Need New Car Price Negotiation Tips

[thamlin000]

I'm about to buy my first new car, a Toyota Tundra. Next month, I'll be graduation from college and starting a new construction-related job. I have been to the dealer, test-drove and picked out the options and colors. I have not started negotiations yet.

I will have no trade-in. I am selling my Z to use as a down payment.

My credit union approved a car loan at 3.69% for 5 years. I doubt the dealer could do better than this considering it is my first car and my age.

According to toyota.com , with the options I selected, MSRP is $26.6k. Invoice price from kbb.com is $23.8k. These trucks at the dealer are $27k-$29k.

I know that I should pay under MSRP, but how close to invoice should I expect to pay?

I need some tips since this is my first time buying a new car and I don't want to get screwed.

Thanks.

[84porsche]

You should be able to pay below invoice. Ask around first before you jump into the dealer. You may know someone who knows someone in a dealership. Don't be afraid to walk away from the dealership and use your cash as a bargaining tool. If you are willing to give/take a few options, look at the Saturday paper (auto ads). They usually have all the specials and you can find something on a deal. Also wait closer to the end of the year and you can get an even better deal on previous year model sales.

[juanbenae]

another thing my pops has done is gotten all the info, like it appears you have. then he plays different dealer against one another. he even went over 200 miles away for the purchase of a vehicle that he found a dealer on line would "meet" HIS price. they gotta make something, but let them know you realize how much they are going to make and go from there.

economic reports that car sales are at the lowest point in 6 years. use that in your favor. also look at other brands to show that the toyota has "not changed much in a few years,, while brand X has done this and that"

[mikester]

In 2001 I was looking at Toyota Tacoma 4x4s - I just thought they were great...I went and test drove one and that really synced up my feeling with reality. THEY WERE GREAT! But with the options I wanted it was in the high 20's for it. So I shopped around and I went and test drove a similarly equipped Nissan Frontier. It was just as nice feeling and the price was more than a few K less. I ended up buying a Nissan Xterra SE 4x4. I don't regret it at all as it has provided me with a great vehicle (even the mileage is a bit lacking) and the price was more than right especially compared to the Tacoma I wanted.

The Tacoma I wanted was a crew cab, 4x4, V6 @ ~28K; the Nissan Frontier was the same @ ~23k and the Xterra I paid 22k for.

I know the Toyotas are nice but there are other trucks out there with similar options that are less expensive. My dad just bought a Titan and he loves it.

Just sayin'

[Jay Auskin]

I was watching a fairly good show on TV about this. A methodology I liked was to "rush" the dealer. Go in there, know what you want, know a price you'll take, and tell the salesman if the deal isn't finalized in 10 minutes, you're leaving. The sales guy started to drag his feet, and the woman says, "Let's go, we've wasted 4 minutes already...tick, tick, tick, tick, tick, 6 more to go!"

They always play the I'll go talk to the sales manager BS. This wastes your time, and keeps you from checking out other dealers.

I'm always very courteous, but the last dealer that gave me trouble, I said to them in a calm voice, "I'm ready to buy the car at this price, and now I'm giving you the opportunity to sell another car today. My price is not negotiable, so let me know what you're going to do."

Good luck.

[gr8fl4porsche]

I have bought many new cars throughout the years as part of running a small business with a small fleet of cars and trucks.
Here is my strategy

1. Know the product better than the salesman - know the invoice price, available options, the dealers option costs, package discounts, available rebates, financing options, etc.
2. Have your proposal in written form - stating that this is the exact vehicle I want- including colors and options - and this is the price I am going to pay for it.
3. Be friendly. Meet the salesman and give him your proposal. If you spend a lot of time with the salesman he will expect more compensation. The salesman will get a minimal commission regardless of how much you pay. He will also get bonuses on moving 'x' amount of cars in a month.
4. Go to several dealers the same day the same way.
5. By the next day you will have someone who found your exact vehicle on someone's lot or is willing to order it for your price.
6. Invoice price is not what the dealer pays for the car - do a search on how new car dealers make their money. Lots of incentives, warranty work revenues and discounts for higher sales numbers within a given period of time.
7. The extended warranty is usually a rip-off at the original quoted price - very negotiable and can be purchased from many different vendors AFTER the original purchase. The financing person can make most of their commission from this part of the sale.
8. If the salesman asks you how much you want to pay a month - say no thanks and walk away. They should be selling cars, not loans.

