How to avoid the new car dealer traps when buying a car
We know buying a new car from a dealer can be tough, that’s why we’ve come up with this handy guide to help you side-step the new car dealer traps.
WHEN IT COMES to buying a car from a dealer and their salesforce, well, you can’t be too prepared. See, while the Internet has changed everything from the way we research a new car, to the way we buy one (you can do it all now without ever leaving your home), many of us still prefer to buy from a car dealership. And for those people, well, we’ve come up with this guide to avoiding the car dealer traps.
The most important thing for buyers is that they go into the dealership knowing the make and model of vehicle they’d like to buy; this can all be worked out online by reading car reviews on sites like Practical Motoring, or even manufacturer websites to see, for instance, what colours the car comes in. You really don’t want to let the salesperson guide you towards a particular vehicle if it’s not the one you’ve already got in mind, because they might just be trying to get rid of slow-moving stock.
And it pays, in your research, to find out how long the vehicle you’re considering has been in production and whether it’s about to be superseded by a new model. Buying near the end of a vehicle’s lifecycle or, worse, just as it’s about to be superseded will immediately affect your future resale.
New car dealers absolutely want your business and they’ll do absolutely everything to get it. And that makes them, ahem, dangerous – figuratively speaking, anyway. That’s not to say that all new car dealers are rip-off merchants, because they’re not, but they will push and pull you to buy from them. Why? Well, because they’re under huge pressure to sell as many cars as possible for the most amount of money possible. And so they all have their tricks of the trade.
For instance, no dealer or salesperson will ever quote you the best price over the phone, they don’t want you shopping around and risk having another dealer out-do them by a few dollars. That means, if you’re in the dealership and the dealer offers you their best price, always get that written down; it’ll help you negotiate with other dealers on the same make and model of vehicle, but it will also mean the dealer can’t “forget” if you go back to them to continue the negotiation. It’s also worth mentioning that there’s no such thing as a fixed-price for a new car.
The manufacturer’s list price is often nothing more than a starting point with most new car dealers willing to negotiate if they can tell you’re serious. Yep, negotiating with a car dealer isn’t a one-sided affair. You, as the buyer, need to be open and honest with the car dealer; you should never be openly hostile. But, ahem, like a first date, don’t go too far too soon, for instance, say you’ve got a vehicle to trade-in, well, it pays to keep that information close to your chest.
That said, some dealers are hip to that tactic and will, often times, come straight out and ask you as their first question. Side step it if you can, but don’t lie. Once you’ve got the dealer’s ‘best price’ then you can reveal that you’ll want to trade-in your old car. And while it pays not to be cocky about your trade-in and what you want for it, you should have done your research on private-sale and trade-in prices for your particular vehicle to get a rough idea of what it’s worth.
But, remember, a car dealer will always pay less than market rates because they, in turn, have to make a profit on the vehicle when it’s sold. So, if you think you can get more money, sell your old car privately. If the make and model you like is available as a demonstrator it’s worth considering it, because a dealer can’t legally sell it as a new car. See, once a car is registered it’s technically second-hand, even if it’s only got 150km showing on the odometer; dealers will be more likely to negotiate on a demonstrator model and you’ll save quite a lot of money by buying nearly-new.
If you’re buying a new car off the lot then ask to see the vehicle’s build plate (which is usually on the firewall) because it will tell you when the vehicle was made. Meaning, even if the vehicle has, say, a compliance plate saying ‘February 2014’, the build plate might say it was built at the end of 2013. And that means, that vehicle, no matter what anyone says will always be considered a 2013 model, and not a 2014 model.
The compliance plate merely tells you when the vehicle was approved for sale in Australia. Before you sign on the dotted line make sure you take your prospective purchase for a test drive, and you can read more about how to test drive a car here. The key thing to remember is that you want to drive it on a variety of roads, not just around the block. And do be careful if a dealer suggests you take the car home for the night; while this will help you get a better feel for it, it will also most likely make you fall head-over-heels in love with it – I mean, it’s bound to be better than your old car.
Okay, so you’ve done all your research, negotiated with the dealer and test driven the car you’re interested in and now you’re ready to sign on the dotted line. Well, don’t. Not yet anyway. You want to go through all of the figures with the dealer, especially if they’re offering finance; they’ll be making a commission, see. So, in some cases, it might actually be worth talking to a private broker to see what they can offer.
Now, when you’re starting to talk money with the dealer they can be quite keen to push you to sign up, but as mentioned, take your time to do your homework on the best finance deal for your circumstances. The break in the negotiation can sometimes see dealers become pushy, saying the car will sell if you don’t buy it right now. Fine. You’re in control, remember. But, if you’ve got your heart set on it, ask them if they’ll take a 24-hour holding deposit to be refunded if you decide not to go ahead. Most dealers will say, yes.
When it does come time to sign on the dotted line, don’t, whatever else you do, say yes to any cost optional extras like rust-proofing, paint protection or window tinting. These will be ridiculously over-priced; some reports suggest as much as 500% more than high-street aftermarket accessories retailers. And make sure you’ve looked at the warranty too. Some dealers will offer you free extended warranty; make sure you read the small print because there might be stipulations, like the vehicle has to be serviced every six months at that dealership for the warranty to take effect.
The manufacturer’s standard warranty might state servicing the vehicle every 12 months or a set number of kilometres. And, then there are dealer delivery charges. These are one of motoringdom’s great smoke and mirror routines; they’re nothing but profit and usually involve nothing more labour intensive than giving your new car a wash and vacuum before you pick it.
Sure, some dealers might go to greater lengths, like parking it in a ‘reveal room’ and covering it with a sheet, but most won’t. So, make sure you negotiate. Buying a new car sounds like a lot of hard work but you shouldn’t be frightened by the process. After all, you’re spending a lot of money on a new car, so you want/need to make sure you get the best possible deal.
Just remember that when it comes to buying a new car you’re in control and can walk away whenever you choose. Good luck.