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WE JUST PURCHASED a new car. The whole buying process has been upended by the pandemic and today’s chip shortage, and we learned seven important lessons.
My wife and I view car buying as an unavoidable chore. We know financial experts recommend buying a car that’s a few years old, so someone else takes the big hit on the initial depreciation. We haven’t done that. We like to buy a new vehicle and keep it for 15 or 20 years.
For the past several years, one of our vehicles has been a Ford F150 pickup, which we purchased new in 2005. Our second vehicle has been a Buick LeSabre, which my parents purchased new, also in 2005. We bought it from my mom when she no longer needed it. Six months ago, the engine blew on our pickup. Since then, it’s been sitting in our barn while I decide whether I should spend $6,000 getting a new engine installed. With it out of commission, having only one 18-year-old vehicle doesn’t seem like a wise proposition.
Two weeks ago, I got serious about buying a new vehicle. We decided we wanted a Toyota Highlander SUV. Highlanders come in seven models: L, LE, XLE, XSE, Bronze, Limited and Platinum. Looking at the specs online, we decided an LE had everything we needed.
Our closest metropolitan area is St. Louis, which is some 50 miles away. There are nine Toyota dealers in the St. Louis area. Toyota dealer websites tell how many vehicles of each model they have in stock, with a picture of each vehicle. I planned a day’s outing and went to the three dealers that supposedly had the most Highlander LEs and XLEs in stock.
Lesson 1: Online reports of available inventory are notoriously inaccurate, at least for Toyota. I went to one dealer whose website said it had four Highlander LEs sitting on its lot, ready for purchase. The dealer had one, and the salesperson said that was a fluke. She said the dealership usually has none.
Lesson 2: Many dealers are adding an “administrative fee,” so the buyer is paying more than MSRP. No more haggling and paying less than MSRP, or manufacturer suggested retail price. One dealer was proud that it added no fee. One of the other dealers I saw added $400 to MSRP, while another added $800.
This was a fact-finding day. I was not planning on purchasing anything, but I did drive a Highlander LE at two of the dealerships. I came home and thought about things for a week. I decided I wanted a Highlander Hybrid—partial electric. It’s supposed to get 35 mpg city or highway. It costs a few thousand dollars more, but I did a breakeven analysis. Depending on the price of gas, after 30,000 or 40,000 miles, I’ll save enough in gas to offset the extra cost.
Lesson 3: Sought-after cars are in extremely short supply. I called the nine dealers in the St. Louis area, two dealers in rural areas east of us, and even two dealers in central Iowa, where my mother lives. Twelve of these 13 dealers did not have Highlander Hybrid LE or XLE that I could walk in and buy. Several offered to put us on a waiting list and said we should be able to get a car within six months. For some, to get on their waiting list, we had to make a $500 or $1,000 deposit. Other dealers said we’d have to wait a year or more and didn’t even offer to put us on a waiting list. One dealer said it restricts sales to people within 50 miles of the dealership.
With the next-to-last dealer on my list, I struck paydirt. It had two Highlander Hybrids sitting on its lot, one LE and one XLE. The buyer for the LE had not been approved for financing and the sale had fallen through. My wife and I rearranged our schedule for the day. That afternoon, we went in and bought the LE. We paid $47,210—an MSRP of $43,643, a $499 “administrative” fee, and $3,068 for sales tax and registration fees.
Lesson 4: Take care of details. We have our credit reports locked to reduce the chance of hacking. In my experience, most establishments use TransUnion, so I unlocked our TransUnion credit report before going to the car dealership. Toyota is offering financing on Highlander Hybrids—4.99% for three or four years, 5.99% for five years, or 6.49% for six years. Although we generally pay cash, I wanted to finance this car. I found out Toyota uses Experian and I couldn’t get my Experian report unlocked at the dealership. I settled for the dealership’s best alternative, Fifth Third Bank at 7.35% with no refinancing penalty. Our hometown bank offers 6.75% for six years. We’re in the process of refinancing.
