It all goes back to the days of Henry Ford when mass vehicle production first began. Back then, it made sense to sell cars through a network of independent dealers. By doing so, Ford created a buffer to cushion fluctuations in sales. Ford's customers were actually the dealers, who would need to purchase and store up to 60 days worth of vehicle inventory.
Since there were no options on vehicles back then, there was no need for special orders and the franchise system made sense. Over the years, the dealers became more powerful and formed strong lobbying groups to ensure States made it illegal for consumers to purchase vehicles without dealer involvement. So although you may see services such as CarsDirect that claim you can buy vehicles online, dealers always remain involved. And it doesn't look like this will change anytime soon.
If anything, the franchise laws have gotten even stricter, thanks to the political clout that dealers have in most States. I read on Yahoo that this is possible, but what is the best way to go around this? No you can't buy direct from Toyota. Largely because of many states' laws assuming you're in the US requiring a dealer relationship for car purchasing, read about Tesla's struggles with direct to customer sales.
Secondly because Toyota corporate simply isn't set up to sell a car directly to a customer. I know there are services that help people through the buying process. If you're finding Toyota dealerships to be this difficult you may consider just buying something from someone who wants to sell to you. If the buying process is this difficult imagine the service relationship.
Edit: Additionally, it's important to remember when financing a car that there are essentially two transactions taking place. First you're negotiating the price of the car. Then you negotiate the price of the money the interest rate. The money does not need to come from the dealership, you can secure your financing rate from a separate bank or local credit union. You should definitely pursue alternate financing if they're quoting you 7.
But don't tell the dealership you've already got your financing lined up until you're happy with the price of the car. I feel your pain. It probably depends on your state, but two things we've tried with some benefit:. You could consider buying a fairly recent used car from CarMax. They have fixed pricing, and you'd save a good amount of money on the car since cars lose tons of value in their first year or so.
Any car manufacturer that undercuts their own dealer network would have that network fall apart quickly. Tesla is using a dealer-free distribution model from the start, so they don't have that problem. Toyota doesn't work that way, though. GM imposed a uniform no-haggling policy with their Saturn brand, but that policy was coupled with local monopolies for dealers to make it work. Lexus has also experimented with no-haggling and online ordering with delivery still taking place at a dealership.
The rest of Toyota doesn't work that way, though. Some car manufacturers, such as BMW and Audi , allow you to take delivery of your new car at the factory for a discount. But even then, the transaction still takes place through a dealer. For one thing, they work at a different scale. You say that you want to cut out the middleman, but the fact is that you do require someone to deliver a Toyota to you, like it or not.
If you're interested in saving money, consider trying various well documented tips, such as negotiating by e-mail before showing up, pitting dealerships against each other. If you don't want to negotiate, you might be able to take advantage of pre-negotiated dealer prices through Costco. You mentioned that the dealership offered you a 7.
You can also seek alternate financing online example or through your own bank. If there's one reasonably close to you, you could go to a no-haggle dealership. Instead of making you haggle the price downward, they just give a theoretically fixed price that's roughly what the average customer could negotiate down to at a conventional dealer. Then just do your best broken record impression if they still try to sell you dubious addons: "No. The last time I bought a new car 06 , a no haggle dealer offered the second best deal I got out of 4 dealerships visited.
The one I ended up buying with made an exceptional offer on my trade comparable to 3rd party sale bluebook value. You can buy a new Toyota from a non-dealer, but not from Toyota directly as they have no retail distribution capability. There is no need to buy directly from Toyota if you want to get a new car without going through a dealer.
As someone who was just recently a salesman at Honda, I'd recommend buying a Honda instead :. If you really prefer your Toyota, I always found quote-aggregation services Truecar, I'm blanking on others very competitive in their pricing. Alternatively, you could email several dealerships requesting a final sale price inclusive of taxes and tags with the make, model, and accessories you'd wish to purchase, and buy the vehicle from them if your local dealership won't match that price. Please keep in mind this is only persuasive to your local dealership if said competitors are in the same market area nobody will care if you have a quote from out-of-state.
As many other commenters noted, you should arrange your own financing. A staple of the sales process is switching a customer to in-house financing, but this occurs when the dealership offers you better terms than you are getting on your own. So allow them the chance to earn the financing, but don't feel obligated to take it if it doesn't make sense fiscally. As others have addressed the legality in their answers, I want to address the idea of the dealership being 'a middleman'.
A dealership serves more of a purpose than just 'middlemanning' a car to a consumer. Actually, they consume a great deal of risk. Let's remember that a dealership is really an extension of the OEM, albeit independently owned and operated, the dealership must still answer to the brand they represent, if people have a bad experience with a dealership, a customer might go to another of the same brand, but more often than not they will go to the competition out of spite.
Therefore, it's in the dealership's best interest to represent the brand as best as possible, but unfortunately that doesn't always happen. Test Drive. A car is a huge purchase, and while it's okay to buy a pair of shoes online without trying them on, a car is a bit different of course, we want to make sure it 'fits' before we shell out several thousand dollars.
It's not feasible for OEMs to have millions of people showing up to car plants for a test drive, right? Scalability aside, some business that is handled in automotive plants are confidential and not for the general public to know about.
A dealership provides an opportunity for those who live locally to see and experience the car without flying or driving wherever the car was assembled. They provide this at a risk , banking on the fact that a good experience with the vehicle will lead to a sale. A car is a machine, and no machine is perfect, neither will it last forever without proper service. A dealership provides a place for people to bring their vehicles when they need to be serviced.
Let's set aside the fact that the service prices are higher than we'd like, because the fact remains most of it is skilled and warrantied labor that the majority of people don't want to do themselves. Trade Ins. It is not in an OEMs best interest to accept a vehicle just to sell you another vehicle, especially if that vehicle is from another brand. Dealership's assume this risk , and often offer incentives to do so, hoping it will lead to a sale. That trade in was an asset to you, but is a liability to them, because they now have to liquidate that trade in, just so that you can purchase a car.
Sure, you could sell your car yourself, and now you would assume that risk: What if your car is not in perfect shape, or has a lot of miles for it's age? Would it do well in the used car market? What if it takes too long to sell and you miss that Memorial Day car sale at the dealer?
This might be okay for some, but generally speaking most people would rather avoid the risk and trade it in at the dealer toward the purchase of a new car rather than the headache of selling it themselves.
I'm sure there are more, but those are the one's that immediately sprung to mind. Just like Starbucks, there are terrible dealerships out there and there are great ones, and very few of us venture to farms and jungles just for fresh coffee beans You already got good answers on why you can't buy a Toyota from the factory, but my answer is regarding to the implied second part of your question: how to avoid haggling.
I found a good way to avoid the haggling at a car dealership can be simply to not haggle. Go in with a different attitude. Another bottleneck in the process is the trade-in. TrueCar attacks this problem with a smartphone app to expedite the trade-in process. You snap photos of your car, answer a few questions about its condition, and TrueCar will solicit bids from dealers in your area, then send you back the highest offer. Online pricing tools may have helped to reassure wary customers, but some parts of the transaction, such as lease calculations or payments from manufacturers to help cover dealer costs, remain inscrutable.
To a public increasingly accustomed to online shopping, the dealer model may seem old-fashioned. FordDirect claims to have helped dealers with more than , sales last year. Another factor in favor of dealers: Customers seem to like them better than ever before. Two of J. It does mean that manufacturers and dealers need to clarify their roles and responsibilities and work together. So while there is still no simple way to buy a car , technology has leveled the playing field.
That gives the customer more clout. New Cars. Buyer's Guide. Type keyword s to search.
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