Many buyers are intimidated when it comes time to talk turkey with car dealers. They often feel overmatched when pitted against dealers who have much more experience haggling. Therefore, buyers sometimes agree to deal too fast and end up regretting it later. To avoid unpleasant conclusion, follow these five hard-and-fast rules.
1. Know your numbers. Te sticker price or retail value, the automobile, usually awards dealer profit margin between 10 and 20 percent. But because sellers can still make a tidy profit charging much less than retail, they are almost always willing to negotiate. Depending on the dealer, most are satisfied with the margin down to 5 percent. As a seller, it behooves you to learn the invoice price retailer (what the seller paid). You can then add five percent and negotiate a price with complete security.
2. Order out. If the seller has not exactly what you want a lot, consider ordering it. Even if they offer to give you a special offer, chances are you’ll end up paying more for the presented model. Why? Because the models are often upgrades cost a pretty penny. So if you want to models without all the extra bells and whistles, do not let a salesman talk you out of it. Simply order out!
3. Do not get emotional. One of the reasons car dealers often have the edge in the negotiations is that they are simply doing their job. As such, they do not take things personally. As a buyer, you need to realize that the seller is not your opponent. Once you accept that fact, you can work with him to get a fair price.
4. Phone ahead. There is nothing that says you can not ask for a price over the phone. In fact, most modern sellers more than happy to quote you a price over the phone or on the Internet. Those who refuse will probably give you a line about doing business in “the old fashioned way.” Our advice? That old excuse is nothing more than a ploy to get your home on his.
5. Do not pay hidden fees. There are certain fees and charges that you will invariably pay when you buy a new car, such as taxes, registration and license fees. There are others, however, that some car dealers trying to slip in under the radar. Things like delivery, handling, sales fees and promotional expenses are most sellers will throw in free to sweeten the deal. Those who decide to bill you for them are not really play with their own guidelines. Some vendors will even try to push the fancy extras like pin striping and rust proof on you at the last minute. If you are not interested in them, simply smile and say “No, thank you.”
Use these simple tips to negotiate a great price on a new car dealership.