Quote:
Originally Posted by biker1
Great advice. I essentially do this but in a slightly different manner. I pick out the model I want before ever visiting the dealerships. I research holdbacks, dealer incentives, etc. off the Manufacturers List price. I try to get a good fix on what the minimum price they will sell the car for. I also research the best price possible for my tradein (if I have one). I then compute sales tax on the net price difference, add in license plate fees, throw them a $200 bone for "document preparation", and give them the bottom line, out the door price (i.e. the size of the check I am going to write). I entertain no other fees/addons. I only visit dealerships that have several of the exact car I want (you can check inventories on the internet). I won't even look at the car (or drive it) until they agree on the price. This saves time. After the price is agreed on, I will then pick the exact color I want (from their inventory) and test drive it. If there are no issues, I write the check. This is not the way they like to operate. I explain my "process" to them and ask if they can work in this manner.
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Before reading on, please note that I LOVE to negotiate buying cars and if you don't like to negotiate, you might look for a no negotiating dealership, but either way you need to do the pre-work that biker1 recommended. You might also check with your credit union (if you are a member) to see what arrangements they have for cost over dealer invoice-they might offer for a small fee a printout of the dealership invoice which is always good to have.
You should note that NO ONE at the dealership (save the dealership owner), not even the General Manager knows the bottom line cost of a car at the time it is sold since the owner of the dealership gets "incentives" (read kickbacks) from the car company based upon sales volumes for the year. Your target should be $100-$300 over DEALER invoice, not to negotiate down from the Manufacturer's suggested invoice. The earlier in the model year and the choice of cars and the options (e.g. is it a hot model or a slow seller) will impact the negotiation. If it is the end of the model year and you are willing to take what is on the lot or something they can trade for from another dealer, you will get the best overall deal with not too much negotiating. If you really want to have fun, ask the sales person, "What are YOU going to do to convince me to buy this car today?" (but only if you are serious about buying the car that day and if you did your homework and know your pricing which you should). Remember that the sales person has a goal to make friends with you in order to facilitate the deal and they bring in someone else (this is the "finance" person) to close the deal and to try and cross sell you the underbody coating and other extras that are pure profit for them. DO find out what loan options they offer and compare to what you already have in hand (or should have in hand). Do NOT fall in love with a car, be willing to walk out. You want their best price while you are at the dealership-this should be the same price if you go back next week, not a today only price. However, if you know your pricing, if they land in the "zone" you want, and you like the dealership, buy the car-you don't need to wait. If they want to let me drive away and call me to come back to the dealership, I might go back (are there other dealers I plan to visit or is the last dealership that I am checking) but then I knock money off of the last agreed upon price since they wasted my time and my "transportation costs". Even if it is $25, make them pay for your time/effort to return since they turned you away initially, probably hoping that you would be in love with the car, relent and take their deal.
I also never agree to THEIR documentation fees and if they tell me it is a law that they do it, I won't necessarily abort the deal if I have the best overall price, but will put them on the spot to show me. I KNOW they can't and I will knock another $25-50 or so off of the agreed (but not yet contracted) price as a penalty. When I hear something like, "are you going to let $50 prevent you from making the deal? My response is no, I am willing to pay you $xx,xxx for the car, it seems to me that you are letting $50 stop a $xx,xxx deal. Approach it for what it is, a business transaction, not new found friendships. They are trying to empty your wallet, and you are trying to give them a fair profit (the $100-$300 over dealer invoice BEFORE they get their kickbacks). I will agree to a $20 or $25 documentation fee just so that I don't need to go register the car myself, but keep in mind that they send one person over with paperwork for ALL of the cars sold, so the documentation fee is PURE profit for them.
Lastly, I advise them that there is to be no dealer "badging" on the car when I pick it up. The dealer badging constitutes free advertising for them and it is not required to be on the car no matter what they say. It is really funny when they bring up the need to cover advertising costs when you are negotiating the purchase price, and you hit them with the no badging requirement at the end (on the one hand they want you to pay for advertising and on the other, they want you to give them free advertising). If I am happy with the dealership and the service, I have no problem telling people (and I tell the dealership that), but I don't want to offer free advertising especially if I get a great deal, but have bad service.
Good pre-work, a good night's rest, a nice meal (don't go on an empty stomach) and last but not least, take your time- will all help you to negotiate the best deal. I am lucky because I also get to have fun while I am negotiating........