The Art of Haggling: Tips for Successfully Negotiating with Car Dealers

Americans tend to dread spending long hours at a dealership haggling over the price of a new or used car. But negotiating with car dealers doesn’t have to be a chore. As long as you do your research and stay calm, haggling over the price of a car can help you get a great deal.

Gather Relevant Information Before Heading Out to Car Dealers

It’s important to remember that your local car dealer and their sales staff have years of experience negotiating. You, as the buyer, are probably only doing it once every several years. The most crucial element to negotiating with a car dealer is having the right information. The good news is that this information is more available now than ever before.

Before you ever enter a car dealer, you should be armed with knowledge about trade-in values, the amount the car you want is selling for locally, Carfax reports if you’re looking for a used vehicle, and pre-approval for financing. When it comes to financing, at the very least, you should know your credit score. You don’t want to be surprised by this information when you’re sitting in
the dealer finance office.

Negotiating is a Business Transaction

Part of successfully haggling the price of a car is remembering that it’s a business transaction. No matter how nice the sales staff is or how badly you want the vehicle in question, it’s important to stay calm and neutral. Another thing to remember is that negotiation doesn’t mean you walk out with a super good deal, and the car dealer gets nothing.

What it actually means is that you’ll probably end up spending a little bit over your bottom line, and the car dealer will end up accepting a bit less than they wanted. You deserve a fair deal, but the dealer also deserves a fair profit.

Focus On the Price, Not the Payment

One of the most essential pieces of advice to remember is that you should never focus on the monthly payment when you’re buying a new or used vehicle. If your negotiations center only around the payment, your chances of getting a good deal are basically gone. While you focus on the monthly payment, the car dealer will shift various numbers to arrive at your chosen payment.

Unfortunately, many times this is the exact first question that a salesperson will ask you. How much do you want to pay per month? You can have a number in your head, but you shouldn’t let them know. If they know your budget, they can shift numbers to make it look like you’re getting a deal.

Instead of focusing on the monthly payment, let them know that you want to discuss the actual price of the car, including any taxes or fees. Tell them that you want to know the out-the-door price of the car, not the sticker or MSRP.

Understand What To Negotiate With Car Dealers

When negotiating with a car dealer, it’s good to know what you can and can’t negotiate. You can definitely negotiate the car’s price, your trade-in value, and the cost of financing. You can also negotiate add-ons, dealer fees, and other miscellaneous costs. The list of things you can’t negotiate is much shorter. This includes taxes, registration, and the destination charge. The latter is the cost of transporting the car to the dealership from the factory. It’s charged by the automaker and isn’t negotiable.

To sum up, don’t go to a car dealer until you have all the relevant information for your situation and are prepared to walk away if they prove to be unhelpful or unyielding.