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Article: Automobiles - Car Buying Tips
By Chris
Fox0
Many of us have been at the car dealership and
have been drained by a salesperson during price negotiations for the
purchase of a new car. Most people give in too easily or do not
negotiate at all to avoid the dreadful act. This only means more
money in the car dealers’ pocket, while you are out of several
thousand dollars! Yes, they make that much in profit per car.
This article unveils the dealer’s selling tactics and how
you can get around them. But before we dive into the new car buying
tips, we need to understand what makes up the dealer’s profits.
In addition to the MSRP (manufacturer suggested retail
price), which is the dealer’s cost for the car plus an additional
20-25% profit, a dealer also gets financial incentives from the
manufacturer when a new car is sold. This is called Holdback.
Depending on the car, dealers can make hundreds on each car
through holdbacks. Dealers also get additional incentives and
bonuses on selling a car before the end of the month and/or quarter.
A shrewd dealer can make several thousand on a new car even by
selling it at invoice price. This is how new car buying can become
tricky for the consumer.
Ready to learn how not to put a
dent in your wallet on your next car purchase? Here are four tips to
get you started. Each one is a dealer tactic to watch out for.
1. The Guilt Trip - As you may have noticed, every desk in a
dealership has photos of the salesperson’s family, instead of photos
of cars. Midway in the negotiation, the sales person will bring them
up and make it look like his little commission check can hardly pay
for his daughters college and little Bradley’s braces.
A
seasoned salesperson will soon have you feeling guilty for driving
the price down and hurting his commission. Watch out not to fall for
this tactic, since you already know about holdbacks and incentive
programs from manufacturers.
2. Wearing You Down - Come
prepared to spend half a day at the dealership or pay whatever the
dealer asks for. Car Dealers are trained to delay and tire you out
to the point where you give in and accept their price just to get
out of there.
After you make your offer, sales people
typically claim they would have to run it by their manager. You may
then have to re-start negotiating with the manager, who is also a
seasoned salesperson. This dance goes on for a while until you give
in.
Remember, there are multiple dealerships in a city, so
they need you more than you need them. Demand to speak to the
manager after a certain time period or threaten to leave.
Because you are devoting a lot of time to bargain with the
dealer, they know you are a serious buyer, so they will not let you
leave. The earlier you can speak with the manager, the faster you
can leave.
3. The Test Drive - We all enjoy a good test
drive and look forward to it. Although it is essential to test drive
a car before you buy it, remember to not show your absolute love for
the car to the salesperson. Their goal is to get you emotionally
attached to the car, so it becomes a must have for you. I have
learned it the hard way.
To hide your emotional tears from
the salesperson, mention the features of a competing car in the same
class, like the new shape, light, leg room, resale value etc. This
will make the salesperson a little vulnerable.
4. Monthly
Payments - This one is to confuse you. Dealers will start talking
about monthly payments rather than the total price of the car. They
will start by asking how much you are willing to pay per month and
how much of a down payment you are willing to pay. Since people
don’t want to look like they cannot afford a certain car, they will
usually give a higher number. Big Mistake!
You have left
little room for negotiation when this happens. Always steer the
conversation to the total price of the car and do NOT mention any
trade-ins at this point. Only after the total price of the vehicle
is completely negotiated then talk about interest, monthly payment
and trade-ins.
As a general rule, remember to only
focus and negotiate on the Total Price of the vehicle. Everything
else is pretty much the car dealer’s trough.
If the above
new car buying tips seem like a lot of hassle, yet you still want to
get the best price in town, there are some websites that do this for
you. www.autoauctionbids.com for example is a great website for this
because you can collect price quotes from multiple local dealers for
a particular car as well as its competing car models (like Honda
Accord, Toyota Camry and Ford Taurus) and compare them.
The
website then allows you to send back the lowest quotes received for
each car make to all participating dealers in your area through the
website itself.
Dealers view this price and continue to
submit new lower prices over a 3 day period. By putting local car
dealers in such a price competition allows you to avoid the dreadful
face to face negotiation and yet gets you the lowest price in town
for up to 3 competing car makes.
The best part about
AutoAuctionBids.com is that it is absolutely free for you and there
is no obligation to buy after the new car auction is over.
For more information on cars and car auction visit http://cheap-car-auction-portal.com
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