Posted by Maria Dimitrova

Read this if: You are planning to buy a car and you want to get good value for the money

Gain: Satisfaction with the deal and a big amount of saved money

Cost: Some time to prepare for the negotiation with the dealer/seller by doing research on the average value of the chosen model and fees to pay the services of companies offering information packages

For most people buying a car is one of the biggest and most expensive purchases they make. So knowing a dozen of useful tips about how to negotiate and strike a good bargain with the car dealer can save you in some cases hundreds of dollars, in others – even thousands. Just imagine how many other things you can spend the saved money on and you’ll be eager to learn how to get the price down on a car.

These are the basic rules of this type of negotiation:

1.Your attitude

As I have quoted Herb Cohen’s advice about negotiation in general in the article “Life is a constant negotiation – learn how to do it successfully”, the first and foremost rule is to adopt the attitude “I CARE —, REALLY CARE, BUT NOT THAT MUCH”and show this both verbally and with your body language. Experienced car dealers can feel when someone is desperate and needs to make an urgent purchase (for example the buyer’s previous car has stopped working) or when you like the car they are showing you so much that they know that they can stick to their first asking price until you give in. So restrain yourself from expressing any emotions which can be used against you in the price negotiation.

This type of negotiation is different from the those with people who you have a long-term relationship with. Most probably you might never see the dealer or seller again in your life so their style of negotiation won’t be led with the “win-win” outcome in mind. They might be rather aggressive and use a range of psychological tactics to make you succumb to their offer. Therefore, you have to be really TOUGH. If being tough is a difficult task for you, then take someone with you who can do this for you. Plus, it will be harder for the other side to challenge two or more people.

Another option if you are uncomfortable with face-to-face negotiation is to negotiate via email. Just make sure if you do this that you save your emails as a record of the agreement. You could also use an online used car-purchasing tool like Deal Negotiator from MyTitleTransfer.com

2.Preparation

Make sure you do “your homework” diligently before going to the dealership or seller or you will regret it bitterly later. Finding the necessary information can save you a lot of money. For example, it’s good to know that the best time to buy a car is during the latter part of the month or in December when dealers are striving to reach their monthly and yearly targets and are more likely to make concessions.
But the most important thing is not to enter a dealership without knowing how much you can buy a car for from Yahoo!Autos, Cars.com, InvoiceDealers, Edmunds.com, MyRide.com ,CarsDirect and Ebay (in europe mobile.de). You need at least 3 printouts of car purchase quotes to have negotiating strength. In this way when you negotiate with the other side, you don’t need to play the “bad guy” as the papers you’ve got will do the job. The seller can’t argue with data from car sites with real asking prices.

Another recommended source of information about new car prices, rebates, dealer incentives and negotiating tactics is FightingChance.com.

Also look at http://www.carbuyingtips.com to learn about the possible scams you might fall prey to – for example buying a wrecked, a flooded or a stolen car with a “laundered” title. Cars damaged in disasters will be salvaged, rebuilt, sold at car auctions and have their titles rebuilt, most likely out of state. That’s why you should run an Experian AutoCheck Vehicle History Report before taking the decision to buy a used car and have a mechanic inspect the car on a lift.

3.Use ALL the information you get to your advantage.

Point out all the scratches, dimples, bad tires, cracked dash, faded paint, rust, seat stains, missing mats, torn ceiling, lack of maintenance records and too much mileage (the standard is 12000 miles per year) to get the price down on the car. The dealers use this all the time, so learn from the best. You even don’t need to argue with the dealer/seller, just list all these defects to your companion so he can write down the damage. The other side of the negotiation will get the message.

4.Ask the seller to justify his selling price.

You’ve done your research and you show them the lower prices in your printouts. If they still disagree, ask them: “What kind of research did you do to determine what your car is worth?” If they show you ads with higher asking prices, tell them that very few sellers get their asking price when they sell a car, so those newspaper prices he’s showing you are inflated.

5.If you like the car, try to convince the seller that they will come out as a winner from the deal.

Point out what they will benefit if they strike the deal with you instead of postponing the sale– they’ll have the cash and a free space in the garage, they’ll save time and money as they won’t need to renew the ads.

When you are dealing with a dealer, you might also say that you will bring more business to their dealership by recommending them to your acquaintances and friends if you are satisfied with the purchase and it’s made at its fair market value.

6.Overcome the dealer’s leverage.

To be able to successfully do this, keep in focus the context of your relation with the dealer – you are not talking with a close friend of yours. The person in front of you is trying to make money out of you. They are experienced in using different tricks to influence you – both verbal and non-verbal. Don’t be misled by their impressive clothing or other symbols of authority. Be cautious and confident at the same time.

Ignore their complaints that they are not going to make any money by agreeing with your offer. In such cases you can mention the “holdback” to show that you know what they are saying is not true. Dealer holdback is a percentage of either the MSRP or invoice price of a new vehicle (depending on the manufacturer) that is repaid to the dealer by the manufacturer. The holdback is designed to supplement the dealer’s cash flow and indirectly reduce “variable sales expenses” ( sales commissions) by artificially elevating the dealership’s paper cost. This means that even if the dealer sells you the car for the invoice price, which is unlikely, he would still be making several hundreds on the deal.

Being well-prepared with information and some negotiation tips is vital to gain the stronger position in the negotiation and strike a great deal.

If you liked this article, check out how to get a good deal on insurance.

Further reading:

Life is a Constant Negotiation – Do it Successfully

Harness the Power of Your Employees

“Decorate” Your Business with the Art of Delegation

Turn a Stressful Work Schedule into Cash

Basic Skills not Taught at School

Get a Better Deal on Insurance

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Build Your Dream Home Cheaply with Import from China

Are Electric Cars Really Eco-Friendly?

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