Ugh, buying a car, right? It’s awful. It’s so much work, so many decisions to make, and so much second guessing yourself. There’s just absolutely no good or easy way to do it.
So first off, I approached it the way I approach everything: with tons and tons of research. Buying a car today, with the Internet at your disposal, is such a different game than the last time I bought a car 11 years ago. There’s so much more information to be had. It’s not just deciding what you want or finding a good dealership or knowing what the pricing options are; I spent a significant amount of time researching sales techniques and tricks. Is there anything as consistently slimy as a car salesman? Spend any amount of time reading about their tactics and you need to shower off the scum afterwards. Yuck.
In addition to just generally learning how far some salesmen will go, I think the most important piece of information that I learned is that the “invoice price” is so far above what the dealership actually paid for the car. I’m sure some of you are saying, “Duh”, but I really fell for the trick that anything under the invoice price was costing the dealer money. I feel hopelessly naive. It makes me wonder how badly I got taken on my last car (they got me with a charge for etched VIN on the windows too).
Basically I more or less followed the script found here. I modified the emails and things, but I kept the most important part, which was breakdown of the various components of out the door price. This is essential. It was *VERY DIFFICULT* to keep all of this straight. The dealers will try everything they can to fudge the numbers. It would almost be comical if it weren’t so underhanded. If you only get the out the door price without the details, it will inevitably be lower than you’re actually going to pay, and when you show up to the dealership they’ll say, “Oooh, I’m sorry, we forgot to account for XYZ, but as long as you’re here…” For instance, nearly every dealer tried to quote me a lower tax rate to make their bid look significantly lower (you know how you assume someone is driving in from downstate Illinois to buy a car at your in-the-city dealership?).
Long story short, I emailed 10 dealerships for a bid. Each of the 10 salesmen required a little bit of convincing that they should cut the crap and give me the numbers that I wanted. Ultimately I received 8 bids. Just as the article cautioned, 6 of the 8 were all within $200 of each other, but one bid was significantly lower than the rest. Armed with that offer, I went back to the other 7 and asked them to beat it. A few of the dealerships got a little nasty at that point, mostly claiming the offer was impossible and wouldn’t be honored. “Fine,” I said. “Just give me your best bid and I’ll put you on the list. If this offer falls through, I’ll move to the next lowest bid on the list.” Ultimately, with a little coaxing, I think 5 of the 7 agreed to match or beat the low offer (with much grumbling I assure you).
At the end of the day, we paid about $1820 under invoice (which is, of course, significantly under the MSRP). I was very happy with that, and I much prefer negotiating via email (I should say emails, since I think all told I had something like 70 emails to and from the various dealers). After reading about all the shady dealings, I wanted to make sure I could do this without losing *my* integrity. As such, I didn’t want to lie about anything. Doing it this way was great; I never had to lie or bluff. This is the current low price, do you want to beat it or not?
The dealer we ultimately went with was the one that had originally offered the lowest bid. Now this sort of proves the point made in the article about why you need to get so many bids. When we got to the place, we could kind of see why they were desperate to sell new cars. The building was a little run down and in a pretty poor neighborhood. It was pretty clear they do most of their business in used cars, not new. And last but not least, the entire place smelled like a sewer. I mean that literally, they must have had some kind of rupture or something. Strangely, nobody mentioned it at all, so we ignored it as well. But hey, who cares; their odor is my gain. But if I hadn’t emailed that one dealer, i would have probably paid $1000 more for my car.
The nice thing was that we had the car financials already agreed upon, so by the time we went in to sign the papers, everything went very smoothly. Even for all the extras they tried to sell us, we just said no and they moved on. They knew we were well researched and we weren’t putting up with nonsense. We didn’t get any hassle whatsoever, as opposed to the people on either side of us who were getting the full treatment. I even watched one salesman talk for maybe 5 minutes to a “finance manager” that I’m pretty sure was just a dial tone. (“Just run the numbers, Eddie, I’m going to do whatever it takes to put these nice people in a car!”) I felt pretty bad for some of the people (but then I felt less bad when I heard them talk about how bad their financial situation was and then demand a widescreen navigation display be included on their brand new, tricked out, luxury mobiles).
One last “trick” I wanted to mention: the dealer was offering a $500 incentive for financing the car. It turns out that there is no charge for financing, and no early payoff fee. You can literally sign up for the financing on the minimum amount, get the $500, and pay the car off with the first payment. As far as I can tell, no gotchas, just free money.
The one thing we hadn’t talked about at all was our trade in. We understood we weren’t going to get top dollar for it, but we had a (very) low number in mind and various print-outs and evidence to back that number up. The amount they offered us – $350 – was so low that it wasn’t even worth trying to bargain on it. $350! We got more money for Sara’s old car from the junkyard, and that was with a completely seized up engine that had to be towed in. I don’t know if that validates that we were getting a good deal on the car so they wanted to hose us on the trade in, or if they were just worn out and didn’t want to deal with it, or what.
So we simply said no and moved on, but the unfortunate part is that I was hoping to get everything resolved that day. Instead we still have to deal with my old car. Still, it was the right thing to do, and it’s not as pressing now that we have a car that we can drive without worrying about a breakdown.