Since you're reading this article you already know how important it is to do your homework before attempting to negotiate a deal on a new car. It's a sad fact that so many don't avail themselves of the internet to read important information as well as having car dealers compete for their business.
When you use the information in this article when negotiating with the multiple new car dealers who will send you competing price quotes after you've requested a no obligation, free dealer price quote you can be assured of negotiating the best possible deal.
In a perfect world you could walk into a new car dealership and they would help you to find the perfect new truck or car at a fair price; however, as in any profession, there are always those who place more emphasis on profit margins and what goes into their pocket , instead of ensuring their customer is satisfied.
By doing your homework you're already off to a good start in buying a new car and looking out for your best interests. Unfortunately there are too many salespeople who pounce on new car buyers who haven't and that gives the salesperson too much control over the situation.
You need to continue researching the vehicles you're interested in buying and evaluating things like safety features, reliability, fuel economy along with their prices, and with your budget in mind.
If you plan to trade in your current car you should find out how much it's worth. Its trade in value will be determined by how old the car is, its condition, how many miles you put on it, features etc. You need to determine its value as a trade-in or its retail price if you decided to sell it yourself. Gather this information and know beforehand, especially if you plan to trade it in to ensure you get fair value.
Don't start negotiations at the MSRP (sticker price). You need to go in with the lowest offer and that would be the dealer invoice price (minus the holdback). With your free dealer price quote you'll receive the dealer invoice price; however, invoice price isn't necessarily what the dealer paid for the car. Due in large part to the 'dealer holdback' which is a percentage of either the MSRP or dealer invoice price that gets kicked back to the dealer.
Dealers also receive incentives and bonuses (money) when they get a higher score on the CSI (customer satisfaction survey). This is a survey all automakers conduct after a customer buys a new automobile from them and gives a high score rate. Then there are volume bonuses, increased incentives (money) when selling last year's models, cash incentives for selling models that are selling slower, etc. All of these reduce the amount actually paid for a new car.
In a down economy businesses can't afford to be greedy and the fact remains that when you have requested multiple free dealer price quotes you'll be able to play the numbers game to find the one who will share part of their profits and come in with an offer below the dealer invoice price.
When you're negotiating, keep control of the situation and only allow one thing at a time to be negotiated. Salesmen like to negotiate a lot of things at the same time (i.e., trade-in value, financing, etc.) – while they place a lot of emphasis on the monthly payment. This gives them more leeway to offer you a more attractive amount while inflating others.
Remind them that if need be, you have received competing price quotes and that you'll buy from whomever makes you the best deal.
Once you've negotiated the sale price then discuss any trade-in, financing etc., and negotiate them one at a time. Never forget that you're holding all the cards and you can walk out the door at any time; in fact, sometimes doing just that will speed up negotiations or get you a better deal.
Speaking of financing, before you even discuss with a dealer you should have already researched interest rates from your local bank or credit union – even other lending institutions. If you can obtain preapproval then you can take financing off the table during negotiations. While there could be a good APR incentive offered by the manufacturer you need to know whether you'd qualify; if you are already preapproved you'll eliminate the chance of getting talked into a higher rate.
Don't pay for after items you don't need or want like paint protection, rustproofing or other things that some dealerships will try to sell you. If you see them on the sales contract just mark them off. Many of those things you could do yourself for a lot less money.
It's just logical that when anyone is forced to compete for a paycheck they'll do whatever they can to get it done; car salespeople aren't any different. Either they make the sale or they lose commissions, and don't hit their sales quotes (get bonus money) unless they sell cars.
When the new car dealerships see that you're shopping for your new car online they will know they're not the only dealership; they'll know that you're comparing their price quote against their competitors. If they don't competitively price the offer they know you'll toss their free dealer price quote right in the trash.
When you request your no obligation, free dealer price quote you will also receive the dealership's exclusive internet-only incentives – they want to make sure they're in the running when you evaluate the price quotes.
It's fast, free and easy to get all of the information you need to negotiate in confidence for a great deal on a new car.