the_marq

This is a skill that I just do not have. It would be nice if this was something that was taught in high school instead of the oh-so-useful skill of determining the hypotenuse of a right angle triangle.... how many times have you used that?

Anyway, as a new Dad I have to get rid of my pick up truck (2001 Ranger) and I'm taking the full on plunge into a 4door car. Mrs. the_marq and I have pretty much settled on a Honda Civic EX, but that's not important. What I am really wondering about is; what is expected of you when you are negotiating? I really have no idea how it works. When I was buying my truck (also when new), I felt like a wiener when the salesdude said, "The price of that truck is $19200."

Then I said, "I'm only paying $18000." Is that how it works, is that all there is to it? He looked at me like I was an idiot, maybe that was part of his strategy. Anyway, I'd really like to go into this purchase armed with some skills and strategy for getting a good price on this car.... wtf is a good price anyway?

Let's say for the sake of argument that the MSRP of this car is $25000. I'm in Canada btw, so bear with me Americans... we pay ALOT more for cars up here.

So how do I do this, I imagine I'll be sitting at the sales guy's desk he'll look at me and say, "OK it's $25000, sign here." As if it's a foregone conclusion that I'm just going to take the offer. What do I say?

--Fuck you Slick, I'm not giving you a penny over $20000!
--Oh come on now Steve, certainly you can do better than that.
--Really $25000... how about 23000? (then what, how does the give and take process go?)
--I INVENTED PINEAPPLE JUICE!

OK the last one was a joke, but seriously how does this work?

--If the new car is listed at 25G's how much will the dealership reasonably move, what's their markup?
--I'm buying (not leasing) and the finance rate is either 2.9% or 3.9% I forget right now. Is it worth asking for a better rate or is that 'off the table?'
--What words and phrases should I use, or avoid?
--What traps might the salesman lead me into?
--Is it easier to get them to throw in extras (leather seats, moonroof etc...)

Thanks.

__________________
The Truth:

Johnny Cash could have kicked Bruce Lee's ass if he wanted to.

#3 in a series

Daemon1313

There really is no way to know the true markup on a car. You can find the invoice but there are a lot of other things going on with the factories that the consumer never sees. Shoot for below invoice to begin with and work it from there.

I can only speak to how it works in the US but technically finance rates are not negotiable. When you see the 2.9% type of specials advertised those are incentive rates that the parent companies financing division are putting out to drum up business. Now the trick comes in if you are going through a bank not affiliated with the dealership. Those rates will vary by the individual banks and it will depend on how much they want to sell the car as to how much effort they are willing to put into shopping around for your rate. You also have the option of doing your own shopping around for a bank.

Flexability is the ultimate key to negotiating with them though. If you are fixed on that one car on the lot that they only get one alloted every 6 months, you will get raped. If you just want a general model, flexible on color and they get 20 allotted a week ( civics should fall inot this category) then you should have an easy time talking the down.

More than anything, always be willing to walk away and try again another time or even better with another dealer.

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A clear conscience is usually the sign of a bad memory.

pocon1

nothing to say

hambone

check edmonds.com.

price your car on there and you can even submit it to get quotes from the internet sales managers at the various dealerships. This way, when you go in to test drive you can come prepared with your internet quote (try to get dealerships to fight over you) as well as the edmonds.com listings.

Try to get as close to or under the listed invoice price of the car. Even with this price, the dealership makes money since they usually get incentives or whatnot.

For a Civic, they are in high demand, so don't expect too much under invoice, but you should be able to get at least near the invoice price.

I highly suggest doing almost all your bargaining over the internet with the sales managers, since you can always pull the 'this place is offering me such and such, can you beat it?" line.

Do not rush. Wait until you are comfortable. They always want you to buy on the spot. If things seem shady, just get up and walk out. Most of the time, this will kick off another 'special discount' just to keep you there. The more alternatives you have all printed out as proof the better for you.

Good luck!

__________________
"Like liquid white from fallen glass,
Nothing to cry over"

braisler

Ditto on getting invoice prices and printing them out to take with you. A friend of mine who bought a new Toyota Tundra used the service from Consumer Reports. For a flat fee, you can tell them exactly what car you want with what options, etc. and they will send you a complete printout of exactly what the dealer is paying for that car. My friend started from the flat, base price and added $500 (figuring a reasonable dealer profit). Then she faxed a letter of offer to 20 different dealerships around the state with the consumer reports copy attached. She got a reply within 2 days and was driving her new truck in 2 weeks.

