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The dealer cost is called holdback. Holdback is not enough for a dealer to stay in business if they sell every car at that cost. Now that you bring it up, I'm sure a bunch of armchair economists will join the thread and tell us all how they'll make money on volume, but cars aren't sold in bulk. They are all sold to dealers at the same price with small fluctuations and special incentives to high-volume dealers.
In any case, I talk about invoice because that's where most people can get a deal. After 3 hours of negotiating a deal, most people don't try to hold out for holdback. If I were selling you the car, I'd get rid of you and take another customer. Not as many people negotiate as you think, and losing a non-profitable deal just to sell a car sounds like a load of garbage to me. Asking for something they reasonably can do most of the time is something that I can endorse when giving negotiation advice.
All of that being said, try asking for holdback. They'll "see what we can do" or they'll just tell you that's not possible. After visiting with their manager, they'll reach holdback with incentives and offer you a car at holdback, but it's not really holdback because they're using specials to get there, and you don't get to take those discounts from holdback. If it were up to me, I'd add all available incentives to holdback and then use that price as a discussion point and then claim you were getting my fake holdback or incentives, whichever is more profitable for me.
Remember, car sales are not about customer service. That's what GM provides with a warranty and service departments provide with maintenance. Sales is about production. They move volume and make gross sales. Those are the metrics that really matter. Sure, there are surveys, and good surveys mean more dealer money, but the business isn't about making people happy. If it were, then every car would be free. When was the last time you got a free car?
As a final note on this post, these sales guys might be the scum of the Earth in your opinion, but they have families to feed and work more hours than a good number of you to feed them. Each commission they earn has to make up for the hours of waiting for a customer to show up when they're making nothing. Keep that in mind the next time you're trying to play hardball with the dealer for a sub-invoice deal. Most dealers have a program called a mini-deal. The mini-deal is the minimum amount a salesperson makes on a car, and I've seen as low as $50 when a car sells for a loss. The average sale takes 3 hours, and that $50 may be all they make for a few days.
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