If you want to buy cheap new cars, there are some guidelines to keep in mind. Car dealerships tend have the advantage in doing deals, but by taking the right steps you can save money when buying new cars. There are new car deals to be had, and they are usually not advertised. In fact, when a car dealer or manufacturer advertises some special promotion, they’ve usually configured it to have their highest profit margin in the deal. That should be your starting point in negotiation, not the deal to jump at in an instant.
Buy at the Right Time If you can wait, getting a new car right when the next year’s model is coming out (or just came out) can put the dealer in a position to want to bargain. Of course, you should always buy when you want to buy. That means that you can’t let yourself be pushed into purchasing before you are ready. Set a timetable for yourself and stick to it.
Understand Different Types of Pricing Dealers will usually have a published price that is called “invoice price”. This is intended to be represented as their cost. It generally isn’t. Dealers get special pricing from the manufacturer in the form of rebates and other incentives. Don’t think that if the dealer is selling to you at the invoice price they aren’t making a profit–they generally are.
Become an Expert Every car dealer and car salesperson is an expert on their product line. You need to familiarize yourself enough to be an expert also. If you don’t, you have given them the power in the business relationship. Learn all about pricing points, option packages and dealer incentives related to your desired vehicle. If you show you know the car every bit as well as they do, they will be more likely to deal. If you are trading in a car, know the value of your vehicle, too.
Avoid Bundling When car dealers bundle things it is generally a way for them to hide pricing you might not like. Make sure you negotiate each part of the deal separately. That includes purchase price and any other things that are applicable (trade-in allowance, financing, warranty plan, service plan). Remember that extended warranties from the dealer might not be the best deal. Research that in advance, too.
Be Ready to Walk Away If you feel the deal being offered isn’t fair, be ready and willing to get up from the table and walk out of the dealership. When you are the party that’s most willing to step away from an unsatisfactory deal, you are the party with the most power in the bargaining. Chances are the salesperson will come up with a better offer to meet your terms before you hit the door. If not, they will almost always call you in a day or two and sweeten the deal.
Getting a new car is exciting. It can also be anxiety ridden and frustrating. Taking the proper steps to make sure you’ve done your homework can help to eliminate that side of the equation and let you really enjoy the ride.