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Take it or leave it, but my advice is never walk into a dealership until you know two things; what is your payment going to be and the price you will pay on the new vehicle. I bought my last truck, and my mother’s car this way and both got exactly what we wanted at the very best price. This is how you do it for those interested.
First, identify the exact year, model, make, package you want to buy and the MSRP for that vehicle in your area. Go test drive that vehicle and make sure it’s what you want to buy. After all, you may not like the vehicle and change your mind.. Make sure you’re clear with the dealership that you’re not buying, but only shopping different models with intentions of buying LATER. Be completely honest in this regard. Keep in mind they will try their hardest to sell you the car at this point. DO NOT attempt to negotiate at this point. You are set up to lose money if you do.
Once you’re sure of what you want to buy, get preapproved through your bank or credit union. That will tell you exactly how much you can afford to spend and your payments/term. If you happen to buy something cheaper then your payments will less, but you know for certain your buying power and max payments ahead time. Your bank or CU rates will always be cheaper than dealer financing allowing you more buying power. This is critical as it can mean thousands of dollars in your pocket with what you end up spending. If you don’t have that option and have to finance through the dealer for some reason, always use that as a bargaining chip because dealers sometimes get kickbacks on financing.
Next, make a list of local dealers in your area of the brand (gmc, honda, ford, etc) vehicle your shopping even if it means you have to drive an hour to get there. The difference in dealer costs can run thousands of dollars, so it’s worth your time to shop with a commute if there’s an option. Major metro areas will commonly have 3-4 dealers (or more) of top selling brands.
Next, never ever walk into a dealer to negotiate price without having an agreement in principle first. Most cars co’s have internet sales depts anymore. Send an email with the same message to each of the dealers internet sales depts stating your name, the SPECFIC (options, color) vehicle your shopping, that you are preapproved for purchase, and you want their best offer on that vehicle. That’s all you tell them. It doesn’t matter if they have the vehicle in stock because they can find the car you’re looking for if they don’t have it currently (assuming it’s available somewhere). Dealers move around inventory all the time. In the event that a dealer doesn’t have an internet sales contact, you’ll just have to pick a salesmen to email. The message is the same though.
Now you just wait for responses. You can expect an array of different responses at this point (or non-responses), and this is where you gain valuable insight into vehicle pricing. Avoid the “come in and lets discuss” responses like the plague. Those folks only have intentions of selling you a car at the worst price, and should be approached only as a last resort, which I still wouldn’t recommend. The best cases scenario is that you get a few responses from straight shooters giving you a price that you can use as a basis for comparison of the rest of the dealers. You can also expect some offers like ”we don’t have that exactly, but do have it in this other color, or with other options”. This is also very good for knowing price for different options as what you may want may not be available with any dealers. If you don’t get a response from certain dealers, or just don’t like the response you got, try a different contact that the dealer with the same message as before. Not all salesmen are the same, and some are more willing to negotiate than others. You’ll find out real quick who wants to deal on your terms and who does not. THAT IS THE POSTION YOU WANT TO BE IN BUYING A NEW CAR. I can’t stress this enough. As soon as you walk into a dealership without know pricing and options from all the dealers you are on the dealers terms and at a severe disadvantage in negotiations.
The communication part of this can take a few days or weeks just depending on what you’re buying. It will become evident what your options are very quickly. DON’T GET IN A HURRY if you’re not comfortable with the responses you’re getting. Keep digging around until your certain you’ve found a deal you’re comfortable is a good deal on a vehicle you want. Don’t be afraid to negotiate further on pricing and options if you get multiple offers too. Once you have the deal you want, then you go to the dealership to close the deal.
I mentioned I bought two vehicles with this method. I bought my truck this way. It was a common model with lots of options. The process took a total of three days from the time I sent out emails to the time I closed on the papers. I got the best deal possible. I bought my mom’s honda last year in the same manner. That one took two weeks because it was a high demand model with a 6 mo waitlist. Salesmen kept trying to get me to the different dealerships to haggle, not many vehicles were available, and pricing was difficult. I kept looking and asking and two weeks later a sales manager I’d not even spoken with before contacted me. He found the exact car we wanted and at a cheaper price than any other dealers. We took the deal immediately and signed the papers a few days later. It worked out perfectly though we had to work a lot harder on that one. The result was the same in both cases though; the best deal available.
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