In Reply to: Anyone use holdback in negotiating price? Results? posted by MikeW on October 20, 1999 at 15:44:02:
: For those who don't know BMW pays a holdback, which is 2.2% of the Base MSRP, to the dealer for each car sold (at least E46). This is on top of the margin they get on the invoice.
: For those who do know, have you used this as a tool in your negotiations? How? And has it gotten you anything?
I was able to use it, and got a good deal on my '99 323i. Here is the offer which I faxed out to 21 dealerships-got 11 replies, one of which accepted this offer. Guess which dealer got my business?
'99 323i/Fern green/sand leatherette 23,530
Sport pkg 2,040
Auto (no flames please!) 1,140
HK audio 575
Folding rear seats 490
Wood trim 425
Metallic paint 405
In-dash CD 170
Add Dest. chg +570
Add dealer advertising fee +200
Less DEALER HOLDBACK -736
Total invoice price ("true invoice") 29,704
Add dealer profit (approx 5%) 1,496
Total (MY offer price) 31,200
The only other fee was a $100 doc fee. This dealer was also willing to swap a set of 7-spoke wheels from a Premium pkg 323i on his lot for the wheels that came with my Sport pkg...only charged me an addtl $100 for the labor-swapping wheels/tires on 10 tires! I was also able to get in on the 'Invoice Special' that CarsDirect.Com was offering for a short time. They wrote me a check for $860 to cover the difference between invoice price (not deducting the holdback) and the price I had negotiated. Also got back $500 for corporate discount. All said, I paid about $100 over 'true' invoice.