Out of the many deals being advertised on new car prices , one of the most intriguing is employee pricing. Chrysler, Ford, and GM have been running ads for employee pricing on the many of their 2008 and 2009 vehicles, offering the same prices that company employee’s pay for vehicles to everyone. Employees usually pay 2-3% less than the dealer’s invoice price for a new car and can apply any applicable rebates or dealer incentives
to that price as well.
Employee pricing sets a fixed, no-haggle price tag on a vehicle that is below the dealer’s invoice price. In exchange for setting such a low price on the vehicles, Chrysler, Ford and GM have reduced the size of the rebates and incentives available on most models, and have boosted the dealer holdback a couple of percentage points to help the dealership recover the lost profits. The end result is that employee pricing is a great marketing strategy, but the actual transaction price of the vehicle isn’t that much different from before. Smart negotiators could get a similar deal. By setting a low fixed price below dealer invoice and making available rebate values known to the customer, Chrysler, Ford, and General Motors have transformed their dealerships into no-haggle car lots.
The advantage to the consumer is in getting that price without having to spend time negotiating with different dealerships. The price of the vehicle is the same no matter what dealership you choose. All you need to do is get a good price on your trade-in, sign on the dotted line, and drive your new car home.
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