Negotiation tactics/car buying

4

4realhorn

500+ Posts
I'm looking to buy an 08 Tahoe (3LT package with add ons) in the coming weeks and one of the problems (other than being a passive person in general) is that once I get a quoted price I'm not quite sure of where to go from there, or where to get information on a reasonable counter offer. I know what I'm willing to pay and know what I want, but I really don't have a good reason for what I'm willing to pay other than I've seen posters on various forums claim that they paid a certain price for a certain product.
Having said this, there seems to be a wide chasm between what dealers are offering and what I want to pay. How do I close this gap?

I admittedly don't know much about the car sales and havent bought a car since 97, so what are some of the factors affecting car salesmen's bottom line? How do I get a good deal without completely cutting their margin out, or whatever it is that they are judged on.
 
Getting a fair price on a car, especially a new car, today is so much easier than it was even 10 years ago. Thank God for the internet. So much information is available for free that the smart buyer can essentially dictate to the dealer what they are willing to pay.

Edmunds.com is a great resource. Go spec out the car you want and you'll see the dealer invoice as well as an average of what buyers are paying on your area for your exact car.

Decide in advance whether you want to buy an extended warranty. We did on both our Dodge truck and our Jeep Grand Cherokee and they have paid for themselves since we tend to keep vehicles for a long time. But that is obviously a personal choice.

Another way to do it that we did in 2001 after a flood totalled all three of our cars was to call a bunch of dealers in and around Austin, Dallas, San Anotnio, and Houston. We told them the situation, the general specifications that we were looking for, and that we were contacting many dealers with the same instructions: to fax us the dealer invoice of vehicles that they had on the lot and to write on it their best and final offer. That we would be paying cash and choosing from the cars within 3 days. I got the Jeep that I have now for less than we payed for a Grand Cherokee with far more options. It happened to be a dealer in Clear Lake. Robert flew down to Houston and drove the car home that week.

If you are buying a Tahoe in the Austin area, go up to Don Hewlett's dealership on I35 at Westinghouse Road. Wear Longhorn gear. Don's father was Lan Hewlett, the "brain coach" under Darrell Royal -- one of the first full time academic coaches in college football. The Hewlett's have been family friends since before I was born. Don and his folks will give you a fair deal. Definitely good people.
 
Dude they are giving Tahoes away right now.

The first rule when buying a car is remember that you DON'T have to buy it. You don't have to buy it from that dealer either. You make the offer and forget out their quoted price. Closing the gap is simple. You should be getting, at a minimum, around 17-20k off the sticker without even trying. When they bring you the quote, look at and write down what you want to pay, no matter how insane. They'll look at you like you are insane and then run off to the mini-manager guy and they'll more than likely counter somewhere in the middle. If you still don't like the price, then stick to your guns or meet them somewhere in the middle. Eventually, you will get the sales manager out there and in the process of taking up hours of their time, they will either a) kick you out of the dealership or b) sell you the truck for a good price. Just count how many Tahoes are on the lot at the dealership and remind them that there could be one less if they want to do do business with you.

Car buying is fun. You are in control. It's not a necessity item either, so if you don't find a good deal, just move on and go somewhere else or wait till the end of the year when they have to eat all the Tahoes that are rusting on the lot.

You don't need a good reason for what you are willing to pay, other than that is what you are willing to pay. I got 11k knocked off a 34k sticker F-150 back in 2005 when gas was 'only' $2.20 a gallon. The great panic hadn't quite started yet. Sure, I was kicked out of the dealership, but when I got home at night, the sales guy called and we met in the middle and I got what I wanted. It was fun.

You close the gap by sticking to your guns. Passive or aggressive has nothing to do with it. If you are aggressive, you'll look like a dick and they won't waste the time dealing with you. You need to appear somewhat passive in general at first anyway, as they will think you are a typical douche that takes the first offer and thinks they got a good deal. They have to get the time invested in you that they could be selling to other douches who they will rip off. You might even consider going home after teasing them and play it out over a few days. They are hurting bad and you have all the power. Just remember that. You can be very passive and refuse their offers. Passive and firm is the way to go. And be ready to walk out at any time, as it can and will happen.

And don't trade right now either. If you are trading and SUV you are hosed...Unless it is paid off and then be prepared to laugh when you see their 5000 offer. If you have no trade and cash you should slay them.
 
Call all the dealers within 100+ miles and ask for their internet sales manager's email address. Send out a mass, blind message ("BCC") stating exactly what you want, asking for their best price. Do NOT include your phone number. You want them to have to respond by email.