Good luck - be tough and you will save thousands

[island911]

Originally posted by thamlin000
I'll be graduation from college . .. buying a new car and I don't want to get screwed.

those are some high aspirations.

Buy someones (private party) low mile "new" . . .if you want a realtively good deal.

Originally posted by Jay Auskalnis
. . .
They always play the I'll go talk to the sales manager BS.
. . ..

I also used to believe that was a stall tactic, used by the sales guy. It turns out the dealers don't give sales guys much leeway. . . so, the sales guys are given no authority, but all the responsibility -- they hate it.

[Dantilla]

Dealers make lots of money when they finance in-house. Do NOT tell him how you are going to pay ahead of time. During negotiations on my last (used) purchase, The dealer asked a few times "How will you be paying for this?" I don't want him to know I'm a cash buyer. That will affect how low he is willing to go. My standard response: "There is no need to even think about that if we cannot agree on a price."

After we agreed on a price, I pulled the checkbook out of my pocket.

[thamlin000]

Wow, thanks for all the advise! I'm going print this thread out and study it closely.

I considered pre-owned, but I really want to choose all my options and want the full new-car warranty w/out spending extra on ext. warranties.

Here's what I've learned so far:
-Type up everything (options/colors) that I want and include a reasonable price near invoice.
-spend as little time as possible with the salesman
-won't tell them about my credit union car-loan until the price is agreed on
-walk if necessary

[nostatic]

go to edmunds.com and look to see if there are any rebates or incentives...that will tell you if you can realistically expect to get the car for below invoice. They also have a function where you can get your "local" price...ie what others are paying. As for me, I start at invoice, look to see if there are incentives, then figure in a few hundred profit ("ad pack"). Walk in and have the invoice/options printed out (from edmunds or other source) and say "I will pay this...yes or no." If he goes back and comes back for "the bump", say thanks and walk out the door. Likely he will come after you. If he counters with something that you want, say done and be done with it. If not, leave. ALWAYS BE PREPARED TO LEAVE. What they will likely do is come back with a monthly payment number...they love to confuse you with lease/purchase/blahblahblah. I stuck to the number and yes/no. I finally ended up screaming at one manager becuase one of his saleswomen was so rude. I walked out the door, called another dealer. I said I want X and want to pay $500 over invoice. He said he could get X, but it would be $700 over invoice. I said I'd be there in 30 minutes to sign the papers. I was, and we were done.

Dealerships and salespeople are all over the map. Some dealers just BLOW. Those are the ones you need to identify quickly and walk out of.

[id10t]

Try to do it on the last few days of the month - bonuses for monthly sales numbers (both $$ and number of sales) are usually determined then. Also, if you happen to stumble across the employee breakroom while looking for the bathroom, they often have incentive dates, etc. on a fairly large calendar.

[dillinger]

Always be prepared to walk out the door!

[SteveStromberg]

It been a long time since I sold cars at a Dealership but we had inventory cards that had the Model Vin and all of the options ect. on the back of the card was the actual cost of the car delivered to the dealer. When i have purchased new cars I refer to the back of the card price. and 10 % thats what I will pay. Try to get an older over 50 yo salesman they will know what you are talking about. I am sure that it is all on the computer now and the back of the card will go right past the young guys but the old guys will know you are a serious buyer.

I all most forgot the most important part. There are two times to make the deal late on Tuesday night and late in the afternoon on a holiday like labor day. I guarentee this is your best time to get a deal.

