I value mine as well and my handshake is my word. However, as with most rules, there are, for me, always exceptions.

Had I been in a situation where I was excited and happy to have found the car I wanted at an acceptable price, then found a better deal, realized that my handshake was with a salesman who had baited and switched me (yes, I should have thought about that before shaking on the deal), I would have reneged on my handshake as well and, yes, I would likely have the same unpleasant feelings about having done so that ND had because breaking one's word is generally unacceptable.

That this thread has gone on this long is, IMO, ludicrous. But then, when people pile on with self-righteous criticism, they can be longwinded.

I think focusing this on car salesman and the practices of the auto industry is in a sense denying the existence of questionable sales / business tactics used in all industries. Examples abound on the unscrupulous. Where does one begin? Can you say Ponzi?

ND walked away from a handshake deal due to him finding a better deal. He did give them the right to match. In my twisted mind this is important .

Remember the Eric Lindros trade from Quebec to Philadelphia in 1992? It ended up in court. NY Rangers felt they had an agreement with Quebec. The court ruled that even though there was a "handshake agreement" the momentum of negotiations was still in play and the agreement w/ NY was nothing more than a understanding as the deal was not legally consummated according to League rules. Ironically, I believe both NY (94) and Quebec (96 as Colorado w/ Forsberg obtained in the Phila trade)won Stanley Cups while Phila still waits...... Karma.

Rick is a "good guy", and if I came across as being self-righteous, then I apologize. As I stated earlier, I've found this thread (and the responses) to be thought provoking (much like the "social experiment" thread from years ago), thus my continuing to engage. The deal is over, the horse is long dead, and I won't post again but I do find this thread intriguing :).

ps: I had a similar discussion with my best friend a few months back regarding "letting underwater properties go back to the banks". While it might be an "astute business decision", personally, I wouldn't do it unless under dire circumstances (and of course there are always exceptions).

Perfect example of what I consider an underhanded and unethical practice by multi millionaire developers...

I guess to me the issue boils down to the fact that there was no contract signed, no money changed hands and the dealership did not even have the vehicle in question.

On the other hand, if I went upside down in my mortgage I would not let it fail just to get out from it unless I was penniless. Like I said, spectrums of grey.

Bunk that! no you were not an ass! They lied to you to get you in the door. They are the ass.

Yes they do, you just haven't been presently with one that found your limit yet. I don't simply mean a high enough dollar figure either. The circumstance of the deal also has a tipping point. No one is a rock, everyone breaks(not to be taken as a negative trait).

No, they'll pay you what they think it is worth to them. There is no right or wrong. The books are 'guides'.....they don't write checks (try it). The actual market fluctuates. It's exactly like looking at last month's Wall Street Journal stock prices and wanting to pay that amount for stock today. And just because someone paid that for stock today, doesn't mean YOU would buy stock for that. You may pay more, or less, depending on your feelings about the market. Cars are no different.

When I trained dealer groups that owned multiple dealerships, I had a meeting with all of the used car managers and buyers, about 30 of them. I had a used car outside, exactly as it was traded in. Everyone got a chance to appraise the car and use an appraisal form I had designed (point of the meeting). These were 'professionals' that typically had several years experience and were paid low six figures. Not lackeys. The spread was over 20% from low to high.

In ND's specific example, the $10,000 figure was a low-ball designed to test his expectations and lower his sights. Typically, in a four-square method of 'pencilling the deal' they will write down a really high figure for the car you're buying, a really low figure for the car you're trading, a really high down payment, and a really high payment. Whatever the customer responds to is his hot button. Usually, the response is, "I can't afford that payment!!" So that becomes the focus, not the price or trade. If it was the trade value, they'd keep the price of the car really high and over-allow on the trade as negotiation. You get my point.

But that doesn't mean that the used car manager didn't appraise the trade for $16,000. It just means that the desk manager held back on the allowance on the "first pencil" to test the waters and know how to move forward with negotiations. It's a game, and ND played it. Not all dealers play those games. I don't.

False on so many levels.

