Car Buying Tips

Since we just finished the process of buying a new car (and I still haven’t had the chance to take any pictures), I thought I would share some tips about how I went about trying to get the best deal.
First, I had some things set up in advance of making any contact. I have a GrandCentral phone number which makes it very easy to avoid phone calls until you are ready to talk to them. When someone calls that number, I can set it to ring my phone at work, home, or cell, or none of them (straight to voicemail). Even once I pick up the phone, I can choose to listen in as they leave a message instead of talking to them, and if I want, I can even connect to them while they are leaving the message. This was a definite sanity saver.
I’d also recommend either setting up a special Gmail address to control the flow of emails, or to be very diligent about monitoring your inbox. The emails came in fast and furious, but I set up a good labeling system and used the Folders4Gmail Greasemonkey script to keep everything well organized into subfolders. Creating filters to label messages as they come in is also recommended, but you’ll probably need to get few emails first in order to set them up properly.
Now, on to the process. I should also mention that we did a little bit of used minivan window shopping at CarMax and and found that the prices on used Odysseys (without negotiation) were really not that much lower than new ones. So, we knew we wanted a Honda Odyssey EX-L. Luckily, Honda doesn’t really have the multitude of options packages that other makers do, so it was easy to inform everyone of exactly what we wanted. I went to the Honda website, and put my zip code into the dealer locator. I got back a list of fifteen dealers in the DC area and went about contacting each through their website (pretty much all of them put you through a website form, as they didn’t list email addresses on the site). For those that had a comment field, I used FiveCentNickel’s form letter and told them exactly what was going on. For those that didn’t have comments, I quickly followed up after they sent me an email with the same form letter.
After gathering all the initial quotes, I was able to weed out some of the higher offers, as I knew they were probably not going to be able to compete. I selected a few of the mid-range offers, and emailed them back with the lowest price quote. This is where things got a bit difficult. As you’ll see below, some dealers dropped out, which scared me into wondering if I wasn’t near the bottom of the market already. Others simply wrote back and said they would match, or beat it by $100. Not exactly what I was looking for, but it got me started in the right direction.
After haggling a bit with them, I went to my next tier of quotes, which were slightly above the lowest, to see if they would go below my new low quote. At this point, I was $200 below my initial low offer. Then suddenly, one of these dealers came back and said that Honda had raised the dealer incentive by $500, and my new low quote was $400 under the first round. At this point, I wasn’t too worried about hitting the bottom of the market, and just wanted to either get someone close to me to get a reasonable low bid, or get down to the very bottom with one of the further dealers. I used a variety of email strategies at this point, griping about the distance I’d have to travel, or the colors remaining, anything to try to spur activity. I knew I was close to the end when one dealer not only dropped out of the bidding but actually said, “I can’t do that price, and I don’t think that other dealer can either.” I did a little more research and found this FatWallet thread about negotiating with dealers. My target price ended up being $26389, and since my low offer was $26400, I knew I was close. I finally emailed the two dealers I had been saving for last. One was a nice guy, but far away, and the other was my nice local guy. The distant guy reluctantly came down to $26200, but said, of course, that he’d be losing money if he made the deal. I went home early on Friday and gave my local guy a call and asked if he could do $26200, and he quickly checked and said yes, with no guilt trip about losing money. We packed our stuff in the car and headed over to pick up our new minivan.
A couple of things I would do differently. First, I would wait until 2-3 days before we were ready to buy, and I wouldn’t have started on a Friday like I did. Dealers work on weekends, and I wasn’t ready to do anything that first weekend. Your best leverage is when you can say, “Get me this price, and I will be in today.” I had to keep delaying the decision, which frustrated me and the people with whom I was trying to negotiate. Second, I wouldn’t bother with any of the “buying services.” The only thing that got me was an extra quote that was right around the starting point for negotiations, and way higher than where I ended up. Maybe different situations would work differently, so don’t let me scare you off. Just know that if you put in a little effort, you can probably get a better deal than their “convenient” service. I also might have tried to buy a little bit earlier in the year. I know a couple of dealers were completely out of 2007s by the time I got to them, and one or two more were down to their last 2 or 3 and weren’t as willing to deal (I know, seems paradoxical). So for us, late November was a bit late for buying an Odyssey. Other models may differ (I know they had a LOT of Accords left), so if you’re looking at using the changeover from one model year to the next to your advantage, start checking dealer stock in September so that you can be prepared to start looking early if they are running low.
I hope that this walkthrough helped you in some way. If nothing else, I hoped I proved that you don’t need to be scared of the car buying process