How to negotiate for new car price - Forester


#1

I am confused on how best to negotiate with a Subaru dealer for a new Forester. I have researched prices on some web sites (e.g.: CarsDirect, TrueCar), and have the MSRP and invoice as listed on those sites. One strategy for negotiation is to make the dealer an initial offer of, say, “$200 over invoice”. But isn’t the problem with this strategy the definition of “invoice”? I have one number for “invoice” from the web sites but the dealer probably(?) has a different number for “invoice”. So when I make my offer, I do not really know the absolute dollar number of the offer since my invoice number may be different from the dealer’s. Am I not understanding something with this strategy? Comments?


#2

They should have pretty much the same number for invoice price. And make a total $ offer, not, ‘$X over invoice’. If that’s $25,000, offer $25,000.

But first learn a LOT more about car buying. Edmunds has lots of information, read all the hints:

Finally, remember to always be willing to walk out, and to buy NOTHING that’s offered to you at the closing (extended warranty, paint protection, etc, etc).


#3

You go in armed with the cost. You have in mind the max you are willing to pay. You know what car and what options you want. You have the money lined up and are ready to go. And its toward the end of the month. I know some people spend months agonizing over squeezing the last dollar out of a deal but I have always been interested in getting a good deal that everyone is happy with. I don’t think I’ve ever spent more than an hour on price and normally conclude a purchase from walk-in to drive out in about three hours or less. Just get a reasonable deal and be happy. “The love of hanging onto your money is the root of all evil.”


#4

How many Subaru dealers are available to you? You are in a better position when there is competition for your business. So, you visit several dealers. You let every dealer know you are also talking to other dealers.

Make your 1st offer lower than what you expect to be an acceptable offer. Don’t move from that offer, but listen the the counteroffer and then walk out the door. Let the salesman and mgr sit on it for a few days. As the end of the month approaches you should get a call(s) from one or more dealers and then the real negotiation begins.


#5

Edmunds.com has a feature called True Market Value. It tells you what people near your zip code paid for a similar car. Below TMV is a bargain, above is not.


#6

Going in Armed with all the data is good. There was the local TV show on Sunday mornings in Manchester NH ran by this Ultra Conservative named Rondo who owned a couple of local businesses. One time on his show he was complaining about all these kids who can access the “Interweb” to get the information on the car they’re going to buy…He said there should be a law against that. He had friends who were loosing money because of it.

One thing you have to be able to do is WALK. The deal isn’t good…then walk. If you have more the one dealer in your area…the negotiate with both.


#7

http://www.carbuyingtips.com/


#8

All good advice above. First thing is to accept that the dealership has all the advantage on this transaction. They do it every day. And have done so for years and years. The sales staff are professionally trained. They practice and practice to get the most dollars from the customer, in any way they can. And they have all the numbers. How many cars in the local area are available like the one you want to buy. What they have sold for. etc etc. Numbers you don’t have. They know the ropes. The have their ducks in a row.

On the other hand, compared to the dealership staff, the rest of us are a rank amateurs. We are behind the 8-ball right from the start. Me buying a car at a dealership is like me trying to score points in an NBA game. With all the preparation and skill the opposition offers up, going straight on against them, it’s unlikely to be successful.

So go around them instead. If at all possible don’t get all ga-ga over one car at one dealership. The power you have in this process is to be flexible about which vehicle you will be willing to buy. And which dealership you are willing to buy from. If you aren’t getting satisfaction at dealership A, go to dealership B. Then back again. Play one dealership against the other. & make sure each dealership is aware there are other options you are considering besides them, like Craigslist used cars.

Be aware that the dealerships know this game car buyers use, and to gain an advantage the dealerships may talk to each other, and in fact may be owned by the same folks! So this might not work, but at least try to get as much free coffee and donuts as you can before walking away from both dealerships!

One thing that seems to work for me is to make the dealership aware you are a serious buyer, and no “just looking”. I have done this by taking my current month bank checking account statement with me. If I’m interesting in making an offer, I’ll show the balance to the salesman to prove there’s enough in the account for the down payment.

