Jump to content

OT: Need advice for haggling w/car dealers...


L-1329

Recommended Posts

  • Members

So would this be a good strategy? Take the difference of the MSRP and the dealer invoice and split the difference. Then subtract the holdback and the manufacturer rebate. Make that my offer for the new car. Then state what I would take in the trades. Offer the cars and the difference in cash, plus tax and nothing else. This I could write up in a letter/spreadsheet easily enough.

 

BTW I am liking the idea of putting them on the time clock, and I think I'm going to use that. Today I went to the dealerships in uniform since my trip cancelled and I was already out. I could do that again and say that I'm leaving in 20 minutes for a flight, so let's get on with it. :cool:

Link to comment
Share on other sites

  • Members

 

So would this be a good strategy? Take the difference of the MSRP and the dealer invoice and split the difference. Then subtract the holdback and the manufacturer rebate. Make that my offer for the new car. Then state what I would take in the trades. Offer the cars and the difference in cash, plus tax and nothing else. This I could write up in a letter/spreadsheet easily enough.

 

Do yourself a favor and try the email quotes. It can save you a ton of time and you may find that dealers are willing to let your ideal car go for less than you're willing to spend.

Link to comment
Share on other sites

  • Members

It's been a long time since I bought a car, but it's finally time to retire the fleet and get a new rig pig. For those of you in the know, is there much benefit in trading in two cars to purchase another at a dealership? One of my cars is worth almost nothing, probably $500 -$800 tops, the other should retail around $7000 to $10000 tops. Does the dealer come out ahead with two, even though one is a beater?


Secondly, any advice on price negotiating is appreciated. I have no problem finding a fair value for the new vehicle, but dealing to get the best trade-in value is something I could use some insight on. Thanks!
:cool:

 

My best advice is that Cash talks bull{censored} walks

if you want to haggle play SHOW ME THE MONEY! otherwise make easy monthly installments like the other 90% of Americans

 

EDIT: oh and deal with a high volume dealer in a state like Georgia or tennessee where the cost of living rate is lower.

Link to comment
Share on other sites

  • Members

 

Do yourself a favor and try the email quotes. It can save you a ton of time and you may find that dealers are willing to let your ideal car go for less than you're willing to spend.

 

 

 

That's a good idea, I will check into it. Question though, they can't quote a deal including trade in's by email, or can they? I can see a quote for just a new vehicle, but how would I incorporate the trades into that without taking them down to the dealership?

Link to comment
Share on other sites

  • Members

 

That's a good idea, I will check into it. Question though, they can't quote a deal including trade in's by email, or can they? I can see a quote for just a new vehicle, but how would I incorporate the trades into that without taking them down to the dealership?

 

Trade in's are a different part of the transaction and should be negotiated separately. The price at which they're willing to sell you the car has absolutely nothing to do with what they'll pay for your trade-in's. First, get your price. Then, and only then, negotiate the trade-in's. That being said, no. they won't be able to quote what they'll pay for your cars. They'll need to check them out first.

Link to comment
Share on other sites

  • Members

 

Trade in's are a different part of the transaction and should be negotiated separately. The price at which they're willing to sell you the car has absolutely nothing to do with what they'll pay for your trade-in's. First, get your price. Then, and only then, negotiate the trade-in's. That being said, no. they won't be able to quote what they'll pay for your cars. They'll need to check them out first.

 

 

The trade-ins are part of the same deal. If they are not going to make a cent on your trade in values, then they need to keep some of the new vehicle profit margin. Likewise, if they have a healthy $ on your trades, then they'll low-ball the new car price.

Link to comment
Share on other sites

  • Members

 

The trade-ins are part of the same deal. If they are not going to make a cent on your trade in values, then they need to keep some of the new vehicle profit margin. Likewise, if they have a healthy $ on your trades, then they'll low-ball the new car price.