First, salespeople don't know the financial details on every car, sometimes hundreds or thousands on the lot. They rely on their manager to look everything up. They are usually not empowered to finalize a deal, or pricing -- some are, but the vast majority are not.

Second, salespeople are NOT paid this way. I've written pay plans for thousands of salespeople. The most common way a salesperson is paid is a certain percentage of commission above dealer invoice, typically 30%. Sometimes (less commonly) it's a smaller percentage of the net (less holdback or other factory-to-dealer incentives). The North American Dealer Association (NADA) targets 17% paid in salesperson commissions measured from net. The typical new car is $25,000. The typical mark-up from net to MSRP is about 13% (10% +3% holdback), or $3250. So if a salesperson sold the average car for MSRP the average commission paid would be $553. If they sold it for invoice, they'd make 17% of the 3% holdback, or $128. Some dealers pay a minimum commission (aka 'mini') of $100-200 even if there is a loss or some other deal where their calculated commission would be less. The average salesperson at a franchised dealer sells 11 cars a month and makes $3500 for their efforts. Using the 17% target, the average profit margin (sales price to net) is $1872. Statistically, the actual average profit is less than that as 'minis' mess up the calculation. If the dealer loses money on a deal, salespeople don't pay 17% of the loss to sell the car, of course....they still make their $100-200.

So you're saying in your world, if you shake hands and agree with someone, there is no conceivable context or scenario in which you would break your promise?

None? Completely black and white? Period?

OK, I broke my word and came back for one last post. Of course you and Lendaddy are correct, and at some point, under certain circumstances...who knows? That said, rest assured that in my day-to-day life, something as mundane as a typical car or house transaction would never reach that threshold as that's just not the way I operate. BTW, if I lived in a "black and white" world, I'd be over in PARF where I'd fit right in :)

How about here:

You go to car dealer. Agree to buy car for $25K, shake on it and will come back tomorrow to sign papers.

Salesguy thinks you have left, and you hear him in the next room laughing it up with another one:

Salesguy: "Ha ha, I got that sucker to agree to $25K!"

OtherSalesGuy: "You mean you didn't tell him that car is going on sale tomorrow for $20K???"

Salesguy: Heck no! He obviously didn't look in the paper to see the sale, it's not my job to do his work for him!

OtherSalesGuy: Yeah, that's true, but that's cold blooded!"

Salesguy: Nah, he's getting what he deserves, him and his bucktoothed wife and ugly kids. Didja get a look at them! Ugh!

OtherSalesGuy: Yeah, but when he comes back tomorrow to sign the contract, he's going to see the sale!

Salesguy: Ah, don't worry about it! He's one of those dumbfuch "my word is my bond" cowboys. Since we shook on it, he has no choice but to sign, even though he has no legal obligation. That's the way dumbfuchs like that roll. Esp. when I put on my "hurt" look and sadly say I thought his word was his bond. They fall for that crap every time. What an idiot.


Obviously, you're not going back to sign up for $25K.

Why? Because they are jerks, they mislead you (although didn't do anything technically illegal), and the whole transaction stinks.

That's the same thing as the "bait and switch" pulled on ND. When the dealer pulls that kind of crap to lure you in, by lying to you, the whole transaction is dirty, and dirty by the dealership's own intentional lying. If the dealership gets punked in the end, that's fair game.

Just bought the wife a new CX 7. I got the $1000.00 rebate & the 0% financing. Keep looking!!

when i bought my mazdaspeed3..i worked out a deal.

up at the finance guy, i was about to sign the deal. i gave it one more look and i noticed they had STICKER PRICE on the document. i came to a skid and asked.."WTF?"

he apologized and called the salesman to verify what our deal was..

1. he didnt believe me
2. i wonder if he would have torn up the document if i had signed it..and drawn up a new one.
3. i seriously wonder if it was a mistake, or was it on purpose.

i am not rich enough to have tested the bastards..but i think they almost got me.