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You do not really understand something unless you can explain it to your grandmother.
- Albert Einstein
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ubertuber

One thing (other than the PM I sent). If you do end up negotiating in the showroom, try to keep them from talking about financing for as long as possible. Negotiate the price of the car - let them think that you have outside financing (or even better, really have it!). Once you have the car at the price you want, let them try to beat the loan you already have.

Lots of dealers will start monkeying with financing to lower the monthly cost of the car - which does nothing in your favor regarding the total amount your paying for it. Keep these issues separate.

__________________
Cogito ergo spud -- I think, therefore I yam

vanblah

The key to negotiation is to realize that you have the upper hand -- always.

You have something they want. Money. The dealer doesn't have squat. That car that you want is not the ONLY one of its kind. (Of course, if it IS a one of a kind and you're trying to buy it then you're probably not concerned with price). They make you think that they have what you want, but they really don't.

Salespeople in general try to appeal to your emotions. They try to make you think that if you don't buy this item RIGHT NOW that you are going to miss out on the opportunity of a lifetime.

My favorite tactic they use: "This price is only good today." You can counter that with, "So, what you're saying is that if I come in tomorrow with that amount of cash that you WON'T sell it to me?" Always let them know that you are aware of their BS.

In fact, most of their tactics can be countered if you just think about it. Language and logic are your friends. Refuse to get emotional. You may really, really want that car, but don't let your emotions drive your decision.

My weapon of choice: silence. I don't tell them how much I'm going to pay. I make them feel like I could walk at any second. Not to say that I'm not interested ... just that I know how full-of-shit they are. Silence makes people very uncomfortable ... it makes chatty salespeople want to fill in the void with anything. Let THEM come up with all the prices.

Of course, a savvy salesperson will usually walk away from you. Let them go for a while. Then walk up to a different sales person and start talking. They'll ask if you were already working with someone. Say yes, but they didn't seem to be too interested in selling you a car (or whatever). If the original salesperson sees you starting to work with another salesperson they'll come running. It's fun for the whole family.

Negotiation is a very subtle thing. It's not like in the movies where a person says, "That's my best offer," and the salesperson caves in.

New cars are a little easier than most big ticket items because it's so easy to find out what a "fair" price is. Used cars are a little different because you don't really know what the dealer has put in to them.

BadNick

As mentioned above, do the internet shopping routine ...choose the model, all the options etc online and get price quotes within a couple days from several local dealers.

The last two new cars we purchased were done that way and both times I got a very competitive price compared to what I read online that other people were paying for the same car.

catback

My area might be different but in my ventures I've found that dealers really won't negotiate new car prices but used car prices are extremely negotiable. However with the new cars dealers are willing to negotiate any extras that come from them (meaning they can't negotiate title and license fees or tax n the like). Obviously others here have experienced different but just my 2 cents.

As for how to negotiate, you tell them how much you want to pay and they will tell you if they'll sell it to you it's not really that hard...invoice and all that stuff really isn't needed unless you wanna be a wholesale buying stickler because the dealer knows how much they paid, how much they need to make to stay in business, and how much the local market has the car going for so while they want to make you a buying customer they aren't gonna pay YOU to buy the car. With that said you can always haggle for the lowest price and you won't be robbing them because if you really did shoot too low they would just say "no" but in my opinion although you may get a really good price you'll also get two-faced friends at the dealership, they'll thank you for your purchase and ask that you come again but once you leave they'll be glad if they never see you again. But that's what happens when someone trys to negotiate down a price that is already "fair". Simply it's buyer sydrome, buyers don't wanna pay shit but it's also something sales people know well.

vanblah

This is an excellent point. If you will continue taking the car back to the dealer for repairs or whatever or if you are going to continue working with them in the future then you may want to remember that you need to pay for that service. It's called peace-of-mind. You pay a slightly higher price with the knowledge that you will have friends at the dealer. I've never personally experienced these "friends" but I'm sure it happens.

The point: If I buy something from the internet I don't have much expectation for after-care or support. If I buy something from a brick and mortar store for a higher price then I do expect support and after-care.

However, saying that "buyer's don't wanna pay shit" is the same thing as saying that all sales people are out to gouge you if they can get away with it.

BadNick

Not to say you don't know, but in case someone gets the wrong idea I just want to clear up a point about Internet car shopping. You don't give up anything like good dealer service and support with the kind of online buying I've done and many others I've spoken with. You shop for best price by starting online, get the quotes from local dealers, then you go into the dealer who made you the best offer and buy it, along with all the normal good service etc you would expect. In fact, if I thought one dealer's service was known to be better, I'd be willing to pay somewhat more for a car from them.

