How do you talk down or bargain car prices?

Question

In January I want to buy a new 08 or 07 Honda Cr-v. It would be my first time buying a car on my own. Do you have any suggestions how to bargain a price down? And do people bargin down by hundrads or thousands? Thanks in advance for you help

Answer 1

What I am telling you is based on 7 years in the business and personal purchases.
--------------------------------Formula-------------------------------------------
MSRP = Sticker(includes Dest. Charge)
Invoice = Can be found on Edmunds.com(include options) or kbb.com
Rebates = Vary by local dealership
Holdback (dealer's profit) = see below portion to calculate holdback
Estimate True invoice = Invoice - Rebates - Holdback
tax = ?% x True Invoice
Tags = whatever your states charges (typically $100 - $400)
Low ball offer = True Invoice + tax + tags - $2,000
Target Price = [ (MSRP - Rebate - Low ball offer) ] / 2 + low ball offer (this is basically the formula I use)
TRY TO GET YOUR PRICE AS CLOSE TO THE TARGET PRICE AS POSSIBLE!
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The car business is hurting right now. Dealers are happy with their "holdback". Its the salesman that are starving. STOP NEGOTIATING WITH THE SALESMAN! Its a fact that the average car salesman only sales 8-10 cars per month. Its also a fact that a "flat", the money a salesman is going to make on a new car sales with no profit(invoice) is $50-$100. So do the math thats only $800-$1000 in commission per month. Thats why dealer are always hiring salesman. Its also why salesman are constantly getting fired.
GET THE SALESMAN ON YOUR SIDE! Tell him up front he's not gonna make any money on you, this will be an invoice deal. Tell him you'll slip him a $100 after the deal if you get your price. So when he goes up to the "salesdesk", he's fighting for you. When the salesman comes back to you with numbers on the paper, they call it an "A" sheet. Cross it out with a big "X", flip it over right your number on the back, next to it write "T/T out the door", then underline it. The first number you write should be at least $2000k below invoice. His manager will either send someone over or come his self. This is a good sign it shows that you werent talking to a "closer". He might even write a note, asking where r you getting your numbers. If this happends, write "I was thinking the same thing about you numbers".
Typically his second number will be $2000 above invoice. If it is, you write," Split the difference, with T/T, out the door" They usually will jump at it.

Tips:

DONT BE SCARED TO WALK AWAY.
CONFIDENCE IS KEY.
DONT TEST DRIVE THE VEHICLE FROM THE DEALER YOU ARE BUYING FROM.
DONT DISCUSS CREDIT, FINANCE, INTEREST RATE, ETC BEFORE YOU GET INVOICE PRICING.
(THESE ARE BUYING SIGNALS, THEY WILL SMELL IT LIKE BLOOD TO A SHARK)

DONT LISTEN TO YOUR FRIENDS. EVERYBODY CLAIMS THE GOT A GOOD PRICE. MOST DONT KNOW WHAT INVOICE IS.
DONT ANSWER ANY QUESTIONS DURING NEGOTIATING FOR INVOICE.
(YOU MAY GIVE AWAY A BUYING SIGNAL WITHOUT KNOWING)

SHOPPING DURING THE LATTER PART OF THE MONTH CAN WORK TO YOUR ADAVNTAGE.
(DEALERS HAVE A PROJECTED SALES IN UNITS THEY NEED TO MEET, SO DO BANKS. THEY TYPICALLY WILL WORK BETTER DEALS AT THIS TIME TO MAKE THEIR MONTH)

IF YOU SUBMIT YOUR EMAIL ADDRESS TO A DEALERS WEBSITE LET THEM KNOW "NOT TO CALL YOU, NOT TO NEGOTIATE, YOU WILL ONLY ACCEPT INVOICE W/TAX&TAGS, IF THEY DO CALL YOU, YOU WILL NOT DEAL WITH THEIR DEALERSHIP, IF THE EMAIL YOU ANYTHING OTHER THAN INVOICE, YOU WILL NOT DEAL WITH THEIR DEALERSHIP" THIS IS THE MOST EFFECTIVE WAY TO NEGOTIATE, AS OPPOSE TO IN PERSON.

THEY KNOW IF YOU NEGOTIATING THIS WAY YOU ARE A SERIOUS BUYER.

THEY WANT YOU IN THE DEALERSHIP SO THEY PLAY THE "GAME" WITH YOU. ITS SET UP TO WORK AGAINST YOU. LIKE A CASINO THE HOUSE ALWAYS WINS.

MOST DEALERS HAVE THE "NEGOTIATING" TABLES IN THE MIDDLE OF THE DEALERSHIP OR OPEN OFFICES.
(THIS CREATES A "BUYING FRENZY")

IT HELPS TO HAVE YOUR FINANCING ALREADY DONE BEFORE YOU SHOP FOR THE CAR.
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Calculate Holdback

If a holdback is calculated from the:

Total MSRP: consumers must include the MSRP price of all options before figuring the holdback.
Base MSRP: consumers must figure the holdback before adding desired options.
Total Invoice: consumers must include the invoice price of all options before figuring the holdback.
Base Invoice: consumers must figure the holdback before adding desired options.

