Negotiating buying a new car

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TranceLordSnyder
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Negotiating buying a new car

Post by TranceLordSnyder » Sun Jan 17, 2010 12:00 am

I'm selling my old car privately for more than I was expecting to get for it, so I'm happy about that.

My wife (Just back from our Honeymoon!) and I are going to buy a new car (yes, completely new.) We wanted to get something that could carry a bit more than a car, but didn't want to drive anything large like an SUV, Truck, or a mini-van. After browsing the internet and checking out potential cars in the lots we came up with the Honda Fit and the Kia Soul (Brand new in 2010) After talking some, she ended up deciding that the Kia Soul was a car she wanted more.

I know buying new is not recommended by most, but it isn't possible to buy a Kia Soul used at this point. Our cars are coming up with more and more problems and it's getting old running them to the garage to get minor issues fixed. A new car would be a welcome change, and my car doesn't have too much more life in it but is valuable to a muscle car guy.

So here is the question. I checked out the Kia Soul at a dealership and noticed on the invoice that they've added a cargo net for $50, a cargo mat for $50, and floor mats for $75. I don't want the cargo mat or net, and I can get floor mats for less than half that. I wasn't ready to buy, but mentioned these items to a salesman and he said they're included and there is nothing he can do about it. If they were listed as options under a certain package, I could understand this. They are listed separately with a price behind each of them unlike anything else. Is this guy full of it? Are new cars completely not negotiable? Is there anything else I can do to reduce the cost of this car?

aadwen
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Post by aadwen » Sun Jan 17, 2010 12:45 am

Why dont you buy a 2 or 3 year old KIA or Hyundai, both which have 10 year 100k warranties, you would get a car for 2/3 the price and a 7 year warranty.

TranceLordSnyder
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Post by TranceLordSnyder » Sun Jan 17, 2010 12:54 am

The Kia Soul really strikes us as a nice looking fun car. It also has extra trunk space to use for taking yard waste or picking up some larger items. We want to have a car that can carry some larger items but don't want to go as full scale as a truck, van, or suv. The honda fit to me was a nice alternative, but she doesn't like it nearly as much as the Kia Soul.

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oneleaf
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Post by oneleaf » Sun Jan 17, 2010 2:01 am

aadwen wrote:Why dont you buy a 2 or 3 year old KIA or Hyundai, both which have 10 year 100k warranties, you would get a car for 2/3 the price and a 7 year warranty.
The 10 yr warranty (powertrain) is non transferrable. The 5 yr bumper to bumper is transferrable. So you would get a 2-3 yr warranty with a 2-3 yr old Hyundai or Kia.

natureexplorer
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Post by natureexplorer » Sun Jan 17, 2010 7:56 am

New cars are very negotiable: http://www.bogleheads.org/forum/viewtop ... highlight=
a cargo net for $50, a cargo mat for $50, and floor mats for $75....Is this guy full of it?
Yes, he is full of it (BS).

TRC
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Post by TRC » Sun Jan 17, 2010 8:16 am

If you're planning to shell out $14,000+ for a new car, is it worth getting concerned about saving money on $225 worth of basic accessories?

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scubadiver
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Post by scubadiver » Sun Jan 17, 2010 9:15 am

A couple of thoughts...

(1) Identify two or three different cars that you would be comfortable purchasing. This gives you options and hence leverage in negotiating.

(2) Be prepared to walk away.

(3) Tell them the price you are willing to pay. If they stick extra items in like cargo nets, tell them you don't want to pay for the nets (the dealer should either take them out or throw them in for free). EDIT: By "willing" I mean low ball them.

(4) $225 absolutely worth negotiating. If you dropped a $20 bill as you walked out of the dealership after buying the car, you wouldn't say "hey, that's only 0.15% of the purchase price, I'm not gonna pick that up." No, you would say, "shit, I just dropped a twenty dollar bill. I better pick that up." I assume this logic transfers to a stack of $20 bills also.