 

A buddy of mine and I used to have fun trying to see who could get the best deal on a given car. We were both waiters at the same restaurant and one of would call the other every now and then in the morning and pick out a particular car. We'd then both go out and see who could get the best deal by the time our shifts started. I learned a lot doing that and wound up using every tactic that I could think of to beat him. I read books, talked to buddies who were and used to be car salesmen and looked at every website that I could. In the end, I was never able to lower the price of a vehicle with a trade in. If I ever heard, "what if I could give you X more on your trade in to meet your price?", I knew that there was more room to negotiate and I did everything that I could do to take full advantage of that. Based on my experience, I think that the dealer would like you to think that trade-in's and financing are part of the OTD price, I've never found it to be true though. Trade-in's are considered a down payment on the car, not a reduction of the total purchase price.

Link to comment
Share on other sites

  • Members

 

so we can do this deal inside of an hour. Oh, and leave me your 4-square."


I filled out his 4-square (the sales qualification form/commitment that sets the preliminary deal for negotiating) in fromnt of all 3 of them. I filled it out with the buy price being invoice less 4%, the trade at NADA trade in, the financing at 2.9 (based on the then market at 6%) and put my payments at a round dollar amount that works arithmatically.


I explaind during the process that the car was at invoice, let them have any holdback outside of the 4% (because they were obviously overstocked and so were the compitition), offered my trade in agains what Carmax would give and stillallowing them 35% markup on the used lot and then had said that the financing is based on my Credit Union rate (utter BS). I then signed the bottom stating that "if all terms are agreeable, I will buy today" to show my commitment to closign the sale.


they were impressed and were pretty close to a deal when the alarm went off on the cellphone. I grabbed the kids, shook hands and told the salesguy that he had my number. my end is satisfied, once yours is to the deal on paper, tell me when to come for my car.


the deal came in $25/mo under my agressive dollar goal (which was already way too low), was at 3.9% (against best deals at that time of 6%) and the rest was as perscribed - it took 'em 3 days of "still workin, we'll let you know", but in the end, we got a screaming deal on our CRV and it only took 1 hour on the front side, 1.5 on the back to get the make-ready together, sign the papers and to have the "new car launch".


Essentially, I had a 1 year old used CRV that was my benchmark that I was attempting to match in the deal on a new car - Like I said, I was $1500 below that.


that's the way I do it,m but I am a professional salesperson/negotiator so I expect not everyone has the moxie I do. That's why I do what I do as well as I do.

 

 

What do you mean when you say "holdback" here?

Link to comment
Share on other sites

  • Members

 

What do you mean when you say "holdback" here?

 

 

http://www.edmunds.com/advice/incentives/holdback/index.html

 

the only caveat I would say is that holdback and other backend incentives are variable due to market conditions and stocking conditions (eg: Ford Excursions when gas was $3.50/gal - dealers could not give them away and there was more in the supplychain, so Ford upped the incentives to move the full-supply line inventory).

 

Bascially, invoice means close to nothing in the real sense of the word. I always say that there is plenty of money being made at this dealership, and my car is one of the ones you need to get rid of, we're helping each other. you keep the additional back ends that I dont know about and I'll drive off happy; sounds fair to me..

Link to comment
Share on other sites

  • Members

It's been a long time since I bought a car, but it's finally time to retire the fleet and get a new rig pig. For those of you in the know, is there much benefit in trading in two cars to purchase another at a dealership? One of my cars is worth almost nothing, probably $500 -$800 tops, the other should retail around $7000 to $10000 tops. Does the dealer come out ahead with two, even though one is a beater?


Secondly, any advice on price negotiating is appreciated. I have no problem finding a fair value for the new vehicle, but dealing to get the best trade-in value is something I could use some insight on. Thanks!
:cool:

 

IMO it's always better to sell your vehicles outright. If you go on kellybluebook.com you will see a very large difference between trade in value and private party value. If you have the time, sell them outright.

 

Also, try and get your own financing if you plan on financing.

 

And never settle on payment if you don't do that. Settle on the total price of the vehicle. HTH.

Link to comment
Share on other sites

  • Members

Great thread.

 

Around here it depends on the make of car you want. For example, there's only one Honda dealer in town and they have no problem selling all their inventory at MSRP. So they don't deal, period. So if you want a Honda, you pay what they tell you.

Link to comment
Share on other sites

  • Members

 

Great thread.


