Phony ‘No-Haggle’ Pricing at New Car Dealerships

In reality, this is just a new sales scheme. This so-called no haggle / money back guarantee promotion will definitely increase showroom traffic, but will not benefit the new car buyer one iota financially. The reason? Because dealer profits are not made on the sticker price of the new car; the profits are made on the trade-in and in the finance and insurance office – the little room where the deal is finalized.
Dealers then receive cash rebates from the factories called ‘hold-back’ and the banks that finance their inventories give them kickback on the finance residuals from paid off car loans generated at the dealer level. Same old book / new cover.


About Gringo Bush Pilot

Retired process and systems manager; itinerant aviation devotee; and real estate investment loan officer. In short, an American economic refugee, retired in Asia.
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