Lesson 5: Financing is out of control. One dealer told us we could purchase a vehicle with literally no money down. Another said we needed to put down $500. Both said a larger down payment wouldn’t reduce the interest rate. Wouldn’t it be prudent for a financing company to require a 20% down payment, or at least 10%? Can people who have saved nothing afford huge monthly payments? We opted to put down $3,768 and financed $43,442. We have payments of $750 per month for 72 months. When we complete our refinancing, our payments will go down about $15 per month.
Lesson 6: The chip shortage is real. Basic economics says that in a free market economy, when there’s a shortage of something, suppliers increase production. When I asked salespeople why Toyota doesn’t ramp up production of Highlander Hybrids, the reason always given was a shortage of computer chips. Also, because of the chip shortage, we received just one key with our new car. A second key will be sent to us at some indefinite time in the future.
Lesson 7: The used car market is wonky. I checked both Carvana and Carmax for used Highlander Hybrids. We could buy a one- or two-year-old Highlander Hybrid LE, with 20,000 or 30,000 miles on it, for a few thousand dollars more than we paid for our new car. When I told this to my brother, he replied, “Yes, but you can have the car this week.”
I know it makes me sound old when I say this, but we purchased our first home—a small but comfortable split-level with three bedrooms, one bathroom and a one-car garage—for $46,000 in 1981. That’s somewhat less than the cost of our new car.
Larry Sayler is the only person with a Wharton MBA who also graduated from Ringling Bros. and Barnum & Bailey’s Clown College. Earlier in his career, he served as CFO for three manufacturing and service organizations. For 16 years before his retirement, Larry taught accounting at a small Christian college in the Midwest. His brother Kenyon also writes for HumbleDollar. Check out Larry’s earlier articles.
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The smart approach would have been to purchase the vehicle through your bank’s Home Equity Loan account and receive a tax credit at the end of the year for interest paid. 6.75% is huge for an asset that depreciates the moment that you drive the vehicle off the lot. The idea of casting a large vehicle net across the area is cool. In fact, I cast it across several states and
it has yielded great savings. Once a friend asked me why I would drive from TN to GA to purchase a car. I replied that anytime that I could save $2400, I would gladly make the day daily. Of course, the best deals were prior to the semiconductor shortage days. I yearn for those days to return. Once the balance between supply and demand resurfaces consumers’ clout will return.
Unless I’m misunderstanding what you wrote, the home-equity approach wouldn’t yield any tax benefit. Thanks to 2017’s tax law, the interest on home equity loans is no longer tax-deductible unless the loan is used to buy, build or substantially improve a first or second home.
https://humbledollar.com/money-guide/home-equity-loans/
A 72-mo loan at$750/mo? Do you have any idea what the opportunity cost of that purchase was? Never mind the sales tax, the likely huge increase in your insurance premiums, and (if you live in the STL area) the annual personal property tax cost? You would have been far better off economically if you had just replaced the engine in your pickup.
This was some years ago, but I’ve “let my fingers do the walking” several times since. I was living in Florida at the time and was looking for a specific color of a specific 4 passenger sports car. After calling Texas, Colorado, Minnesota, Ohio, New York and Massachusetts, I found the car at the best price. Saved enough that the savings paid for my airfare, motels and gas for a brief vacation while picking up the car. I haven’t had as rewarding a car buying experience since.
In the last decade I’ve “negotiated” the purchase of four new vehicles for cash. I found each dealership had different attitudes towards service. Consistent amongst them, they presented a price and said take it or leave it. One exception was at Mazda, where we did not buy, where a dealer offered $600 off if we financed and said we could pay the full loan off in the first month so it would be like paying cash. Subaru, where we did buy, pushed hard for financing and for a service plan; the experience sucked big time but I would buy another Subaru. Honda made us wait, so I told them if they wanted to sell us a car, they needed to close the deal within a few minutes or we were leaving. I’m glad all of this happened before covid.
