How to buy a new car?

[CapitalGuy]

I know there have been a few threads on this, but try searching "car" on here. Lol.

I have done my research and picked the new vehicle I want to buy (a Subaru, to my surprise. Never even considered one before). I know the exact trim levels and add-ons I want, and know which dealerships in the region have that specific car on their lots right now.

Anyhow my strategy is to take the CarCost Canada report I just printed, offer 3% above the wholesale cost to the dealer (after factory to dealer rebates are factored in) and stand my ground as much as I can. I will also show an appropriate degree of disgust at the outrageous fees he will try to add in, and of course say no to undercoating, Scotchguard and all that crap.

What do you think. Am I missing anything big here, in terms of getting a fair price?

 

[Hangman]

When I was car shopping, I looked at Subaru, and the sales guy (really nice guy) said they really don't have to bargain much, since they were selling out. They had one Impreza left, in the trim level I wanted, and were trying to get more shipped in. It's worth trying to strike a firm bargain, but I find they weren't all that concerned with losing my business because demand was outstripping supply for that model. (I ended up with the Mitsubishi instead).

In the end, you're going to pay a good chunk of money in interest, so watch the terms of the agreements as much as the final price. I found they were very unwilling to just flat out say the total cost.

I didn't find a lot of pressure to get add-ons, like the old rust-proofing and whatnot. I think they just build that dealer prifut into the MSRP price now. It was a far less adversarial process than I expected.

 

[Blue-Spheroid]

When entering a dealership, never give them you ID or anything else you're not willing to leave behind. Many places ask for your ID and then keep it in "the managers office" to make it harder for you to walk away.

When I buy a new vehicle, I always make it clear from the outset that I want to discuss all prices in terms of absolute final costs, (taxes in, rebates included, air tax, tire tax, freight, etc.) to drive the car off the lot. The dealers won't want to play this game, but they will, if you make it clear you will walk out if they don't. Negotiating in this way makes the process much more simple and avoids surprises at the end.

Another bit of advice is that you let them quote you a final price (as described above) on the car you want to buy. Don't ask for any after factory options or add-ons at this stage of the discussion. Once you have this price, counter with a price lower than your "real" final price and ask for the add-ons that you want to be included. Don't low-ball too much or they'll think you're wasting their time but don't allow them to push you above your final number. If you've done your research, you'll know what that number is for you. If they counter-back with a decent offer, keep bargaining but, remember, don't let yourself be persuaded to exceed your budget.

At the end of this process, they'll either offer you a price that's acceptable or they won't.

If they DO meet your price criteria, congratulations, you've bought a new car. Remember to stand firm on the FINAL price bit because they may try to sneak in some extra costs at the last second.

If they don't meet your price point, don't despair. It was a good practice run and you have a better idea of what's possible in the negotiation. Now, go to another dealer for the same brand and start again with the knowledge you've gained. You may have to adjust your bargaining strategy based on the experience and you may have to rethink your price point...but never make these decisions while inside the dealership.

 

[iwantitfree]

If you have the cash, buy the subaru in the states. You get more car (installed options) for the money.
If not, join APA.ca and get you car thru them. I have carcostcanada report and all the dealership wanted 6% for 2010 legacy.
I joined apa and the car broke they recommended was charging only $800 above invoice for any model of 2010 legacy.

 

[Meister]

I am surprised that the internet has not taken more of a foothold in this arena. I mean factory options, colours etc... are clearly defined options that can be dealt with online, just like buying a Dell computer. I am sure the manufacturers are somewhat resisting it to still support the dealernetwork, which they need for service.

 

[tboy]

Well, I don't know about subaru, but most car makers have a website that clearly defines the price of the vehicles and all incentives. You can even search most dealer networks to see who has the car you want.

I don't know how hungry subaru will be for your business now with toyota basically tanking. I've never bought one nor shopped for one so I dont' know.

I do know that hardballing doesn't work. If they have a price they have to get for the vehicle, they won't budge on it. I know even if you go in with cash that won't mean a thing. In fact, they prefer NOT to deal in cash.....

