Tips on Negotiating Price with a Car Dealer

yummypinacolada on 27/02/2024 - 02:34

Hi, I just want to share my tips on negotiating or haggling prices with a dealer. Note: This tip doesn't work for Toyota cars.

  1. The salesperson will try to trick you by claiming that the Recommended Retail Price (RRP) is already the final price or that they can only lower it by $500 or so. Plus, they might throw in offers like a full tank of gas, free carpet, and free premium plates. If you press for a better price, they'll say they need to consult the manager and ask you to secure the deposit then and there if you agree on the price. Don't fall for that trick; simply say you need some time to think it over.
  2. Once you're back home, start calling two other dealers. Ask for their best price and mention that you've already received an offer, but if they can beat it, you'll make the deal with them. Most of them will ask how much the other dealer is offering you. Now, this is a bit tricky because you don't want to reveal too high a price, which will result in a smaller discount, but you also don't want to lowball and seem straight lying. If it were me, I'd say I was offered a ~5% discount off the RRP and ask if they can beat it. If not, I'll stick with the other dealer since I've already done a test drive with them. They'll need some time to discuss with their manager.
  3. Now, you wait for their offer to come in. Once it does, the dealer will likely pressure you to make the deal over the phone right away. Again, just say the offer isn't as good as you expected and thank them for their time. Wait a bit (a couple of hours); there's a chance one of the dealers will call you back with a better offer. Once you have this offer, agree to it and say you want to make the payment directly in-store(DO NOT pay the deposit over the phone yet). If none of the dealers call you back, go to the next step.
  4. Once you hang up, don't head straight to the dealer you agreed/disagreed with. Instead, call the first dealer you approached who only offered ~$500 off. Mention that you received an offer of $X off from another branch. Ask if they can do better. If they offer an even better deal, then congrats, you've just successfully haggled! If not you can always go to the offer that you've agreed on OR just ask for pricematch if this dealer is more conveniently located to you.

All the numbers on this will vary based on how popular the car is, how much is the stock level for the car, and how long is the waiting time. Of course you might be able to get away with cheaper price if you comparing it with more dealers, but I think this approach should already give you a good deal. I've made a mistake by getting time pressured by the salesperson, I hope this tips can help others getting a good deal on a car.

Automotive

Comments

  • Jaduqimon on 27/02/2024 - 06:21
    +8

    Lol…Yeh this only works at MG/LDV dealers right now.

    Try it at a Toyota dealer buying a rav4 and get laughed out the door

    • kerfuffle on 27/02/2024 - 08:36
      +5

      To be fair, second sentence from OP acknowledges that.

    • pegaxs on 27/02/2024 - 17:01
      +1

      Yeh this only works at MG/LDV dealers right now.

      And BYD Atto 3… There is currently a $3000~ish incentive from them to buy one of their cars because they have HEAPs of stock of '23 plated cars that they over ordered and now have to dump them on the open market for anyone who will buy one.

      If I was in the market for one and didn't care about build/compliance date, I would go in and knock the $3k rebate offer off the price and then another $3k off the price on top of that, and I am almost 100% sure they would sell you one just to get rid of old stock.

      My bet is that come EOFY sales time, if BYD still have '23 model Atto 3's in stock, with the rumoured update model coming out, you will nearly have them doing a BOGOF deal at this rate :D

  • solidice on 27/02/2024 - 07:39
    +7

    OP is still living in the pre-covid world.

  • elgrande on 27/02/2024 - 07:42
    +4

    This post belongs in 2016.

  • JIMB0 on 27/02/2024 - 07:44
    +1

    Have you done this recently?

    • yummypinacolada on 27/02/2024 - 09:12
      +2

      Yep, just done it these past couple of weeks. Works for Hyundai I30, Mazda3, and Mitsubishi ASX. Although I didnt get the final best offer at the end, so hopefully this will help others securing best deal.

  • kerfuffle on 27/02/2024 - 07:46
    +2

    OP also forgot to mention that it would only apply to base spec trim, base colour cars. (For those who cbf digging, they just purchased the just-released Hyundai i30 hybrid sedan in white, which at the moment only comes in base spec trim until the higher trims are released in the second quarter of 2024).

