In tough economic times, negotiating with a seller for a new car can be a major challenge for even the most battle-hardened consumers. However, by employing a few simple tactics, anyone can get a commonsense deal and drive away from the dealership without feeling cheated. In fact, the following five tips include all you need to know to bargain like a champ.
1. Be Willing to Say “No”
Honest, experienced dealers will respect a buyer’s decision to “walk away” at any time during negotiations. However, most consumers never even attempt this strategy. Your goal is to remove the pressure to buy by being 100% ready to say “No” to any deal that doesn’t meet your minimum criteria.
Doing so is an excellent way to show the seller that you will not be a pushover. Expect a counteroffer when you say no, but some dealerships won’t make one for a day or two. The good news is you’ll have extra time to investigate other offers during that interval.
2. Pay Attention to Timing
Never underestimate the power of strategic timing. A little bit of planning in this area can save buyers thousands of dollars with little effort. Call local dealers and ask about special pricing, advertised discounts, and upcoming sales. Most sellers have annual, monthly, and other time-sensitive sales quotas. The most common quotas for dealerships occur at the end of each month. Similarly, year-end clearance events can be the perfect time to snag your favorite vehicle and take advantage of a significant price cut.
3. Shop Around
The easiest tip to implement: Shop at least three dealers to find the best price on the exact vehicle you want. Let dealers know you’re shopping around, and be willing to use the prices you get from one seller as leverage when negotiating with others.
4. Perform Targeted Research
Spend at least two hours online checking out prices and availability of your preferred make and model. Read reviews on major car-related websites, like Car & Driver, Edmund’s, and Motor Trend. Before heading into the dealership, arm yourself with specific data regarding price range, market value, and typical dealer incentives. Look at local dealer websites for special promotions and sales.
5. Focus on “OTD” (Out-the-Door) Price, Not the Sticker
Ignore the sticker price and focus on the total cost to drive away, also known as OTD or out-the-door price. The number usually includes the base price, registration fees, taxes, and various dealership fees. Include them all to find out your actual cost to take ownership of the vehicle.
Before You Shop
Review the tips above in order to prepare yourself. Doing research and planning to buy at the right time comes easily to most individuals. Some need to practice the art of assertiveness before plunging into the search for a new car. Try saying no to a few people in other aspects of your life to get a feel for what it’s like to be firm but pleasant.
That way, it’s much easier to boost your chances of getting a reasonably good deal on the next vehicle you purchase. Preparation is the secret ingredient, so use a friend to do a few practice sessions in which they play the role of the dealer. It’s time well-spent and can save any consumer a substantial amount of money.