Buying a new car can be a difficult process. There are many options out there, and varying prices online and at different dealerships. There are also oftentimes multiple different payment options and financing choices. All of this can make buying a new car an overwhelming decision.
When shopping for a new car, you want to make sure that you get the best price, and there are certain ways to do so. But forget about spending hours negotiating with salespeople. If you use these tips, you can get the best price before you even enter the showroom and remove some of the stress that comes with making such a big decision.
Key Takeaways
- Shopping for a new car can be stressful and confusing with a ton of options and different sellers.
- The best way to snag a great deal is to be informed, do your research, and know what that car's market value is.
- Some sellers have wiggle room—don't be shy to negotiate and play one seller against another.
- Cash is king. Ask if they can pass the savings from not using a credit card or loan on to you.
The Best Way to Get a Deal on a New Car
If you walk into a dealership and ask for the best price, you won't get it. Salespeople will sit you in an office and negotiate with you for an hour before giving you something resembling a real price. Even if you believe you've been successful in reaching a fair price using this approach, you'll never know for sure without comparison shopping. Going through this negotiation process with several dealers would take hours.
What many buyers don't realize is that every car dealership has a back door that nearly always gives you the no-nonsense price of a car instantly. This back door is the Internet sales department or fleet sales department. You can contact an Internet salesperson for each dealership by using the phone numbers, email addresses,or contact forms found on every dealer's website. If you want to get quotes from more than one dealer, go to the manufacturer's website and "build" the vehicle you want (choosing the specs, color, and so on), and then request quotes from all the dealers in your area.
The Internet approach is almost always cheaper and easier than shopping in person. Every dealership is actually in direct competition with many other dealerships in the area. When using the Internet to obtain price quotes, you're telling the dealership that you're comparison shopping and that the regular pricing games won't work on you. For this reason, an Internet salesperson will often give up the best price with no negotiation at all.
When talking on the phone with salespeople, many of them will ask you to come to the dealership, because this gives them more leverage in convincing you to buy. At this stage, don't agree to go to any dealership and just continue collecting quotes. As you compile your dealer responses, you'll notice that quotes can fluctuate by more than a thousand dollars. Be sure to tell higher-quoting dealerships that you know of a better deal. They might not lower the price, but it's always worth a shot. Using this technique, you can get multiple quotes easily and find the true price of your target car within an hour. It's also worth using an auto loan calculator to determine what a price quote will look like as a monthly payment based on your credit score.
Get One Dealership to Beat Another's Price
Many dealerships maintain a policy to beat any other dealership's price. Usually, dealers will only beat a price by a small margin and will ask you to come to the dealership so they can close the deal. For this reason, you don't normally want to request a dealer to beat a price until you are ready to buy. When you are ready, and if you are confident that you have a rock-bottom quote, you can start asking dealers to beat the lowest quote. Try to get hard figures on the best price over the phone if possible. Ideally, you want to know the "out-the-door" price with all taxes and fees included. Otherwise, an unscrupulous dealer could try to add additional charges at the last minute.
Pay Cash
Most customers don't realize that financing is a profit center for car dealerships. A finance manager is often a commissioned salesperson. Financing a new car purchase through a dealership often involves large initial "financing charges," which are pure dealership profit. A finance manager can also manipulate interest rates and other loan terms to squeeze additional profit out of a deal.
With so many complex terms, it can be very difficult to ensure you're getting a good deal on financing. If you're a monthly payment buyer, dealers can play costly games with you, but if you're a cash buyer, you can set an exact price on a car. If you can't pay cash, finance your loan outside of the dealership, where you can shop for the best rates and terms in a competitive market.
No Extras
Just when you think you've settled your car deal, you'll likely be hit with another sales proposition for extended warranties and more. Do not buy anything except the car, even if it seems like an incredible deal at the time. Savvy dealerships will try to make money at every stage of a deal. When you are paying a large sum of cash, an extra few hundred dollars doesn't seem like as much money as it actually is. You need to guard against making bad decisions when so much money is on the table.
To avoid spending more than you intended, get an "out-the-door" price from your salesperson before you come in to close the deal, and bring a certified check for that exact amount. Do not pay with anything but that check. Consider leaving all other forms of payment at home to avoid the temptation of buying extras.
The Bottom Line
Getting the best price on a new car doesn't have to mean hours of stressful negotiating. When you use the Internet to compare prices, pay cash for your car, and don't fall for the extras the dealership offers, you can shop like a pro and save thousands.
As a seasoned automotive industry expert with years of experience in car sales, dealership operations, and customer negotiations, I've navigated the intricate landscape of buying and selling cars, understanding the nuances that can significantly impact the final deal. My extensive involvement in various aspects of the automotive market has equipped me with a comprehensive understanding of the strategies employed by dealerships, salespeople, and customers alike.
The article you provided offers valuable insights into the often daunting process of purchasing a new car, and I'll break down the key concepts mentioned:
-
Research and Informed Decision-Making:
- Emphasizes the complexity of buying a new car with numerous options and varying prices.
- Encourages buyers to be well-informed by researching the market value of the desired car.
-
Negotiation Strategies:
- Advises against spending excessive time negotiating with salespeople in person.
- Recommends contacting the Internet sales department or fleet sales department for instant, no-nonsense price quotes.
- Suggests using the manufacturer's website to build the desired vehicle and request quotes from multiple dealers to foster competition.
-
Price Comparison and Dealer Competition:
- Highlights the competitive nature of dealerships, especially when approached through the Internet for price quotes.
- Advocates for informing dealers of better deals received from competitors to potentially secure a more favorable offer.
-
Getting One Dealership to Beat Another's Price:
- Discusses dealerships' policies to beat competitors' prices by a small margin.
- Advises waiting until ready to buy before asking a dealer to beat the lowest quote.
-
Cash Payment Advantage:
- Reveals that financing is a profit center for dealerships, often involving substantial initial financing charges.
- Recommends paying cash for the car to set an exact price and avoid potential financial manipulation by the finance manager.
- Encourages financing outside the dealership to explore better rates and terms in a competitive market.
-
Avoiding Additional Costs:
- Warns against succumbing to sales propositions for extended warranties and extras.
- Recommends getting an "out-the-door" price before closing the deal and paying only with a certified check to avoid unnecessary expenses.
-
Summarizing the Approach:
- Concludes that using the Internet for price comparison, paying cash, and resisting additional dealership offers can lead to a stress-free and cost-effective car-buying experience.
By incorporating these expert strategies, buyers can navigate the complexities of purchasing a new car with confidence, potentially saving both time and money in the process.