The last car was the week before covid shutdown. I told my wife that if the shutdown was real, she better get a car fast. Her car was totaled (she was fine, thank you BMW for the engineering in Minis) one week earlier. Fortunately, there was something she liked on the lot and wire transfers now take minutes. We picked it up Tuesday before everything closed. Phew. She worked straight through the pandemic so she needed a car, and not negotiating sharing my car meant she needed a car. And she enjoys the car too. Paying premium for a sports car was definitely worth it. But this is a separate discussion.
I’d rather do without than pay over MSRP. MSRP is no bargin, it is a “suggested” price which sure is not in your favor. I figure if you can’t pay cash, you can’t afford it. Zero percent financing, maybe, but only AFTER price negotiation. I’ve seen folks get so ga-ga over low financing that they don’t negotiate on the price as hard and certainly don’t come out ahead. Don’t tell them you are going to pay cash until after price negotiation. Dealers want financing and get all bothered if you pay cash. The games are getting all more creative (what drives folks to CARMAX, which is top dollar but no games) – I was looking at a dealer used car. Price was competitive. Looked at the fine print “all used car purchases include mandatory dealer add-ons (which totaled $2K).”
when i saw the word barn and highlander, i got confused.
in my world, barn means farm and highlander means no place for
hay bales… how is that working out? as a guy with a civic and an f-150,
i can’t imagine giving up my long bed. in terms of ICE vs HYBRID, i am
not a car guy, but i hang out with garage owners,. their advice, across the
board has been to pick one or the other. they believe one vehicle with 2
operating systems is not the way to go.
I last bought a new car in 2017 through Costco Auto Program. I really enjoyed the whole process with pre-set price and no haggling. I know I may not get the best price, however the Costco price should be reasonable enough. Really like our Honda CRV since that night in 2017 driving it off the dealer’s lot.
We found too that the Costco program doesn’t necessarily get you the best price, but it’s a good deal with Costco helping you make a tough decision.
Interesting that purchasing this car cost nearly as much as your first house in 1981. But the dollars then were more valuable than today’s dollars. Gradually, over time, the value of dollars has declined through what we call “inflation.” The Consumer Price Index, which is our best measure of the value of dollars (though still an imperfect measure), increased from 94 at the end of 1981 to 296.797 at the end of 2022. A 1981 home purchase of $46,000, would require about $145,000 of today’s dollars of diminished value. Or, taken the other way, a car that cost about $44,000 at the end of 2022 would be equivalent to about $14,000 back in 1981. Of course, nothing stays the same over 40 years. But those numbers give us a sense of how much the value of our currency has declined over 40 years.
And my grandparents bought a 4BR house with detached garage in Larchmont, NY for $14k in mid-1940s. My other grandparents bought their first used car circa 1930 for $25. These numbers may be instructive about the structure of inflation, but not much about car prices. Compared to the prices of other things, I’d argue car prices are less. Cars now are more reliable, last longer, get better mileage, pollute less, are more comfortable, are way more safe, have better sound systems, are more difficult to steal, handle better.
An observation: Car articles get a lot of comments on Humble Dollar (smile). We bought a new car in 2020 (during the pandemic) and the deal was unbelievable. Today it would probably be at sticker. Hopefully things will get back to normal and better “deals” will be available for everyone.
I’ve bought two Highlanders, one was a 2001 Hybrid that I bought used. I currently drive a 2015 XLE. When I bought the current vehicle, I considered a hybrid but the $10000 price difference at the time turned me off. I’ve also owned a Prius X. All were great vehicles. The market is pretty goofed up today so I hope I can get another 3 years or so on mine. Then, I will swap cars with my wife and she will get an electric. I will drive her 2018 Honda CRV for many more years.
