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also, always use a broker like broadspeed, or orangecar, similar. They will put you in touch with the dealer who is prepared to do the best deal. Often, a dealer out in the sticks will ahve a lot more leeway to do a better deal than a big town/city dealer. Certainly has been my experience.
The fees are certainly there, and someone (dealer or manu) will be picking up the cost.
Most mainstream dealers (Peugeot, Ford etc etc) have much less profit in a car than you would ever imagine. For example, when I worked with Peugeot, a 206 generally held about £700-£800 front end profit. Certainly not the the 1000s that most people believe...
My advice is dont always doubt the dealer; just find a GOOD salesman, who you like, can trust and doesn't spin you any tales. They do exist.
Also go in with quotes from Carwow or similar - they may not be able to match someone else who's just trying to hit their last sale to get quota, but it'll keep their pencil sharp.
And I got more off the VW than he did off the Audi.
I just got a new C class coupe and there was a contribution from both and on top of that a hefty discount from the dealer. Bought via drivethedeal, even cheaper than car wow and miles better than the dealer price, monthly payments 1/4 less for a much better specced car. They even delivered the car to my house, perfect!
Used car margins are pretty small though. When I got my Golf GTD I actually saw the dealer screen (they showed me a finance example on it) and with a straight sale with none of the optional guff they sell you they were only making a couple of hundred quid.
They gave me £15k for my car as trade in and it needed 4 new tires (£700 worth), a service, and the bonnet paintwork needed some attention. They've got it listed for less than £17k with everything sorted on it. Not much margin in that.
Although I agree that car dealers are largely crooks and liars, I don't in principle begrudge them making a profit, as after all the alternative (a complete free for all where you just hope the car you're buying isn't a lemon) is much worse.
We then can earn upto an extra 6% based on achieving a certain volume, CSI level & PCP renewals.
Certain models also have a lower margin as well and don't achieve any top up.
At Kia we used to just have 12% no having to hit standards but that was around 4 year ago.
Were lucky if we make more than 2% in a car nowadays.
Has been a productive day thanks to carwow. Current discount from Audi is around 16%, although that includes s bit of finance contribution. Quite pleased with that though!
Why would your car purchase be any different.
I was amazed to find the profit levels in a car were no better than about 5% depending on model. The special editions were worse!
IIRC it was the first year that Ford Credit made more money than Ford Cars. The salesmen got far more commission on the finance products than on the cars.
I have no idea if that is the same these days, with the more recent rules on financial product selling.
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I was looking (after some research) at the Golf Alltrack, the Octavia Scout and the Leon X-Perience. Very similar cars (though not as identical as some would have you believe). It came down to the dealers (Seat knocked themselves out pretty early as did the closest VW dealer), which had the right set of kit and options and the end price.
After all, even if Audi had offered a 25% discount on an A4 Allroad it'd still be far more money than any of the above three at the same spec.
A car purchase is a bit different though because saving a few hundred is different to saving £3000 off a Toyota Yaris.