(5) Be prepared for last minute "administrative" fees when you actually buy the car. When we bought a new car last summer, the dealer tried to stick a $120 fee for something or other on us. We threatened to walk out. They didn't remove the fee, but they did reduce the price of the vehicle by another $120 (very principled of them, I thought).
Last edited by scubadiver on Sun Jan 17, 2010 10:56 am, edited 1 time in total.

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cyclysm
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Post by cyclysm » Sun Jan 17, 2010 10:46 am

natureexplorer wrote:New cars are very negotiable: http://www.bogleheads.org/forum/viewtop ... highlight=
Do this. I used this technique and can honestly say that buying our new vehicle was one of the easiest purchases I've made. Be sure to ask for a price that includes all the administrative and documentation fees so there are no surprises at the end.

Do not under any circumstances tell them what you are willing to pay. Just insist on their best price--if they do not provide it, they will not get the sale. Very very easy!

natureexplorer
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Post by natureexplorer » Sun Jan 17, 2010 11:19 am

Cyclysm, would you mind sharing some specifics of your experience with this method?

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Post by LadyGeek » Sun Jan 17, 2010 11:34 am

Everything is negotiable. You'll need to feel comfortable with saying "No" in a one-on-one conversation. If you don't, bring someone with you who can.

Why? Because you have to deal with the "closer". After you agree on price with the saleman, he's going to want you to talk to someone to finish the deal (sorry, but I have to have this person talk to you...). The sole objective of the closer is to add on as many unnecessary things as possible to maximize profit. Such as (my experience):

- Insurance to payoff your car in the invent you are unexpectedly unemployed and can't make the payments. No.
- Extended warranty. No. Or, up to you. In any case, never ever pay what they ask. Offer no more than half and see what they say. Newer cars are very reliable. If it's going to break, it will occur within the warranty period. For me, no.
- Undercoating, rust proofing, or any extra treatments to extend the life of the vehicle. No.

Be sure to get the Vehicle ID Number (VIN) ahead of time and checkout the new costs with your insurance company. Depending on your state, you'll either have a few days to get coverage, or call the insurance company to have coverage before it leaves the dealer's lot.
Wiki To some, the glass is half full. To others, the glass is half empty. To an engineer, it's twice the size it needs to be.

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cyclysm
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Post by cyclysm » Sun Jan 17, 2010 6:44 pm

natureexplorer wrote:Cyclysm, would you mind sharing some specifics of your experience with this method?
Sure!

The first decision is what to buy and whether to buy new/used. I believe this a personal decision and depending on how long you plan to keep the vehicle, there are benefits to each. That said, the process below only works for new vehicles since new versions of the same model are essentially identical. Used cars are not identical, and thus you cannot pit dealers against each other. With that background, here's what I did.

First I drafted an email that did the following things:
- Specifically described the vehicle I wanted (Make, Model, and trim package). Color was not important to me, but if you have a preference, let them know--popular colors may come at a premium price.
- Let them know I had a trade-in that MAY be part of deal, and provided an accurate description of the car (mileage, condition, specifics about obvious cosmetic/mechanical concerns, etc)
- Asked for the best price on the new vehicle, including an itemization of all fees/costs that would be necessary to close the deal and any "dealer extras" that would be included in that price
- Asked for a best estimate on the trade, subject to a test drive and evaluation
NOW THE IMPORTANT PARTS
- Stated I was sending this request to all dealerships within a 150 mile radius of my location, and that I was interested ONLY in the best price on what I had described
- Said that I would accept responses for 5 days and the dealer with the best price would earn my business.

I then did as I said and sent this to 13 dealerships. Some had email addresses on their websites, others had "contact us" form pages that I had to use.

After a couple days, three emerged as the best priced, so I called the guys that made the 2nd and 3rd best offers. I told them I was following up on my email and just wanted to make sure they had provided the lowest offer. I was polite and said that I did not want to to make an offer that did not make business sense for them.

One asked me to name my price and I refused, saying that I was interested only in the best price possible and there was no way I could know what made business sense for him. He wouldn't go any lower, so I thanked him and said I'd be in touch when I had heard from everybody.

