C_C

So, at last it's our turn to move to the US and we're flying to LA next Tuesday June 7 .
One of the first things we'll be doing is buy a car. We've narrowed down our search to two models (new), and we strongly prefer to buy cash, partly because we won't have jobs/strong credit when we first get there.

Now, to our surprise, we read that buying cash is no longer the "magic solution" to getting a better deal, as dealerships nowadays get most of their profits through financing and dislike buyers who pay cash . So we're wondering how we can go about getting a good deal with a cash payment and I'd love to hear the experiences of people who have been into a similar situation.

A few things we've read and are wondering if they are good ideas:

a) that when going into a dealership we should avoid to discuss payment methods at all costs (if need be, even by misleading the salesperson into thinking that we are considering financing ) and only disclosing our true intentions once a price has been agreed. Not sure I like that, as it sounds quite sneaky to me and I'm not too much into haggling and playing games. Of course I strongly dislike sneaky salespeople too (who doesn't?)

b) that we should contact the Internet Sales department beforehand and get a good quote (in writing) before we physically go into the dealership. This sounds like a good option, but does it really work?

c) that we should give the dealership a call beforehand and obtain a good quote (and ask to have it in writing) before we physically go in. Again this sounds fine, but again, does it really work?

d) that because the 2012 models are due in soon (and we're looking to buy a 2011 one) there may be more room for negotiating a better deal for an '11 model. Is this so?

Any advice or opinions are appreciated. Any negotiating tips are also welcome.
In an ideal world, I'd like to walk into a dealership, test-drive, decide on which car to buy, agree on a reasonable price without much haggling, write them a check and drive off in the new car

Jerseygirl

Yes to your first question. The dealer makes more money if he sells a vehicle through lease or finance...so be vague about how you intend to pay for it. Unless you are going for a luxury car you will most likely find the car salesmen to be hard sell salesmen. I doubt you will be able to get a price over the phone. They want you in their office...surrounded by photos of their family...to try to convince you that they are your new best friend.

It is their job to prevent you from leaving the dealership until you have signed on the dotted line. We always make it clear right up front that we will not be making a decision that day.

md95065

One option is to let them finance it for you at whatever ridiculous set of terms they can come up with (and even if you have no credit history the dealer will work really hard to find someone who will make the loan because they *really* want to sell that car) and then pay the loan off immediately.

You do need to make sure that there are no 'early payoff' penalties, of course, and I can't remember what the law in California says about those so you should definitely do your research carefully if you follow this path.

lansbury

Do these people sell the car you want http://www.intlauto.com if so you can tie it all up in the UK before you leave, and at a better price than a US dealer will give you. We used them to get a Jeep before we moved over in 2006.

I just got a pick up last month, paying cash. Found one on the dealers web site I liked and e-mailed internet sales to ask if it was still in stock and to quote a price. They called me and asked when I wanted to look at it. I said if the price was OK, I could be there in 15 minutes and got an immediate quote of $2100 off the sticker price.

Went down took a test drive, they asked up front how I was paying and I said a check. After the test drive as we pulled into the dealers I said yes but the price was too high and made a silly offer which they refused and insisted on the price they quoted on the phone. I said no thanks and the wife and I started to walk towards her car, got an immediate offer of another $1000 off the price. Didn't seem to be any problem I was paying cash, no doubt a finance deal would have got a bit more off, but with the interest I would have been paying more.

The upshot was, they didn't seem to balk at haggling because it was a cash deal, and I got the truck at quite a bit below the Kelly Blue Book price. Took just over an hour to getting there, test drive and paperwork to driving off in a new truck.

In the US there are always car sales and incentives going on. Look on the dealers web sites for the area you are moving to and see what they are offering. Look online at Kellys Blue Book they will give you the MSRP and the average selling price. You shouldn't pay more then the average selling price and aim to get below it. Know this information before you contact a dealer.

In Oregon it is becoming quite common for dealers now to post their lowest price on the car and no haggling at all. If you know up front what the price will be, cash deals make no difference.

Lakersdarge

I say be honest with the salesman, be polite but stand your ground in terms of what you want. Go in with a good idea of what kind of car you're after, what you're willing to pay, and how you want to pay. And if you don't like what you're hearing, walk away. They will either try and accommodate you or you will be able to find another dealer down the road who will. I imagine most dealers will probably bend over backwards trying to sell a car to you in this economy.

Personally, we were so sick of bad experiences dealing with car salesmen and their typical slimy tactics, that our last car we bought was through ebay. We checked out the buyer's previous feedback to make sure he was on the up and up, and it had free Autocheck report right there within the ebay listing (which is like a background check for cars, similar to Carfax). Communicated through email, paid deposit through paypal, mailed the rest to him in form of a cashiers check, then went to DMV to sort out the paperwork. Very happy with our purchase, especially since we dealt directly with another honest human seller. I think we got a better deal too than if we tried to buy the same car through a dealer.

cluedweasel

Here's some useful links for new car pricing and incentives.

http://www.edmunds.com/car-incentives/ - Will tell you what incentives are available.
Edmunds in general is a very good resource for new car buying. Select the model(s) you're interested in and click on the pricing link. You'll get what they call the "trucost". What the car is selling for, compared to invoice and sticker.

http://www.truecar.com - Good for seeing the prices people are paying for a car.

