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Discussion Starter #1
Thought this information might be useful? I realize that no one is getting great deals on the Pilot now, and some are even paying a premium price, but down the road this might come in handy, so I thought I would post it now, before I lose it...

LX
MSRP - $26,900
INVOICE - $24,203.25

EX
MSRP - $29,270
INOVICE - $26,333.02

EX-L
MSRP - $30,520
INVOICE - $27,456.31

EX-L RES
MSRP - $32,020
INVOICE - 28,804.26

EX-L NAVI
MSRP - $32,520
INVOICE - $29,253.58

Don't forget to add another $460 for Destination/Handling. I think I read somewhere that Honda expects around 70% of its sales to be on the EX model. Also there is usually something like a 3% dealer holdback that the dealer gets from Honda for selling the vehicle. I believe it is based on the MSRP, but I'm not sure if they are getting holdbacks on the Pilot or not?
 

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Holdback & overall profit

Of course they get holdback!

The holdback is the incentive the factory give to dealers when the vehicle is sold fast.

This is the factory's enticement for the dealer to put cars on the lot and move 'em out. (The factory expects payment upon delivery to DEALER not consumer)

The amount of the holdpack payment typically falls to half after 45 days and goes to zero after 90. Thus, unsold cars cost the dealer money.

Dealerships pretty much NEVER will negotiate into their "holdback" but as cars get 'stale' the new cars sales manager will instruct the sales staff to "MOVE THE STALE ONES PRONTO" and work harder to deal on those.

It will be a long while before that happens with Pilots.

The gap between MSRP & Invoice is generally all open to negotiation. It seems far too few folks are interested in negoitiating. I guess they fail to realize the factory ALWAYS catches up with demand! As you can see that leaves about $2000- 2700 of room. It just kills me when some dealer says they HAVE to charge over MSRP 'cause they aren't making money on 'em otherwise. HAHAHA.

It also is useful to remember there are LOTS of other areas for profit. Typically finance companies will give 'spiffs' to dealers for steering them customers. The parts & accessory sheet is big ol' profit center. There are third parties (ADP) who will pay dealers for "buyer information". All KINDS of goodies!

That said, running a dealership is not a license to print money. You are at the mercy of the manufacturer. If they build a crummy product and/or do a bad job marketing product you suffer (ask an Olds dealer). The cost of land is high in good areas, and there are restrictions on everything from lighting to sound to ad flags. You need salaried staff to deal with that. There are alot of opportunies for employees to get their "hand in the till" as the volume of transactions increases. Goofy business expenses come at inoportune times-- somebody slips on an icey parking lot and files a claim at the time your business is slowest.

I know three families in the new car business (all GM stores). You don't have to feel sorry for 'em, as they all do OK, but it is not a piece of cake.

And just to clarify, anybody who blindly pays the "FIRM PRICE" over MSRP is indeed lazy and/or not very bright.

Sorry about the length...
 

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For everyone's enlightenment

--------------------------------------------------------------------------------

Honda Attacks Another Key Market Segment

by Bill Visnic

Ward's Auto World, Jul 1, 2002


Anatomy of auto makers heading in different directions: Honda Motor Co. Ltd. introduced the '03 Pilot, its first-ever Honda-badged midsize SUV on June 3. In the first full year of production, Honda plans to sell 80,000 units of the around-$30,000 competitor for the industry standard Ford Motor Co. Explorer and recently reinvigorated General Motors Corp. stalwart for the segment, the Chevrolet TrailBlazer.

The next day, GM — basking of late in congratulatory press about its robust truck/SUV sales — sweetened by $750 an already handsome incentive “package” available for the TrailBlazer, an all-new model that's barely been in the market a year.

And by the Pilot's on-sale date, Ford had for months been eating a $1,500 rebate to move the once-unassailable Explorer — this latest '02 model recently was redesigned like the TrailBlazer, only including a costly independent rear suspension in the vain quest for refinement of its truck-based underpinnings.

After driving the Pilot on the road and in some manmade trials that prove the Pilot the approximate off-road equal of its truck-framed competitors, rest assured there won't be incentives on Pilot in its first year. It pummels the rude and rickety Explorer in any comparison you'd care to make, and although it concedes certain points to the TrailBlazer, the Pilot's embarrassingly better-assembled, exhibits superior-grade interior materials and design and presents an overall look and feel of craftsmanship the Chevrolet can't match.

The final nail: The Pilot's cheaper.

