Best Car Deals
How to get the best new car deals in the new economy
Having great negotiation skills has always been important in getting great new car deals.
But in the new economy, hard bargaining and negotiating with dealers is less necessary and oftentimes not necessary at all.
It's not because dealers are any easier to roll over. And it's not because customers are more savvy than in the past. They are, but these are not the reasons.
The age of perpetual new-car incentives
Only a few years ago, car manufacturers offered "sales" and buying incentives only about twice a year. Maybe a rebate here and there on a model or style that nobody wanted. Or a lame "employee pricing" promotion. Otherwise, customers had to get good deals the old-fashion way — hard, agonizing haggling with a dealer salesperson.
Things are different now. The economy has been in the dumps for a long time and car sales have suffered. Car manufacturers are offering special incentives — every month — to get customers to buy again. Incentives are offered in the form of direct-to-customer rebates, low-interest loans, 0% APR loans, special lease offers, and "hidden" factory-to-dealer cash. In most cases, the incentives are being offered on not just a couple of makes, models and styles, but on a broad range of vehicles.
What does this mean for automotive consumers?
It means the best car deals come to you — they are given to you — without having to haggle and negotiate. These are deals that a customer could not possibly negotiate on his own.
Here's why.
Without any special incentives and help from his manufacturer, a car dealer only has control of one element of a deal — price. Even then, he can only negotiate price within the limits of his potential profit margin, which is approximately the difference between his invoice price (what he pays the manufacturer) and the sticker price. Although he may have a holdback or sales bonus that lowers his cost a bit, he can't sell cars for less than his cost and stay in business for very long.
So how do dealers sell for less than invoice price? At low interest rates? With extremely low lease payments?
They get help in the form of incentives from their parent car company.
Car companies control not only prices, but rebates, loan rates, lease prices lease money factor, lease residuals, factory-to-dealer cash, and special bonuses ("loyalty" discounts, trade offers, package deals).
Therefore, when a customer buys a car with special incentives, the price could easily be less than a dealer's cost, the loan rate could easily be less than a customer could get at a bank (even 0%), and the repayment terms more flexible than a dealer could otherwise offer.
All of this without haggling and negotiating.
These kinds of exceptional deals are being offered every month by most car companies and their dealers. You don't have to ask for them. And the deals are genuine good deals, not some kind of dealer scam or come-on.
However, there may be restrictions and limitations. Deals are time-limited, usually only available for one month. Deals might vary by region. Only certain models and styles may have incentives at any one time. If both rebates and low-interest loans are offered, you must take only one, not both. Low interest (and 0%) loans and special leases are only available to customers with good credit. Some deals require a specified down payment or amount due at signing.
Of course, if the exact car that you want, and must have, is not being incentivized this month, of if you don't qualify due to credit issues, you are forced to get your deal the old-fashion way — haggling and negotiating. It's good to know your credit score before you go seeking incentive deals at a dealer.
Where do you find these great car deals?
Best-Car-Deals - Our sister web site that discusses the latest new-car incentives, rebates, low-interest loans, factory-to-dealer cash, and special lease deals.
Car Company Web Sites - All car manufacturers such as Honda, Toyota, Ford, Acura, and others have web sites that usually have a "special offers" page which lists the vehicle models and styles with incentives. Be sure to read the small print for any restrictions or limitations.
Online Car Pricing Services - Online companies such as Edmunds, and TrueCar
provide free new-car price quotes that include any rebates or discounts available at that time. Get as many quotes as you can to compare. Lease deals are not included.
TV Commercials and National Newspaper Ads - Car companies often advertise their current promotional incentive deals on TV networks (not local channel dealer commercials) and national newspapers such as USA Today or Wall Street Journal.
Summary
The best new car deals are not the ones you can negotiate for yourself, but the ones that are given to you without negotiation. These are incentive deals being offered monthly by car companies through their dealers. Dealers, on their own, cannot put together these good deals, and customers cannot negotiate the same good deals on their own.
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