Dealers LOVE the Supplier Discount program!

[neweagle]

Hello! What a GREAT site!

We're in the market for an '07 Chevy Tahoe, so I'm doing my due diligence by researching everything I can.

I have access to the GM Supplier Discount, which is around $5,000 off of MSRP for a fully-loaded Tahoe LTZ. I found out from my last visit to a dealer that when a customer uses this program, the dealer submits some paperwork after the sale to GM, and GM gives the dealer the amount of the discount. So, while I save $5,000 off of MSRP, the dealer still makes that $5,000.

Of course, the first thing the salesman did when I mentioned the program was to print out the dealer invoice, which showed that the MSRP was $50,400, and the dealer invoice was $45,677.99, which leaves the impression that they make no money on the deal. In reality, after the dealer gets the money for the supplier discount from GM, they would have essentially gotten MSRP for the deal ($45,677.99 from me, $5,000 from GM).

So, the question is: how can I leverage the fact that I'm guaranteeing them a $5,000 check from GM via the program, no matter what they sell it to me for? Anyone else have experience using the Supplier Discount to have a dealer go below their invoice?

Or, am I just out to lunch on this one? Thanks!

 

[mikew2069]

I used the Supplier Discount Program, but I had no knowledge of the kickback from GM. I wish I would have though b/c I could have definitely negotiated more value for my tradein or something... Oh well....

 

[07TahoeLTZ]

Supplier Discount is only...

I used the Supplier Discount Program, but I had no knowledge of the kickback from GM. I wish I would have though b/c I could have definitely negotiated more value for my tradein or something... Oh well....

Good enough to get to a starting point...shoot for $8000 off MSRP...then you are getting a good deal.

 

[CaMs]

interesting, I was shopping this weekend for a tahoe or yukon..went to several chevy & GMC dealers...i also have access to the discount, PLUS they are giving back $2000 in incentives witch makes it even a better deal

I got a quote of a fully loaded tahoe(black on black) with nav. for 614 a month...800 down(first payment + security),that payment also includes NYC tax..so before tax its around $570.. you guys think that a good deal??

 

[PAZach]

interesting, I was shopping this weekend for a tahoe or yukon..went to several chevy & GMC dealers...i also have access to the discount, PLUS they are giving back $2000 in incentives witch makes it even a better deal

I got a quote of a fully loaded tahoe(black on black) with nav. for 614 a month...800 down(first payment + security),that payment also includes NYC tax..so before tax its around $570.. you guys think that a good deal??

How many months? Othewise sounds like a pretty good deal to me.

 

[CaMs]

it was for 39 months.. I also got a quote for a LT2 without nav @ RES for $550 but im not sure if i want the stock NAV or just get it without NAV and hook up my carPC....

Dam i hate when my cars go back...to much thinking

 

[neweagle]

it was for 39 months.. I also got a quote for a LT2 without nav @ RES for $550 but im not sure if i want the stock NAV or just get it without NAV and hook up my carPC....

Dam i hate when my cars go back...to much thinking

39 Months @ $614 = $23946 + 800 down = $24746. $25K for an LTZ? Are you buying or leasing?

 

[CaMs]

39 Months @ $614 = $23946 + 800 down = $24746. $25K for an LTZ? Are you buying or leasing?

leasing, but i dont think it was a LTZ model... i think LT2 with nav..i have to check my paper work

 

[gm_geek]

leasing, but i dont think it was a LTZ model... i think LT2 with nav..i have to check my paper work

how much was a sticker price on that vehicle ?

 

[CaMs]

how much was a sticker price on that vehicle ?

MSRP: $45,875.00
Supplier Price: $41,277.36
Current Offers: -$2,000.00
Net Price: $39,277.36

 

[gm_geek]

Price is good. but looks to me that dealer is trying to make up on the interest rate.
I'm currently leasing a vehicle. sticker price was $46K. after all discounts and very low interest rate. this was my deal. $5K down $350 per month including CA tax

 

[CaMs]

But isnt the interest rate only applied to when you buy?

Currently i believe and also checked on my paper work that the Residual Value is at 60% and the money factor is at (.0028) witch is 7% or 6.9% (i forgot what # he was using)

Is this inline to what chevy's numbers are regarding residual & money factor...whats funny was that i used the same calulations that the dealer had, typed that into the edmunds lease cal. and came up with a $588 payment.. i just cant figure out whats the extra $ he is adding in...

i also typed in the info for my other lease quote of $550(without NAV) and edmunds was dam close @ $541..witch i dont mind..but there is a big diff. of $30 bucks to the one with nav

 

[gm_geek]

But isnt the interest rate only applied to when you buy?

Currently i believe and also checked on my paper work that the Residual Value is at 60% and the money factor is at (.0028) witch is 7% or 6.9% (i forgot what # he was using)

Is this inline to what chevy's numbers are regarding residual & money factor...whats funny was that i used the same calulations that the dealer had, typed that into the edmunds lease cal. and came up with a $588 payment.. i just cant figure out whats the extra $ he is adding in...

i also typed in the info for my other lease quote of $550(without NAV) and edmunds was dam close @ $541..witch i dont mind..but there is a big diff. of $30 bucks to the one with nav

interest rate apply either you buy or lease (they still have to finance you for what you are going to pay)
just call that dealer back and ask them what rate they are giving to you, and then everything will make sence to you.

 

[Donzi4me]

Hello! What a GREAT site!

MSRP was $50,400, and the dealer invoice was $45,677.99, which leaves the impression that they make no money on the deal.

Or, am I just out to lunch on this one? Thanks!

This is EXACTLY what the dealer wants you to believe.
The $45,677.99 you saw on the invoice, is not the TRUE invoice. There is a 3% holdback from GM minus the destination charge.

Here is the breakdown:

$50,400 MSRP. - $900 (delivery charge) = $49,500

$49,500 x 3%(holdback) = $1485

$45,677(fake invoice) - $1485 = $44,192 (Actual invoice)

The 3% holdback is for advertising etc. etc. Most dealers will not "haggle" into this amount.

As far as the dealer getting the $5000 back from GM, I don't think so. I think it's more like $750 for each supplier paperwork.

So if you buy it at the $45,677(fake invoice), the dealer will lead you to believe he is not making any money. But in reality, at $45,677 he is really making at least a $2200 profit. ($1485 + $750)

But I think if you can get a new tahoe at the fake invoice price, plus deduct the rebates and any GM card money, you have gotten a good deal. Dealer has to make something to stay in business and you didn't get taken.

GOOD LUCK

 

[slicktoptt]

The "money factor" is the interest you are being charged over the lease.