Based on my experience, it is just easier and faster to "cut to the chase" of getting a known good price when you get pricing online from the "internet sales dept" of the dealer. Not to say a good price negotiator/shopper couldn't do the same face-to-face in the dealer showroom, but I find the internet shopping scenario to put more pressure on the dealers in favor of the buyer and you have more liesurely time to research and think about it.

woohog1

Something you might try and im not sure if you have bought this car already or not, is to have the absolute lowest limit you will go, as well as the highest limit in mind.Say the price is 25000 at first offer him 20000 both you and he knowing that is not gonna work. Then we he says no dice simply say 21500 and see if he can come down. Continue working that way. You gotta realize also man, these people gotta move some cars, and they expect to make a little bit of a profit. So go in knowing what you absoultely will pay, then work your way up to the high point. If he wont come down to your resonible high point, then simply get up, thank him for his time and walk away. Hope this helps.

__________________
God created man, Sam Colt made them equal.

waltert

I went with my mom to buy my first new car. we went to dealership A, which had the car I wanted in the color I wanted...we talked them down to 12,900 out the door price. then my mom got on the phone with dealership B, asked them the best price THEY could do for the same car, and it was 11,995 out the door. we asked dealership A if they could match it, they said no, so we went to dealership B and bought the car I wanted in a color I didnt want...but the color wasnt worth $1000 to me, LOL

just remember that there is ALWAYS another dealership. dont let them screw you by lowering the monthly payments, and not the price of the car.

ratbastid

Lean back and whisper, thereby adopting a dominant physical position.

Also, refuse to speak first.

eribrav

Recently bought a Subaru, and not sure if this applies to Honda but.....

Try to find a company or a cause "affiliated" with Honda that has a buyers preference program. For instance Subaru has a partnership with IMBA. You become an IMBA member for about $30. You can then after 6 months buy a Subaru at invoice minus 2% from your local dealer. Best car shopping experience ever. No haggling, good price and you can contribute dollars to a cause you support.
I realize the 6 month wait is probably a stumbling block if you need the car sooner but this might help other people too.

hambone

I can't stop laughing....good play my man

__________________
"Like liquid white from fallen glass,
Nothing to cry over"

braisler

Yeah, or it is called being known as a sucker. If a dealer makes a $2500 profit off you when they sell you the car, are they going to think of you more as a 'friend' than the guy they only made a $500 profit from? I would argue that they are going to think of you, if they think of you at all, as the sucker that they can gouge for anything.

These people aren't your friends. After your warranty period, the dealer is almost always the worst place to get your car serviced. Not worth building a 'relationship' with. Trust me, the relationship is one sided.

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You do not really understand something unless you can explain it to your grandmother.
- Albert Einstein
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catback

Not true, the friendship you make with them may not be the "hanging out on the weekend" kind but they will look out for you more so then someone they dislike. As far as profit goes $2500 isn't really that much profit for a dealership, they aren't a grocery store that sells stuff everyday to many customers. For a $25,000 vehicle $2500 is only a 10% profit, most grocery stores mark up products more than 10% above what they pay.

sapiens

Like braisler, I don't really understand this sentiment. If I am going to work with them in the future, then I will pay for that service at the time the service is rendered, not before. Why would I pay more up front so that they will be nice to me later? Does that mean that if I don't overpay them up front, then I can expect bad service? If so, I don't consider that peace of mind. If so, I don't want to give my money to that business. If I buy a particular brand of car, I can get under warranty service at any dealer.

I agree whole-heartedly.
Two-faced friends at the dealership? I never expect to make friends at the dealership - two-faced or otherwise.

I think the appropriate mindset of a buyer should be that sellers are liars. (Similar to pocon1's statement about seller mindset : "Buyers are liars.") I do not trust anything that a salesperson tells me. That said, I treat them with respect, and I expect the same from them.

catback

In truth, neither party can trust the other since the days of morals are out the window. The dealer (seller) expects you to be cheap in whatever way possible and the buyer expects the dealer (seller) rob them. It's basically a war of the one that wants to make the most money vs the one that wants to pay the least money and nobody is playing by any rules because you all know if you could get the dealer to pay you to buy the car you'd leave with no negative feeling morality wise nor would the dealer if they made a good size profit off of you. Really it's sad times and it's even sadder for honest people to try to work in such a society because they have cons trying to con them whether they are a buyer or a seller.

I'm still waiting to see buyers try to negotiate other prices on new things like cloths, groceries, oil changes, car washes, homes (brand new). I mean there is alot of mark up that you can try to get marked down so why stop with "car dealers make too much profit off me" and start working the negotiation elsewhere. I'm sure everyone here thinks tow trucks charge too much so surely that's one to start with...

sapiens

There is some good advice regarding purchasing a car in the thread below started by jorgelito:
http://www.tfproject.org/tfp/showthread.php?t=113891

desal75

This thread is disheartening to me. Is this really the mindset people have when they sit down at my desk to buy a car?