I’m saying to the salesman that once I’m satisfied w/the deal, all I have to do is sign the check and the deal is done. Gets the salesman att’n and speeds up the dealership’s final offer.


#9

Just find the dealer on the internet and let the sales manager make you an internet offer. Then just go in and pay them if you want a car. Then you don’t waste time and you get the job done. Now is a good time to buy because the car isn’t eight months old before you get to drive it.


#10
With all the preparation and skill the opposition offers up, going straight on against them, it's unlikely to be successful.

I have to completely disagree with that…Especially in a buyers market. While they do have all the numbers…I find that most of them are NOT that good. Their so-called training consists of a maybe 2 weeks before they are let loose on the public.

Even with this economy turn around…cars sales are still down. They are hungry for buyers. But you have to be prepared and hold your ground. I’ve walked out of several dealerships in my day…and more then once they called me back meeting MY TERMS.

DEPOSIT?? Maybe each state has different laws. I give them $100 for a deposit. Never paid more then that…and never will.

One thing that seems to work for me is to make the dealership aware you are a serious buyer

That has never worked for me. Every time I came saying I’m looking to buy…is when the pressure started…What I do…is go in…say I’m just looking and want to test drive one. I’m all prepared with knowing the MSRP…invoice…If I’m satisfied after my test drive…I’ll go up to the salesman that greeted me (they work on commission) and then tell him I’m interested…and tell him the price I’m willing to pay. I usually low-ball it…and leave a couple hundred dollars in wiggle room…If they don’t want MY deal I stand up and leave…simple. If they start playing games…I leave…I don’t need the hassle.

You’re right about many dealers being owned by one corporation…That’s common around here…but that information is easy to find. There are 4 dealerships within 30 miles of my house…2 are independent…and 2 are owned my the same company. So if I want a Toyota I have 3 dealerships to deal with.

I also am NOT stuck on one brand…When I bought my 4runner I could have easily have bought a Pathfinder. But the Toyota dealer gave me a better deal.


#11

My method is to tell the dealer this:

First tell the dealer what you want. Make model and year or whatever you feel you really want. Next tell the dealer that you are going to shop around at other dealers (maybe a dealer in another state or across the street.)

You will then choose the best deal he will offer.   Don't play around, if the dealer does not like that, walk.  Remember, the dealer needs to sell cars, you don't need to buy one. I have done this several times with success.  Don't be afraid to walk away,  The dealer must sell cars or go hungry. 

Don't be afraid of contacting a dealer in the next county.  

IMPORTANT:  Don't give you keys to the dealer! That would put the power in his hands.   As long as you have the keys and you don't let him Disappear with your car.

I have used this several times and I was only surprised once, when I when in for a closing, the price was significtly less.  I pointed out and all he did was smile.

#12
Don't be afraid of contacting a dealer in the next county.

When I bought my 98 Pathfinder I drove 20 miles past a Nissan dealer to the other Nissan dealer. That dealer I drove past will NEVER get my business.

Agree about NOT giving them your car keys…even if you are trading it in (which I never do). Negotiate FIRST. Then when you have the deal you want for the new car…THEN work out a deal on the trade-in. If they don’t give you a fair deal…then sell it yourself.

Good point about telling dealer you’re looking around. I always do that too. But NEVER EVER tell them where you’re looking. It’s none of their business.

One list thing…I know this thread is for someone who’s already decided on what vehicle to buy…but if you haven’t…then go to one of the local car shows they have every year. Usually the year I’m looking for a car I’ll go to the one in Boston. That way you can look at all the vehicles at one time. Get an idea of what you may want to purchase…and eliminate some on your list. Be prepared to ask questions. The one in Boston usually has manufacturer representatives there that are far more knowledgeable then the sales schmuck.


#13

I agree with most everything mentioned so far. I’ll add that if you are buying an in demand, model, then the dealer isn’t going to as willing to negotiate. When I sold cars at a Ford dealership, in late 2004 We had the only black 05 Mustang GT in town. When ford rolled out the new 2005 Mustang they were producing 70% V6 models and 30% GT models. Everyone wanted the V8 GT model, but there weren’t many available and consequently they were demanding full sticker price, with some dealerships even going so far as to add a $1500 “Market Adjustment” on them.

