I am an ex new car salesman from the 80's & early 90's, but I know the modern tricks too. AMA

If you were buying a car tomorrow, what tricks would you use?

Go to edmunds.com and look up the car you're interested in. Spec it out just the way you want it. At some point in the process, edmunds will ask you if you want to get some quotes from dealers in your area. Say yes, and they will do the emailing for you. When you start getting email replies, start playing the dealers off each other. For instance "dealer A gave me a quote for $100 less. Can you beat it"? At some point you will hit the rock bottom price. That's the dealer. Go into the showroom with your printed email in hand and ask for that deal. Don't expect the salesman to welcome you with open arms. It's a mini deal for his pocket.

The website is edmunds.com not edmonds.com

Oh Christ, what a blunder. I hope everybody reads your correction.

Same question, what would you do if you were headed to the dealer to buy a used car? What kind of wiggle room can you expect?

Same answer, do your homework. Go to edmonds.com or kbb.com - They will give you 3 prices on any used car: trade-in value, wholesale value and retail. All values depend on condition of the car. Figure the dealer paid trade-in value because he did in 95% of the cases. You will see a huge difference in dollar amounts. That's your "wiggle room". But you'll have to do a lot of work to get it closer to trade-in value. The only way to get close to that number is if the car has been sitting on the lot for at least 45-60 days, or more. Then, the used car manager wants to move the car off the lot, instead of taking it to the auction to sell. It's best to shop for used cars when the dealership is CLOSED. You can pick out the one you want, check the mileage if it doesn't have a digital dash and then look the car up on the internet.

Technology has probably changed things, but I worked on the used car lot section of a big new car dealer in the 90's. The price that was on the sticker was $3,000 + whatever we had in the car (purchase price + oil change/service + detailing). Unless the car was special in some way (sports car, loaded up luxury car, etc.), they would sell it for $1,000 profit at any time. So many people had no idea they could negotiate $2,000 off the asking price.

Holy shot that's a lot of money. Is this true for cheapish cars ($6-10 thousand), or only higher priced ones.

edit: how did I get away with this post when I had two typos?

It's true.

how accurate are edmonds and kbb for used car pricing?

I've always had the impression that kbb was a tool that salesmen used to make the buyer think they were getting a good deal, when in reality, the market differed quite a bit in their favor. Is this true? Or do I have an incorrect impression?

Actually they're pretty damn good. They even ask for your zip code because they know a car can be worth more or less in different parts of the country. They get paid to be right.

As someone who sold new cars for a summer and hated it I have to say I wish people were that educated. The dealer I worked at was that rock bottom and I made 100 bucks a deal plus 10% of accessories. People couldn't wrap their heads around the fact that we literally couldn't go any lower and always thought I was trying to screw them. Quit after 3 months because I was not the personality for the job. I always felt like I was screwing over these people who shouldn't have been buying the car they were buying, due to their financial situation. Worst job I've ever had.

It was also the worst dealer you could have chosen. There are better ones out there, but not many.

What are common pitfalls and traps that people fall into when buying a new car, and what would be the best way to avoid them?

Leave your emotions at home. The worst thing you can do is show the salesman you're in love with a certain car. Never walk directly into the dealership. Wait for a salesman to approach you outside. Then tell him straight up you're not there to make friends. Be prepared at all times to get up and walk out of the dealership during negotiations. You CAN get a better deal on the last day of the month.

I can vouch for this as well. Be polite, but firm.

Husband and I went to just look at some vans. Nothing wrong with ours and it was only two years old. It was something to do. Then he wondered if we could negotiate a lower payment on a new van. Fine. I am the one who haggles and deals with the sales person. We found the one we liked and the sales guy came over. We go in and he starts running the numbers. He slides a total joke of a number over to husband and I take it. No. I told him. That won't do. Then I explained we have a 2 yr old van that is perfectly fine. We want the payment to be less than what we have now, or no deal. Sales guy kept running back and forth, supposedly to a manager, to ask for lower numbers. I kept telling him no. Husband wants the new van bad now and is cracking. I refuse to allow the sales person to speak with him by answering for husband and interrupting. Sales guy disappears and comes back again with his "final offer". "Best we can do." I grab husband and stand up, tell the sales guy I'm sorry we wasted his time. That still isn't good enough. He was $10 a month over what our current payment was. And we start walking away. Husband knows it's the right thing to do, but is really pushing me to give. Not going to happen. Reaching the door outside, sales guy comes running after us. Finally, he gives me a number that is $30 less than our current van payment. "You've got a deal." I told him.