Then again, that's essentially been Honda's winning formula from day one. First it was midsize cars. Then it was minivans. Now Honda's introducing a remarkable new competitor in yet another segment dominated by the domestics. And once again, the domestic auto makers' best-selling efforts are immediately outclassed.

Wearing their least-confrontational personas, Honda officials are quick to say they don't believe Pilot will cut into Explorer or TrailBlazer sales.

Dan Bonawitz, American Honda Motor Co. Inc.'s vice president-corporate planning and logistics (and the kind of tuned-in “car guy” the domestics desperately need), says, “While we may be able to take a few sales from these well-entrenched nameplates, our primary focus will be on import-brand customers and particularly our current owners and Honda loyalists.”

Those are nice, non-fightin' words, but if you believe the Pilot's presence has no impact on the domestics' position in the midsize SUV segment, then you probably believe Taurus still is the country's best-selling car. A look at the charts on page 52 shows that domestic share in the midsize SUV segment is dropping steadily and the Explorer — even though it still sells in excess of 300,000 units — just isn't the market juggernaut it used to be.

Although Bonawitz diplomatically avoids saying the Pilot will trounce Explorer if there's even a hint of comparison shopping, at the same time he can't resist invoking the specter of Odyssey, which sent DaimlerChrysler Corp.'s minivan developers and marketers crying for their mamas and sullied DC's 15-year reputation as the maker of the world's most-desirable minivans:

“Like the Odyssey before it, we believe the Pilot will set a new standard for vehicles in the segment.”

Okay, one seasoned journalist surveyed the multitude of cupholders and the ketchup-package holder in the Pilot EX's rear-seat center console and summated: “Four-wheel drive Odyssey.”

That's more than a little true, of course, because the Pilot, like the Acura MDX that came before it, borrows heavily from the Odyssey minivan chassis. But there's a beefy boxed perimeter for the unibody that says this thing can handle the medium-duty trails from various U.S. off-road parks in which it was developed. Moreover, the Odyssey remains the best minivan on the Earth, so you could do worse for inspiration.

The Pilot's minivan genetic code means you're awarded the segment's most interior cargo volume: 90.3 cu. ft. (2,557L) vs. 81.3 (2,302L) for Explorer and 80.1 (2,268L) for TrailBlazer. Toyota Motor Corp.'s Highlander, also a player but one that doesn't offer as much ruggedness potential, rings in with 81.4 cu. ft. (2,305L).

Pilot's two rear seat rows fold flat into the floor — following the slickest formula we've yet seen to do so — and the cargo bay that awaits gobbles the vaunted 4X8 sheet of building material. Forget that trick with any competitor.

Yet the Pilot manages to look, well, manageable, thanks to a length that's shorter than Explorer and TrailBlazer. Width is Pilot's trump card, where it beats everything in the class and affords a real Barcalounger feel — at least to the first two rows; Honda admits the third-row, belted for three, “was optimized for children.”

Front and rear independent suspensions each enjoy subframe mounting, and rack-and-pinion handles the steering, meaning Pilot's not a handful to corner. Ground clearance is a respectable 8 ins. (20 cm) and the only wheel/tire package is a decent 235/70-16. Acura's MDX handles more assertively largely thanks to its 17-in. rubber, but Pilot's no pig — it just understeers more than you'd prefer, at least until you remember the size of the box you're driving.

Pilot's sizeable, yes, but doesn't “drive” heavy like so many body-on-frame SUVs. Honda brags that at 4,439 lbs. (2,014 kg), Pilot is the lightest 8-passenger SUV in the market. The comparatively low mass yields best-in-class acceleration and passing performance, according to Honda's claims — surpassing even the TrailBlazer and its superb 4.2L DOHC I-6, an engine the Pilot's chief powertrain engineer openly admires.

Pilot's powerplant hardly is a slacker, being almost directly carried over from the high-falutin' MDX. The 3.5L DOHC V-6 is enhanced by Honda's VTEC variable valve timing and lift and its 240 hp is as stout as anything in the class except for the TrailBlazer's above-mentioned mill, which needs another half-liter of displacement to beat the Pilot by 30 horses. And Honda's large V-6 appears up to the duty cycle the company's researchers say should be typical. Buyers of midsize SUVs seldom tow anything, so Pilot's basic 3,500-lb. (1,588-kg) tow rating is up to the job.

Pilot is slightly more frugal than its midsize SUV playmates: 17 mpg (13.8L/100 km) in the city and 22 mpg (10.7L/100 km) on the highway. Our experience with Hondas often proves the opposite of most “official” mileage ratings: You actually might do better.