If you go in and say This is I want to pay or I walk, and it's below what they can offer, they'll let you walk. They certainly won't sell it at a loss. I know I've gotten good deals on models that have either sat on the lot for over a month, but that's with North American vehicles that have a kazillion options, are imports still offerred with limited options?

As stated, it depends on whether the vehicle you want is popular or not.

All you can do is figure out what you want to spend, and find the vehicle you can afford.

 

[Captain Fantastic]

http://www.theglobeandmail.com/globe-drive/deals-of-the-week-tactics-of-the-deal/article1490881/

Deals of the Week
Tactics of the deal

Jeremy Cato

Globe & Mail

Published on Friday, Mar. 05, 2010 11:33AM EST

Last updated on Friday, Mar. 05, 2010 10:05PM EST


It is a hoary, old cliché, but so true: knowledge is power.

And knowing what sort of money is on the table in any new car negotiation – i.e., the publicized and unpublicized sales incentives – puts the buyer in a much stronger, much more powerful position.

That is the premise behind Deals of the Week. This feature brings forward a richer picture of what is available to sweeten the deal on four new models each week. Factory-to-dealer incentives, for instance, are not freely circulated in the public domain, but the buyer who knows to negotiate for them, is positioned to secure a better deal.

At Deals we also try to get behind the scenes of the car business, to explain how the industry works. On this point, it is important to understand that the car retailing business is mostly tactical, not strategic.

That is, manufacturers/distributors and their dealers are constantly monitoring the marketplace, using day-by-day results to adjust incentives, sales sweeteners, and the like that are designed to move the iron off dealer lots. This is done not just nationally, but by region, too.

Tactics? Take the car maker who wants to clear out an old model to make room for its updated replacement. In this case, the manufacturer often slaps on an attractive finance or lease rate, or cash, to move the iron.

Cash can come into play as either a factory-to-dealer or a factory-to-consumer rebate. Auto makers also make features available free of charge to dealers, who then have the option to pass them along to buyers at no charge. Again, this can juice sales.

The takeaway here is that because sales incentives are tactical, they change constantly. Manufacturers and their dealers modify these sales tactics to meet constantly changing marketplace conditions and they can do so at any time, without any warning.

For buyers, Deals of the Week is a starting point for negotiating with the dealer of choice. But it is important to remember that new car retailers are independent business owners; they are free to sell cars for whatever price and in whatever packages they choose. No dealer is required to agree to any sales incentive at any time...

(Cont'd in link, including other "Deals of the Week" articles.)

 

[james t kirk]

I really don't think it needs to be such a game frankly.

Do your research on the manufacturer's website and on line. Walk into the dealer and start haggling to see what you can come up with. With some lines, the dealers have huge signs hanging in the dealers describing the sales incentives that are available. With others - they have the list price.

Start low (but not stupid) and be prepared to go up. You can tell when you are getting in the right area.

As stated, they are not going to sell the car at a loss.

At the end of the day, you both want the same thing. He wants to move a car and you want to buy one. They price you pay may not be as low as they could have gone, but odds are, it will be close enough.

Used to be that the only ones who really dealed were the North Americans. Honda might have knocked off $1,000 or $1,500 and that was about it. But lately even they have been playing ball. Especially on the financing side of things.

If you're 500 apart or so, and he won't budge, try asking them to throw in some free shit - like winter floor mats, or an ipod interface, some dealer installed accessory. Usually it costs them fuck all and it would cost you 400 to buy.

Then call it day.

You can drive yourself crazy and spend hours upon hours to save 500 bucks. Simply not worth it from a time and aggreavation point of view.

 

[tboy]

Good points there with dealer installed options. There is HUGE markup on those things. I recently had a trailer brake controller installed and I got it for dealer cost. The difference between retail and dealer cost? $225.00 on a $400.00 item. Same goes for bedliners etc......

 

[Damondean]

A friend successfully used a car broker. They charge a fee of about 200. They do the shopping for you. My friend was very happy.

Just do some research about them online. The dealership sales guys are always "nice guys." That is their job. Generally, the upsell starts whenn you meet the financial guy to sign the contract. They especially like to push extended warranties.

