Pricing For Custom Ordered Car

[SplawnDarts]

I'm getting quotes from several dealer to order the following:
GT Premium Fastback
Rapid Red paint/black interior
6 speed
Performance Pack
Magneride
Active Exhaust

MSRP is $49,005. Edmunds has invoice at $47,211 and they're probably right since they have the MSRP right.

What should I be trying to get here? For most makes I'd be trying to capture most of the dealer holdback (3% for Ford I think) so maybe targeting $46,275 or so. But it looks like most people aren't doing that well on Fords? And I don't know how ordering plays into it with the plague.

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[AGM2018]

I'm getting quotes from several dealer to order the following:
GT Premium Fastback
Rapid Red paint/black interior
6 speed
Performance Pack
Magneride
Active Exhaust

MSRP is $49,005. Edmunds has invoice at $47,211 and they're probably right since they have the MSRP right.

What should I be trying to get here? For most makes I'd be trying to capture most of the dealer holdback (3% for Ford I think) so maybe targeting $46,275 or so. But it looks like most people aren't doing that well on Fords? And I don't know how ordering plays into it with the plague.

I would ask, at a minimum, for a 10% discount off the MSRP of your custom ordered mustang as a final, "Out-The-Door" and "On-The-Road" price, including all tax, title/registration/license and dealership costs. Thus, a 10% discount from the $49,005 MSRP would be $4900.50; $49,005 minus $4900.50 equals $44,104.50...rounded to $44,105. That would be my purchase offer. While a 10% discount isn't as much of a discount as one may negotiate off the MSRP of a mustang in a dealership's inventory, a 10% discount, inclusive of all taxes, title/registration/license and dealership costs, for a custom ordered mustang, in my opinion, isn't a bad deal. YMMV

 

[SplawnDarts]

Maybe I don't understand how the dealer is charged for the cars. I'm used to dealers that pay invoice minus a holdback amount. For Ford everything I've seen says holdback is 3%. So if this works like I'm familiar with for other makes, the dealer pays $45,794.67 for my car delivered to their door.

Is that right, or am I missing something?

 

[BimmerDriver]

It's not fair to compare deals for different people in different states. Markets are different, taxes differ, eligibility for rebates differs...

If you buy the car for 3% under invoice, how does the dealer make a profit? They have to make something to stay in business.

 

[Cobrakit]

The dealer doesn't pay invoice, there is the holdback. Also, dealers can get special deals from factory based on their sales (i've been told). Then their are factory rebates to you. Its hard to get more than invoice plus rebates on special order cars, but you can ask always try. Also, dealer will usually try to get any price increases when car is actually delivered.

 

[shogun32]

If you buy the car for 3% under invoice, how does the dealer make a profit? They have to make something to stay in business.

A dealership of any good size (mom/pop hickville dealership excepted) their parts and service department is what pays the rent, the employee salaries, utiliteis and business license etc. New car sales is just gravy. AGM2018's sales tax rate is 6%. So net of sales tax that 49K MSRP car should be bought for 15% off, or 41600. If you're dealing with a high-volume dealer and have a lower sales tax (eg. 4%) then it's not uncommon to get 15% WITH the sales taxes rolled into the figure.

How does a dealership sell hundreds of current year F150 for 25% off MSRP? Because it sure didn't cost them 85-89% of MSRP to buy it!

 

[jacknifetoaswan]

It's not fair to compare deals for different people in different states. Markets are different, taxes differ, eligibility for rebates differs...

If you buy the car for 3% under invoice, how does the dealer make a profit? They have to make something to stay in business.

Consumers are not in the business of making sure a company stays in business, they're in the business of getting the best deal for themselves, like it, or not.

To OP, Costco Vehicle Services shows invoice at $46,531 with those options. If you can deal with the PSC2 tires, the PP2 (which includes Active-Exhaust and Magneride) comes in at $47,392.

JR

 

[SplawnDarts]

Consumers are not in the business of making sure a company stays in business, they're in the business of getting the best deal for themselves, like it, or not.

Correct.

Ultimately I decided to take a different approach because a) my wife decided she really wanted a convertible (which I was on the fence about) and b) I found a suitable 2019 car in stock. Probably not my preferred color, but one I can live with.

GT Premium Convertible
Black
401A (fancier than I need, but I don't mind it certainly)
Performance Pack 1
Manual transmission
Active exhaust
"Safe and Smart" package (again fancier than I need)

MSRP: $54,040
Invoice: $52,065
What the dealer actually paid back in 2019 (invoice minus holdback): $50,503
What I paid: $47,677 of which Ford put up $2500 in the mistaken belief that I'll keep the car financed with them. So the dealer actually got $50,177 out of the car. So it looks like they lost a few bucks, but as Cobrakit pointed out they get some volume bonuses, plus I think Ford has helped them out with some cash for their inventory during the plague. I was having difficulty getting dealers to order for me at a good price and it doesn't seem like production is open yet so this probably was for the best.

 

[ahl395]

Sign up for Mustang Club of America for Ford X Plan. Order the car with X plan and not have to worry about negotiation BS. I believe I saved 2-3k off MSRP with X plan when I ordered my car.

 

[BigBeed]

Sign up for Mustang Club of America for Ford X Plan. Order the car with X plan and not have to worry about negotiation BS. I believe I saved 2-3k off MSRP with X plan when I ordered my car.

^ This right here. That's what I did when I ordered my PP2 and the process was smooth as can be.

 

[Clover]

Not sure if Ford was the same but I did an internship at a Dodge dealership back in the early 2000s and there were multiple ways the dealers made money on a deal. First off, how much under invoice a dealer buys cars from varied by model in the past. Trucks had tons of room in them back then but the Chargers had like $500 of profit in them. Dodge would give the dealer and salesman additional amounts for each sale and for hitting targets or moving hard to move models. That means that cars sold at cost still make money for the dealer and the salesperson. Also, if a car sat on the lot too long, Dodge started to fine the dealer each month is remained unsold which made the dealer pretty incentivized to get rid of them even at losses. Like others have said, most of the dealers money actually comes from finance, parts, and service. Those added on warranties are big money makers for the dealer and back when I was there they tried to price them with a 40% margin and a lot of people buy them and other add ons. Not at all uncommon for a car to be sold at cost but for a dealer to make $2K on the backend.

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