Even with all of the rebates and discounts being offered by car companies, getting the best price on a new car will take some work on your part. You will need to research your purchase carefully and negotiate with the dealership to come out on the good end of the deal. The following steps will help you through the process and increase your chances of getting a fair price on your next purchase.
Sticker Price vs. Market Value
Start by learning the sticker price of the make and model you are interested in. The sticker price is the amount that the dealership would like to sell the car for, but it is not the amount that they have to have or the amount that you should pay. The sticker price is just the starting point. The price that you want to pay should be equal to or less than the actual market value. The market value is the average price that other people are paying for the car in your area. Market value is often dependent on geographic region as well as the car’s options and color. You can get an idea of market value by using the True Market Value tool on Edmunds.com. This tool offers market values for new and used cars based on actual sales figures.
Incentives and Rebates
Every car company is offering some type of incentive or rebate to attract buyers. Before purchasing a vehicle, you should research all of the discounts that may be available to you. Get your hands on a print copy of the offer and take it with you when you negotiate. Keep in mind though, that you may have to have excellent credit to take advantage of incentives like no money down or zero percent interest.
Multiple Quotes
You should never buy a new car without getting quotes from multiple dealerships. The price you are asked to pay for a Ford Focus or any other make and model may vary from dealership to dealership. Call or email every dealer in your area. Tell them that you are looking for the best, bottom-line price available for that car. You will be amazed at the differences in the price quotes. If you have a particular dealership that you’d like to buy from, let them know about lower quotes and ask them if they can match or beat the price.
Be Flexible
You will almost certainly get a better deal on your new car if you are flexible about specifics, such as the color of the car and additional options. If you know that you want a Honda Accord, but do not care what color it is or whether or not it has Bluetooth, be sure to say so. The dealerships you speak with will be able to make more cars and better prices available to you if they know you aren’t picky.
Be a Fierce Negotiator
After doing all of the above things, you should still work to negotiate a better price. Dealerships do not make the bulk of their money on new car sales. Their big profits come from parts and service. They want to sell you a new car because it means that you will probably be back to do business with them again at some point–either as a repeat customer or as a customer who needs vehicle service. In other words, you are a package deal. Most dealerships will give on the price of a new car in hopes of securing future business. Don’t be afraid to ask for a price below invoice.
Be Vigilant
You should know that the selling price of the car isn’t the only thing you need to worry about. If you got a bargain basement price, the dealership may try to make money in another area. For example, you may be asked to pay additional administrative costs or delivery and handling charges in addition to the selling price, tax, and regular processing fees. Be vigilant and if necessary, ask the dealership to waive superfluous or duplicate fees.
Know When to Walk Away
If you are having trouble with the negotiations or if you just can’t get the price you’re looking for, walk away. There are other cars, other dealerships, and other days. It’s as simple as that.
Guest post from Bailey Harris who writes for www.carinsurancequotes.net, a car insurance comparison site.