The other simply said that that was his best offer, so in the interest of his time I said that I would probably be going elsewhere, but did say that if anything fell through, he was my next option.

After this, I went to the place with the best price (which was also the local dealer) and got them to firm up the offer on the trade. They did this, then put the offer in writing, then I came back the next day to sign everything, pay, and take delivery.

All this was very painless, but keep your guard up when in the FNI office signing documents. I said no to all the add-ons, but he tried a couple times to adjust the extended service plan to something I might like. I had to say no to that one a few times, but eventually he got the point.

Truthfully, it was all incredibly easy. After I sent the email, people knew I was serious and they were not going to waste any time putting a sales job on me. I had far more troubles when I was doing test drives and just looking at floor models when trying to narrow down the actual make/model to buy!!!

Think about it, how many times do you get 10 people, all selling the same product and all authorized to negotiate price, competing for your business? Not very often, but dang, it is nice!

polaar
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Post by polaar » Sun Jan 17, 2010 6:57 pm

I second the above; have bought 2 Hondas in the last few years this way. E-mailed all metro Detroit dealers, insisted on bottom-line out the door price, took lowest price, then got extras (mats, etc) thrown in to cinch the deal. Very little hassle. I was in the driver's seat. Got great prices! A good idea to use the Consumer Reports $14 report to benchmark offers.

billb
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Post by billb » Sun Jan 17, 2010 7:03 pm

I'm probably a couple of years out from buying my next car, but would you care to share the email you sent to these guys? You can omit personal details and specifics about the car, options, etc ... I'm just trying to get some ideas about the verbiage to use.

Thank you.

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Re: Negotiating buying a new car

Post by LadyGeek » Sun Jan 17, 2010 8:30 pm

TranceLordSnyder wrote:My wife (Just back from our Honeymoon!) and I are going to buy a new car (yes, completely new.) We wanted to get something that could carry a bit more than a car, but didn't want to drive anything large like an SUV, Truck, or a mini-van. After browsing the internet and checking out potential cars in the lots we came up with the Honda Fit and the Kia Soul (Brand new in 2010) After talking some, she ended up deciding that the Kia Soul was a car she wanted more.
Sanity check. Did your wife (congratulations! :beer ) actually drive the Kia Soul? Don't commit to anything until she drives one and is sure that she will be happy in it. You'd be surprised how differently people perceive cars. No way to tell from a showroom floor. Buyer's remorse can last a long time.
Wiki To some, the glass is half full. To others, the glass is half empty. To an engineer, it's twice the size it needs to be.

pitt76
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Post by pitt76 » Sun Jan 17, 2010 9:18 pm

I have been trying to buy a new Cadillac SRX. Since it is a brand new version , most dealers are selling them almost as fast as they come in. I have been using the above described techniques, but results have been slow. One dealer gave me $658.00 off. The second started at $700, but I have him up to $1025.00 off which is about what the edmunds.com TMV price is. Several dealers I emailed didn't even respond. One of the problems is that the # of Cadillac dealers is down and I suspect that GM is asking the remaining ones not to severely undermine each other. My son's friend owns a Cadillac dealership about 75 miles away and he offered to take off $3000.00 on a more expensive version. He is supposed to give me a quote on the less expensive trim version I want to buy tomorrow. I will probably buy it from him, only because his price will be lowest due to my son knowing him.

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Post by pitt76 » Sun Jan 17, 2010 9:19 pm

I have been trying to buy a new Cadillac SRX. Since it is a brand new version , most dealers are selling them almost as fast as they come in. I have been using the above described techniques, but results have been slow. One dealer gave me $658.00 off. The second started at $700, but I have him up to $1025.00 off which is about what the edmunds.com TMV price is. Several dealers I emailed didn't even respond. One of the problems is that the # of Cadillac dealers is down and I suspect that GM is asking the remaining ones not to severely undermine each other. My son's friend owns a Cadillac dealership about 75 miles away and he offered to take off $3000.00 on a more expensive version. He is supposed to give me a quote on the less expensive trim version I want to buy tomorrow. I will probably buy it from him, only because his price will be lowest due to my son knowing him.

