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Buying a brand new car - What to do

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DerStrom8

Super Moderator
Hi folks. I find myself, for the first time in my life, looking to buy a brand new car. As you know, car salesmen and saleswomen are sharks. They'll take you for every penny they can, and you'll need to make a firm stand from the start and refuse to budge. Throughout the buying process I have picked up a few tips that I wanted to share, and collect other suggestions from the members here (who have bought new cars in the past).

To be clear, this post DOES NOT necessarily reflect purchases of used cars, nor is it a discussion of whether you should buy new or used. It also should not be make/model-specific. Instead, it should serve as a general guide to anyone looking to buy a brand new automobile from a dealership.

  1. Do your research
    -The process will be much, much easier if you go to the dealership for the first time knowing exactly what you want. Once you know what you want, find the car invoice pricing (NADAGuides is a great resource: ). This will tell you what the dealership pays for the car (though you can usually still talk them down below this cost, depending on how good you are) and the manufacturer suggested retail price (MSRP). Always try to dicker the price down to or below the MSRP. Make sure you print out this invoice/MSRP page!
    -If you plan to trade in your old car, use NADAGuides to find the same information. Put in the information for your old car in order to determine its trade-in value. Print out this page as well.
    -Research all dealerships in your area, and even ones that are a bit further than you would like to travel. Find the lowest price you can and print out the page (I personally would recommend getting rid of any dates to avoid any chance of the salesperson thinking you've got an old price). This will give you some leverage to hold against the salesperson.
    -Research the dealers you are considering buying from. Look for reviews that are not associated with the dealership's website. Look for google groups, cars.com, etc. Make sure you look at both the good AND bad reviews. This will help you dodge some of the worse dealerships out there (poor quality, poor service, overly-pushy staff, etc).
    -If possible, research the staff of the dealers you're considering buying from. If you have friends or family who have recently bought from them, ask who they had as a salesperson and what they thought of them. If they were happy with their service, then you can ask for those salespeople by name when the time comes.
    -Browse TrueCar.com. TrueCar will give you an idea of what other people in your general area paid for similar cars to the ones you're looking at.
    -Look for special rebates or other deals offered by the manufacturer. These can often be brought with you to the dealership to help your case.
  2. Split your correspondence into 3 visits
    -The first visit should be to look at the car. This is after deciding exactly what you want. DO NOT test drive a car until you know exactly what type of car and what options you would like. If you cannot decide between a few cars, make sure you have a specific model and package in mind for each car. The goal is to not give them a chance to talk you into options you may not want/need. If you tell them before you drive the car the exact year, model, and options package you want, and you stick with it, they won't be able to talk you into anything extra. Try to avoid test-driving a car unless it was on your list before coming to the dealership, and it is the exact model and option package you selected beforehand. Don't give the salespeople any wiggle room. If you don't know the exact model you would like to look at, then you're not quite ready to test-drive. Do a little more research first. NEVER talk money during the first visit. Tell your salesperson as soon as you meet him/her that you will NOT be talking finances today, and that you are ONLY here to look at the car(s). Don't back down--If they try talking money, remind them you don't want to discuss it.
    -The second visit should be to discuss costs. This is when you'll need your printouts of the invoice price and any other deals you found from other dealerships. Make sure you are very familiar with your monthly and yearly bills/loan payments/spending habits. Beware your debt-to-income ratio. If it is over 36% (generally speaking) then you are much less likely to get financing. The lower it is, the better the deals will be. Also, don't be afraid to say no. If the prices are still too high and you've tried all the tricks, and even if they already told you that's their best offer, tell them it's too high and that you're not interested. Often this will push them to give you their rock-bottom price, which may be even better than their previous "best offer". They may also call over a manager at some point and you can discuss it with him or her. They are most likely to give you the lowest possible price. Once they give you a rock-bottom price, THEN mention your trade-in, if that is part of your plan. DO NOT show them the paper saying how much it's worth, and DO NOT give them a number. Let them "appraise" it and give YOU a number. Since you know the value of your car based on the NADA values, you will know if they're trying to gyp you or not. If it's lower than what's on the paper, don't be afraid to tell them you know it's worth more than that. Don't let them talk you down below the value NADAGuides gave you. The trade-in is your "secret weapon", so to speak. It is your last ditch effort to drop their price, but only after they've dropped it as much as they can already. If they ask you before this point if you want to trade it in, tell them you haven't decided yet. Don't let on that you plan to trade it in until the very end.
    -The third visit is when you buy the car. At this point you should have done all your research, know exactly which car you want, test driven it, and talked the dealership down to the lowest price. Sometimes this can be done at the very end of the second visit instead of going in for a third one, but that is entirely up to you. If you feel comfortable with the deals offered and are prepared to bring home the car, you can often do that after the second visit.
  3. Never forget that the salesmen/saleswomen are there to get as much money from you as possible
    - In order to overcome the enormous pressure from car salespeople, you must be firm and stand your ground. There is also no need to be polite. Show them that you will not back down, and that you know what you want and will not be persuaded otherwise. You must shark the shark. If you have to tell a fib here and there (i.e. you have looked at other dealerships and have more to look at, even if you don't) then go ahead. Try not to show too much interest (don't get too outwardly excited if you see something you like). You can show some, but if you make the salesperson think you like the car too much, they will think they can sell it for more. On the other hand, don't act entirely uninterested. Showing a little bit of interest will tell them that you're worth their time. When you leave the dealership, if you feel like it, tell them you're not sure if you'll be back. Pick apart even the most minute aspects of the car that you don't like, and make them known. Remind them frequently that there are other dealers and cars that you're looking at. Ultimately you want to keep them competitive with other dealers.

