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[Midnight Rider]

The reason I believe that the freight and set up are B.S. (and I may be wrong) is because they are not part of the MSRP.  The dealers invoice I believe includes the costs of shipping & setup, but I would like to hear from someone that actually knows for certain.  

The other area that raises my concern is the large discrepancy between dealers in the same area for setup charges.  One may charge $499 and another $1200.  

Would Moco suggest a selling price and the dealership accept a bike without the understanding that the suggested price must minimally include what it will cost the dealership in freight and setup?

For example, I paid $2,500 below MSRP on a 2012 Ultra (In Sept.) and negotiated, no freight or setup fees.  Should I believe that the dealer sold me the bike at a loss?  I'm doubtful, that they would have made the deal if that is the case.  What would be their incentive to do so?

All I can speak to is the car business, and Toyota's specifically.  The freight was not included on the dealer invoice price sheet.  The dealer invoice showed the price of the vehicle (dealer cost), plus the freight.  The freight charge was a seperate line item from the cost of the vehicle, just as it is shown on the window sticker.  Since I have no first hand knowledge of how HD invoices appear to the dealer, I will just assume they show it the same way.  As mentioned, rather than complicate matters, they just set a flat rate for freight.  That was true for Southeastern Toyota distributors, which included some 4-5 states (it's been 4 years since I did that).  Setup charges are a bunch of BS.  As mentioned, HD pays the dealers for that, so there is no reason to pay for it again.  The wide variance in those charges indicates that it is a BS charge added on by the dealership, much the way a "paint sealer", "interior protection", etc is added on to the price of a car sticker, usually on a seperate window sticker, as the manufacturers window sticker cannot be altered by the dealer.  I think that's a law.  I don't know, but it would not surprise me if the CVO bikes had a markup of 5K or so.  That number has been mentioned here previously, but I'm not sure anyone but a HD sales manager or GM would know for sure.  So if you paid $2500 under MSRP, with no freight, you got a good deal, but the dealer probably still made money.  And I would assume that on a model that is hard to move, HD would provide some incentive to the dealer to move it.  Some colors of CVO's, and some models, were hard to move.  I saw SE Dynas sit on the floor for months and months.  The SEVROD I bought in '06 sat on the floor for almost a year...the new models were about to come out.  So I got what I consider a fair price on it, but I have no doubt they made money in some way.

A lot of people who came into the Toyota dealership were under the misconception that there were large differences between dealer cost and sticker price.  It depended on the vehicle...a $50K vehicle had a wider margin than did a $18K Corolla.  I did Internet Sales, so sold most vehicles at invoice.  We still made money because of hold backs, but sometimes we'd give that up too, just to move something off the lot.  It was a volume game.  There was no "secret" dealer invoice sheet.  We might "show" that we ate the freight on a regular sit at the table type deal, but selling vehicles at a loss was not something that was often done.  Holdback amounts were based on unit sales for a given period of time, so if we were short of a "goal", we might eat a few cars so that we'd get a bigger holdback amount on the other units we had sold that quarter.  As a salesman, I was not privy to some of that information.

[FLY-DOG]

I want somebody to tell me who besides H-D sells ANYTHING at MSRP?

Freaking ridiculous. 

Rolex

[Kingspoke]

Thanks Grouchy & Rider for the clarification!   You speak from 1st hand experience, which is credible.

[Keats]

If you consider there is an approximate $6500 - $7000 gross profit built in to the MSRP of a CUSE7, even at $2500 below MSRP your dealer still did very well.  Profit margins on Harley's, especially CVO's, are much higher than what you find over at your Ford or Chevy or Toyota dealership.

I am not sure where you get your info but there is an approx 13% profit at invoice.

that is about $4700 on a 37000 bike.   not 6500 - 7000

maybe I am wrong?    nobody can make 20% at list

[HogBreath]

You guys twist it around any way you wanna but when I shake the salesman hand and we agree on a purchase price, and they start adding $200 for this or $200 for that I'll call BS on it everytime. The guy should have taken all of HIS costs to mind before agreeing to a price plain and simple. If a "few hundred bucks" dont matter on a 35K deal next timee i'll make the check for $500 less than we agreed upon.

[bmcgc]

I was in Great South HD in Newnan GA today.

They have a 13 CVO RG, the tag on the bike says "Prep and fees $3400", so a 33k bike, they have jacked the price to $36,400 + freight + doc + TTL. 
 
They do that on every CVO they put on the floor because some idiot walks in and pays it.

If you want the dealers to stop that BS, then people have to quit buying at inflated prices.