Around here it depends on the make of car you want. For example, there's only one Honda dealer in town and they have no problem selling all their inventory at MSRP. So they don't deal, period. So if you want a Honda, you pay what they tell you.

 

 

FYI, it only cost $600 for a friend of mine to have his GMC shipped to Dallas from Tustin CA

Link to comment
Share on other sites

  • Members

 

Great thread.


Around here it depends on the make of car you want. For example, there's only one Honda dealer in town and they have no problem selling all their inventory at MSRP. So they don't deal, period. So if you want a Honda, you pay what they tell you.

 

 

Great point. It depends entirely on what kind of car you want to buy. If the vehicles are in high demand they probably won't budge. I know that some dealers were selling Scion xB's above MSRP and getting away with it. If the car has been on the lot for awhile, you usually can bargain with them. Consumer Reports (the magazine) has a service that will give you the invoice price on the exact car you're looking at plus any unadvertised dealer incentives, so that's an option as well if you've got your eye on something.

 

My dad is great at haggling - so much that it embarrassed my mom to be in a dealership with him. He found that the GM and Chrysler dealerships had a lot more room to work than the Hyundai dealerships did.

 

Bottom line, do your homework. Find out what price you want to pay for the car you want and don't settle until you get it, even if it means walking away or getting laughed at by some pin-dick salesman.

Link to comment
Share on other sites

  • CMS Author

From ten+ years experience working in car dealerships:

 

Haggling is fine, but if you overdo it, you'll wind up screwing yourself. There's a bottom line, period, and the dealer can't go below that. They do need to make a profit, and they won't sell a car unless they do.

 

Check the Kelly Blue Book value of your trade-in. Don't expect miracles or over-estimate the car's worth. Despite what I've read earlier in this thread, dealers do indeed make money on used cars...lots of money. If the car isn't worth much, they will sell it to a wholesaler...the guys who get the cars that you see in the scummy used car lots...or they will sell it at auction. You will be offered the trade-in value of your used car...nothing more. If you're given more, it means you're going to get less discount on the new purchase.

 

Because of the above, it's often easier to just sell the car privately and not deal with a trade-in...some folks just have trouble juggling two transactions, or will use it to justify a purchase that's not really good after emotion has taken over.

 

Don't play games with the sales staff. You don't like being played, neither do they. The sales staff almost always has to get a deal ok'd by the sales manager, so don't get pissed if he's taking 15 minutes to find the guy, explain the deal and get back to you. So don't walk unless you're really leaving.

 

Despite what was written here earlier, accessories, while overpriced, are not a 500-2000% markup. Do the math on that one. In many cases accessories will be included to get you 'over the top' on a deal. So save that for the end. "Hey, throw in the bedliner, and it's a deal" will often get you that $400 bedliner free. But it doesn't cost the dealer $4:rolleyes:

 

Don't buy the coatings, waxes, protections, etc. Do look at the factory-sponsored extended warranty. It can be a decent deal and offer you some protection. Don't expect to get it thrown in with the deal...that's a rare occurance, but it's happened. Do make certain the plan is owned by the factory...the contract must be between you and Ford, for instance, not some third party administrator. They're the ones that screw you.

 

There's no such thing as "invoice". Period. Nobody but the dealership owner, his accountant, and *maybe* the sales manager know what the dealer actually pays for the car. That's because manufacturers charge different dealerships different prices, there are all manner of rebates...some public, some private...there are quota bonuses, and incentives. But on the other side, no dealer I've ever seen actually pays cash for the cars. The entire lot is "floorplanned" by a local bank. Each car is worth X dollars per day in interest charges to the bank, so the longer it sits, the more it costs the dealer. All of this adds up to no way for you to know what the "invoice" really is.

 

Buying a car doesn't have to be too stressful. Be realistic in your goals, and don't get caught up in the new car smell, and the desire to buy.

Link to comment
Share on other sites

  • Members

 

There's no such thing as "invoice". Period. Nobody but the dealership owner, his accountant, and *maybe* the sales manager know what the dealer actually pays for the car. That's because manufacturers charge different dealerships different prices, there are all manner of rebates...some public, some private...there are quota bonuses, and incentives. But on the other side, no dealer I've ever seen actually pays cash for the cars. The entire lot is "floorplanned" by a local bank. Each car is worth X dollars per day in interest charges to the bank, so the longer it sits, the more it costs the dealer. All of this adds up to no way for you to know what the "invoice" really is.