Best part, the brand new van had the power package and CD player. The 2 yr old van we just traded didn't have squat. Just a radio, and crank windows, no power seats...nada. We saved $30 a month on the new van, plus another $45 a month on insurance because of additional air bags. I was also able to get them to pay tax and tags and cough up free mats. We paid that sucker off 5 years ago and it's still running strong.

EVERYBODY ON THIS THREAD MUST READ THIS!!!! THIS IS HOW YOU BUY A CAR. CASE CLOSED. GOOD JOB.

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Yep. They have quotas to meet with the manufacturer too. End of the month, end of the quarter, and especially end of the year.

Fiscal year or January?

December 31st to be exact. They also want to go home and party for New Years Eve.

Wait, you say tell the salesman I'm not here to make friends, but later said make friends with the salesman so he can go sweet talk the sales manager for you? Which is it?

Okay. Be pleasant. Make nice to the salesman, on the lot, but don't be afraid to let him know you're a serious buyer but you're not there to make friends. Once you step into the dealership, all bets are off. Put your game face on and be prepared to walk.

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Never give up your keys. You give up control when you do. If they take your car for a test drive to put a number on it, ask for your keys before you start talking money. If you don't have you keys, they know you can't walk.

This happened to me when i was buying my first car. it got to the point where I was yelling at the salesman to give me my keys back. They threatened to call the police because I was making a scene. I told them to go ahead because they had stolen my keys. Fuck that place.

Rule # 1. Never give up the keys. They got you. You can't leave. If they take your trade in for a ride, demand your keys back before you ever start talking deal. If they won't, threaten to call the police, right in front of them. Then walk out, you're in the wrong dealership.

Who is the SOB that invented the DOC fee.

It is just guaranteed clear profit.

Some dealer for sure. This is one fee that is pretty much not negotiable. It's pure profit.

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Glad to hear that. I've never seen that happen in person, but I guess if you've got the stones to try it, why not give it a shot.

Whats your take on the warranties? are they worth it or should you not bother?

Waste of money. About 75% profit for the dealer. Exclusions are in fine print. Today's cars are built so much better, you shouldn't need an extended warranty for ANY car, except maybe one in the100k range.

Did you ever try to get some guys to kidnap your wife for $40,000, while your father-in-law paid $1,000,000 for her ransom so that you could open up your own dealership in Wisconsin using "half" of what you paid the crooks?

My wife is priceless. My father-in-law is dead. I'm retired and not in any mood to make deals any more.

I guess you're not from Fargo, then.

Not a chance.

1. What was the weirdest thing that happened to you.

2. On the scale of 1 to 10 (1 being just sitting down forever and 10 being a legi designer) how boring was your job?

3. Have you ever lied or hidden information to sway the consumer to buy another car?

Weirdest thing? You're almost your own boss (once you've been in the business a while). When you're out on the lot, you can basically walk away from an asshole and no one is the wiser. It's fun too. The job was never boring. In fact it was a lot of fun. You get to prank people, prank your co-workers, and drive around in new cars all the time. Was probably my favorite job, except towards the end when it became so cut throat. Lied? Ah here and there, but nothing that really hurt anybody. I was probably one of the most honest car salesman around, hence the fact I was only in the business for 8 years. I might told a customer or two that a different model was a piece of crap when in fact the other car was really nice. Nothing really outrageous though.

I know a lot of used car salesman, you sound like a saint in comparison.