Plain and simple.

[FLY-DOG]

I was in Great South HD in Newnan GA today.

They have a 13 CVO RG, the tag on the bike says "Prep and fees $3400", so a 33k bike, they have jacked the price to $36,400 + freight + doc + TTL.  
 
They do that on every CVO they put on the floor because some idiot walks in and pays it.

If you want the dealers to stop that BS, then people have to quit buying at inflated prices.

Plain and simple.

I bought my bike at Great South and had to walk out 3 times within a week and a half then wait a week, when I went back they ended up making an MSRP plus freight plus tax deal with me, still not great in my book but  I could not find another dealer willing to go lower than MSRP on a CVO Street Glide and Great South had the bike I wanted.  Even if I found a cheaper price accross country I didn't want to fly and ride back just to save a little especially considering the travel necessary.

[Midnight Rider]

You guys twist it around any way you wanna but when I shake the salesman hand and we agree on a purchase price, and they start adding $200 for this or $200 for that I'll call BS on it everytime. The guy should have taken all of HIS costs to mind before agreeing to a price plain and simple. If a "few hundred bucks" dont matter on a 35K deal next timee i'll make the check for $500 less than we agreed upon.

I don't blame you there, Ken.  Once a price is agreed on and I shake hands with a person, that's all I'm going to pay.  When I gave internet pricing on a car, it was an out the door price via e-mail 90% of the time.  That included the tax at our location.  We would lose a deal occasionally because the tax at our location was more than at other locations near B'ham.  When I ask for a price on something like a car or bike, I ask for OTD pricing.

[Fiberguy]

I bought a 2013 110th SERK, (#90), and I paid MSRP at Southside Harley in Virginia Beach.  They gave me a very competitive interest rate, and we worked out some on the extras, but I'm pretty sure if I kept at it, I could have negotiated a better deal.  The day before, I went to Bayside Harley nearby and they wanted $2000 over MSRP on a standard SERK, and gave a interest rate, from the same lender, that turned out to be 2% above Southsides.  I felt like Bayside had lost this trust and I tell this story to everyone I can so that they will be informed and hopefully they can get the deal they want.   I recommend that you shop around to at least two dealers, make sure to get the facts, and not opinions, do not be mislead by a dealers ability to impart an atmosphere of trust, and most importantly, stop a Harley rider and ask what he/she thinks is a good dealership.  They all want to keep you sitting there for hours so that you "just want to get it over with" and agree to more than you would have if you just walked in. This is a sales method that applies to all vehicle sales, so don't use that as a gauge.  I stopped by, filled out the paperwork, and left.  I had them call me with the numbers.  I just never thought a dealer was allowed to jack the interest rates above what the bank offered.  The surcharge was a Red flag.  I paid MSRP on #90 because I absolutely wanted an 110th SE Road King, I also knew they would be in great demand, and lesser dealers were adding surcharges,  so I was less than aggressive on the negotiating, and more on getting that sucker in my garage. I feel Southside was prudent on their negotiations, and were entirely honest, and I feel this is the key in being happy with a purchase, and I sure am.  What is more important is my ability to tell others of my experience so they may not be taken on their purchase.  Bayside's of the world beware...we Harley riders do talk

[Midnight Rider]

I bought a 2013 110th SERK, (#90), and I paid MSRP at Southside Harley in Virginia Beach.  They gave me a very competitive interest rate, and we worked out some on the extras, but I'm pretty sure if I kept at it, I could have negotiated a better deal.  The day before, I went to Bayside Harley nearby and they wanted $2000 over MSRP on a standard SERK, and gave a interest rate, from the same lender, that turned out to be 2% above Southsides.  I felt like Bayside had lost this trust and I tell this story to everyone I can so that they will be informed and hopefully they can get the deal they want.   I recommend that you shop around to at least two dealers, make sure to get the facts, and not opinions, do not be mislead by a dealers ability to impart an atmosphere of trust, and most importantly, stop a Harley rider and ask what he/she thinks is a good dealership.  They all want to keep you sitting there for hours so that you "just want to get it over with" and agree to more than you would have if you just walked in. This is a sales method that applies to all vehicle sales, so don't use that as a gauge.  I stopped by, filled out the paperwork, and left.  I had them call me with the numbers.  I just never thought a dealer was allowed to jack the interest rates above what the bank offered.   The surcharge was a Red flag.  I paid MSRP on #90 because I absolutely wanted an 110th SE Road King, I also knew they would be in great demand, and lesser dealers were adding surcharges,  so I was less than aggressive on the negotiating, and more on getting that sucker in my garage. I feel Southside was prudent on their negotiations, and were entirely honest, and I feel this is the key in being happy with a purchase, and I sure am.  What is more important is my ability to tell others of my experience so they may not be taken on their purchase.  Bayside's of the world beware...we Harley riders do talk

