When you buy a new car the experience is all about getting a good deal and trying to grind the dealer down because when you buy a new car you experience one of the rare opportunities in life where non-salespeople can test their negotiation skills and haggling savvy. Some people hate it, some love it, but everyone can agree that it is best to walk out of the dealership feeling like you did not get scammed or schemed, and knowing that you got a decent deal.
There are some simple tips to help you on said decent deal, here’s one of them: if you buy a new car at an opportune time you are taking an important step to ensure that you are getting a good deal. Knowing how a new car dealership operates will allow you to approach them at a time when they are pressured to sell more than other times. If, on the other hand, you decide to start shopping when they are under less pressure they will not sell you a car unless it is on their terms. Of course, if you buy a new car on the dealerships’ terms will probably mean that you overpay. You will want to learn invoice prices for the cars you’re interested in. Understanding what the dealer paid is key in negotiations when you buy a new car.
Most experts and car buyer testimonials agree that the end of the month is the best time buy a new car. This is because the dealerships and the sales staff have quotas to meet regarding their sales numbers. Both of these parties need to meet this quota in order to achieve their monthly bonus (or keep their job). In the cases of the sales staff, they will do everything they can to sell you a car even if it means that they do not profit on the sale. Sometimes a salesperson will give up his commission on a car by selling it at the price you want. However, they know that by selling the car they move a step closer to achieving their monthly bonus. The bonus check can outweigh the commission on one car sold.
In the case of the dealership, they too will push cars at the end of the month for cheaper in an effort to meet their quota and look good in the manufacturer’s eyes. The strategy is that they will discount the car for you and make up the difference with the money they will receive in the bonus. Believe that they need you to buy a new car from them.
Getting even more specific, one of the better times to hit the new car dealers is early on in the week. The reason for this is that there will probably not be that many people out there on the lot. The sales staff will feel pressure to sell a car to anyone that shows interest as opposed to letting them get away. This is in contrast to the weekends where the new car lots are busy and they may not find as much time for you. If you try to push too hard when the lot is crowded the sales staff may reject your offer quickly and move onto the next customer. Monday may be the best day buy a new car, especially if the dealership had a somewhat slow weekend.
The end of the model year for a car is another great time to get a good deal when you buy a new car. As the new models start rolling and appearing on the streets, the old ones become less attractive to buyers. Because of this, dealerships are forced discount the price on these outgoing models, even if they cost the exact same with the same MSRP. If you can time your purchase during one of these model changes you may be able to get a great deal. Additionally, the trick is to hold out for as long as you can. As time goes on the dealerships will become increasingly desperate to move the older models. As they grow more desperate they will be more willing to drop the price. The only drawback is that the longer you wait the more limited the inventory is going to get. In addition to what the dealership can do, there are often times big rebates and low interest rates that are offered by the manufacturer on these models. If you know that there is a new design on the car you want then you will be able to get the old design for a good price. This especially holds true after the newly designed car is introduced to the car lot. The cars with the older design need to be liquidated as soon as possible to make room for the new.
Just last summer we decided to buy a new car to help us with storage capacity (to haul camping and baby gear, our Newfoundland dog and our on-the-way new family without jeopardizing our desire to save gas. We ultimately bought a 2011 Subaru Outback (contrary to the advice above) but we paid the 2010 invoice price not the increased 2011 price – but we bought a new car import from the United States and saved over $9300.
Triple threat: End of the month, beginning of the week, end of the model year. Boom! lol That’s how I got my car, I also bought it used. It was a test drive model with low mileage at the end of the model year. Great deal.
Last model year is also the way to go if you like the car. The price usually drops quite a bit if there is a new replacement model coming up next year.
We couldn’t get the Outback we wanted by the time the 2011s came out. We paid invoice for the car (and accessories) – coming from Canada that is gold! (not to mention the mass savings by importing).
I’d have to say the most important thing when buying a new car is knowing what you want. If you go in there knowing what you want, you’ll likely say “no” to more expensive add on’s such as gps, navigation, tvs in the headrests and more – if you dont, the salesperson could convince you that they are “really helpful and worth the money”
Knowledge is power …
Great tips! I also learned that if you are extremely nice but super prepared, often the dealership will work with you.
Good work on the car purchase. I’ve always liked the look of Subarus.
Thanks! We love the Subbie. It is so high off the ground I can really haul it around our cottage road and Canadian winters with ease.
Thanks for sharing your tips SPF. I have found buying a car that is two years old to be a real savings. By then you no longer have to pay for depreciation costs and there are still few miles on the car. Plus the cars are usually in great shape.
And the warranty is still valid!
Great tips, but I think the best one is to go when there is no pressure! The power to get up and say “no dice” provides such an upper hand when negotiating. If you are leaving the lot in a car that still runs the dealer has zero power.
My ex-husband was a car salesman at a very high volume dealership. He said that the myth of the end of the month was wrong. Beginning of the month is when you can do your best. Since everyone thinks it is the end of the month, more people come in and they can get more units “out.” (You can always ask a car sales person how many they have out for the month.)
If you come in at the beginning of the month, they probably don’t have many out for the month, they are hungrier for their commission and want to get some out so that they don’t have as much pressure at the end of the month.
Also, since it is less crowded, you are also more likely to get way more attention, so you can walk out and you will be followed to close the deal.
I’ve read this as well Danielle. I think it depends on the dealership. Neither end of the month is the “wrong” time to try to buy I think.