Please don't compare me to a used car salesman. They are as low as lawyers. New car sales is at least one or two notches above them.

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I'll try to be gentle. You got fucked. Once you take possession of the car, they are not inclined to do the things they said verbally that they were gonna do. Take this as a life lesson: never take the car off the lot till the car is right. Don't be so anxious that you're sorry later, like you are now. Sorry for being so harsh.

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Keep hounding them. Maybe they'll fix all that stuff to get you off their backs. Squeaky wheel thing.

Have you ever sold a car for sticker price? My grandma bought one once...

Yes, more than once. It makes your day. Tell your grandma we love her. And I actually paid sticker price once myself, when I was in my early 20's and very stupid.

How much would you typically make on the sale of a car? Does dropping the price to the bare minimum effect the commission drastically?

I made 25% of the PROFIT on the deal. The more you paid for the car, the more I made. The profit is any money above dealer invoice. Therefore, if we grossed $1200 profit, I made $300. A mini deal was $50 for a no profit or little profit sale.

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Yes & no. Ask, and the dealer might just show you the invoice. It will say "dealer invoice price" on it, but in reality it's not their bottom line price. I've seen a lot of cars sold at dealer invoice. The dealer gets a kick back at the end of the year from the manufacturer, depending on a lot of factors, like amount of cars sold, amount of hard to move cars sold, amount of cars sold that the mfg. shoved down the dealer's throat. Those kinds of numbers will never be shown to ANYBODY else in the dealership, except maybe a really trusted accountant who handles the dealers books.

Can you enlighten us about "holdbacks"?

The manufacturer "holds back" a certain amount of cash from the dealer, but it's essentially the dealers money. They get that money when all the "i"s are dotted and the "t"s are crossed. It's money (profit) the dealer will never reveal to sales people or sales managers. I've never seen a dealer dip into "hold back" money to make a deal. It's like stealing from them. It's sacred to them.

Thank you for doing this, you're such a kind soul to show the horrible overpriced-ness of a car. Being in the service industry for so long, its really hard to be mean to anybody working. I'll be sure to be firm and straight faced when I buy a car in the future. (I could be a total asshat, but its forced out of my system around people making a living.)

It's been said that buying a new car is the 2nd most traumatic experience in your life. Getting married being the first.

Here's one you don't get, I'll bet...

What is wrong with the people at the Suzuki corporation? Why haven't they figured out after twenty or so years "Maybe Americans have no interest in buying our cars, let's go back to motorcycles?"

You're right, I don't get it.

I'm looking for a used car now and I have no clue what I'm doing and know vitually nothing about cars. I just want a 4 door sedan, no older than a 2003 model, and no more than 100K miles. Any tips so I don't get taken advantage of?

Edit: I know you sold new cars, but just thought you might be able to give me a tip or two still.

Shop the dealership after hours. Pick out a used car you want. Go to kbb.com and look up that particular car to see what they are selling for and what the dealer probably paid for it. Make an offer less than retail but more than trade-in value. Try not to insult the salesman, but be fair to yourself too. If it's a really old car with 100k miles on it, I'd ask the dealer if you can have YOUR mechanic take a look at it. You'll have to pay for that, but it could save you in the long run if the mechanic says it's a lousy car, don't buy it.

I got my 2006 Honda CRV for $2,000 below the sticker price because they had two of the same exact car (one had much more mileage), and dropped the price of the one with lower mileage! I searched and searched for cars, test drove a few, but found the deal online after one hour of looking at edmonds.com. It was the end of the year, and I went in and told them what car I was looking into buying. They tried to get out of dropping the price, but I brought a printed out copy of the ad and said they had to honor the price they posted. Salesman was annoyed, but I got a great deal! One trick I use: I never even bother looking at new cars. I don't want the temptation!

You done good :)

In those meeting rooms where you decide the price of the car, are those rooms bugged?

Not to my knowledge. Then again, that was a lot of years ago. Today? All bets are off.

