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10 Tips To Buy A Car Below Invoice Price

February 18, 2014

A big mistake that some new car buyers make is that they believe those ads on TV where a salesman is screaming "If you're one of the first 3 people to come down to our showroom we'll sell you a new car for $100 under our dealer invoice price!!!!" They think it's such a screaming deal they camp out the night before just to be a lucky winner.

The sad thing is so-called deals like that aren't really good deals and in this article we're going to give you the information you need to negotiate a real deal; not be another victim to a marketing ploy.

Then after you've requested your free, no obligation new car price quote and have received multiple new car price quotes from competing dealerships, you'll be able to to negotiate a sweetheart of a deal on a new car or truck.

How Can A Dealership Sell Me A New Automobile Below Their Dealer Invoice Price?

With a lot of assistance from the auto manufacturers. Think about this for a minute: How many times have you been driving to work or the store and passed a dealership with the same cars parked on the lot? Probably more times than you can count. The fact is that makes the automakers real nervous, because if their dealers aren't selling the cars they currently have in stock they are unable to buy more.

  • What happens then is the automaker offers car buyers like you attractive incentives such as cash rebates, low and even zero percent financing; they will even offer the employees discounts and then permit them to offer the discount to a friend and/or family member.

  • Those incentives being offered to customers are only the one's they advertise on TV; there are factory-to-dealer incentives and kick-backs (like the dealer holdback) that no one talks about, let alone advertises. The 'holdback' alone is around 2 to 3 percent of the dealer invoice price or MSRP that gets returned to the dealership after a car buyer takes delivery.

  • And let's not forget about monthly sales bonuses, regional incentives where the dealers compete for the big bonus money, volume bonuses, special incentives to sell slower-moving models, end of month/year-end bonuses . . . well, you get the picture.

This is the reason that not only can a car dealer sell you a new car or truck below their dealer invoice price, but they can do it and still make a chunk of change in profits. So if any salesperson tries to tell you they're willing to take a big hit and sell you a new vehicle for $50 under their invoice price just smile; then let them know they'll have to do much better if they want your business.

10 Tips To Buy A New Car Below Invoice Price

Here are several ways you can increase your chances of buying a car well below the dealer invoice price :

  1. Locate vehicles that are in an overabundant supply on the market.

  2. Research and be willing to consider more than one make and model. Run head-to-head comparisons.

  3. Determine the prices of the new cars or trucks you've selected, along with available manufacturer rebates and incentives. FYI: Note release dates of the new year's models, as this means the dealers will need to pick up the pace to move the current year off the lot.

  4. When you request your price quotes, request a quote from multiple new car dealers so you're exposed to their special internet-only pricing; which is lower than if you just walked in to their sales office.

  5. When you follow up with the new car dealers, negotiate (via email) with several of them.

  6. If a particular car salesman doesn't want to play ball, let it go; this is why you want to request numerous price quotes.

  7. Never forget you hold all of the cards, so be patient. You have the power and the dealerships need to make a sale to you more than you need them to (after all, you have multiple price quotes).

  8. Since you'll have everything in writing by negotiating via email, read over the offers to make sure no one is jacking up other parts of the sale to balance out a discount on the sales price.

  9. Be reasonable and work for a win/win: The dealers need to make some money and won't take a loss on the sale; even if the ad makes it sound like they will. Buying a new car for $200 to $500 below the dealer invoice price puts a win in your column.

  10. This is why it's so important to understand the true dealer cost and the general amount of profits the dealer is making off of a sale to you; you'll have a better idea of the number you should shoot for.

The bottom line is when car salesmen who work on commission and have bonus money at stake are forced to compete they'll go out of their way to make the deal work. By starting a bidding war between your new car dealerships and pitting them against each other, you'll have the leverage you need during negotiations.

Request free, no obligation price quotes and receive dealers' special internet-only prices. When you combine your competing price quotes with the available manufacturer incentives and what you learned by reading this article you'll be driving home with a screaming deal on a new car.

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