What cars people buy has always been a mystery to me. I’d love to own a fast little sports car, but I’d probably get tickets for driving too fast and getting out of a very low car at my age is a slow, embarrassing process. They also cost too much! I have instead bought “practical” cars at a lower price point and then driven them for 100,000+ miles before considering a replacement. When I see someone driving a car that costs upwards of $100,000, I can’t help but think that if they had spent 1/3 or 1/2 of that amount on a lesser car and then invested the difference, they’d be better off in the long run. Of course, this is probably also the reason why I read blogs like the HumbleDollar!
I felt a need to buy a newer car in 2021 when most dealers were firmly in the driver’s seat. I have only bought used cars for more than 30 years, and the chip shortage had reduced the inventory dramatically. After months of searching and researching, I jumped at the chance to buy a 1-year old Honda with low mileage. It wasn’t perfect but I’ve been making lots of road trips to visit family and friends with a more dependable vehicle. I really lucked out with a loan rate of just 2.44 percent for a 6-year loan from my longtime credit union. I wrote about the decision for HumbleDollar. https://humbledollar.com/2021/10/fit-to-be-bought/
I used to always buy used cars from the dealer auction with a friend. This time I researched a dozen new mid-size SUVs two years ago. I was going to test-drive them all and then decide. I first stopped at a Honda dealership and no one would talk to me and left. The next stop was a Toyota dealership. Tested a RAV4 but decided it was too small. Tested a Venza LE, bought it and paid cash. Love it and recommend it. Hybrids are fantastic.
My question is how to sell my previous SUV, a Cadillac SRX. Dealers only will give me half its value. A friend suggested Craigslist. I wonder whether that’s safe with all the scammers and thieves around now.
Over the years I have bought a few new but mostly used cars. Our last three car purchases were after our previous cars were dead, one from old age and mechanical failure and two from accident damages where the cost of repair was not justified considering the vehicle age and mileage. I have never traded a car in and any seller I bought a replacement car from would not have wanted our old cars anyway.
I was able to donate our dead cars to the local NPR station that is located on the campus of my almamater in the town where I live via a national program of NPR. You may remember the show “Car Talk”. No cost to me, they send a tow truck and my university gets the small value of the car less the tow charge. I always have gotten a nice thank you letter for donating the cars from my school and I get a good story to tell.
The only requirement for this process was having a clean vehicle title and proof that I was the owner (show my drivers license at pickup). A charitable donation is possible if the junk car auctions for more than $500 (never happened for me). I like knowing and being able to prove that a clean transfer of title occurred and it is not likely that someone could rebuild a junk car and that I could have potential future liability on an old VIN with my name in the event a future wreck. My understanding is most of these car donations end up in a junk yard where usable parts are stripped and the remainder ends up being smelted at some point.
Thanks for the update on the (sad) state of the car market. I live alone and drive a 16 year old Camry Hybrid, so I understand the concern about the Buick. However, the Camry has only done 65,000 or so miles, and the independent repair shop I have used for over 30 years shows no signs of going out of business. I think I can wait another year or even two. I still miss the Mazda MX-6s I drove before the Camry, but Mazda doesn’t seem to be going the EV route yet, and I want my next (and likely last) car to be a plug-in hybrid.
I expect to pay cash for the next car, and I think the most important ability when car shopping, as with any form of bargaining, is a willingness to say no, keep saying no, and walk away if necessary. When I bought the Camry we had, I thought, agreed on the bottom line price, but when the paperwork arrived there were some additions. I said no, several times, and the additions disappeared.
I also think a test drive is indispensable. I once thought of replacing the then current MX-6 with a Honda Prelude, but it only took a short drive for me to discover that the driver’s seat was too uncomfortable.