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Re: Negotiating buying a new car

Post by cjackson0 » Sun Jan 17, 2010 9:56 pm

LadyGeek wrote:Sanity check. Did your wife (congratulations! :beer ) actually drive the Kia Soul? Don't commit to anything until she drives one and is sure that she will be happy in it. You'd be surprised how differently people perceive cars. No way to tell from a showroom floor. Buyer's remorse can last a long time.
I agree. Make sure to test drive it first. I test drove a similar Scion last year and had serious visibility issues with the car. I very much enjoyed the fit and I believe it was consumer reports top choice for sub-compact cars. The price is a little steep however.

CarlZ993
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New Car Purchase

Post by CarlZ993 » Mon Jan 18, 2010 1:53 pm

It sounds like cyclysm's buying technique is almost identical to the car buying information service that I have used with great success over the years: www.fightingchance.com. Basically, I start my 'quest' by finding out which specific vehicle I want. That will mean visiting local dealerships and doing some test driving. Fend off the salesperson with 'I'm just looking right now.' When I decide which vehicle I want, I order the package from fightingchance. About a week from the end of the month, I call up about 12 different dealerships (excluding the dealership that I test drove the vehicle at) and ask to speak to the sales manager. I tell him/her that I will be buying a vehicle by the end of the month. I tell him/her basically what type of vehicle I'm interested in. I ask him/her if I could either email or fax them a copy of what I'm looking for. They almost always ask for an email.

I draft an email letter describing the vehicle with all the specifics. I list the dealer's costs, suggested retail price, and shipping costs. I also list the percentage of the dealer holdback. I start getting responses back fairly quickly. There may be some dealerships that don't want to sell vehicles this way. You simply thank them and tell them that you're offering them an opportunity to sell me a vehicle. It is their choice if they wish to try to sell me a vehicle. Anyway, after you get your responses back, contact each sales manager and let them know what our best price is. See if they go lower. Most won't. Don't tell them which dealership was the cheapest. I go back to the salesperson at the dealership where I test drove the vehicle. I tell them the quoted price and give them an opportunity to meet or beat the price. If they do, great. I buy it there. If not, I buy it elsewhere.

I got a really good deal at a Honda Dealership in San Antonio (I live in Austin, 80 miles away). Before I left to buy the vehicle, a different dealership in San Antonio beat that price significantly. So, I bought it from the second dealership.

A satisfied customer of fighting chance.
Carl Z

azbryanw
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Post by azbryanw » Mon Jan 18, 2010 2:31 pm

Why don't you call the internet fleet manager and ask him what he is selling the car for?

Usually the floor mats, etc. are used to pay PACK ...or the amount that the dealership gets that isn't figured into the salesmen's commission.

polaar
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Post by polaar » Mon Jan 18, 2010 2:32 pm

billb wrote:would you care to share the email you sent to these guys? You can omit personal details and specifics about the car, options, etc ... I'm just trying to get some ideas about the verbiage to use. Thank you.
I went into my "sent" messages and retrieved the e-mails from my 2009 purchase. I hope this is helpful.

Cold e-mail:
Dear Mr. X,
Please send your best out-the-door internet purchase price on the following vehicle, as well as availability:
[Year, Make, Model]
[Color, Interior Trim]
Please indicate vehicle price and separate destination charge, and if there are additional fees or charges besides sales tax and title and license fees.
I would prefer to communicate through e-mail; please do not call.
Thank you,
Me

Follow up e-mail:
Dear Mr. X,
Just two additional small questions:
1. Is clean-up, prep, and a tank of gas included in the price you quoted?
2. Will there be fewer than 10 miles on car?
Thanks again,
Me

Final e-mail:
Dear Mr. X,
If you can add All Season Mats and a Cargo Tray at no charge then I am ready to buy from you with the numbers you have quoted. Please let me know if we can start the sales process.
Thank you,
Me

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Post by rallycobra » Mon Jan 18, 2010 2:49 pm

If you aren't paying cash, bring your own financing. Bank of America has some very low rates on new cars now.