The weasels will try to talk you into their showroom. Tell them no, you want vehicle specifics and their best price. Compare your lowest price to edmunds.com pricing -- you should be at least $1K below invoice -- and tell all the other dealers that you won't consider their vehicles unless they can beat your best price. Most will. Repeat as necessary.

You can do all the negotiating from your computer. Only go to a dealership once you know they have the vehicle you want for the price you're willing to pay.
 
Just a question, why a Tahoe? As mentioned on this thread you will get an SUV highly discounted right now b/c nobody wants the gas guzzlers and they aren't expected to have a high trade in value down the road. They are becoming obsolete in many cases.
 
Here's a tip that worked for me. Negotiate the best price you can with a dealeship A. When they say they can't go any lower, "test drive" the car you want to dealership B who sells the same car. Tell them, if they beat the other dealership's offer, you will buy on the spot. They can get a quick sale and spend almost no time with you.

I "test drove" the car I was considering to dealership B who sells the same brand (but different ownership). I told dealership B the price dealership A was quoting me (after two weeks of negotiating) and said if they beat it by $500.00, I would buy it on the spot. They agreed. I bought the car from the dealership B (who spen less than 15 minutes with me) and then drove the first car back to the original dealership A (who was not happy). I saved $6,000 off the sticker on a $30,000 car. Anyone could have bought it for 3-4K off sticker (we established that negotiating on day 1), so I think I saved an additional $2,000 by being persistent and playing the dealerships against each other. I'm sure they still made a profit though.

My last car purchase was much less eventful, however. Both local dealers have the same ownership AND the car I wanted was in demand. I still paid well below sticker but they seemed happy to do it and I bought it the same day I test drove it for the first time.
 
I second jimmyjazz's e-mail method. We just bought a new car and I did this will all the dealers in the area for the car we wanted. Had to drive an extra 45 minutes away to get the one we wanted but that time saved almost $2000.

Figure out what options you want. Be very specific in your e-mail and be detailed. Make them offer. Compare those to Edmunds, KBB and Cars.com prices and finally to each other. Have a firm offer before you ever walk in the door.
 
Don't want to derail the thread, but are the same tactics used for a certified/pre-owned car? If I see a pre-owned car for 20k for instance, do you have any leverage to move...if so, what would you think is fair.

I checked edmonds which lead me to lookinng for used cars, and prices range from 20-25 for the car I'd like.
 
I think it's probably a LOT harder to determine the worth of a used vehicle. So many factors come into play.

That said, I believe most dealerships make their money on used car sales. $500 profit on a new vehicle is a good deal in their eyes, but I bet they clear $2,500 on most used cars. Theoretically, I guess that gives you some bargaining room, but it has to be harder to play one dealer against another for the simple fact that they don't have identical vehicles.
 
There is a website that basically does what jimmyjazz is describing for you (autobytel.com?).

The last time my wife bought a car, I told her to go negotiate but not pay more than $X. The dealer never got close to $X, so she went to this website and got 4-5 quotes via email from dealers within 100 miles that were less than $X. The lowest quote was in Temple, but we called an Austin dealer and asked them to match it, and they did.
 
There have been a few people who have used this internet method in the past. There was a long thread on it a couple of years ago. If somebody is buying a car and does not use this method, they are giving money away. It is simple, it saves you tons of money and it is convenient.

And as somebody said, do not give them your phone number. Do not go into their showroom till you are ready to sign. They don't need either of these things. What they do need, and desperately at this time is your business and money. You hold all the cards and you determine what happens. Or you can walk into a showroom for the circus viewing and spend more money.
 
How does he find that out? Isn't that info on the autobytel type sites? I thought their service fully informed the buyer on what the dealer paid and stuff like that. I have not done it so I don't know for sure.

Is there a place he can find that out or figure it out to empower himself even further?
 
i took the advice i got on hornfans and saved big time. they gave me a quote, i made an offer, they countered and i countered back. they weren't willing to meet me so i told him to give me a call if he was able to do something. that was friday.

monday i get a call and got what i wanted.

two most important things:

they want to sell it more than you want to buy it
be sure you're willing to walk out (don't let the niche of car buying excitement take over)
 
From what I've learned, few brands have dealer holdback exceeding 3%. On a Tahoe, that's maybe $1,200 below invoice. I suppose if a manufacturer's rebate is part of your deal, the dealership essentially gets to pocket that money, but regardless, $1K+ below invoice is pretty good. At some point, you're picking nits, and probably ought to be considering some other things, like the exact vehicle in question (options, color, etc.), dealership proximity, etc.
 
A few years ago, my credit union made the dealers cost available to its customers. Not invoice, actual cost. I actually had a couple of dealers claim it was against the law to have that info. Check with you bank/credit union.
 