Thanks for the great article and all the comments. After 40 some years of navigating through many car purchases, new and used, I quickly learned that you need to do your homework and be willing to walk away. Sad to say, you have to practice the technique of playing the dealer games to your favor. I’ve been astounded at the number of people that will outright pay whatever the price the dealer gives them as most people don’t like the negotiation process. Literally, hundreds or even a thousand $ more than we paid for the same vehicle. Fortunately, we found a dealer that has worked with us for many years and we’ve done well by them (and, yes, we still check around). Indeed, it’s a new day in the world of car buying (haven’t purchased new since 2017). I’d like to replace our 2011 I drive but it’s still a great car so until the wheels fall off, it’s a keeper. May come a day when we just drop down to one vehicle between the two of us (gasp!).
“Wouldn’t it be prudent for a financing company to require a 20% down payment, or at least 10%?”
That is why I avoid bank stocks. Always have.
Good idea refinancing. One day, perhaps in the distant future when rates are lower, you can just refinance again. But I’m glad I’m not a car person. I just want something that gets me from Point A to Point B and a car that costs less than $20K fits the bill. Plop a few grand down and finance on a 48-month term, you’ve got a low car payment, a decently reliable vehicle, and a not absurd amount of interest to pay back over the life of the loan.
Better still, after you repay the loan put the car payment into a “new car” fund. After a couple of cars you should be able to pay cash.
I fail to understand why everyone seems so obsessed to pay cash. I was never offered any discount for paying cash and I always got loan at low interest like 1.99%
This article made me really grateful that we won’t be car shopping in the near future. Our most recent purchase was in July 2020 before things went nuts. We got a good price on a 4th of July sale and a good financing rate. No more, I take it!
We have two Audis, the other one bought in 2018, both with very low miles (thanks, pandemic). We get letters, emails, and calls all the time from the Audi dealer where we bought both cars, frantically pleading with us to trade them in on new models (“I NEED your car!”). No thanks, we’re good.
We went through over 20 years of buying late-model used cars but switched over to buying new ones some years back. This is my usual process: 1. Obtain a loan approval from the local credit union where we have our accounts (it’s good for 90 days). 2. Do research online to see what kind of model(s) we might consider. 3. Visit local dealership(s) that have the model(s) and do a test drive. 4. Use an online source (the car maker’s website or a third party) to try to find available cars with the features I want. 5. Have a salesperson from a local dealership find the car for us. 6. Go to the dealership and sign the papers and pick up the car. Oh, and 7. Put the first $5K of the purchase on my Amex to get points ($5K was all the dealership would do).
With the two Audis, in one case the Audi financing was better than our credit union’s, and in the other, it wasn’t. In both instances, we took the best financing but paid both loans off fairly quickly.
When I purchased a new Kia Sorento in 2018 I put $5k on five separate cards and wrote a check for the balance. Earned $275 in CC rebates and paid off the credit cards in full when the bills came.
After buying our highlander when reviewing the numbers from the deal we found big error the next morning. Had to threaten to call dealership owner to get it resolved. Triple check those deal numbers.
I knew things were bad in the car market, but I had no idea how bad. I guess my timing was just dumb luck. I bought an SUV at the end of December in 2019, and I was still able to negotiate the price down. Because of the options I wanted, the car had to be delivered from Texas. There was no additional charge for that, and I got the car well below MSRP. Guess I’m keeping it for a while. I was going to look for a second car, but apparently that won’t be happening anytime soon.
Yep, I’m trying to buy a Venza Limited and no can do. On the list, did not have to pay the $500 because I went through The CarPro Show that lists qualified dealers to do business with. It’s a pain; however, and I have been maintaining my current vehicle, it’s in tip top shape, and have a great Independent mechanic shop to use when needed. So, I’m patient and can wait as long as it takes. GLTA!
Seems like the option to professionally store our car while we travel overseas could be money well spent.
I am about 50/50 buying new versus used.
One caveat about buying used. Do NOT trust Carfax.
I purchased a late model low mileage (~15,000 miles) VW Jetta for my daughter after several weeks surveying the greater Denver market online.
I used the VIN for each candidate and did a Carfax search for potential problems and only considered cars that “passed.”
