Unlike customer rebates and incentives, dealer cash or factory to dealer incentives are only available to the car dealer for use in marketing their new cars to the consumer. These incentives are not normally advertised to the outside public, and sometimes even the salespeople employed at the dealership will not be aware they’re available.
Example: A dealer must sell 45 Chevrolet Camaro’s in April to earn an additional $500 per car.
Factory-to-dealer incentives are paid directly to the dealer once the vehicle is sold. Normally these types of incentives are paid on a monthly or even quarterly basis. When it comes down to selling a car, most dealers will negotiate or even give up a factory-to-dealer incentive to keep you from buying a new car from their competition. A dealer may take a $2,000 net loss to sell that 45th Camaro to gain $22,500 in bonus money from the manufacturer.
Manufacturers will run these programs at different times of the year. If you don’t research this information upfront or ask about these programs at the time of purchase. Most dealers will not come right out and offer them to you. Before you contact a dealership you will want to do a little research to determine if the car you’re looking at has any rebates or incentives available.
Customer rebates and factory incentives vary by manufacturer and type of vehicle. Popular or high-demand vehicles are less likely to have any type of rebate or incentive available.
I’ve had readers tell me they’ve inquired about dealer incentives with a dealership and the sales managers were unaware of the incentive and had to look up the information themselves to see if it was true.
It is ultimately up to the dealer if they will negotiate any or all of this money, some will and some won’t. If you run across a dealer that will not negotiate it, just move on to the next one.