__________________
The Man in Black fled across the desert and the Gunslinger followed.

sapiens

Too many salespeople trying to force me to buy the TruCoat sealant I suppose.

The last time I purchased a car, we agreed on a price including TTL. Then, when they brought me the papers to sign, the price was $300 more than the price they were telling me verbally at the same time. When I asked, they said, "Oh! Those are dealer coupons for oil changes, discounts on service, and free car rental with service coupons." Aargh! $300!

desal75

You shouldn't have paid the 300

__________________
The Man in Black fled across the desert and the Gunslinger followed.

waltert

like it or not, buying a car is a business deal, and can get very competitive.

my friend was a car dealership salesman, and he showed me how he was taught to screw people...the funny thing is that he didnt even know he was trying to screw me in the mock-deal, but I was keen to his game.

I remember when my dad wanted a company truck, I called every dealer in a 200 mile radius to see who could get me the truck at the best price.

I think we ended up paying $38k for a $43k truck...the white diesels were in high demand at the time.

desal75

At my dealership, I have never been encouraged or taught how to screw people.

__________________
The Man in Black fled across the desert and the Gunslinger followed.

sapiens

Clearly.

I have no doubt that there are many honest, straight-forward car salespeople like yourself. (Salespeople that do not "screw" their customers.) That said, waltert's experience suggests that an individual salesperson could be honest while still screwing customers. (without intent).

DDDDave

Marq,

Don't feel bad about not 'being able' to negotiate. It is like anything else, if you don't do it very much you don't get a chance to 'get good' at it.

I could go on and on and tell you some great stories but this really is your first rodeo. The problem is, buying a car and especially a new car is something that the average person does every three or four years. Anything else we do once every three years we are not very good at either.

My advice, also given earlier, is to use Consumer Reports. Spend the $12. and get the buying guide for your specific model. Read the buying tips, and then re-read them. Remember, you are in control. Basically, you will never get the best deal unless you walk away at least once. Even if it is just to clear your head. The buying tips in CR are very good. I have used them many times. Also, go shop the lots at night when the dealerships are closed and it is cool. You can look at all the cars with no pressure and if nothing else, get comfortable with walking around the car lot. It can be overwhelming. Do not, repeat do not, try to 'out negotiate' the salesman or the dealer. A good salesman sells a car a day and a good new car dealership sells 10 cars a day. They are good at what they do just as you are good at your job. Think about how you could take advantage of a first time customer at your job. Take the whole process at your own pace. There will always be tomorrow. Also, expect to get screwed on your trade in. Especially if you plan to trade in a 2001 Ford at the Honda new car dealership. If the dealer offers you a great trade-in price, you are paying way too much for the new car.

That's enough. Do the CR thing. Good Luck.

__________________
I am just a simple man trying to make my way in the universe...

"Go confidently in the direction of your dreams. Live the life you have imagined." - Thoreau

"Nothing great was ever accomplished without enthusiasm" - Emerson

Willravel

1) Locate a large dealership in a small town with low property values.
2) Go to buy when you know they're getting the new models and need to dump inventory.
3) Bring cash. If you have to buy an expensive briefcase with a lock and handcuff it to yourself, so be it. You'll just look like a Bond villan for a few hours.
4) If the place is busy, leave and come back the next day.
5) Learn what the dealership pays for the vehicle and use that as your starting bid. This can usually be from 10%-45% below MSRP. Reasonable MSRP, based on sales, can be located at Edmunds.com. I would suggest starting at 15%-20% off MSRP. As for what the dealership pays, that's not easy to get.
6) Be the coolest, most gorgeous motherfucker in history and find the dorkiest, youngest looking salesperson on the lot. Fake being cool if you have to, but Pierce Brosnan is more likely to get a good deal on a car than Woody Allen. Never underestimate a person's want to be cool by association. Be funny, have a great story, speak up and in a clear voice and walk with excellent posture. Men, be Fonzie. Women, be Laura Croft.
7) Test drive with equal confidence. Share you're knowledge of the car (so do your homework).
8) When you get back from the test drive, this person will get someone else. Don't let them. "I like *insert name here* and I want to work with him/her." They will try a really weak good cop bad cop most of the time to try and force your hand. "This car is already marked down..." blah blah, you already know what the car is worth, so this is all meaningless.
9) Leave if you need. They will put pressure on you. If it doesn't look like they're going to bend, then there are other dealerships (which is something you mention, "Oh, well I'm sure *insert local dealership here* can help me out.").
10) No one needs lojack. Don't get the extra crap. You can get it cheaper on eBay later. Shit, I'll put it in for you.