Acura 3% of the Base MSRP
Audi No holdback
BMW No holdback
Buick 3% of the Total MSRP
Cadillac 3% of the Total MSRP
Chevrolet 3% of the Total MSRP
Chrysler 3% of the Total MSRP
Dodge 3% of the Total MSRP
Ford 3% of the Total MSRP
GMC 3% of the Total MSRP
Honda 3% of the Base MSRP
HUMMER 3% of the Total MSRP
Hyundai 2% of the Total Invoice
Infiniti 1% of the Base MSRP
Isuzu 3% of the Total MSRP
Jaguar No Holdback
Jeep 3% of the Total MSRP
Kia 3% of the Base Invoice
Land Rover No Holdback
Lexus 2% of the Base MSRP
Lincoln 2% of the Total MSRP
Mazda 2% of the Base MSRP
Mercedes-Benz 3% of the Total MSRP
Mercury 3% of the Total MSRP
MINI No Holdback
Mitsubishi 2% of the Base MSRP
Nissan 2% of the Total Invoice
Pontiac 3% of the Total MSRP
Porsche No Holdback
Saab 2.2% of the Base MSRP
Saturn 3% of the Total MSRP
Scion No Holdback
Subaru 3% of the Total MSRP (Amount may differ in Northeastern U.S.)
Suzuki 3% of the Base MSRP
Toyota 2% of the Base MSRP (Amount may differ in Southern U.S.)
Volkswagen 2% of the Base MSRP
Volvo 1% of the Base MSRP
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EXAMPLE:
2007 Toyota Camry LE auto w/ minimum option needed (from edmunds.com)
MSRP: $20975
Invoice: $18771
Rebate: $0
Holdback: $420 (2% of MSRP)
Tru Inv: $18352
Tax in CA :$1514
Tag: 200 (est.)
Low ball: $18066
Target: [ ( 20975 - 0 - 18066 ) / 2 ] + 18066 = $19520 (out the door price, all fees included)

Answer 2

If they want to sell it to you for $20,000, then you tell them that you want it for $19,000 with a roof rack (whatever, a sunroof, etc...). They would take it to the manager and come back with an answer. Your first number would probably be rejected. Try to bargain in the hundreds of dollars. If you offer too low, you might insult them. Remember, they have to make money too. They are usually paid on commission from the sale.

Example:

I'm trying to sell a car for $5,000.

You offer $4,000.

I say 'no', $4,800.

You reject it. $4,200

I reject it. $4,600

You reject it. $4,400.

I reject it. $4,500 and a full tank of gas.

If you thing it's a good deal, you take it. I sell my car for $4,500 and you get a car with a full tank of gas.

Sometimes you can negotiate a deal sweetener like a full tank of gas, gas cards (usually $500, if not already included), a portable DVD player, or some other car related item into the deal so that you will accept a price above what you would have accepted, but below what they wanted. Look into available incentives before you go shopping. You might be able to find a dealer having a special sale or get gas cards with your vehicle.

Do remember, because the new vehicle market is somewhat depressed now and has been since Hurricane Katrina, the MSRP (Manufacturer's Suggested Retail Price) doesn't matter anymore. Vehicle prices are almost always below or far below that number now. Therefore, you have to negotiate their arbitrary number to get a better deal. Don't let them fool you! MSRP means nothing!

Answer 3

Bargain will be done based on the report of the car and the feed back provided by the mechanic.Check the car to find out whether there any worn out tires any interior problems etc., and then based on it bargain with the dealer saying that it will cost you extra money and the price that is fixed by the dealer is not that much reasonable.

Answer 4

Be Patient. Don't take the first offer. Be willing to leave and hopefully they will call you in a day or two if the car is still there. Be nice...but firm. Do your homework on-line....make an offer based on this info. Remember...it's okay to walk away. You WILL find another car you like just as well....I promise!! And then you can start wheeling and dealing all over again...in fact you will probably do it even better.

Answer 5

Bargaining depends on the quality and price of the car. If a car costs $30k, then you bargain in the thousands. If a car costs $4k, then you bargain in the hundreds.

Answer 6

YES YOU DO BECAUSE THE CARS ARE NEVER WORTH FOR WHAT THERE SELLING THEM FOR. FIRS YOU TELL THEM EXACTLY WHAT YOU LOOKING FOR,THE PRICE RANGE THAT YOU FEEL COMFORTABLE WITH AND DON''T TELL THEM HOW MUCH YOU HAVE FOR A DOWN PAYMENT UNTIL THE BRING YOU THE CAR THAT YOU WANT, THEN MAKE THE OFFER.