I bought from a large VW dealer in Denver and everything was fine until 6 months later when the dashboard electronics went out. I later learned this is not uncommon after flood damage due to deterioration of the wiring.
A year later the driver side headlamp was damaged by a rock and I did a DIY replacement. The wheel boot had to be removed and I discovered 6 to 8 inches of dried leaves and mud layered inside.
The car was clearly a flood damaged vehicle and almost certainly was “totaled” somewhere out of state. Carfax completely missed this. I didn’t followup with the dealer but will never again trust a clean Carfax report.
This is why you hire an independent mechanic (Lemonsquad) to review/appraise the vehicle for things such as flood damage, rust, wreck repair, engine problems, transmission problems, etc. Well worth the ~$200 bucks in the long run. And, watch the dealer object or not allow the review. If they object, walk away, they are hiding something.
I have three cars ranging from 8-13 years old. All very dependable and still great to drive. My wife keeps encouraging me to buy a car I really want since we’ve always been rather frugal with our picks in the past. Nevertheless, with all the choices on the market, and the ridiculous price tags attached, I am easily dissuaded to stick with my current trend of running with my current vehicles until they die.
I will hold my 30 year old Volvo together with cable ties and duct tape until I see signs of a return to some kind of normalcy in the car market but I’m not confident that it will come anytime soon.
Old is gold when it comes to new cars. Insurance increases, property tax increases, and the cost of ownership is a benefit to others. I just purchased a new ignition key for my 1990 Volvo 740 as the old one lost its teeth. The boy’s at Ace hardware had to blow the dust off the blank key and charged me a wapping $2.99 for it and commented on how car keys today are electronic. Electronic car keys, I can’t imagine the cost when they wear out in thirty years.
Bought a Toyota Venza on New Year’s Eve, after my mechanic advised me to replace my 15 year old RAV4 (32 miles short of 360k) for my own safety – way too much rust on the frame, etc. I searched online and found 1 used 2022 XLE Hybrid within a 200 mile radius, less than 4K miles, and an acceptable color, and at a very good price. I paid cash. Just for fun, I have continued to track them, and the prices have gone up with higher miles. I had wanted a RAV4 Hybrid, but none available. I feel that I got lucky.
In November I bought a 2023 Subaru Impreza. Lots of people asked why I didn’t buy a used car, and those people didn’t believe me when I explained that a 2019 Impreza with 100k miles was only $1,000 less than a new car with 5 miles. Besides, Subaru was offering a special deal where financing a new car was for an interest rate of 3.9%, which is not remotely possible for a used car. I don’t regret my decision!
I wonder if you tried calling Experian? I had the same problem at a dealership once, the salesperson recommended calling whichever credit company they used, and it worked fine to unlock the report.
Getting quotes from multiple dealers is what I do. I discovered last time around (pre-pandemic) that a dealer a 90-minute drive away was outside our local marketing area, which saved me a substantial marketing fee that all the local dealers had to charge.
I don’t get buying a car off the lot. Instead we order exactly what we want from the factory and pay cash for it. The odds of a car having the exact color and features we want being found at a dealership aren’t good. We both bought cars during the pandemic. I bought used on the internet via Vroom for half the price of a new vehicle and she bought a brand new Bronco Sport with all the chips for less than list price.
Toyota and Lexus will not allow you to “order” a vehicle, period.
I have bought a few new Toyotas for family members over the past several years as well as for myself . My first step was to go to the Toyota manufacturing site and “build” my car , then have the dealerships compete on price. I did that before visiting any . Buying a used Toyota had not made sense for years now. The last few times , ( before the pandemic) the used price was as just about high as new but there was no wait . And now you have found the used price is more !
I usually pay cash for new cars and drive them forever like you do. When I have financed, my local bank in Massachusetts where I’ve done business for years gave me a better deal than what the dealership could offer. Their “finance director” was amazed.
I have found that more businesses are using Experian now, not TransUnion.