Buying a new car is an art and a science, and requires focus and a level head. Be firm, don't feel you have to be polite, and be very clear about what you want. Don't let them talk about something that you don't want to talk about. Never feel like you need to hear them out--You don't. If you refuse to give them wiggle room, you have the best chance of getting exactly what you want for the lowest possible price.
 
If anyone has other tips to add, please don't hesitate to post them as replies. I'm still in the process of buying a car, so every little bit helps!
 
No tips, but I must ask: "Where were you when I bought the new '69 Vette??"....

Well, maybe 2 additional tips.

1. Don't go to the dealership with a pocket on fire that's full of money and with -
2. A fever for the car exceeding that of sex :banghead:.
 
Hi Matt,

I am quite skeptical of on-line reviews by relatively anonymous individuals. First, there is no way to weed out the idiots from those with brains. Second, there is a clear selection bias -- the most popular item will have the most negative reviews. Third, there is no way to know for sure that the individual actually owned such a vehicle and is not just a troll. And so forth.

On the other hand, large corporations with fleets of vehicles have valuable and documented experience with most brands. Unfortunately, they won't just give that information to you for very obvious reasons. Case on point, I bought a new American-branded vehicle in 2012 (Ford Fusion SEL). I have had lots of problems after the first year. I was at a family gathering in October and was admiring my SIL's car of about the same age ( a Mazda). I mentioned my problems, her response was yep, the engineers at her company won't touch a Ford. She works for a very large company that makes fuel additives. Thus, it tests lots of car brands for extended periods. The moral of that story is, if you know an insider at a large company, get their views on the fleet cars they purchase.

John
 
Hi Matt,

I am quite skeptical of on-line reviews by relatively anonymous individuals. First, there is no way to weed out the idiots from those with brains. Second, there is a clear selection bias -- the most popular item will have the most negative reviews. Third, there is no way to know for sure that the individual actually owned such a vehicle and is not just a troll. And so forth.

On the other hand, large corporations with fleets of vehicles have valuable and documented experience with most brands. Unfortunately, they won't just give that information to you for very obvious reasons. Case on point, I bought a new American-branded vehicle in 2012 (Ford Fusion SEL). I have had lots of problems after the first year. I was at a family gathering in October and was admiring my SIL's car of about the same age ( a Mazda). I mentioned my problems, her response was yep, the engineers at her company won't touch a Ford. She works for a very large company that makes fuel additives. Thus, it tests lots of car brands for extended periods. The moral of that story is, if you know an insider at a large company, get their views on the fleet cars they purchase.

John

Thanks John, you bring up a good point regarding the reviews. It's strictly subjective, and it's up to the buyer to trust reviews or not. Generally you want to look at the ratio of good reviews to bad reviews, not just the number of either. That is also why I suggested asking friends and family who have recently purchased cars for their recommendations. As for knowing an insider at a large company, that would certainly come in handy, but the majority of prospective buyers probably don't have that luxury.
 
Another comment: I stated several times that there's no need to be polite. To an extent that may be true, but it is important to remember that you should not at any point be unpleasant to the car salesman/saleswoman. Try to be friendly, but don't be overly-polite. Just remember that YOU are in charge, not them. You don't need to "ooh" and "ahh" at everything they show you, and in fact you should avoid it. Keep a calm, clear-headed demeanor.

Before going in to discuss the money, set a limit for yourself. Don't let them talk you above that point. If they try, tell them that you're at your limit and won't go any higher.

Also, when negotiating the price, never counter your own offer. Suppose you offer $15,000 and they're silent. Never raise your own price. Give the salesperson time to counter it. Otherwise, you come across as weak and a poor negotiator, and will convince them that you're an easy target.

Threaten to walk out or go to other dealers if you feel the need. If you think they're being unreasonable, or not giving you the deal you're looking for, tell them that you'll go to a different dealer. If you've been at it for a while and don't seem to be making progress, then stand up and leave. Once again, always remember that YOU are in charge. You don't have to do anything the salesperson says. Your goal is to find the right car for YOU at the right price for YOU. Not for them.
 
I mentioned my problems, her response was yep, the engineers at her company won't touch a Ford.

Interestingly I was talking to someone a while back, who worked for a company that has a HUGE fleet of Ford Transit vans - and they had large numbers of unexplained engine failures, which Ford were unable to find any reason for. In order to try and find an answer the company and Ford got together and secretly fitted 'black boxes' to the vans that recorded their usage - the result was that the throttle on the vans was almost always either ticking over, or flat out on the floor, only rarely anything in between.

So basically the vans were trashed to death :D
 
Another comment: I stated several times that there's no need to be polite. To an extent that may be true, but it is important to remember that you should not at any point be unpleasant to the car salesman/saleswoman. Try to be friendly, but don't be overly-polite. Just remember that YOU are in charge, not them. You don't need to "ooh" and "ahh" at everything they show you, and in fact you should avoid it. Keep a calm, clear-headed demeanor.

Before going in to discuss the money, set a limit for yourself. Don't let them talk you above that point. If they try, tell them that you're at your limit and won't go any higher.

Also, when negotiating the price, never counter your own offer. Suppose you offer $15,000 and they're silent. Never raise your own price. Give the salesperson time to counter it. Otherwise, you come across as weak and a poor negotiator, and will convince them that you're an easy target.

Threaten to walk out or go to other dealers if you feel the need. If you think they're being unreasonable, or not giving you the deal you're looking for, tell them that you'll go to a different dealer. If you've been at it for a while and don't seem to be making progress, then stand up and leave. Once again, always remember that YOU are in charge. You don't have to do anything the salesperson says. Your goal is to find the right car for YOU at the right price for YOU. Not for them.
I could loan you my wife. But you would need to be prepared to stay at the dealer for at least 6 hours. :D
PS. She loves it!
 
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