Hell you can negotiate a blowjob if you will buy something full size at this point in time. Dealers have nearly a 6 month inventory in many cases on Full size trucks for instance. Look at the dealer's inventory, it's mind boggling the number of full size trucks SUV's they filling every available space on the lots.

Employee pricing is usually kick *** with GM, but right now you might find an even better deal from a more remote dealer. Find what you want and be willing to travel a little bit. you ought to be able to get the EXACT vehicle you want.

You will do even better on a truck IMHO, but I understand the SUV lust, we just can't bring ourselve to sell ours. Of course resale is **** right now so that makes the choice easier.

ALL the auto dealers are dropping their pants right now just to cut the carrying costs. You are going to see more than a few GM related dealers fold in the coming year.
 
If you havent bought the Tahoo yet, wait another 5 days.

The end of the month/Weekend combination is absolutely pure chaos in the car industry.

If your dealerships are open on Sunday, go in at 2pm (or around 5pm on Saturday if they arent open on Sundays) and be prepared with your research. offer a dumb@ss stip low amount.

Almost every sales manager has some sales quota that they need to hit that day and if you come in on the last day and they need one more sale to hit that quote (which pays them a shitload more money), they will do anything and everything to get the deal.

Old co-worker of mine (Ryan) was a burned out car dealer sales manager. Told many stories about selling a brand new car on the last day of the month at 8pm for a $3 THOUSAND dollar loss- and this is a real loss, $3k below the real drop dead from the factory cost.

The incentives from the car manufactuors along with his own owner made it a do or die deal.

Ryan's own paycheck got a $3500 boost by selling the last car, and the dealership got an additional $20k bonus for getting that last sale, even though it was a massive loser.


Aug 31 is a Sunday. If you are buying it literally doesnt get any better than that day.

Use the internet to bargain it down to 2-3 dealers near you. let them know you are buying on Sunday (or Sat if they are closed) and let the fireworks begin
 
Go with the employee pricing and get it Sunday. A good buddy (and relative) of mine is the sales manager at Covert in Hutto. I bought a truck form him about a month ago. He gave me $600 of the $1000 holdback. He said with employee pricing, you can expect to get another $800 off of that. Basically, without any negotiations, you should be able to get it $1500 behind invoice.
 
I just went through all this. I am a guy who doesnt have time or patience for the ********.

Edmunds.com.

Spec out the car. Then there is a section when you can find out what the average price is that people in your area are actually paying.

Then there is a section when you invite bids via email. Open it up as much as possible. The dealers will commit to a number in writing.

Only communicate with them via email. They will bid against themselves.

The first time I talked to them was to get the VID number and close the deal.

The internet and market conditions have conspired to make this the best time in history to buy an American SUV.

My advice to you is to use that weapon and stick it all the way up their ***. Dont give them more than five minutes of your time.

Remember, whoever names the number first loses.I was shocked at how low they went right off the bat, and I was buying a foreign car which doesnt get discounted as much.

Let them eat each other alive.
 
1. remember you don't have to buy the car
2. remember that there is a greater than zero chance you will be dealing with a douchebag of the highest order
3. do your research on edmunds.com
4. you can rear end a dealership on a new SUV right now
5. know a number that you have to get to in order to make sense. if it doesn't, **** em.
 
There is some good information on this thread and some mis-guided. Its all about what you want in your car buying experience. if it price and price alone thats one thing, then there is if you have a trade- something they shouldnt even see until you are on your way to f&i. secure financing before you enter the dealership- they do not shop the best rate for you they give you the rate that is most profitable for the dealer.
there are so many ways to knock cost off of a car deal. The best way to be happy about a car deal is to think of what you are buying and what you are willing to pay. a mistake that is commonly made is having that price that you have agreed to yourself for paying and not negotiating beyond that point. INTERNET PRICING is more than you can get by going into the dealership. Get the internet price and start your negotiating from there- if they dont want to do that go to the next dealership with the quote- you will recieve a phone call after you leave.
buying at the end of the month has become a myth- there are not larger discounts just because its the end on the month. they make make it seem that way but they will get you in f&i if you have not secured financing prior to.
i could go on and on, i currently help family,friends, and fellow longhorns for a small fee, if you are interested in having me negotiate your car deal for you feel free to PM me or email me at [email protected]
 
The price will be good but the financing will not. Thats why it is important to secure your financing before hand. Financing is better at the beginning of the month because banks want a bird in hand. Also those same rebates and the price of the car at the end of the month, were there in the beginning of the month. Thats not getting to the human element of sales guys and their quotas and whatever sales contest they have going on.
 
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