Thanks for the interesting article. Good luck with the Highlander – it was one of the cars we considered for my wife. We bought a new Honda Pilot about 18 months ago. We had a similar experience except that Honda was offering 0% financing. I had not planned on financing the purchase, but we ended up with a 48 month loan. The price was the same whether we paid cash or financed it. Each month I look at the balance and consider paying it off just to get it off the books, but remind myself I’m making ~4% on that cash.
I bought a used Dodge Durango in anticipation of my daughter needing a vehicle soon as she got her school permit last year. I regret it. I prefer to buy new as you do. You take care of it, you know its history and maintenance record. I’ll be car shopping at some point this year and using the Durango as a trade. Hopefully things improve a bit regarding inventory. Thank you for the informative article.
Well, you have convinced me to keep my car even though repairs have cost a small fortune in the last year.
I wonder if car dealers are part of the price gouging Sen Warren rants about?
Car dealers and hospitals….
Hospitals are being squeezed by Medicare with lower payments. The result is higher costs for private payers.
Car dealerships are today’s horse traders. And they are doing themselves no favors in this whole pricing fiasco. Maybe it’s time to eliminate the new car sale from dealerships altogether. Vehicles could be purchased online and dropped at your door. Dealerships could serve simply as maintenance and repair points.
There would srill need to be a mechanism for test driving. A neighbor let me drive her Forester a few years ago as a test drive, but this can’t be a standard mechanism for people testing cars.
I am very happy that Tesla decided to sell their cars direct to the end users cutting out the car dealer cartel.
Not going to happen. The National Automobile Dealers Association (NADA) and State Dealer Associations control local legislatures and lobby Congress regarding protecting dealerships, i.e., stealerships. TSLA has a workaround to NADA’s stranglehold on auto dealer sales and service.
Great article! Appreciated the shared experience since my wife and I are looking at a new vehicle purchase in the next year!
Could i suggest a way to buy?
I don’t know how effective it is these days, but I did this the last few times i bought. Car dealerships are setup to rip you off using tricks the lay person can’t imagine so once you walk into a dealership you are in their playground so-to-speak. You could spend all day there and be used and abused.
This method only works if you aren’t in a hurry.
What I did was e-mail dealerships and asked for the out-the-door price of a specific model (I usually buy the base model).
The dealership will email you back and make all sorts of excuses to have you come in. Don’t. If you do, you fall into their trap.
Ask for an out-the-door price approved my the sales manager.
Compare that price from several dealerships.
Print the whole email trail out and then walk into the dealership to conclude the sale.
Keep your eyes peeled until the very end as there are many more tricks they can play on you.
I bought my last car in 2012 exactly the same way. I negotiated by email beforehand, got the car VIN number and picked up exact same car from the dealer. I did take expensive financing from the dealer which made him happy, but immediately refinanced within 3 days with my credit union for 1.99%
Exactly and you can get the template from The Homework Guy website. Just google it.
+1 on this approach – it is the way to buy new because you can definitely get apples to apples comparison if you can find the exact vehicle you want in multiple locations.
We just bought our first ever new car off the lot a year ago when things were still really out of hand on the car and chip shortage. The one we wanted was a standard model in the lineup (Mazda CX5 Carbon AWD) that came with a mix of options that were part of other model trims in that model. It was its own thing and only came in one color with one set of options. We love it.
And yes, we paid over MSRP – which was kind of astonishing to me given that of all the things we ever bought, we ended up paying full boat for the most expensive purchase I’ve ever made besides a house. Did I say we love it already? 🙂
Here’s one they tried to sting us for: door protector film. You know – that 3M clear tape? Just tiny strips of that on the door edges, bumper edges, and the leading edge of the hood. Something like $1000 or $1500 dealer-installed option. After walking away from the deal – twice – the dealer owner finally called me and said come on in and let’s do this.
Be prepared to walk!
I have used this exact method previously (pre-pandemic). I was amazed how much of a discount off of MSRP I was able to get.