I sold cars and trucks for at least twelve years and was very good at it. I averaged over 35 new and used car sales every month, and most of my bills got paid on time, because of that. Now when I look back at some of the tricks and tactics used to conclude the deal, it just makes me smile.

If you sell cars for a living, you might not like what I am about to expose in this article. When it comes to negotiating new car prices, buyers have more ammunition at their disposal than most realize.

With the internet revolution in full swing, one can determine how much the car dealership paid for the shiny new automobile seating in the showroom.

In this article about new car negotiation tactics, you will also learn when it’s the best time of the day, the best day of the week, and the best date of the month, to buy your new car if you want a terrific deal.

Most car salespeople are trained liars, just like lawyers, and the very good ones do it with a wide smile designed to pull you in.

If you go into the dealership, and you start looking at the salesperson as your friend, you’ll pay more than it’s required for your new car.

You must realize a salesperson’s job is to extract as much money as possible for that new car, including charging you sticker price.

If you have a used-car to trade in for your new car, most likely you’ll pay more for your new automobile.

I decided to write this article for my friend’s blog after my recent encounter with a salesman while trying to buy a new car.

He hated that I knew all his moves, and the sales manager at the end agreed to the price I had in mind.

Please read on to learn how to negotiate car price that’s mostly a win-win for you, and some profit for the dealership. 

✔ Negotiating Car Price Initial Steps

Before you even go into the dealership to start your negotiation, you need to arm yourself with some basic information about the car or truck you want. You’ll need a pen and paper to take down notes.

✘ Find the dealer invoice factory cost. First, you want to log onto http://www.edmunds.com/, input the make, year, and style of the model you want.

On the next page, write down the factory cost of the car. Next, write down the dealer factory invoice price (this is not completely accurate, as Edmunds has been under much pressure to stop revealing the actual true cost, but it’s close enough).

✘ Find the Customers Incentives Figures. At that same page, click customer incentives. Sometimes they have more than one and all can be combined, to further reduce the cost of your new car or truck. Write all the incentives down.

✘ Find the Holdback Figure. Next you want to log onto http://www.edmunds.com/car-buying/dealer-holdback/, you’re looking for the holdback figure.

It will be given to you as a percentage of the dealer cost. So if the dealer cost is $20,000, and there is a holdback of 3%, meaning the dealer gets an additional $600 separate from the profit he or she makes from selling you the automobile. Write that number down.

By now, you have an idea what the dealer paid for the car, and the amount of money the manufacturer will give back for selling the car.

Most times, the car manufacturer even rewards dealers for meeting or exceeding quotas in any given month, but that number is cleverly hidden.

Remember, always keep the customer incentives money away from the cost of the car, as all that incentive is your money and can be used as you please if you buy the car or truck.

✔ What is an Automobile advertising Charge?

Sometimes the dealer invoice will include a co-op advertising charge of about $200 to $400. In some localities, dealers will come together and advertise the brand on television and radio, or print, to generate more interest and sales. Guess what, they want you to pay for that expense.

So in some cases that number would get added on to the figure you got from Edmunds. For now, leave it out of your figure, but just be aware it might exist.

Now that you have the true cost of the automobile (98 to 99% accurate), we need to start searching online, for the best deal. I would advise you to buy within a few miles of your home if you can.

Lately most cars come fully loaded with all the essential amenities you need for a comfortable ride. Most would have an automatic transmission, some form of music system, air-conditioning, floor mats etc.

You need to determine the standard equipment that comes with the car you want. Take a look at the other accessories and see if you need any of them.

The more extras you want in your favorite ride the harder it is to score a great deal, especially if the dealer is installing the stuff at the prep garage.

If you want a Dodge Caravan, and you want a step board, you’re going to be paying more for it, through the dealership.

✔ Now You Can Use The Internet to Get Quotes

Almost all major dealers have an online presence, and you can use that to your advantage. Have each of the dealers emails you a quote on the brand and model you want.

Most dealers treat customers from online differently than customers that just walk-in without any research or knowledge about the car buying procedures explained in this article.

Have dealers close to you, email you a few quotes. If you have several email accounts (which I suspect most of our readers do), conduct your negotiation through three different personalities.

Make sure you let the dealers know upfront you’re aware of the rebates, and you want prices without the rebate deducted from the total.

✔ Here’s What you might get with the online new car quotes

Most salespeople are told not to discuss prices over the phone or online. The key ingredient for any dealership is to bring you into the showroom, as you cannot sell a new car to an email address.

Some of the dealers you contact might just give you a “lowball” price, just to pull you into the showroom.

Some might just be upfront with you, and give you what they want for the car, and let you decide for yourself.

If you discovered a dealership lied to bring you into the showroom, make sure you go over all the documents, as they just might lie about other charges piled onto your new car price.

✔ Negotiating Car Price at The Showroom

✘ Make an appointment with a specific sales-person, at least two or three dealerships that you intend to visit on that particular day.

Please do not let the person trying to sell you the car know you’re shopping around, keep that fact to yourself.

✘ Try not to go to the showroom with all the members of your family. The more people you have in your entourage, the easier it is to sell you a car with an inflated invoice. Go with your wife, or just go alone. A good salesman will ask you, if you’re the ultimate decision maker.

If you and your significant other are unsure about the best color for the new car, make up your mind before you get to the dealership. A Couple arguing at the showroom is a sure recipe for higher prices.

