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Bargaining
for a New Car... Page 2
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Your goal here is to learn how to deal with the toughest:
- The first rule is to travel in twos. You're much less likely to succumb to sales
pressure if you have a spouse or friend with you.
- The next rule is simple, too. Buy near the end of the month. Both salespeople and
dealers have quotas. Although every deadline isn't at the end of the month, many are.
- Watch for the dealer's add-ons. Many of them are extremely profitable for the dealer.
Don't be pressured into sealant packages and other high margin options. If you want an
alarm or special sound system get competitive prices before you talk to the dealer.
- Also watch for duplicate charges. For instance, the invoice price should include
freight. Make sure that it doesn't show up twice.
- Take a test drive in the car that you're considering. Quality has improved, but you
still might find that there's something wrong or the equipment isn't exactly what you
expected.
- Start your negotiations at the invoice price, not with the sticker. Increase your offer
in small increments. A couple of hundred dollars is often enough to keep things moving.
- Use newspaper ads to encourage competition among dealers. Always plan on visiting more
than one dealer. Even if the specific make and model you want is only offered by one
dealer in your area you can still set up competition. Just select a similar model from
another manufacturer and use the competing car to get the price of your favored model
down.
- Remember, you can negotiate anything. Don't believe that they won't or can't budge on
any particular item.
Don't stay too long in the dealership. Tell the salesman that you only have one hour.
After it's up, excuse yourself and leave. You can always resume negotiations where you
left off the next day. The fact that you're willing to leave will help get the salesperson
to their lowest price more quickly. Some dealers will even offer to let you take a car
home overnight. They want you to fall in love with the car and to stop shopping. Don't do
it.
The Price
How do you know when the dealer is really at the rock bottom price? Generally, if you can
stay close to invoice you'll be doing well. If you can get the bargaining down to a $50
difference on a $15,000 car, you're doing a good job.
Trade-Ins
Once you know what you'll pay for the new car, it's time to talk trade-in. Don't discuss
it until now. During your research you should have checked the value of your car. Kelley
Blue Book ( kelleybluebook.com) or NADA (nada.com) will
provide the necessary information on your vehicle. Remember. The dealer's goal is to make
money on both cars. Your goal is to minimize that.
If your trade-in is fairly new, it's worthwhile to wash and wax the old cruiser. Dealers
claim to be smart in buying cars, but there's still something helpful about making a good
first impression.
Consider taxes before deciding whether to trade-in or sell your car. In most states the
amount subject to sales tax is the price of the new car minus your trade-in allowance.
With sales tax running 6% in some areas a $10,000 trade-in could save $600 in taxes.
Dealer Trouble
If you should have trouble, the Federal Trade Commission may be able to help. You can
contact their Consumer Response Center at 1-877-FTC-HELP. You might also want to check
with your States' Attorney. Many states have laws to protect new car buyers.
Remember, your car is normally the second most expensive item that you own. This is one
purchase where extra time and effort pays big dividends.
Good Luck!
Gary Foreman edits The
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