Should you expect a discount if paying cash for a motorcycle

[RhadamYgg]

As mentioned in other threads, I started (but then aborted) the process of putting down some money on a 08 Ninja 250R.

Part of the reason was that I started with the premise that I'd pay cash - and this is what I told the sales person.

He wrote out a quote - and wrote down for the price of the motorcycle - at the full list price.

Now I understand there is a perception that the Ninja 250R is a hot bike, and maybe it is. But I expect some $$$$s off if I'm going to pay cash - or why in the world would I pay cash? Might as well finance if paying cash isn't going to gain me any advantage.

So, that put me off... Anyway. I mean, I know the Rebel is no sweet machine, but the Honda dealer that I went to had a posted price on it - $200 below the list price. I noticed a bunch of their bikes were below list price (on the tag on the bike).

So, anyway, after he added the extended warranty, the LoJack, the freight charge, the taxes, the 'cheap' Ninja 250R was going to cost me something like $6,284.51 - I balked - and not only because it is a lot of money (it is), but if I was going to pay cash - I wasn't prepared to pay that much cash...

So, I walked out. What can you do? And when I left the guy didn't seem to work all that hard for the sale. I got a secondary quote without the LoJack and the Extended Warranty - and it was a bit better, @ $4,705.19

So, as you can imagine - my thoughts turned to buying a used bike without the freight charge, no LoJack because it should be at least a little less steal-wantable from the theifs out there and no extended warranty.

And as I understand it, we live in a time of declining motorcycle popularity and they should really appreciate that I would be putting a deposit on a bike they don't even have yet and they wouldn't have to ever make payments to the manufacturer for because I'd be taking it off their premises as soon as they receive it.

RhadamYgg

[Thumper]

No...they actually do better money-wise if you finance through them, that's why you negotiate the price before telling them how you'll pay for it. But right now you might not do better than MSRP on a Ninja because they are in demand, but 6 grand? Definitely good that you walked away. You really can do better than that.

Is buying used not an option? You can get one 2-3 years old for a whole lot less than new, and they're reliable enough that your risks would be low. And at the much lower price, if you did need repairs in the future, you'd have that cash you were going to pay for new...

Now the Rebel is a pretty sweet bike, but you're more likely to want something with more power a lot sooner than you would the Ninja, and if I recall, you like the sportier looking bikes--? It's still tons of fun, either way.

[Brackstone]

Thumper is right you will save money if you finance through them. That is how it was when I bought my Ninja.

Also don't get the LoJack for it unless you plan on keeping the bike for a very VERY long time. I highly doubt anyone will steal your ninja because frankly it's really cheap.

Why go through the trouble of stealing it and getting rid of the serial numbers or whatever these nefarious people do when the resell value is till going to be LESS than retail.

That's the point of buying "hot merchandise" to get it cheap.

Now if you have your Honda 600 CBR RR yeah I guess having a LoJack wouldn't be a bad idea.

[koji52]

that's not always correct. With the markets and credit situation, I think right now, companies would rather take cold hard cash rather than take the risk of financing. Additionally, i'm pretty sure dealers would rather have the cash now rather than later.

Simply put, Honda's financing entity borrows the funds for consumer loans from another entity at a rate lower than what we the consumers would get. That's where they complement their profit, through the difference of our interest rate and theirs. Theoretically, as their borrowing rate increases, yours will too, especially if you have less than stellar credit. If that interest rate difference is less than what they'd get investing a risk free treasury bond of the same length of time as your loan, they would much rather take your cash. Your loan has much risk associated with it (defaulting, interest rate changes, etc), while cash does not. However, since you're probably buying from a dealer, which is likely locally owned, I'm pretty sure they'd rather just take your cash.

My mom usually buys with cash. She'll walk in and say, "I have this much to spend in cash. I'm looking for this." Then you start negotiating. She's gotten some pretty nice deals. Maybe you should try it.

Then again, I could be wrong. Who knows

[Nick Pimpin]

I had a similar situation. Two weekends ago, I went to look for a Ninja 250. MSRP was $2999.99 for the last 2007 they had, which automatically is $500 cheaper than the 2008 model.

So I went with the 2007, was paying with cold hard cash and started negotiating. I got them down to $2521 on the bike price. I was pretty happy with myself, THEN I got to the "deal room" aka financing room. First I had to deny all the mandatory "Do you want LoJack, do you want an extended warranty, do you want a service warranty, do you want GAP insurance" crap. They actually asked me if I wanted GAP insurance. HELLO "exceptional people", I AM PAYING CASH... lol.

Anyhow, after I got thru that I took a look at the contract. They were going to charge me $681 in freight, and $225 in dealer prep!! I was irate that they would try to screw me over like that. I got up to leave, then the guy told me he could do better and took the freight down to $350 and the dealer prep down to $125. It still seemed higher than I wanted, but not exorbitant like it was.

So that's where it ended up... does anybody know what an honest rate is for dealer prep and freight is? I presume dealerships probably rob people all the time when it comes to those items.

[Brackstone]

that's not always correct.

True the Ducati dealership I went too said it makes no difference to them. However with Kawasaki this is a fact.

[koji52]

that's not always correct.

True the Ducati dealership I went too said it makes no difference to them. However with Kawasaki this is a fact.

What is fact with Kawasaki? And what makes no difference to Ducati?

[Brackstone]

that's not always correct.

True the Ducati dealership I went too said it makes no difference to them. However with Kawasaki this is a fact.

What is fact with Kawasaki? And what makes no difference to Ducati?

The Kawasaki dealership I went too would only offer me a deal on the ninja if I financed. However the ducati dealership told me finance or pay cash they don't care.

[koji52]

I'm sure any deal you may have gotten on the purchase price at kawasaki was outweighed by interest expense, finance charge, etc. Somehow, the dealer made money on the deal. True, I did not take into account incentives that dealers may recieve from financing companies. But generally, cash now is better than cash later, thus purchasing with cash is generally preferred by dealers.

[TrueFaith]

I'm sure any deal you may have gotten on the purchase price at kawasaki was outweighed by interest expense, finance charge, etc. Somehow, the dealer made money on the deal. True, I did not take into account incentives that dealers may recieve from financing companies. But generally, cash now is better than cash later, thus purchasing with cash is generally preferred by dealers.

Sorry, but I don't think that is true at all, even in our depressed economy. Financing a bike or car will always be preferrable to a dealer. They don't worry for one second about weather you will default on the loan. That's the financing institutions problem, not theirs. Financing of motor vehicles has always been and will always be one of the main things that keeps most dealerships in business. Cars especially are not selling anywhere near as well as they were at this time last year, so you will see more and more "attractive" financing offers on new cars so dealerships can stay afloat. This is not a cash economy and has not been for some time. A dealer knows he will make out better on the sale if you finance your vehicle through him. No dealer is happy to see a cash customer. Today's economy is all about a good credit rating, not weather you actually have the cash to back it up.