It is very common.  The situation is a little different if the manufacturer is offering a set interest rate (if you meet the qualifications) through their own financing arm of the company.  Like HD's Eagle Bank or whatever it's called.  That's who financed my bike, and at the time they had a 2.9% rate for X number of months.  The dealer came back with an offer of 3.9% and I said WTF, I went on line and saw the special rate offered, so tell me why we are not getting that rate (my wife was with me).  After going in his office and "checking to see if he could get a better rate", I got the 2.9%.  I'm sure that HD financing gives the dealer some kickback on the financing, but it may only be .5% in a case like this.  But beware...car dealers "shop" your loan by sending your score out to several lenders they use, depending on your credit score.  Within 10 minutes or less, they may have 5 or 6 offers to finance you at X%.  In almost every case, the finance guy will bump it 1% or so as that is how he makes his money.  All this is done before the finance guy ever calls you into his office. The dealer then "sells" your loan to whichever company...I'm not sure how the difference is given to the finance guy, but I know for a fact that he gets at least part of the difference, if not all of it.  On a 30K loan, that's $300 if he "makes" 1%.  Not a lot of money, and if I'm offered a competitive rate, I don't care if he makes a little...he's got to live too.  That's why they hate cash deals.  The best way to buy a car or bike is to contact your bank or credit union and get pre-approved before shopping.  Then you've got a rate in hand before you start the process.  If they offer the same rate or better, then go for it...if not, tell them you can get the money for X% and see what they do.  Usually, they'll come back and match that.  If they can't, then go get the check from your chosen lender.  They hate that too.  I'm not going to begrudge the dealer, the saleman, or the finance guy making a living, but I'm not going to contribute to his early retirement either.

[ultrarider123]

But beware...car dealers "shop" your loan by sending your score out to several lenders they use, depending on your credit score.  Within 10 minutes or less, they may have 5 or 6 offers to finance you at X%.  In almost every case, the finance guy will bump it 1% or so as that is how he makes his money.  All this is done before the finance guy ever calls you into his office. The dealer then "sells" your loan to whichever company...I'm not sure how the difference is given to the finance guy, but I know for a fact that he gets at least part of the difference, if not all of it.  On a 30K loan, that's $300 if he "makes"

Midnight, how's things down in Selma, BTW? 

OK, I've bought WAY too many cars/bikes/4wheelers/boats/jetski's in my day but how is this the first time I've heard of this?  I'm glad to know it but dealerships jacking up the interest rates to make a bit more money...is that not illegal?  I can see the banks/credit unions going a bit more than prime to make money for the bank and account holders but for a dealership to do it just for additional profit?  Doesn't make good, honest sense to me and will not use a dealership from now on that I know or find out is doing this.  I've always had my financing (or cash in a rare occasion) ready before I went in so maybe that's why I've not experienced this "rate jacking".   Thanks for the heads up M.R., your insight is greatly appreciated.

[bmcgc]

The consumer shops for the best deal and so does the dealer.

The best deal for the dealer is you taking the higest interest rate possible, they get a kickback.  I have an 800 FICO score and Great South Harley tells me that 10.85% is the best they can get me.

I went into my CU and walked out with 2.99%.

I do not buy new vehicles anymore and havent for quite awhile.  I paid 20k OTD for my 2006 SEUC with 5k on the odometer.  I financed 10k @ 2.99% and got a $430 payment for two years.

4-5 years from now I will find a 2012-2013 SEUC that only has a few miles on it and I will pay 1/3-1/2 of what the orginial owner paid.  The bike will still be like new.

I usually do not buy from dealers either. In the case of Harleys, most private sellers are so far upside down that it seems that better deals can be found at dealers.  At least thats how it is around here.

Thats another side of the issue altogether.  Dealers dangle a 20% off parts and labor carrot when you buy so a lot of guys load up on chrome and clothing and add another 3-5k to the amount they finance. 

[Porschestan]

The consumer shops for the best deal and so does the dealer.

The best deal for the dealer is you taking the higest interest rate possible, they get a kickback.  I have an 800 FICO score and Great South Harley tells me that 10.85% is the best they can get me.

I went into my CU and walked out with 2.99%.

I do not buy new vehicles anymore and havent for quite awhile.  I paid 20k OTD for my 2006 SEUC with 5k on the odometer.  I financed 10k @ 2.99% and got a $430 payment for two years.

