Maximize Savings, Minimize Hassle

• Can I purchase a car for less than the dealer paid the manufacturer?

Yes, you can, it is challenging but possible with the right strategies. Here’s how you can approach it:

1. Research and Preparation

• Understand Invoice Pricing:
  • Invoice price is the amount a dealer pays the manufacturer for a car, but this doesn’t reflect incentives, rebates, or holdbacks that the dealer may receive. Tools like Edmunds, Kelley Blue Book, and TrueCar can help you find the invoice price for the vehicle you’re interested in.
• Know the Market:
  • Research current promotions, rebates, and incentives offered by manufacturers. Also, understand the demand for the vehicle—cars that are not selling well might be easier to negotiate under invoice.
• Credit Score:
  • Make sure your credit score is in good shape, as it will give you more leverage in negotiations and access to better financing options.

2. Timing Your Purchase

• End of the Month/Quarter:
  • Dealers often have sales quotas to meet and may be more willing to negotiate towards the end of the month or quarter to hit their targets.
• End of the Year:
  • Dealers are eager to clear out old inventory to make room for new models. Shopping at the end of the year or when a new model year is introduced can give you more bargaining power.
• Holiday Sales Events:
  • Major holidays like Memorial Day, Black Friday, or the Fourth of July often feature significant sales events and promotions.

3. Negotiate Effectively

• Contact Multiple Dealers:
  • Reach out to several dealers via email or phone to get price quotes. Let them know you’re shopping around and ask for their best offer. Use these quotes to pit dealers against each other.
• Focus on Invoice Price, Not MSRP:
  • Start negotiations based on the invoice price, not the Manufacturer’s Suggested Retail Price (MSRP). Mention any promotions or rebates you’ve found during your research.
• Bring Up Dealer Incentives:
  • Mention factory-to-dealer incentives, holdbacks, and rebates that might not be advertised. Dealers sometimes receive bonuses from manufacturers for hitting sales targets, which can give you more leverage.
• Be Prepared to Walk Away:
  • If the dealer won’t budge, be ready to walk away. Often, showing that you’re serious about leaving can prompt them to reconsider and offer a better deal.

4. Consider Financing and Trade-Ins

• Secure Pre-Approved Financing:
  • Getting pre-approved for a loan before you visit the dealer can help you negotiate from a stronger position. It also allows you to compare the dealer’s financing offer against your pre-approval.
• Be Cautious with Trade-Ins:
  • If you’re trading in your old car, don’t mention it until after you’ve settled on the price for the new car. Otherwise, the dealer might use your trade-in value to mask the true cost of the new car.

5. Leverage Online Tools and Services

• Use Car Buying Services:
  • Some online services like TrueCar or Costco’s auto program can help you get pre-negotiated pricing, sometimes even below invoice.
• Price Alerts:
  • Set up price alerts on websites like Edmunds or Autotrader to monitor when the car you want drops in price.

6. Finalize the Deal

• Carefully Review the Contract:
  • Before signing, ensure that the contract reflects the agreed-upon price, and watch out for any hidden fees or add-ons.
• Check for Additional Incentives:
  • Sometimes, there are last-minute manufacturer incentives or dealer discounts available that you can still apply to your deal.

7. Be Ready to Pounce on a Deal

• Act Quickly:
  • If you find a car offered under invoice, be ready to act fast. These deals are often rare and may not last long.

By following these steps and being diligent in your research and negotiation, you increase your chances of buying a car under invoice. Good luck!