Dealers don’t make much on new cars anyway but they do get bonus’s for hitting targets. Also they’ll make money on finance, Gap, Tyre/Wheel insurance and Ceraminc coatings etc. Most new cars at the mo are in short supply due to chip and wiring loom shortages so I’m guessing if the are genuinely new then likely to be least desirable models.

Indeed - it's rather like cinemas that make more money on selling sweets, food and rink than tickets and, at least up until 6 months ago, supermarkets often used fuel sales as a loss leader to entice people into the store.

I suspect that thes sales people saying they are 'cost price' is really a cost to them, then they sell all the add-ons you speak of and also add back a bonus for sales over a certain threshold.

My dad bought a 08 plate (run-out, near base model) Fiesta for probably near cost price back in 2008...for about £6200. Given the current prices of the latest version that seems a world away, as does me buying a Mazda3 1.6 petrol TS2 for £10.3k 18 months earlier.

It'll be 'interesting' to say the least whether car manufacturers/dealerships will (or even be able to) reduce prices when the inevitable big recession comes in a few months time. Stagflation doesn't give much room for maneuvre, but not selling cars at all won't do them any good. Maybe we'll go back to the 'base model' approach...

You should judge the deal on whether it is the car you want at the price you are happy with.

No-one saves money by spending more on something they may not need just because it seems discounted.

As other posters have noted the invoiced price is only one element - bonuses, finance deals, paint protection, service schemes etc etc are other ways they make their money.

Even if genuine the dealer's invoice cost does not include various non-optional charges such as delivery (to the dealer), pre-delivery preparation, their time registering and taxing the car, etc. In the UK all of that is usually added in when quoting the manufacturer's retail price. The only price which matters is what they want "on the road". You can bet that will be a lot more than "invoice + £1" even if you avoid their efforts to sell you optional extras.

Edited by misar on 02/09/2022 at 21:26