Extra: if you're getting a used car and the engine bay looks immaculate, pull out the spark plug wires and check for moisture. I just recently bought my grandmother a car and it lost power because of that. I had to take a compressor and blow the damn thing dry. They can do that at the dealership free of charge when you're buying the car.

Ilow

Willravel comes through again, good tips. As others have said, information is your friend as well as the willingness to actually walk if the deal doesn't meet your needs. Always get the cash price for the vehicle. Go at the end of the month when dealers are trying to make their quota, sometimes they will sell for little or no profit on one car if that will push them over the threshhold of a factory dealer incentive that is larger. Go during slow periods, weekdays etc. If you arrive with a price that is reasonable and tell them beforehand and they still get into the back and forth paper-with-numbers pushing game just leave because it's obvious that they don't respect you. Same if you tell them a cash price and they stary with monthly payment talk. look over all the paperwork before you sign anything and ask questions. There are some people who are intentionally rying to dick you and others who are simply inexperienced or in a hurry and make mistakes, the point is it's not their money (yet), so they care less than you. Don't get rustproofing. Know how much things like premium sound systems cost when you go to Circut City etc, so you know if the upgrades are any kind of a deal. If you're firm you can afford to be as polite as you want. good luck.

__________________
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--Sam Harris

the_marq

This is some great advice everybody, I am overwhelmed by the knowledge everyone shared. We're going out test driving in a few minutes, I'll report back later.

Thanks again!

__________________
The Truth:

Johnny Cash could have kicked Bruce Lee's ass if he wanted to.

#3 in a series

Brewmaniac

Ok, yesterday me and my wife went to a local Toyota to see a Matrix. I've got the CR print out w/invoice of $14,864 and a quote from a dealer in Illinois(about 70 miles away) for $15,700 less TTL and they tell me they can't even match it. So we just left discouraged.

Wondering what to do next? I think the Matrix is so hot right now and Toyota didn't build many stripped models we want. We also stopped and looked at the Pontiac Vibe, the Matrix's twin. They are truly a world cars American and Japanese built in Canada. The salesman there said he would search for one Monday.

__________________
"That's a joke... I say, that's a joke, son"

Willravel

The Matrix isn't as hot as they'd have you believe. Right now the Camry is their bread and butter, and the Yaris is their new kid on the block. MSRP of the base Matrix online says $15,410. I figure you're probably going to have to shell out a few grand for the necessary modifications, so start at $13,000 and work from there.

Do you mind if I ask what type of dealership you're buying from (big city, small town, downtown, suburbs, etc.)?

I wish you the best of luck. If there's anything I can do, don't hesitate to ask.

jorgelito

Why on earth are you looking at MSRP?? You should look at INVOICE and INVOICE only. The INVOICE price already includes the dealer's profits plus extras. You should be able to get below INVOICE.

Seriously, check out the other thread on how to buy a car and you will be happy. There is some great, practical car buying advice over there.

Willravel

So asking for the 2007 Matrix for $13,000 is a bad deal?

jorgelito

If the MSRP is $15 K then the INVOICE is most likely a few grand below that. So yes, it would be a bad deal. It all depends on the INVOICE. Go look at that thread, it explains everything. If you need any help buying a car, just PM me or ask and I will be more than happy to help you.

Willravel

The average sale price for a base Matrix is a little over $13k, according to Edmunds. Start with $11k or 11.5k.

Also, 'invoice' is just as easy to read as 'INVOICE', if not more so.

jorgelito

There you go, perfect.

?????

pocon1

nothing to say

Willravel

93 Ford Tempo, bought for $800 with 50k miles in 9'7
89 Ford Taurus SHO bought for $200, in perfect condition
94 Ford Escort, bought from a dealership in 2002 for $1200
06 Audi A6 Quattro, bought in 2006 for $35k
e46 BMW M3, bought late last year for $9k, and sold for 10k
95 Mitsubishi Eclipse GS-T, bought this year for $2000

So that's 6 cars for myself, and I've not included cars I've bought for others or have helped others bought. If I had to guess, it'd be in the high 20s. So how many cars have you bought? Of those, what prices did you pay and how did they stack up to the invoice or MSRP? I'd like to know because you're coming off EXTREMELY condescending without any real reason I can see. And please don't just give me a 'well, I do this for a living'.
I'm 23.