According to a Forbes article from May of last year, the average new car costs $30,303. That was then. With sales increases due to pent up demand and readily available loans, that average price might be even higher now.
You’d think that prior to spending such a large amount of money, a potential buyer would do a massive amount of research on getting the best price, knowing what features are available on a vehicle, its repair record, resale value, etc., etc. But, for a whole bunch of car buyers, the decision on what vehicle to purchase is often an emotional one – “…it’s so cute!” or “…I’ll look good in it.” Car dealers salivate like wolves over fresh meat when they get buyers like that. They know they can load the vehicle up with useless extra-cost features and charge whatever they want.
Surveys of drivers on their attitude toward the car owning experience say the worst part is the purchase. They detest overly aggressive sales people and the pressure to buy right now. Buyers could easily reverse the situation if they armed themselves with information so that they are the ones who control the buying process and have dealers dancing like jitterbugs by knowing what they want, what’s available and not settling for anything less. Some lessons follow when buying a car.
Know The Price Of The New Car
It’s important to know what the price of a vehicle you’re interested in should be. There are numerous sources for that information. On a new car, check out websites like Kelly Blue Book (www.kbb.com) and Edmunds.com for information on what the wholesale price of a new vehicle is. That’s the price that a dealer pays a manufacturer for the car. The final price of the car can vary significantly from what the wholesale price is depending on many factors. If the car is a hot seller, you’ll have to pay more. The number of vehicles sold by the particular dealer will influence the price. Dealers that move a lot of vehicles may often be able to let one go at a slightly lower price. A dealer’s location will play into the equation with their expenses like taxes, rent, utilities and the cost of labor having to be factored in. Also, manufacturers often offer incentives on some vehicles. You can find information on current incentives in a specialty publication called Automotive News (expensive to subscribe to, check the library) or car company websites. Also, check newspaper ads on Fridays to see what various dealers are charging for new models.
Timing Also Plays A Part
Carmakers will often offer incentives worth thousands of dollars if a dealer sells a certain quota of vehicles in a month. If the end of the month draws near, and the dealer hasn’t met their quota, they’ll be dealing like crazy in order to meet their obligation. This means the end of a month, and I mean the last or next-to-last day, is often the best time to shop.
Most of this advice can also be applied to used cars. The websites mentioned above can tell you what a certain year, make and model of a vehicle should cost, depending on condition. Used cars coming off lease can be especially good deals with their previous users limited in the amount of mileage and wear and tear they could put on a vehicle. Dealers often have CPO (certified pre-owned) programs that attach excellent warranties to off-lease vehicles that have been thoroughly inspected and carefully prepped, but these are often more expensive that what the same vehicle from a private seller would cost. If you do plan to buy a used car from a private seller, it’s very wise to pay for the services of a certified technician with knowledge of the vehicle make and model to inspect the car you’re interested in for any glaring defects.
Know The Value of Your Car
If you’re buying from a dealer and trading in your old vehicle, it’s very, very important to know what the value of your car is. Dealers often will low-ball a person on their trade-in by thousands of dollars in order to profit off a person’s ignorance.
Recently my wife and I went shopping for a new vehicle for her and the experience exemplified some common practices dealers use to try to make you fall for their deal. We knew exactly what her current vehicle was worth. After an exhaustingly long process of sitting and waiting while the sales person went who-knows-where to do who-knows-what, a test drive of the new vehicle and an examination of our trade in, the sales person offered us five thousand dollars less than we knew the vehicle to be worth, claiming a small scratch on the rear fender necessitated installing a new quarter panel. When we loudly balked, and my sweeter-than-sweet wife surprisingly used language uncommon for her, the smooth talking sales manager came over to raise the offer, but still below the level it should have been. We walked out.
Don’t Be Afraid To Walk Away
Dealers will often try to wear you down by putting you through an unnecessarily long process. If the price they offer on the new vehicle or your trade-in is not acceptable (it usually isn’t) they do a back-and-forth game between your sales person and the sales manager. If that still doesn’t work, they send over the slick sales manager to smile broadly while he or she attempts to con you into accepting their deal. This can be enough to give you a migraine. Don’t fall for it. If things don’t feel right at any point in the process, walk out. There are scores of dealers available for you to purchase your car. I’ve accompanied many family and friends on trips to car dealers and it’s shameful how common and stupid their tactics are. When you encounter a dealer that’s straight up about what a car costs and what your trade-in is worth and makes the process happen expeditiously, it’s like a breath of fresh air, but unfortunately, not very common.
Remember, forewarned is forearmed. Arm yourself with every piece of information about a potential vehicle purchase beforehand and you’ll do much better in getting the vehicle you want and need at a fair price.
Robert Sinclair Jr. AAA New York –Years of involvement with cars, combined with his skills as a public speaker, prepared Mr. Sinclair for his current position as the spokesman for AAA New York. For the past 12 years he has represented AAA with all national and local electronic and print media. Robert’s position dictates his being knowledgeable on a host of policy issues related to motor vehicle transportation.