I had a gentleman come in and test drive the black GT, and then we proceeded to talk numbers, I was upfront about it and told him, that if he wants the car he’s going to have to pay sticker price. They thought I was BSing him. And demanded to see the GM. I got the GM, and the GM told him exactly what I had told him. The guy said that he was going to see if he could get a better deal another Mustang GT elsewhere. I gave him my card, and told him that I didn’t think the car was going to last long on the lot. The guy told me that he thought that we were tring to take advantage of him by not negotiating at all, I told him that it’s the car that’s in high demand and demand is vastly outstripping supply at the moment, and that most of the other dealerships in town are marking up these cars beyond sticker price. He said that I was blowing smoke up his posterior and went left.

Later that day another gentleman came in and was interested in the same car. I repeating my spiel about sticker price and that there were no negotiation on this car. This guy said that he had been shopping around and that he gathered that at best he would be paying MSRP. He test drove the car, and liked it, mentioned that he wanted a black on black Mustang GT anyway, and paid for the car in in cash that day.

The next day the first customer comes back, and said that he wanted to buy the black Mustang GT after all. I asked him how much the other dealerships were marking up the GT’s they had on their lots, he said that most were adding $1500-$2500 onto the price of the cars. I could’ve been ass about and pulled the " I told you so card". But just told him that I already sold the car that he had been looking at and it was the only the GT we had on the lot.

Anyway the moral of the story is that right now Subaru is selling all the cars they can produce, demand is more than the supply is for several of their models so you may or may not be able to get the car for close to invoice.


#14
I agree with most everything mentioned so far. I'll add that if you are buying an in demand, model, then the dealer isn't going to as willing to negotiate.

There are some cars that come along and everyone has to have one. The Miata was one. When it first came out people were paying THOUSANDS over MSRP. Stupid if you ask me.


#15

The new Challenger is another example.
I was looking around the local Dodge lot awhile back and noticed an orange SRT8 model sitting in the used lot. Another person happened to be on the lot at the time and mentioned the owner had traded it in after a year of owning it. The previous owner had paid 60 grand for the car, and that it was a low production number, and that the dealer wasn’t backing down from the $43k sticker price. A brand new model, at the time, was going for that price. Can’t imagine the bath the guy took when he traded the car in.


#16

We found it very easy to buy a car last year. Equip yourself with all that pricing info off the Web (which often includes estimates of actual sales prices), hit the dealership to see whsr they have and take a test drive, then go home. Don’t give them your keys, don’t get into negotiations where you sit in an uncomfortable chair while they string you along with guff about needing approval from four levels above them. Just go home and say you’ll be in touch if you’re interested. They didn’t pressure us at all. We made an offer by e-mail, they countered, we said no thanks, then they sold it to us at the price we offered. No bother at all. We didn’t have a trade-in, which did simplify things, and we weren’t buying something in short supply. A Forester should be similarly easy, unless you need some unusual combination of options.


#17

I agree with @MarkM

Do NOT trade in your car

Sell it on your own

If you trade in, they may give you a good trade-in value, but screw you on the new one. Of course, they will hide it in all the paperwork.


#18

This forum has had multiple threads on how to buy a new car.
One of the best is at:
http://community.cartalk.com/discussion/958009/secret-tricks-of-car-salesmen/p1

[Update] It’s a long thread, but pay attention to all the posts in there by “deepplaid”. That person is a friend of Tom & Ray (who created that thread just so deeplaid could contribute) and has spent time in the industry. He gives lots of good insight from his experiences.


#19

@JoeMario

I just read that thread you posted

Thanks. It had a lot of useful information

Anyways, I can’t believe how rudely DeepPlaid was treated.


#20

Let me correct that last statement

I can’t believe how rudely DeepPlaid was treated by a few individuals . . . or was it only one?