Went in to trade my leased nissan pickup in for something newer/smaller/better gas etc. The salesmans went out to the car and came back, told me that the tailgate had a different paint job (than the original) on it and therefor my car was worth less. He told me that somewhere between the time i bought it (2010) and now, the tailgate was stolen or given a bad paintjob. I had never had the tailgate serviced and it even had the same sticker from the original dealer from 2010. How big of a lie was this guy telling? perhaps just trying to take advantage of someone who doesn't know about cars as much as he does?

If what you're telling me is true, he's a big time crook. Go elsewhere.

Does it really help with sweetening the deal if I act unimpressed with the car during a test drive?

Most of the time. Never show emotion towards a particular car. They can pick up on the fact that you've just fallen in love with the car, and will probably buy it for more money.

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You have to play dirty like they do. You have to be willing to do whatever it takes to get the best deal. Fuck the 2 dealers who tried to fuck you first. I would however let them know in an email that you bought somewhere else because of their sneaky tactics.

My gf just bought a new car and this is exactly what I told her. Too bad I couldn't be with her when this all went down. She's all like, "oh Fred was so helpful at the dealership." Poor girl, I love her to death.

Be nice. Tell her you think she got a great deal. Break her heart in about 10-20 years, not before.

what are somethings a prospective car buyer can say to get a car salesman to drop the price?

The salesman can't drop the price. Only the sales manager can. Therefore, you can at some point make friends with the salesman and have him go tell his manager "this is the bottom line for this guy, or he's gonna walk".

We just bought a car, brand new Honda CR-V. What do you think of truecar.com? We used it on this purchase, but it seems exploitable... We got automated quotes and worked dealers against each other...Winner dealer ended up 50 miles away. Bought on last day of June, rejected every add on by finance guy, and got a 2.3% 72 mo. He told us it was $1500 below invoice. Bullshit or no? What non confirmable numbers are used to get a good deal? I think we are one of 3 in lowest bin on sales histogram here:http://www.truecar.com/prices-new/honda/cr-v-pricing/2012/

Never heard of truecar.com, but from what I see, it looks to be another good website to do your research with. All things considered, I'd say you got a good deal all the way around. You did all the right things. I'm a little skeptical though, that you got a Honda for 1500 under INVOICE. Maybe 1500 under sticker, but 1500 under invoice sounds too good to be true. Did you in fact SEE the actual invoice?

Any advice on placing a factory order?

Same rules apply as if you were buying a car off the lot. The dealer is not happy with that deal though, because he doesn't get his money till you pick the car up. On the flip side, the dealer has no expenses like interest and other bullshit.

So the dealer has less expense? Can this correlate to more room for negotiation under the invoice price?

Too many people are talking about under invoice. That's not gonna happen. Under sticker is the correct number. The answer, yes, probably get a better deal by ordering it, but don't look for a lot.

What's the biggest mistake people make buying cars then vs now?

Are there any "deals" that you have to watch out for that really aren't worth it?

What's your favorite memory of the business?

What's your favorite color?

The biggest mistake is not being prepared. In this internet age you can find out the true invoice of ANY car. "Deals"? Just don't get stuck buying a car that is not popular and will have no resale value. Specialty cars are a good example. Boxy frumpy cars too. Favorite memory. Ha, that's a long story, but shorten up, guy offers me $8000 on a $12000 car. There's only about $700 to play with and he offers me 4 grand under sticker. I turned and walked away without saying a word. They were from the old country and the daughter was doing the talking, while they talked in their native tongue. Funny part was, he spoke English when we down down to shouting at each other. He walked, the dealer never knew what happened. Favorite color? Black can't be beat when it's clean & polished, but they show the dirt too much.

You alluded to the topic in this thread a bit, but what's your take on leasing cars? I work with a guy who swears by it (and he starts with a list of about 20 or so dealerships in his half of the state). Despite the care he takes in brutally going for the best offer from a long list of dealerships etc, I still can't shake the feeling that leasing is not a good idea.

He's getting fucked, he just doesn't know it. I made the most money on cars that I leased. Unless he's really smart and knows something about the business, like cap costs, residual values, etc. then he's not as sharp as he thinks he is.