I've had great success with auto negotiation by walking out of the dealership. Once they won't go any lower, just leave. Call the guy maybe a day later with a lower number. Usually, they will talk to a manager and lower the price if you come in right then to sign the deal.
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rallycobra
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Post by rallycobra » Mon Jan 18, 2010 2:49 pm

If you aren't paying cash, bring your own financing. Bank of America has some very low rates on new cars now.

I've had great success with auto negotiation by walking out of the dealership. Once they won't go any lower, just leave. Call the guy maybe a day later with a lower number. Usually, they will talk to a manager and lower the price if you come in right then to sign the deal.
26% Total Stock Market/20% Total International/13% Small Cap Value/6% Reit/35% Intermediate Bond Fund | 65/35 Stock Bond 2:1 Domestic/International + Reit

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ualdriver
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Post by ualdriver » Mon Jan 18, 2010 2:56 pm

billb wrote:I'm probably a couple of years out from buying my next car, but would you care to share the email you sent to these guys? You can omit personal details and specifics about the car, options, etc ... I'm just trying to get some ideas about the verbiage to use.

Thank you.
sample letter, paying cash for a fictional 2009 Honda Accord V6 LX

Good Afternoon-

I am sending this same exact letter to all of the Honda dealerships within a 50 mile radius of my home. I am a serious buyer, and will be paying cash (or have obtained my own financing) for my requested car. I have already test driven this car and have no need to visit your dealership other than to make a purchase. I plan on making this purchase within the next 7 days.

I am only interested in a new, 2009 Honda Accord V6 with the LX trim level. I am only interested in black, silver, or red cars with the black interior color. (or put whatever you SPECIFICALLY want here)

Could you please send me your TOTAL, OUT THE DOOR PRICE for the car requested above? This price should include ALL taxes, fees, delivery charges, prep fees, dealer fees, and anything else that you have added to the price of the car. E-mails that I receive that do not include a quote for the car requested above will not be considered.

Please keep in mind that if I decide to purchase this car at your dealership, I will have no interest in purchasing any extended warranties, fabric treatments, or any other add-ons. I simply want to bring a check for the exact amount you quote, sign the papers, and take my new car home. I want this to be a quick and easy transaction for both of us.

Thank you for your time.

Regards,
John Smith
john.smith@net.net

NOTES:
1) Go to honda.com (or whatever brand), type in your zip code, and find the websites to all the dealers you want to send the above to. Either just cut and paste the above to their sales department or if they have an internet sales department, even better.

2) If you have a trade, it complicates things a bit. The last car I purchased for my in laws included a trade, so I just added a paragraph saying that I had a '98 Ford Escort with XX,XXX miles that I would be trading in, but it will be a totally SEPARATE deal and not to consider the trade as part of the new car's purchase price. I was willing to sell the car myself if the dealer tried to screw me on it.

3) As a courtesy to the dealership that took me the time to show me the car, test drive it, etc., when I was in the information gathering stage, I usually give him last right of refusal. I'll call him or swing by with the best price and ask him to match it. If he doesn't, I just drive to the dealership whose quote I accepted.

mtl325
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Post by mtl325 » Mon Jan 18, 2010 3:25 pm

I have had great success going to Edmunds.com and printing out the TMV report on the specific car/trim. After receiving the first offer, I'd show the salesman the print out. Salesperson would leave and the manager would show up - in every instance, the dealership was willing to match or slightly beat the Edmund's estimated market value.

Granted the last time I bought a new car was 2002, so things may certainly have changed.

OwensVI
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Post by OwensVI » Mon Jan 18, 2010 4:55 pm

it is okay to buy a new car if you want to and can afford it.

Everything is negotiable when buying a new car. Stay strong, they won't let a deal die over floor mats. If they are willing to then that is a signal that you are getting a great deal.

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