 

True. But, "invoice" is a great number to work from. In other words, if I got a car for $100 over "invoice", that's one thing. If I got the same car for $1600 under "invoice", that's a whole other thing altogether. IMO, invoice is only something from which you work.

Link to comment
Share on other sites

  • Members

Having worked with a co-worker that did work inside dealers, I've learned a few things.

 

If you end up in a room and get left alone for a while... a long while. You're being listened to. See, the former co-worker is in telecom and would install gear into those rooms for listening to conversations. Particularly if you're there with your spouse, they're interested in seeing which person they need to focus on to get the best deal for themselves.

 

We tried this. We walked into a dealer when my wife was looking for a car. We end up talking numbers and get left alone in one of the offices. For a while. My wife already knew the drill. We sat there, silent. I tell my wife that I've got to go to the bathroom, get up, and go there. Of course, while in the bathroom, I page myself since we're not ready to buy and I'm not dealing with this crap anymore. I come back in and a few minutes later my pager goes off. I look, give the, "oh crap. Work, we've got to go," and off we go. Out of nowhere as we're leaving, the sales guy comes running out. I tell him that we'll deal with this another time. I've been paged and really have to go.

 

We ended up buying through Costco. Got a pretty decent deal, no trade-in and a low interest payment (at the time).

 

The story of the co-worker was even funnier. They went to buy, knew the deal and would just go outside to talk. The sales guys kept saying that they could talk in the room but they'd just say that they liked the fresh air or some such. Drove the sales guys crazy.

 

Now, I don't know that every dealer does this. When I bought my Audi, it was pretty much all done out in the open. Not that they aren't going to try to screw you. Audi just knew that they didn't have to cut because, hey, we're in demand and someone else will buy that car if you don't. Of course, my next car will be much more humble and I know I'll end up going through the "game".

 

Another story from a co-worker was that he decided to play their monthly payment game. The problem for them was that he knew the game, was a finance guy, and had things all set. So they ask him what he wants his payment to be. He gives them a number. Sure, they say, we can do that over 5 years. He smiles and says, nope, you'll do that over 3 years. Meanwhile, he's got another dealer on the phone while working with this guy. The guy ends up agreeing. Did he get the best deal? Who knows. He got the deal he wanted, which was certainly not the one the sales guy wanted to give him.

 

As for Craig's comments, he's still true to a degree. However, if they're going to be douche's to me, I'm not going to play nice.

 

Of course, I'm going to be dealing with a trade-in so I'm expecting that I'll be screwed in some way or another. There's probably no way around that. I won't even be playing the monthly payment game, though, because the car will be bought outright. No payments for you, sorry. I've checked what KBB things a dealer will pay for my car and my wife and I agree that it's probably more than we'll get but we've already got the number in mind that we're willing to accept. I can try going Cars Direct or whatever that'll buy your car even if you don't buy theirs. Of course, they subtly hint in their adds that they don't think that KBB's accurate so I read that as 'we're going to lowball your sorry ass'.

 

Fun :rolleyes:

Link to comment
Share on other sites

  • Members

 

True. But, "invoice" is a great number to work from. In other words, if I got a car for $100 over "invoice", that's one thing. If I got the same car for $1600 under "invoice", that's a whole other thing altogether. IMO, invoice is only something from which you work.

 

 

There is some pretty good info out there that will get you pretty close to what a dealer has in a car. and its not on the sticker. I have had dealers show me fake invoices ,, and all kinds of {censored}. I tend to buy out of town ,, since they know if i get up to leave ,,,i prolly aint comming back. I buy GM at EMP1 ... so thats as good a deal as you can get. but when i buy a ford i have to play the game. As the saying goes ,, car dealers dont live in big houses because they are not making money on cars. rat

Link to comment
Share on other sites

Archived

This topic is now archived and is closed to further replies.

×
×
  • Create New...