4-5 years from now I will find a 2012-2013 SEUC that only has a few miles on it and I will pay 1/3-1/2 of what the

orginial owner paid.  The bike will still be like new.

I usually do not buy from dealers either. In the case of Harleys, most private sellers are so far upside down that it seems that better deals can be found at dealers.  At least thats how it is around here.

Thats another side of the issue altogether.  Dealers dangle a 20% off parts and labor carrot when you buy so a lot of guys load up on chrome and clothing and add another 3-5k to the amount they finance. 

One of the most efficient use of money when it comes to motorcycles (HD)
Discipline is required, and if you use this type of financial thinking in many areas of your life you will have a great nest
egg to boot.

Midnight Rider, great advise!

[Midnight Rider]

Midnight, how's things down in Selma, BTW? 

OK, I've bought WAY too many cars/bikes/4wheelers/boats/jetski's in my day but how is this the first time I've heard of this?  I'm glad to know it but dealerships jacking up the interest rates to make a bit more money...is that not illegal?  I can see the banks/credit unions going a bit more than prime to make money for the bank and account holders but for a dealership to do it just for additional profit?  Doesn't make good, honest sense to me and will not use a dealership from now on that I know or find out is doing this.  I've always had my financing (or cash in a rare occasion) ready before I went in so maybe that's why I've not experienced this "rate jacking".   Thanks for the heads up M.R., your insight is greatly appreciated.

Things in Selma are good...different, but good.  Not as much to do at night down here, but that's probably a good thing in my case.

You don't see this kind of stuff because it's all "hidden" from you by the finance guy.  Like I said, you just have to know what kind of rate you can get from other sources in order to know if the rate they are offering is decent or not.  And these things don't happen if the car company is offering a really good rate to move some cars as is often the case during certain times of the year.  I don't care if the guy is going to make money on the loan as long as I know I'm getting as good a rate as my credit allows, from whatever source.  There's only a couple of things to know when buying a car...NEVER shop a montly payment; ALWAYS shop the price of the car and know what your car is worth on trade before walking in.  But you've got to be honest with yourself about what condition your car is in.  A lot of people thing there car is "Excellent" when in fact, it's only "Good".  A very small percentage of cars are "Excellent" book value.  So know the trade in value and the retail value if it's on a dealer lot.  A dealer is never going to give you more than trade in value, regardless of what's shown on paper, unless your used car is a "hot" seller and he can bump the lot price IF he's going to put it on his lot.  Most trades are auctioned off by dealerships.  I don't care how they show the deal on paper, but I know what I'm getting for my car, and what I'm paying for theirs in the end.  With the internet, there is no reason not to know what the dealer's cost is on what you want, minus any rebates or special offers.  Don't be what we called a "lot up"...somebody who just walks onto the lot uneducated.  That's where dealers make real money.

All bets are off if it's a car that is high demand and short supply.  Miata's were that way when they first came out.  A Toyota Prius was that way in the summer of '08...they were selling for 2-5K over sticker, and people were buying them because of gas prices.  It was stupid, because they'd never make that money up in gas savings, but it's all about perception.  As soon as gas prices dropped from $4+ a gallon back down to $3.50, I was selling them at invoice again.

[North Georgia Hawg]

I bought the Honey Badger new from H-D of Macon, GA last Aug 26... paid MSRP plus freight plus a $200 doc fee (about half of what the Atlanta dealers charge), plus sales tax... and that was IT. NO setup fee. That was and probably still is their policy on CVOs there. I paid cash.... just wrote them a personal check and that was that.

The 2012 Hot Citrus SESGs were as rare as hens' teeth at the time... the Honey Badger was the ONLY Hot Citrus available anywhere in the state of Georgia at the time. I felt then, and still feel now, that it was as good a price as I could have gotten anywhere for this bike at the time.

And they treated me very well. The dealership has a very interesting history. Greg Sassaman, the owner, took me around the whole facility after hours on a Friday night until after 9:00 PM, and told me the story of how his Father Grover Sassaman was signed up as a dealer in Indiana by Arthur Davidson himself. As it turns out, we are both drummers. Their dealer history is on their website at http://www.harleydavidsonofmacon.com/aboutus.asp. There is a great video on there, too... of an interview with Grover.

Of course... that was then and this is now. I am glad I'm not buying a 2013 though... it being the big 110th anniversary year and all - the Ts and Cs might be very different this year than they were 14 months ago! And the 2013s don't even come in Hot Citrus!