I asked advises here before and it really helped me make sound decisions, so here's another one that I need advise... if anyone would be willing to give me a piece of their mind...

We're buying a new car, and we have been shopping for about a week now. It seems with pre-owned cars, I don't have a problem bargaining with the price ( I already bought two Preowned and I think I managed to get a good deal), but with the new cars, I feel like I couldn't bargain.

Last night, we visited a dealer and he listed the base price of the car and the options available for a particular car. So when he told us the final price, I asked if he could do better... he could knock off a $100 bucks off he said...
what are my options here.
Should I continue to lower bargain for a lower price and wait for him to go back to his manager and then offer a better deal?
How much do you think I could take off the price? 5%, 7%?
I am very inexperienced with buying new cars, so I really really appreciate a good advice on tactic...

Jeffrey

I'm not good at bargaining for anything really, and with car dealers, it is worse. But I know that many car manufacturers are not doing well these days (GM is one of them), so I think it would serve you well to continue to bargain until you get the price down to where you want it. No matter how hard the dealer is being, remember that they really want the sale and for every dealer that doesn't bend, the next one probably will, so visit different places.

The question is what they mean by "base price." I'd ask him what the invoice price is, first of all, because he'd not be knocking $1,000 off an invoice price. That invoice price is, allegedly, what they paid for the car. Generally speaking, you should be able to buy the car for about $500 over invoice in a good deal, depending on the car and the company and the dealership.

You are definitely buying at the right time of the month. Today and tomorrow they'll be looking to meet their monthly quotas, and a sale is a sale.

By the way, are you financing or paying cash? If you're paying cash, you should demand to see the invoice and offer to pay just over it. In a financed deal, they'll look to screw you with interest rates regardless of what they sell you the car for. Don't accept the first one they offer. They can almost always go lower.

Bill

One way to find the invoice price is to check the web and see what the manufacturer (Toyota, as an example) lists. What I've done in the past is offer 10% above invoice; if the dealer balks, I walk away--there are other dealers in town & a 10% profit is very healthy. Also, I always try to deal with the highest ranking person available.

Good luck on your car purchase.

~Adam

Pick up Consumer Reports current issue, the annual car issue. Great info on makes, models, reliability, and great negotiating tips on getting the best deal you can on the car you want.

[ March 30, 2005, 12:07 PM: Message edited by: scottie ]

Also, check out Edmunds. They will list incentives, dealer invoice price etc. and you can go into the dealer better informed.

Yahoo actually has a pretty easy site to go through and find information too. There's also a used search which is very good (and brings up a lot of results). I just bought a 2004 car with 2,000 miles on it and it was a good 5000 bucks cheaper than it would have been new.

Plus it always helps to know exactly what car you want. That way, you can target your research on the model, resale value, reliability, and so forth.

A few more pointers I got from a co-worker who used to sell vehicles:

1) If you are trading in a vehicle, do not EVER give your keys to the sales agent. If s/he wants to see the vehicle, go with them and let them into it.

2) Someone mentioned going at the end of the month, which is true. End of the year is even better. And if you can do it, go late in the evening, just before closing, and plan to stay a long time. The sales agent will not go home if s/he thinks you are ready to buy. My co-worker mentioned that he once stayed until 3AM to close a sale.

3) If you have any kind of additional incentives (GM card redemption, for example), do not even mention this until a deal has been made, but do mention it before the paperwork is done. If the sales agent is ready to shake your hand to close a deal, it is time to bring up the additional incentives. Don't worry, the dealership gets refunded for those so they won't mind too much.

Good luck and happy shopping!

[ March 30, 2005, 05:45 PM: Message edited by: Purdue Fan ]

Thanks so much guys for the advise. It really helped me a lot. I don't think we'll be able to make up our minds before the month ends, but we probably will continue to look maybe up to middle of April. I got a good deal by going through lending tree for financing so I am going in with a blank check which from the advise I have gotten, may work out to my favor.
Love you guys.