The VTEC V-6 is backed by the standard fitment of a buttery 5-speed automatic and Honda's neat-and-easy VTM-4 all-wheel-drive system. VTM-4, made by BorgWarner Inc., doesn't have a low- range transfer case or any of that lever-throwing off-road stuff, acting, as it does most of the time, like a front-drive-only layout, with the rear wheels taking torque only when a front wheel begins to slip.

Inside, the Pilot reflects its somewhat staid sheetmetal: everything's solidly crafted and assembled, material choice befits the sticker (can't say that for the Explorer or the TrailBlazer), and everything's sensibly arranged in that voluminous interior, plus the bonus of plenty of well-developed nifty mini-features. If you need a thousand idiotic little switches and automatic foot-warming floormats, look elsewhere.

There's the Honda-typical trim choice of LX ($26,900) or EX ($29,270), and you have to plump for the EX to get any of the three major options of leather ($1,250 added to the EX), DVD rear entertainment system (add $1,500 to the EX with leather) and DVD-based navigation (add an ambitious $2,000 to the EX with leather).

It seems apparent from the growth of the imports and the slide of the domestics that the Pilot's formula is the new SUV order. Buyers want refinement and good performance — both come easier when employing the car-based unibody layouts favored by the imports. It's certainly nice to have some offroad capability — and Pilot's got more than I can imagine typical suburban SUV-weenies ever testing — but vehicles like the Pilot don't hide behind the facade of Rubicon-conquering off-road prowess; they just offer what's needed to get through a bad winter with confidence.

The '03 Pilot moves the needle not because of its styling or driveline innovation or anything remotely radical. The Pilot's simply the best blend yet of the attributes “real-world” SUV buyers want from a $30,000 purchase.

Sure, there are plenty of strong-selling SUVs still running around on truck frames and solid rear axles, but Pilot's inevitable success only will underscore the futility of relying much longer on that tired formula.

SPECIFICATIONS 2003 Honda Pilot EX Vehicle type: Front-engine, all-wheel drive, 8-passenger 4-door SUV
Engine: 3.5L (3.471 cc) DOHC V-6 aluminum block/aluminum heads
Power (SAE net): 240 hp @ 5,400 rpm
Torque: 242 lb.-ft. (328 Nm) @ 4,500 rpm
Compression ratio: 10:1
Bore X stroke: 89 mm × 93 mm
Transmission: 5-speed automatic
Wheelbase: 106.3 ins. (270 cm)
Overall length: 188 ins. (478 cm)
Overall width: 77.3 ins. (196 cm)
Overall height: 70.6 ins. (179 cm)
Curb weight: 4,439 lbs. (2,014 kg)
Market competition: Chevrolet TrailBlazer; Ford Explorer; Jeep Grand Cherokee; Toyota Highlander



© 2002, PRIMEDIA Business Magazines & Media Inc. All rights reserved. This article is protected by United States copyright and other intellectual property laws and may not be reproduced, rewritten, distributed, redisseminated, transmitted, displayed, published or broadcast, directly or indirectly, in any medium without the prior written permission of PRIMEDIA Business Corp.
 

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Discussion Starter #4
Sorry to get you all wound up like that renov8r!

Thanks for all the info. I had heard bits and pieces of what you describe before, but not everything you mentioned. I'll file that info. away and I'm sure that will come in handy the next time I get to negotiate for a car that's open to negotiation...

Ha, ha, ha...
 

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RE HOLDBACK AND OVERALL PROFIT

Does anyone know what dealer holdback is on a Pilot? I saw somehwere else on the web that made me thinka all honda Vehicles where at 3% but an ealrier post here with the same title implies that maybe this slides depending on length of time on the lot?...Also does something called a speacial dealer incentive come into play and are there typical Dealer incentives that honda gives and when and why would they give them?
 

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This is more of a prediction than a question, but when do you guys think there will be more opportunities to negotiate below MSRP. I figure at least not until after the new year. Just wondering. :confused:
 

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I am just a junior copmpared to alot of seniors here but In my opinion the main factors will be your geographic location, how the economy goes from here, and when the new plant is done... i think within a couple of years. Also considering what dealers told me around here that they still have a hard time getting the Minivan Odessy-spelled wrong i know but it was introduced in 1998!. It seems that Honda is either very good at manipulating the supply and demand(price driver) or they just need to get more aggressive on taking over the market like they have done with Accord, last I heard they where cranking out well over 30000 accords a month but I think current production capacity is maxed out at 8-10,000 Pilots, these are just guestimates based on stuff I have seen and subject to my poor memory!:eek:
 
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