    Are you going to rent out your brand new car?

    • yummypinacolada on 27/02/2024 - 09:15
      -1

      Yes I did buy Hyundai i30 hybrid, but this I also tried it with Mitsubishi ASX MR(not the base model) and could get ~6% off rrp at the end

  • AngusD on 27/02/2024 - 08:43
    +1

    Simplest thing is to do a bit of digging around for info re the specific car you're buying. Look for online forums, Facebook groups etc (Australian ones, obviously) dedicated to that kind of car. Ask in there what people paid for their car (similar spec, recent purchase etc). You should get a feel from that what kind of prices are achievable. Once you know what price other people have been able to get, just don't go over that because you know the dealers are able to do it at that price. Be prepared to walk away if a dealer won't go to that price - another dealer will.

    • yummypinacolada on 27/02/2024 - 09:16

      Yes, this is a good tip, I wish I have done this as well

  • Duckie2hh on 27/02/2024 - 09:28
    +1

    I use the same strategy except I call the furthest metro dealership first (less traffic & more likely to be hungry for sales). Did this and got 10% off RRP on a new Mazda 3

    • JimB on 27/02/2024 - 09:40

      How recent was this?

      • Duckie2hh on 27/02/2024 - 10:31

        M day 2019

        • JimB on 27/02/2024 - 10:51

          Pre covid.

          It may still work to a lesser degree today if they have excess stock which no one does.

          I purchased a Subaru using a regional dealer 150km away pre-covid. Melbourne dealers (owned by Suburu) won't budge from RRP. Called up independent regional deal, offered 10% below RRP. The declined but called me a week later to accept my offer.

          Deal done via phone/email

          Met the sales guy for the first time when he delivered the car to Melbourne.

          I called the sale dealer post covid.. little stock available so told me to buy at RRP from Melbourne dealer.

          This strategy may still work if they have the car in stock ready to go.

  • yummypinacolada on 27/02/2024 - 09:36

    Congrats! I thought about calling further dealership, but I didnt have a car so doing this will cause more trouble for me

  • dtc on 27/02/2024 - 10:45
    +2

    The concept of playing dealers off against each other is great in theory, but often doesnt work because - hey - dealers know that is what you are doing and so never give you their best price. They know you will come back and try to get a better price. So while you may be getting reduced pricing as you go around to each of the dealers, you arent ever actually getting their final price.

    Try this option - pick the price you are willing to pay. Make it realistic, do your research. Say 'I'll buy right now, today, on the spot, if you will accept this offer'. If they say no, then walk away (or if they say 'no but will do it for $500 more' then perhaps accept if you are comfortable in doing it). Go to another dealer. If multiple dealers say 'no' then your price is unrealistic. You will probably get follow up calls, do the same - 'I'll come in and sign right now if you accept this offer'.

    • JimB on 27/02/2024 - 10:55

      +1

      I think offer a price and stick with it.

      The dealers will eventually let you know if your offer is reasonable. If too low, they won't bother making a counter offer.

      If they ask you to increase your offer by $2k your offer may be in running. Just stick with it and let them come back to you.

  • apple2016 on 27/02/2024 - 10:49
    +1

    Can confirm, this works for high yield European cars AMG, BMW M3 etc!…

  • AryaTheExplorer on 27/02/2024 - 13:52
    +1

    I tried this many times but too much hassle/time wasted for not enough discount. I've done quite well buying new cars through car brokers though. It's way easier to get the dealers to bid for your business since the best price comes with no commitment required, unlike if you try the same with a dealer in person or over the phone. The discount does depends on how popular the car is though, I've enquired about pricing on in demand models like RAV4 or Everest, maybe a few hundred to 1k off plus you can negotiate for a car that can be delivered sooner depends on the brand, but it's always better than "get laughted out of the door"

    • yummypinacolada on 27/02/2024 - 23:45
      +1

      That's why I mentioned the discounts will really depends on the car you choose. Toyota is a no hope for bargaining as their wait time is already a year, it means they have lots of time to sell it before the stock arrive.

