To successfully save a bundle on your next new car purchase, educate yourself about vehicle pricing. This way, you know a good deal when you see one. Luckily, you can do most of your negotiating online. Researching and shopping same-make dealers online helps you to save a bundle; you do not have to go into a dealer until you have negotiated a price online.
Determine Invoice Pricing
Invoice pricing is the amount a dealership paid for a new car. You'll need to know it to determine how much you can save. A majority of dealers will not sell under the invoice price, but will work with knowledgeable consumers from invoice price rather than window sticker price. Edmunds.com offers a "True Market Value" tool to help buyers determine invoice price. To effectively use it, go to the manufacturer's website to build a car with the options you want (true market value pricing initially shows base model pricing). Add the same options and packages into the "True Market Value" tool as you did on the manufacturer's website.
Shop Multiple Dealers
Once you've determined the correct invoice amount, figure a fair purchase price. From the manufacturer's website, locate dealers in and around your area. Choose several within driving range (or as far as you will go). From the results list, access individual dealer websites and email addresses. Start with any dealer and state that you are ready to buy a specific vehicle if the dealer can reach your price. Once you have a price offer from one dealer, you can use it to continue negotiating with other dealers. Continue emailing other dealers stating your intent to buy and your current price offer. This way, dealers compete for your business.
Time Frame
Dealerships are more likely to make deals at the end of the month. Salespeople have goals and bonuses to reach, which are set by dealer management. The dealership itself has goals and bonuses in place for its region, set by the manufacturer or regional manager. If you wait until after mid-month, the dealership is more likely to reach a lower price to earn your business and move closer to its goal.
Considerations
Customers shopping multiple dealers may have an opportunity to shop outside of their own state. Because each dealership charges a document fee, or a nonnegotiable fee charged for completing a variety of paperwork, you may save more money purchasing outside of your state or eliminating a nearby state altogether. Some states cap the maximum document fee allowed and some don't. The difference can cost you over $500, which is worth considering when you are trying to get the best deal possible. Call or email to ask about the document fee before you send your price offers.
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