Lakersdarge

Doh, just noticed you're after a NEW car. I suppose the ebay advice is still applicable, even though I think there's more choice there if you're after used.

scrubbedexpat099

Does anybody go into a dealer now? Everybody I know buys on line.

I guess you could print it if you need to.

Why would you, see above.

Yes

Michael

It can depend on what car you are purchasing. In the early 1990s I was purchasing a car for my son (Honda Civic CRX) and I could not get a dealer to sell it below MSRP and even though I told him I was paying cash, he kept counter offering monthly payments trying to induce me (assuming I was too dumb to realize that he was charging me more than MSRP plus financing) to purchase the vehicle. I then went to a discount car dealer and he offered me the price at 6% below MSRP. Apparently a discount car dealer has agreements with dealers throughout the area and he found one with my specifications on a lot about 70 miles away and it was delivered within 2 days.

During that same year I was looking for a Nissan 300ZX for myself (cash again) and the local dealers were selling it for 15% under the MSRP. I contacted the same discount car dealer but the best he could do was 6% under MSRP so I bought it off a local lot.

I've always paid cash for my cars and have never paid no more than 6% below MSRP one way or another. I have found that if the car is already heavily discounted below MSRP, very little or no deal making will occur and the dealer doesn't try too many crude tactics but if the car is in short supply, the dealer will try all kind of tricks to get you to pay above MSRP whether financing or not. The dealer prefers you to finance the car since they make more money and they can try to hide your true cost of the car especially for people that look at a monthly budget instead of the total price. Also I found that a dealer, because of tactical reasons, prefers that you finance a car because he can offer you a monthly payment and if you accept that offer, you won't know the true total price until you sign the final contract.

Almost every time I have gone to a dealer and told them I was paying cash, they usually came back with a counter offer of monthly payments. When I again tell them that I was paying cash and warned them that if they counter offered again with payments, I would walk off the lot but some still came back with a monthly payment counter offer and I left.

Also don't get suckered in by additional dealer markups. Usually those are things like undercoating that have little or no value or some other useless thing but is not part of the MSRP. Some dealers add those things to try to get the starting negotiating price high allowing them to still get above MSRP. If additional dealer markups are in the price, I'd probably recommend that you go to another dealer unless you desire a hard negotiation.

Although the dealership prefers you to finance the car, financing and sales are separate and normally the sales people will not lose a sale just because you don't finance a car. Each department has to show the boss that they are making money and a loss of a sale will hurt the sales department.

Bob

Just ask about final price on the road and tell them you'll discuss how you get there afterwards.

Get a car finance deal with no early payout fees...and then pay most of it off, leaving about a grand that you can pay off over 12 months. Best way of building up some credit history with minimal fuss and cost.

AdobePinon

a) Get a price before discussing payment options.

b) Yes, I've done it that way once. Got one for $100 over invoice - walked in next day with a loan from my credit union, a letter from my insurance agent, signed the paperwork and drove off. I couldn't get a good price the last two times I tried it though.

c) Yes, I've done that twice now. Got one for invoice, and one for $200 over invoice. This requires patience. Most dealers will not give you a price on the phone, and if they do, it'll be MSRP. You have to keep calling them all (and be prepared to drive some distance to get it) telling them what you want. When one of them needs to make a last minute plus up on some mysterious quota, that's when you'll get the price you're looking for. Be aware that:
(i) Dealers typically pay below invoice for a vehicle at the end of the day.
(ii) Certain vehicles will almost never sell below MSRP. Patience works best with common models. Others, if you really want them that bad, you just pay MSRP and move on with your life.

(d) Probably too early to really get a deal on an '11. Also, if the predicted shortages of some cars actually come to pass (tsunami), this year might not get you that deal. Or it might not matter either way.

Giantaxe

This is exactly what I did when I bought my last new car (for cash). I don't think there's anything underhand at all in wanting to negotiate a final price for a vehicle before discussing how you're going to pay for it. In my case, the salesperson was very taken aback when I said I was going to pay cash, but then accepted in with good grace. He did admit that the dealer made $$$ from any finance contract.

Ash UK/US

See if you can get a good deal on your loan(for example 6 months interest free etc) then pay if off.

When we bought our first new SUV 7 years ago we wanted to fianance $5000 we were told they were not willing to finance anything less than $7000 when we bought our car 3 years ago we asked for a 'cash deal', the sales man stopped short of laughing at us, he told us they would loss money on us paying cash!

C_C

Thanks everyone for the brilliant advice - you gave me a lot of good pointers
Our first choice is a VW Jetta S.
Let's see how it all goes - it will be very interesting

penguinsix

Don't even think about MSRP or the sticker price. Negotiate from the invoice price that the dealer pays after factoring in some wiggle room from the invoice. You can get this information on a variety of auto websites in the US.

You can also consider using a car buying service which will guarantee the lowest price or they pay you the difference.

Insurance will be your bigger problem though.