  • pegaxs on 27/02/2024 - 16:39
    +2

    1: Won't work if you say "I need to think about it" as most sales people will write you off as a time waster.

    2: Other dealers don't give a shit about phone calls. They know they are people just fishing for a better price to take to another dealer and they usually won't entertain phone calls asking for "a better price". If you are not sitting at their desk and talking turkey, they DGAF.

    3: Offers won't just "come in". You need to chase them and you need to get your arse in the door if dealerships and do the leg work. Build a rapport and show a genuine interest in actually slapping down a deposit, not just waste their time with pathetic phone calls and time wasting "i NeEd tO gO HoMe aNd ThiNk aBoUt iT".

    4: Again, phoning will get you nowhere. You won't even get to this step this way and even if you do, you could have saved all the bullshit and just laid out your offer with the first salesman without all this subterfuge. Added to this, they will likely say over the phone "well, that's pretty good, you should take it", get off the phone and then chat with the other sales guys about how much or a time waster you are.

    Your whole "how to" is rubbish at its core and rarely, if ever, works this way. Sales people will rarely give any info over the phone and will seldom make it accept offers or take notice of any "well this dealer has offered…" without some form of proof or evidence.

    The best way to get the best deal is WAY simpler…

    1: Do your homework on the make, model and specs (Go to dealers and look at the cars, tell them you are just looking and get a card if they are helpful.) and on what the average price is for these vehicles. Pick a price that you feel is a reasonable price for both you and the dealer, then pick a price just under this to start at and a price just above this that you would still buy at. (ie: $30k RRP car. $28.5k is reasonable. $27k start, $29k walk out)

    2: Work with the sales people. Go down and say "I've already done my homework and I am here to buy TODAY if we can come to a fair price". Don't go in until you are ready to buy. When YOPU are ready to buy, YOU have the balance of power. If you are tyre kicking, you have nothing.

    3: Give them your reasonable lowest offer. Tell them if they can do that price, you are ready to sign today. If they scoff or start the bullshit, just thank them for their time and walk. If they say "ok", sign on the dotted line. If they offer higher or no offer off RRP, counter off your happy price". If you get nowhere and they just laugh, go home and reassess your offer.

    4: Compromise. A car in stock is worth money in your hand. A car ordered is burning money. Ok, so you really want the Aubergine Dream frosted chunky flake, Live Electric mellow two tone Luxury model with a sun roof… problem is it's a 6 month wait and back order from Europe, but they have a Gunmetal Gray one in stock that is 3 months old, but no sunroof… Take it. This car will be burning a hole in their profits and it will need to be moved ASAP. ALWAYS ask what cars they have in stock in the spec you want (or close to what you want.) and what one has been there the longest. Chances are they will just about add "will do cartwheels on delivery day" to the sales order if you asked them too.

    • yummypinacolada on 27/02/2024 - 17:06
      -1

      Its up to you if you think these tips are rubbish, but I literally just bought a car from dealer yesterday. And for weeks that I've been to many dealers, they all call or message me back asking for offer or gave me better offer.

      • dtc on 27/02/2024 - 20:14
        +2

        Weeks of effort and you may not have received the best price; you might have managed the same price by sitting down with a deposit and making the same offer at the first dealer

  • proxyalex on 27/02/2024 - 23:36

    Anyone have any tips with subaru dealers around Sydney, looking at a MY24 BRZ, but don't really know what is a realistic amount I can push in this environment?

    • yummypinacolada on 27/02/2024 - 23:51

      Try call a dealer further away from your place just to know the stock level and whether there's any wiggle room from the RRP. Based on that + your own research you can put a reasonable offer to them.

  • BudgetBountyOz on 27/03/2024 - 09:49

    I bought a Kia in early 2023 and the price was much harder to negotiate back then.

    Didn't even have a chance to test drive as most dealerships didn't have the available.

    Only got 1k off after calling multiple dealerships, but got more extras included after negotiation.

    I feel the more cars are available and it is easier to negotiate on price now.

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