When is the best season to buy a car?

Winter. Especially if there's a foot of snow on the ground. Other than that, December 31st, last day of the month, last day of the year

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Absolutely! The worst thing you can do is walk in to the dealership boasting that you're gonna pay cash. They make money off the financing. I worked in that department too. My income depended on financing. If you walked in paying cash, I hated you. I had deals that were contingent on us doing the financing, because we were at rock bottom on the car and the only money we were gonna make was in the finance office.

Not sure exactly how car loans work, but if you wanted to take advantage of an offer that relies on financing, could you simply buy a car and pay off your loan as soon as you received your payment book?

Yes! But make sure it's a simple interest loan. You'll pay pro rated interest charges on other types of loans.

Can you tell me, a person who knows nothing about buying a car, what are some words/phrases they might use to confuse me, or any words/phrases in general that the average person might not know that could be helpful?

Get familiar with "sticker price" "invoice price" "best deal". Can't come up with any more off the top of my head.

How effective would you consider this strategy to be for buying a new car?

One of the simpler chapters described how I got the best price on a new car many years ago by shuttling back and forth between two Buick dealers in Vegas who had different owners and were selling the same model with virtually identical options. The trick is to start with an insanely low offer, gradually raise it each time you visit or revisit the dealership and to divulge your strategy to both of them. Unless they are colluding, this technique cannot fail to land an offer that is right at the lowest number they will take. Because they know that if they let you walk away without accepting a profitable offer, the other dealer will certainly accept the slightly higher one you offer him.

When someone offered me an insanely low offer, I had the stones and moxy to tell them "go buy from somebody else, you're insulting my intelligence". Having said that, I once had a guy come in once a week, trying to beat us down in price. Each week we'd drop our price 50 bucks. Eventually we got to the place HE wanted to be, and we sold him the car. That was the only time I got called into the owners office for selling a car. He told me "I just wanted you to know you sold a Cadillac for the lowest gross profit ever". He wasn't smiling.

Just show me the Car Fax.

When buying a used car, that's always a good idea, especially if you have any suspicions about the car.

First off, thank you so much for doing this. I've been stuck to going with my gut on how to purchase a new car and such, granted I've been researching for a long time.

Please help me out now.

Here's my story and I'll make it simple. First time buyer here and I'm trying to steer away from paying more monthly than I can handle. I'm interested in the Mazdaspeed3 and online at one dealer about 25 miles away from me they have a base model for about 22k. That's their "webprice" or "web deal" or whatever. Dealers closer to me have the same car (features I'm assuming are the same) for about 24k and up. So after reading this I obviously see I need to do certain things such as have someone come to me and don't show too much interest in a particular car and what not. Is it a viable strategy to print the price of the cheaper dealer and bring it to the closer dealer and negotiate price from there or what? I'm pretty sure they all have competitive pricing so they will drop it to get my business but should I try and dip lower from that or what? Also, should I avoid saying what I want my max car payment to be? And if so how do I avoid that.

I'm young, and need some assistance and with your tips that I have read so far I feel a bit more comfortable I just need this little bit of more info you can give me. Help me out please! And thanks for all the other tips!

Absolutely take the printed deal from the guy who's 25 miles away to the closer dealers. You're gonna buy a car closer to home, I guarantee it. Don't bend, don't cave. They will not want you to buy from someone 25 miles away. It's called pride.

What is the largest sum of money you "over charged" for a car?

Probably 2 grand. But that was on a lease. You can make more on a lease because the customer doesn't really know what the selling price of the car was, just what the payment is. Never ever walk into a dealership with a max payment in mind. The dealer will make sure he gets to your payment, but you'll never know how he did it. You can bet he made a ton on the deal.

What's your favorite make of car?

Chevy. Corny, I know. But I'm old fashion (and old,71). I'll buy American whenever I can. I have to stick with GM cars anyway, because my wife gets employee discount from her brother. That price can NEVER be beat.