[Rot 911]

Tham, what if I said to you, "I'll give you $5000 to $10,000 if you buy this 2004 Toyota Tundra with similar options, but it has 10,000 miles on it, but still has a warranty for 26,000 miles more? That is essentially how much you are looking at for depreciation the minute you drive that truck off the lot. We all have the new car lust, but here you are just starting out of college with a 5 year debt. And I can almost guarantee you will not have that truck 5 years from now. You say you don't want to be screwed, but you are screwing yourself. The way things are financed now it just seems like everyone is acting like the money you spend is play money, cause you don't really see it anyway. Believe me a 1 year old vehicle with low miles, cleaned up, looks and acts just like a brand new vehicle. Why give someone else your hard earned, future, money?

[lendaddy]

I would agree with Kurt, with the insanely long warranties they offer now (usually transferable) it makes little financial sense to buy new. New cars are for people who have the money to buy convenience, cause that's really all you get. If money is a daily/weekly concern to you, don't buy new. ESPECIALLY a damn truck! New trucks ae cool for 2 months, then you realize "it's just a truck". Besides they are so well made compared to cars they have little trouble repectively. My opinion, buy a nice 3/4 ton (they ride much better now, and are overbuilt) maybe 2 years old and save yourself a boatload of cash. JMHO

[thamlin000]

Kurt, Len, Island:
Y'all made really good points regarding the purchase of a pre-owned truck.

But here is my worry. Whoever owned this truck before me probably knew that it was going to be a short term ownership. I'm afraid of abuse such as excessive towing, overloading the bed, off-roading, and lack of maintainance. You know, truck owner stuff. Maybe I'm being sort of a pansy here, but I am afraid of spending ~$20k something that could have been beat on.

All of the used 2003/sub 20k mi Tundras have asking prices equivalent to the new vehicle asking prices. Though I'm sure the used trucks are more nego.

I still have a couple weeks, I might as well check out some *certified pre-owned* trucks.

[island911]

Originally posted by thamlin000
Kurt, Len, Island:
Y'all made really good points regarding the purchase of a pre-owned truck.

But here is my worry. Whoever owned this truck before me probably knew that it was going to be a short term ownership. I'm afraid of abuse such as . . .

THe reallity is, all kinds of guys (usually just out of school) buy a nice new truck, with the intension of keeping it nice and having it for the long term. THEN they find out it is more than they can afford. Usually not the pmnts, but the insurance gets jacked . . or they loose that cool new job, or have to move to NY (or ?)

Anyway, hardly anyone uses a truck as a truck. . .if they do, it will be obvious.. . even after a few months abuse.

[JavaBrewer]

Yeah I have to agree - you should be at least considering used trucks. I recommend buying from a private party vs. dealer for all the obvious reasons. It's more of a hassle not having them all sitting there in the dealer lot but you'll get more for your money. Case in point, in January I got my 00 F-150 (Lariat, extended cab, loaded, 5.4, tow pkg, extended warranty, new Mich. tires) from a private party with 46K miles for $14K - truck was over $28K new. The truck was in new condition, seriously. It's not hard to tell when they've been abused and these day's most are totally babied. Best part of the deal is that in 16 months the truck will be paid off in full. Then I'll consider an early 911 as a toy!

I admit that Toyota Tundra's are in high demand and don't depreciate as quickly as Ford, Chevy, and Dodge. I also like the new Nissan Titan. That said I would put my Ford up against any other 1/2 ton truck out there, plus it's cheap to maintain (except for the gas). Good luck with your search. The Tundra is a hell of a nice truck.

[turbo6bar]

Gosh, when the price tag starts to push $30k, I'd seriously consider a Dodge 2500 Cummins or Ford diesel. If I were in the market, I'd look for a used truck in the 1-4 yr old range. You can simply get more bang for the buck. Paying retail is so boring.

Otherwise, I don't see any reason you cannot buy at or a little above invoice, but be patient. Toyotas are great vehicles.
Jürgen

[thamlin000]

Alright, I located a clean black 03 Tundra 12,000 mi w/ all the options I want and it's only 45 min south of me.

Can anyone Carfax it? If not, no worries. I'm going to check it out tomorrow.

vin #: 5TBRT34183S400191

I'll keep everyone updated.