✘ Before you start haggling over the numbers at the dealership, I highly suggest you test-drive the car you have in mind.

When I sold cars for a living, it was one of my rules to offer a test ride before commencing negotiation, unless the customer refuses.

✘ Just like jewelry stores have special lights to make the diamonds shine very bright, dealers have little psychological tricks they play to get you comfortable.

Contrary to what some might think, we buy from people we like and trust. Most dealers would do almost anything, to make you like and trust them, and that is how you over-pay big-time.

✔ New Car Buying Tips

1 – Try not to get into any arguments. Calmly state the brand, model and the color you want. Ask if they have it in stock, and you would like to see it. Let the salesperson know you intend to buy a new car today if the price is right.

Try to negotiate on what the dealership has in stock, not what he or she can get for you. The worst thing you can do, is negotiate on a car the dealer does not have in his inventory.

While it’s common for dealerships to trade cars with each other, you’re asking for more trouble if you buy a car without actually seeing it.

So, only try to negotiate car prices on what the dealer has in stock, not what they can trade for.

2 – Do not discuss financing at this stage, as it has nothing to do with the car price. Sometimes dealers might try to intimidate you by asking how good your credit is, and can you qualify for a new car loan.

You have to deflect that question, and concentrate on the car price. If you proceed to talk about financing without discussing the new car price, you’ll over-pay all the time.

3 – Get the exact figures for the car in writing. If the number is an unrealistic selling price designed to bring you back to the showroom after you’re looked at other dealers, the salesman would not put it in writing.

On Edmunds, they will let you know if the dealer factory invoice includes the destination charge or not.

4 – Confirm all the rebates you know about with the salesperson. Some of the rebates might have an expiration time-frame.

5 – Please visit another dealership close-by. You need to visit the other dealership, regardless of how good a deal you got from the first dealer.

Conduct yourself the same way at the other dealership, except for the test drive. Get the best price and promise to come back later, after doing your due diligence.

As you look at the prices from both automobile dealers, give preference to who has the car in physical stock, or dealership expecting a delivery from the factory in a few days.

In both cases, they will have an actual VIN (vehicle identification number) to give you.

6 – The worst thing you can do is leave a deposit on a car without a VIN number. I have done it as a salesperson and I can assure you, the sales agreement if fraught with many bait and switch tactics, which will have you paying a lot more for the car.

✔ Should You Trade-in Your Old Car or Not?

From my years of experience, you’re better off selling the car privately for cash, or bank verified certified check.

Dealers love used car trade-ins, as the highest grossing deals involve buyers given up their old car for a new car. A dealer is only equipped to give you wholesale price for your car, when you examine the numbers closely.

Most salespeople would ask you upfront if you have any car to trade-in, before even starting the car negotiation session. Why? Because having a used car to trade in, changes the new car negotiations steps to the dealers favor.

Advertise your car for sale privately, and you would make more money from that, than trading it to the dealership for a new car.

✔ Now for The “Dreaded” F & I Manager

You now have the best new car price, and you’re happy for it. Do not rest on your laurels yet, for the road to getting your new is fraught with many hidden charges, through the finance manager.

The finance manager is the most important person at any dealership. He or she is responsible for making the showroom much more money, by back loading must new car purchase with add-ons and finance tricks, which might be illegal in some states.

Your time with the finance manager should be brief if you’re not financing through the dealership. Reject all the dealer additional services. Whatever the dealership is selling you at this stage is way over-priced to say the least.

I have seen people pay $800 or more for an alarm system that cost the dealership only $90. You do not need any under-coating in your new car to prevent rust, as it comes with some form of factory rust-proofing already.

✔ What About if You’re Financing Your New Car

Sometimes, manufacturers would run special promotions of low interest financing, and that can save you a bundle.

Do your own calculations if it’s better to take the rebate, or take the low financing cost. Do not accept the finance manager’s calculations as facts, they’re trained to lie, and most of them are very good at it.

Get your own financing elsewhere, and then compare it to the dealer financing cost. When comparing, look closely at the car loan terms, examine the number of years, interest rate, and the monthly payment.

Please shop around for your financing, and don’t just accept what the dealership offers you. I have seen many deals make $100 profit during the negotiation phase, and then make $4000 to $5000 profit through the finance manager.

✔ Best Time and Days to Buy a New Car – For Low Prices

✘ The best day to shop for a car is Monday or Tuesday, because the showroom is slower on those days. Try not to buy new cars on weekends, most likely you’ll pay more.

✘ The best time to arrive at the showroom is very early in the morning, for best negotiation deals. Most sales people like to start the day with a sale, and you can use that to your advantage.

✘ Try to buy your new car by the last week of the month, preferably two to three days before the month’s end.

Most showrooms have sales incentives for both salespeople and managers, and the pressure is highest, before the month’s end.

You’ll get a much better deal at the end of the month, provided the dealer has the vehicle in stock, and you’re in a position to take delivery right-away.

Negotiating a new car price is not all that difficult, as long as you follow some of the steps outlined in this article. Get started by doing your research online through Edmunds, and then get some reliable quotes before visiting any of the dealerships.

You’re better off selling your used car privately, instead of trading it to the dealership. You also need to shop around for your new car financing.

It would be nice to hear some of the tactics you used to get the best price on your new car purchase. Please leave your opinion in the comments section!