In The Driver’s Seat
I grew up in Michigan and currently live in metro Detroit, which is also known as the Motor City. I’ve often contemplated if my love of the automobile stemmed from constant exposure to cars throughout my life, or if it’s simply the aesthetics of beautifully designed body lines and the power felt from being in control of a powerful engine. I truly feel it’s the latter. I was the only girl in auto shop class in high school, so if my love of the automobile was a product of my environment, there would have been other girls in that class too. My fascination with cars has led me to a career in the automotive industry, a career that I love. I thought I would share some of my passion with you, as 2006 vehicles are hitting the road soon. I’d also like to share my car buying technique that can save you a lot of money when you’re shopping for your next car.
First, I just want to show you a cool car. I was fortunate to be able to attend a Pontiac Solstice event at GM headquarters recently, and man, would I love to have one of these. Pretty, powerful, and they’re so reasonably priced too!
Cars with limited production and high demand like the Pontiac Solstice are virtually impossible to get a bargain on, but cars that have been around past their first model year, especially 2005 vehicles that the dealers are trying to move, can be had for a steal if you know how to bargain.
From information gathered through the years, and through experience, I have come up with a car buying technique that has worked not only for me, but for family and friends. If you are looking for a new car, I highly recommend it.
First, determine the car that you want: specifically, the model, options, and color. You can find this information by visiting the manufacturer’s site. Then take this information to a site like Kelly Blue Book to find the dealer invoice price, then visit Edmunds to find the dealer holdback amount.
Your goal should be to pay no more than $500 over the dealer invoice price for a vehicle priced less than $30,000, and no more than $1000 over the dealer invoice price for a vehicle priced more than $30,000.
Obtaining pre-approval on a loan from your financial institution and becoming familiar with special financing incentives from manufacturers is highly recommended before you start shopping. It’s always best to shop with cash, or to know how you are going to finance it ahead of time. Salespeople may steer you to financing that would not be to your advantage because they receive a “dealer reserve” from the financial institution. The dealership may also play around with the numbers when you finance through them, masking costly add-ons. Just be careful and read and understand anything you sign.
Next, locate dealers within a mile radius to which you would be willing to drive to pick up a car – say 100-150 miles (dealers can be located on manufacturer sites).
Once you have chosen your dealers, create a fax with a side column listing all the dealerships you are requesting a quote from (just the dealer name and fax # - this shows the dealers that you are obtaining competitive bids - or if they have e-mail addresses, send an e-mail to all of them with all recipient e-mails visible). Within the body of the fax or e-mail, tell the dealer what model, options, and color choices you are looking for, and ask them to get back to you with their best price by fax or e-mail (don't give your phone number and don't indicate that you're a woman – use a man’s name if you need to. Unfortunately, I don’t think I need to explain why).
It's good to have a dealer in your pocket who would agree to beat your best price. You can shop at your local dealer and find a car you like, tell them you are obtaining quotes, and ask if they would be interested in beating your best quote.
After you send your faxes and e-mails, you will receive offers back from the dealers within 2 days. Take the 2 lowest offers, and ask the second lowest offer (by fax or e-mail – again, do not give away you are a woman) if they would beat the lowest offer you received. Your goal is to have the lowest offer you can find in writing. When you have that lowest offer, take it to the local dealer to beat.
The last time I used this technique, the sales manager came out during the final moment of the purchase and said, "You know I'm not making any money off this," and I said, "Yes you are. You're getting a $500 holdback from the manufacturer." The dealer replied, "Oh, you know about that..." Needless to say, nothing more was said.
In summary, it's best to do your homework. You can have the car you want at the lowest price you can get in 3 days. In addition, dealers are trying to clear out 2005 inventory right now and are more likely to sell at rock bottom prices (they look better within manufacturer dealer rankings if they sell a car with no profit vs. sending it off to auction). Using this technique at any other time of the year is best done in the last week of the month when the sales people are trying to reach their quotas.
Finally, a little woman-to-woman talk about car buying: Car salesmen are notorious for taking advantage of women. They will play on your guilt, and will not go as low as they can on price because they think you are an easy sale and can win the negotiation battle against you. When buying a car, you need to be firm and stick to your guns. If you don’t get the deal you want, walk out and don’t look back. Remember you will never see this salesperson again, so don’t feel guilty when they tell you how they are not making much of a commission on your sale and they are having difficulty feeding their children. The sales person’s personal life is not your problem, and don’t let these techniques fool you. They are there for one thing, and that is to squeeze as much money as they can from you. I know that this car buying technique might seem complicated and stressful, but it’s really not. It empowers you to get your best deal. It’s really up to you - you need to ask yourself if paying several thousand extra dollars to a car dealer is better than doing a little footwork.
~~~ Kris Bauer
