You most likely are familiar with the most obvious sales sweeteners or “spiffs” that dealers and manufactures use to clear their lots – cash giveaways, cheap financing, gas cards, and so on.

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You’re probably unaware of dealer spiffs. The simplest are quotas that stipulate how many vehicles a dealer should sell in a given period. Hit the target and the carmaker cuts a bonus cheque.

“A $2,000 per vehicle incentive for selling 100 vehicles represents a $200,000 incentive. They are often structured as an all or nothing incentive (sic) so there is considerable motivation to meet the sales quota,” notes auto analyst Dennis DesRosiers of DesRosiers Automotive Consultants in a note to clients.

That’s why certain car shoppers sometimes find themselves being offered an unbelievable deal. The dealer is looking to hit that quota and earn the factory bonus.

“As dealers get closer and closer to hitting their sales quota, they are motivated to cut prices and even use some of their own money to encourage a consumer to buy the vehicle,” notes DesRosiers.

But shoppers should be alert to how dealers can “game” the system.

“It is common, for instance, for a dealer to buy the last few vehicles themselves if they are close to the total and then sell them in the following period,” notes DesRosiers.

Buyers should know whether they are getting a brand new vehicle, or a used one first bought by the dealer.

Why? As DesRosiers concludes, “warranties start when a vehicle is bought by the dealer and the vehicle may not be sold to a consumer for weeks, thus short-changing consumers on some warranty coverage.”

If the deal seems too good to be true, you could be buying a used car, not a new one.