 

[Yoga Face]

offer 3% above the wholesale cost to the dealer

Offer less than cost to all of them then sit and wait

They may need to sell to get incentive bonus from manufacturer at end of quarter

They make their real money from the garage

 

[tboy]

Offer less than cost to all of them then sit and wait

They may need to sell to get incentive bonus from manufacturer at end of quarter

They make their real money from the garage

yeah, sit and wait until the cows come home because NO dealer will sell a vehicle below cost. They wouldn't be in business long if they did.

(and YF: the incentive bonus from the OEM is calculated into the base cost of the vehicle by the dealer)

 

[Yoga Face]

yeah, sit and wait until the cows come home because NO dealer will sell a vehicle below cost. They wouldn't be in business long if they did.

That goes against what an ex salesman told me

1 They get bonuses if they sell so many cars so they will sell below cost to get the bonus

2 Their biggest profit comes from the garage

Used makes more sense anyways


Any other opinions ????????????????

 

[toughb]

That goes against what an ex salesman told me

1 They get bonuses if they sell so many cars so they will sell below cost to get the bonus

2 Their biggest profit comes from the garage

Used makes more sense anyways


Any other opinions ????????????????

***

That's true.

As the total sales volume increases a retroactive rebate to the dealer kicks in and increases in increment as the volume goes up.

...

 

[tboy]

***

That's true.

As the total sales volume increases a retroactive rebate to the dealer kicks in and increases in increment as the volume goes up.

...

and you believe everything a CAR salesman tells you? LOL.....

The rebates are calculated into the base cost of the vehicle which gives the sales manager the lowest possible price he can sell the car at. So, to sell something "at below cost" that means even after the OEM incentives are factored in. NO sales manager will let THAT happen. The dealer would have his nuts in a sling for doing that......

Now RUbmeister can fill you in on all the details, he used to lease or sell or something like that.

I have family in the car business and have seen the computer screens that show EVERYTHING about any particular vehicle. They have a line for what the vehicle cost them when it arrived, how long it was on the lot for, (there's a cost associated with that), what incentives are available from the OEM on the vehicle, what the price is with all rebates for quota achievement, everything.

In fact, I seem to recall seeing the same screen for cars not on their lot. So they could see if they could do a dealer to dealer sale. It is all tied into the VIN number on the vehicle.

BTW: thinking that dealers need service to survive is a crock. If that was true then any leasing company wouldn't be able to stay in business because I have yet to see one with service bays......

To Capital Guy: if you're thinking of leasing you do realize that you can go to any dealership to lease any vehicle right? When I picked up my new F150 they were doing the paperwork on an Audi R8....at a FORD dealership.

 

[Blue-Spheroid]

You guys have forgotten that "tboy" is always right. Even if your personal experience tells you otherwise, you're still wrong and he's right. He's been on a tear in several threads lately and tactics like "proving him wrong" or "highlighting the error in his position" seem to have no effect.

The rest of the conversation in this thread has been interesting.

 

[rafterman]

I have heard Toyota has come out with five years interest free loans for obvious reasons but others are following suit.

 

[Yoga Face]

The rebates are calculated into the base cost of the vehicle

of course they are

how long it was on the lot for, (there's a cost associated with that)

of course there is which now gives them 2 incentives to sell below cost

The sales bonus and dump a car that is taking up valuable and costly space

These two factors have to be in play (along with your patience) before you will get a car at below cost but it does happen

 

[Yoga Face]

I have heard Toyota has come out with five years interest free loans for obvious reasons but others are following suit.

They say used is the way to go if you have cash but these "free" loans are factored into the price of the car so you would be better off with a bank loan and still buy used it seems to me

Do you believe they are paying for that loan ???

What do you think TBOY ????

 

[Tokyo Heights]

Just be very careful these day's with the introudction of HST and combining of Freight & PDI Charges with the Retail Price of a Car, there is also a big scam now merging the total prices, the dealers are charging over 1500 as freight charges, & over 700 & PDI Charges or earlier the freight charges for a medium size cars were from 600~800 whereas PDI charges were around 250 but with merger again the customer is becoming the victim and dealers are going to earn some extra profit on each car in the name of Freight & PDI Charges. Just beware of new legalize moeny making scam by automobile dealers!