How To Effectively Negotiate With A Car Dealer

October 2, 2020

Finding the right car entails seeking a competitive dealership that offers your desired vehicle. People planning to get a car, particularly first-timers, forget the importance of meeting a good seller or dealer as they tend to focus on the vehicle itself. After all, a car is one of the biggest and most significant purchases one can make in their life. However, effectively negotiating with your car dealer can allow you to take full advantage of your purchase.

Finding The Right Car Dealer

Your choice of a car dealership significantly affects your car purchase and experience. Therefore, make sure to find the right car dealer by looking for these qualities:

  • A wide selection of vehicles
  • Friendly and knowledgeable salespeople
  • Certifications and permits to operate
  • Service amenities
  • Has a good track record and reviews 
  • Fair and affordable pricing

If you’re living near Greece, New York, these car dealers offer a plethora of automotive solutions to assist your journey towards vehicle ownership. Their services include:

  • New and pre-owned vehicle sales
  • Car loans and financing
  • Certified service experts
  • Vehicle parts and accessories sale 

Before finalizing your decision and meeting with your car dealer, take note of these tips and advice in negotiating with your car dealer effectively:

1. Do Your Research

Knowledge is your biggest weapon in every negotiation. Before stepping into a car dealership, you should be equipped with the right information about your desired vehicle, the dealership, and the current market. 

For instance, knowing the average market value of your chosen car helps you compare dealership prices, allowing you to shop around and get the best deal. By knowing your car’s market value, you can compute how much these dealers make on your car sale. 

If you’re purchasing a new car, you should be knowledgeable about terms such as manufacturer’s suggested retail price (MSRP), dealer invoice price, dealer holdback, dealer incentives, regional ad fees, and more. Searching dealership reviews online can also help in knowing how their terms work. 

On the other hand, if you’re opting for a secondhand car, there are numerous blue book services or estimate websites that determine the current value of the used car you’re eyeing. These prices are estimated by identifying the car’s year, make, model, and mileage.

2. Act Unenthusiastic Or Uninterested (At Least As Much As You Can)

A highly effective negotiating strategy that has to be accomplished properly is showing the dealer you’re not too eager to make the purchase. By acting less enthusiastic during the negotiation, the salesperson can make room for pocket-friendly offers. 

Car salespeople have two approaches to selling their vehicles: encouraging buyers that you’re getting an excellent car or getting the car at an excellent price. Talking about the price is not advantageous, so it’s better to shift the conversation to the vehicle and make the salesperson convince you how noteworthy the car is.

Additionally, mentioning money might put you into more trouble. Steer the conversation toward the chosen car and its comparable cars. 

3. Settle Your Ground Rules 

Salespeople are experienced negotiators, and you might immediately sign up for the deal once they start talking about their terms. Ensure that you’re in charge of the negotiation by setting and informing them of your ground rules and driving the right negotiation process. 

For example, let your dealer know that you’ve already calculated and decided on the amount you’re going to pay, and have but little allowance to spare. However, assure them that your offer is still fair on their side. If they can’t agree with your target price, inform them that you have already planned to look around other dealerships.

While negotiating, don’t forget to be polite and respectful. Avoid being emotional during this business transaction as it can be used against you. 

4. Get Your Calculations Ready

Your price offer should always be reasonable and negotiable enough in the first place. Although you want to save as much as possible, your car dealership should also maximize their profit. If you have set a target price for your desired vehicle, prepare your calculations on how you arrived at that price. 

Your calculation of the car’s total cost must fundamentally include the following:

  • MSRP at the time of purchase
  • Base invoice price 
  • Option add-ons or packages
  • Additional services 
  • Destination fees
  • Dealer profit 

The dealer might also offer to extend your car loan for a few years to lessen your monthly payments, but you’re not actually getting a good deal. This is why it’s important to save up for your car before negotiating with dealerships.

5. Know When To Walk Away

Transactions aren’t always successful, and that’s completely okay as it’s the essence of negotiation. If you’ve observed that the negotiation isn’t going anywhere, your best resort is to walk away empty-handed instead of settling with a bad transaction. 

Here are some strategies that salespeople use to take over the negotiation, which also indicate red flags:

  • The salesperson closed the decision with a take-it-or-leave-it offer without meeting your target price according to your desired vehicle and its configurations. 
  • The dealer might suggest asking around dealerships and beating their offers. Although you already planned to shop around, let your dealer know that you wish to complete the purchase ASAP. 


Bottom Line

Purchase negotiation is like a tug of war. While the car buyer pulls on the left side, the dealership reciprocates with the same force because both parties want to get the most from it. There’s no one-size-fits-all approach when negotiating with your dealership, but these tips might guide you during your car buying process to make both ends meet, and finally let you drive your dream car off the lot.

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