Build the correct Rav4 trim level and options on that specific unit, and match up the "invoice" and "MSRP" to know if you really are getting below invoice price. I used to do that with my customers to show them that I was not lying when I told them I'm losing the dealership money to sell them a car.

Also be aware of the buyer's credit score and what interest rate (if financing) is given. I don't know how shady your local dealership is, but I know dealerships give interest rates that don't correlate to the buyer's credit score.

And on that topic, the rebate and special interest rate (probably 0% for great credit score right now) cannot be combined. I can't imagine the rebate being that high enough to offset 0% financing, so I would go with 0% unless the rebate is more than $2,500).

One other thing are dealer addendums. Yes, they may be losing money on the sales price of the car, but if they tack on some stupid $1k addendum for silly door edge guards and "paint protection" that costs them $100, then they're still making money. I know a lot of my local dealerships are doing that (the dealership I worked for was the exception). They will only agree to that sales price if you will agree to that addendum. Tell them you're not paying for that even if they already put the parts on the car since you did not ask or want those items. Don't be afraid to walk out if they don't budge on it.
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Old 01-05-2019, 10:22 PM   #3
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With all that said, if the sales person took a lot of time with you guys, explaining and demonstrating each feature, please take that into consideration when making any deals. I can't tell you enough how extremely frustrating it was teaching customers how to use each Safety Sense feature on top of any vehicle/trim specific feature only to have them buy somewhere else because "they were a little bit cheaper" than my price was. If you asked the sales person to spend a few hours of their day for all of that, then I think it's worth a couple/few hundred bucks.

Now if they were wasting your time with obvious BS and lies, that's a different story.
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Old 01-07-2019, 01:40 AM   #4
GrayYaris
 
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Good tips- thank you. What about the holdback? Isn't that usually listed on the factory invoice?
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Old 01-07-2019, 03:14 AM   #5
Kaotic Lazagna
 
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Quote:
Originally Posted by GrayYaris View Post
Good tips- thank you. What about the holdback? Isn't that usually listed on the factory invoice?
There are two types of invoice sheets, and only one actually shows the dealer holdback. It was also the invoice that was hidden somewhere in the inventory database, so I probably only found and printed it out a handful of times in the 3.5 years I sold cars. iirc, it's the invoice that looks super simple and plain, almost 80s print out like. lol

It should be noted that, at least at the dealership I worked for, any expenses related to the specific unit is deducted from the holdback. So for example, if the car was, say, dented or scratched on the lot and was repaired, that came out of the holdback. It was infuriating to actually make a "positive" deal on a car, only to find out after the deal has been made and contracts signed that I actually made a negative deal because of this. This does happen quite often as dealerships try to cram as much inventory on their lots as possible, so door dings and scratches are becoming inevitable; not to mention if they cheap out on their "detailers." By detailers, I don't mean when the car is sold and actually gets detailed, I'm referring to the power wash crew that is brought out and sprays down the cars on the lots. If they're incompetent, they smack the cars with the hoses and use dirty towels to dry the cars. I remember actually making my GM fire and switch companies because a Prius I sold ended up requiring almost $3k in body work, so that was a negative $3k deal for me. I never did follow up to see if the GM forced that company to pay the body shop bill.

So in the end, I actually wouldn't use holdback as a negotiation piece.


A better negotiation tactic would be to try to purchase on the last day of the month. I know more dealerships are going away from the typical commission system in favor of units sold equaling tiered salaries. So for example, if selling 16 units bumps the sales person up a tier, and on the last day of the month they're at 15 units, they just have to sell one car (by themselves) to get to their next bump. Just that one car deal can cost them $1k to $3k salary, and that has happened to me before where I lost out on that money due to being short 0.5 units (if another sales person helps in your car deal, they get half the unit count). But if you don't want to wait until the last day of a month, just build the car to spec on Edmunds and try to shave off a little more off the "actual market price" or what ever they termed it.

One other bit of information, the longer you drag out negotiations, the less likely the sales manager will be inclined to take "stupid" deals. I can almost guarantee you getting a great deal if you find the Rav4 your family is looking to get on your dealerships website with the stock/inventory number, build it on Edmunds and print out what they say the market price is, go in and do the whole test drive bit, go back to their desk to "negotiate a deal," and simply pull out the print out and ask them if they can do (insert your amount here) better. Get all that done in under 30 minutes, and I'm sure they'll say yes. And also say you'll give them perfect scores on the sales survey (just make sure you actually give them perfect scores) if they can agree to those terms.
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