Dealers get the deposit for two reasons. First is that every tire kicker would order a car if there were no deposit. A large majority of the population does not have an extra $5K to let someone hold on to for three months.

Second is to create an emotional attachment. It is a soft close. If you are willing to hand over $5K it is likely you are going to take delivery of the car when it arrives.

 

BTW there could be a waiver construed in the document from the dealer above, but it would never hold up in court. There are no damages in them flooring the car until is sells unless, per the above example, you ordered wild colors like hot pink with green interior.

 

OK, you've convinced me to order my next car from a California dealer.
In fact, I will order one from every dealer in town and give each a
$ 1000 deposit.
When the first car arrives, I'll take it for a test drive and offer the dealer $5000 below the agreed to price or I won't take the car.
(I will make sure he is aware that I have a few more cars about to arrive)

If he does not agree, I get my deposit back and tell him to go screw.
Then I'll make the same offer to the next guy .........etc.

Eventually I'll buy it from the guy who gives me the best deal and get my deposits back from the other schmucks.

Sounds too good to be true , but what do I know .
Only in California . Lol

 

A deposit is not necessarily always refundable in California. There are new "cooling-off period" laws in place, effective July 2006.

This link might shed more light on the topic, good luck~!
http://www.dca.ca.gov/pubs/car_buyer_rights.htm

 

The cooling off period only applys to used car sales where a 2 cancellation option contract is purchased. There is no change in the rules around a deposit on an ordered car.

 

I've learned in my buying process that if you are in an area with several dealers, the best thing is to negotiate with their current inventory of cars. They want to move out the excisting to make space for 07's. It's easier to get a discount on a existing than an ordered. Also, depends on what you order. I tried playing hard ball with my C4S, but I realized that the dealer was only going to receive 2 the month I wanted to purchase...laws of supply vs demand apply. They were willing to not give me the 5K of the car in hopes that a walk in would pay full price. I ended up only getting approx $3,500 off the msrp.