I think we are starting to go around in circles but to address your question, I think that you have confused the word "honest" with "distasteful". Just because the dealer didn't roll over and give away the car or tell you all the details doesn't mean he lied. Being aggravating isn't dishonest. As you stated, you vote with your feet. You asked our opinion and I suspect that the reason you asked is because deep down inside you are not the kind of guy who normally breaks his word. As such you were looking for someone to tell you that two wrongs make a right. It doesn't. How would you feel if a Pelican said they would buy a part from you for for $350 and you agreed you'd meet them somewhere in a week. You agreed to not sell the part to any of the other folks that PM'd you. Two days later, another person PM'd the guy and offered to sell the same part for $20 less so the Pelican PM'd you and said the deal is off, I found it for less money. You've turned away other buyers who have gone ahead and bought the part elsewhere because the guy said he'd buy it. Wouldn't you be upset? What the dealer did to get you to come there was dishonest. I wouldn't buy a car from them for fear they have done other dishonest things like roll back the odometer on a demo or not disclose bodywork done to repair damage while on the lot.
To be clear, I do not appreciate nor can I defend the many aggravating things many dealers do. I won't buy a car that has had the "mop & glo" package of paint sealant, scotchgard, undercoating, and maybe cheap tape pinstripes for $999.99 If nothing else, I'll order a car and require that the extras are not applied.

Kaisen is describing exactly what I saw for 10 years in the new car business. Don't forget that used car appraisal is based on what the dealer thinks they can sell your trade-in for. A Chevy dealer will usually pay more for a Chevy trade-in...
We haven't even discussed the overhead cost of a dealer. Can you imagine trying to insure a place that lets people like me testdrive their cars? :D

Out of curiosity, kaisen: do most dealers still tack on a huge lot fee to every deal before they figure in sales commissions? Are doc fees still set in stone or are some stores willing to negotiate on them?

..

You'd have to be totally naive, or working within the industry to believe that the dealer deserved anything better. Fixed pricing is just the latest sales tactic. It is meant to give the consumer the false sense that the dealer has done everything they can to give the "best price". I call BS. And as far as dealers losing money on a deal... same BS. They make it up on the next victim. They aren't running a charity. If there wasn't something in it for them, they wouldn't make the deal. Do you really think they are going to pay you to buy a car? My brother is in the business and I've seen the way it has changed him.

I would have honored the deal I made...regardless of losing money. I can always make more money.

I just bought a car last Friday.(true story) I tried to close the deal with a handshake, but the dealer insisted that I sign some paperwork.

Porsha,

I don't think I'm confusing things. To me if you walk up to me and tell me my car is worth $10k when you know full well it is worth $16k then that's not distasteful, it's dishonest.

It's pretty simple really, if car dealers want to be treated with honesty and respect then they should start doing the same to their customers. Of course car dealers aren't really interested in being honest, they want to make max profit. Unfortunately in the car biz that means screwing over every customer you can.

Everyone rationalizes things so they feel ok about themselves. I rationalized breaking my word with the dealer. You are rationalizing a car dealership lying to it's customers because that's how you used to put food on your table.

I really don't have an issue with how dealers work as long as everyone understands that a car negotiation is a no holds barred affair.

What is wrong with you people? The dealer wants to make a profit. OH MY GOD!
We want to buy their car for wholesale but want retail for our trade in. We don't pay the insurance, floor plan, salaraies... Also, the dealer didn't tell you how much he made in profit on the car he sells as well as your trade! He's withholding information. What a liar! He deserves to die!
Sorry. I am no fan of high pressure dealerships but you guys are whining about someone trying to make the best deal for themselves like it is a crime against humanity. I see guys on Pelican bragging about the great deal they got at a yard sale on stereo speakers or some other item. Not one of you said "Hey, you lied to that guy by not telling him he could have sold those speakers for 3 times the money". No, you just smiled and told the Pelican "good job". You want to judge honesty by the amount of disclosure? Next time you get pulled over for speeding, don't try to get out of it. Go to court and say "your honor, I was doing 78 in a 55 but the officer wrote down 66 to give me a break". All this indignation is just greed. You are mad that someone is trying to make a profit at your expense. When it goes the other way, well, hey, its just busines...
This whole conversation was started by ND who wanted to know if he was doing the right thing. Next thing we see, is everyone judging what the dealer did. I guess in the world of some Pelicans, 2 wrongs do make it right.