Jeff,

First off, you should never buy a new car from the retail showroom. The best way to purchase a new car is through the dealers fleet department. They will start with the invoice price and add $100-$600 to it. If you are looking for a hard to find car or one that is in high demand, you will pay more for it.

If you know what you want, make contact with the fleet manager and ask him/her if they have a similiar car in stock. Chances are they do or can do a dealer trade for you. This will save you the hassle of negotiating the retail price down and saves you hours upon hours at the dealership. In addition, you won't get the hard sales pitch for after market products that you'll get on the retail side.

I often wondered when I'd be so taken by a thread that I would actually register and reply. Who would have thought it would be on buying a new car? ha-ha I would have thought Hockey or Horse Racing, but whatever worked. wink

Todd

Jeff - Edmunds is a terrific resource as it allows some comparison. Hopefully you are looking at a class of cars, and not set one THE ONE, just yet. When you reach that point, go to several dealers, esp. if they are fairly close in proximity, they would sell their own mothers to make a deal rather than see the next guy down the line get your business. Under our current economic conditions, factoring in the end of the month and you should be able to walk away with a car at sligthly over the dealer's cost. REMEMBER even if they sell the car at what it cost, they may still be earning anywhere from 2-5%. THAT WILL GET THEIR ATTENTION.

I didn't catch if you had a trade...that is another area where they really rip you off, totally low-balling trades. I used to sell cars myself, and I hated it. There has been a lot of good advise given in the posts before mine. You did the right thing arranging financing before purchasing. The finance department makes more money for the dealership than do the cars sitting on the lot. I am a big believer in pre-owned vehicles that have been certified. I have only purchased pre-owned, since new vehicles can depreciate by as much as 25% just driving it off of the dearler's lot. Last piece of advise...SHOP AROUND! Car dealers are a hungry breed.

Millerbeach makes a great point....

More car buyers find trade-ins stuck with debt

Long-term loans, lower resale values seen contributing to problem

A growing number of new car buyers are finding they owe more on their existing car loans than the vehicles are worth as trade-ins.

The phenomenon, known as being “’upside down” on a loan, is the result of a confluence of changes in the ways Americans buy and finance their vehicles.
Article Link

My aunt just bought a new car and went through a leasing agent, who took the specifications of the car she wanted (including the price, which was a couple thousand cheaper than the MSRP value for what she wanted) and the guy searched around and found a car at a dealership a few hours away, but they had enough incentives and such so she could get the price she wanted. Of course, the leasing agent is going to get some compensation, but you end up getting more bang for your buck. You can also buy cars through most leasing agents if you do not want to lease too.

I have a couple of ideas. ONe is to go through a buying service. My credit union has a service where you tell them what you want and they do all the bargaining for you. It saves on your end.
When I bough my last car, I got the invoice price information from Edmunds or somewhere and walked in with the printout. I knew they had a rebate from the manufacturer so I offered them the invoice price. They, of course, dithered but when it was clear that was my final price, they gave it to me.
Most finanacial planning people I read suggest buying a car one to two years old. The depreciation in the first year is phenomonal so that a car one or two years old is a much better value. Of course, you don't get that new car rush, but how much is it worth to you.

Just an update for anyone who gave me advice a few weeks ago.

The car seach is over, and a car was purchased last night. Whew! And I really thanked everyone for the good advice, specially that Edmunds.

In the end, I was able to get the exact color and packages I wanted from the car, and $5k off the sticker price and a cruise to the Bahamas for 5 days. It was quite a lot of fun, but believe me, I really don't want to go through this again for at least 5 years. Cheers everyone

So what did you get? Deets, please!

So are you taking us all with you on your cruise!? :confused: wink

I'm embarrased to say, but we bought a Lexus Rx330 with white exterior. We're just happy that we bought something that we planned to buy from the very beginning. I know, I know... gas guzzler... but I'll end up using it only in the weekends.

Embrace pride in ownership, Jeff! wink

Nice ride, good choice!

they're discounting RX's that much? Wow, that's unusual, especially considering it was redesigned in 2003.

Aubie, isn't that an SUV? They aren't exactly popular cars at the moment with the gas prices. Doens't surprise me at all.