Okay you've got Element fever and you want a new one - which at the time of this post is a 2006 (see my previous thread on 05 vs 06 pros and cons which applies to any year-end purchase decision). Here's my proven strategy on how to get your best price. Think of this as a periodic post to help you get the best deal. Remember, car dealers sell dozens if not hundreds of cars each month. YOU buy ONE every few years. Who do you think has the upper hand and advantage in this picture?
To begin, AVOID going to the circus atmosphere of the dealership as an "up" (a customer about to be pounced on when he innocently walks on to the lot) except to make your decisions on exactly what you want. In fact if you must go, do this at a dealer you are sure you won't buy from if possible. I like to do it at the high priced margin dealerships that would never meet my price, just to get back at them for being rippers. They think I'm a stroke - a time waster that will never buy, and because of their policy of making too much on each vehicle (imho), they are right. They'd call me a stroke, but I call them a rip. Again, don't go cold into a dealership except to decide what you want.
Once you are positive what you want, my strategy then is to use the FAX BLAST METHOD. You simply fax the Sales Managers of as many Honda dealerships as you can and YOU TELL THEM exactly how much you are willing to pay - it is most important that YOU SET THE PRICE and not waste time fishing for their best price or a quote, also specify the exact color and model you want and make it clear you are ready to buy NOW. You also include the following wording: "I am ready to buy TODAY! Please don't waste your time or mine trying to bump me on the price. We both know you could probably eventually sell one of these to someone else for more than I am willing to pay, but why not sell BOTH of us and roll another unit today?" Some of this is car dealer lingo so use those exact words in the last part. The important point here is that you don't fax, email or call around for quotes. Quotes will always be too high and you risk getting into ego based power struggles with the person giving you their price, which can mean that someone that might have met your price if you were just civil, calm and stated one time what you are willing to pay and stuck to it, will get emotional watching his profits get cut down and down and just refuse to sell you anything at all! Again, you state to them exactly what you are willing to pay. YOU must control the pricing! If you're shopping around by attempting to get a dealer's best quote, you will usually end up paying more than you have to and you will likely have gone through lots of back and forth frustration! Why put yourself through that?
By popular request, I've added what your fax or email should say:
Eventually a dealer somewhere will meet your price if there is a profit in it and the supply is not outweighed by the demand. How much should you try for? Well, I believe $300 under their total dealer invoice price (not msrp!) including destination is a fair deal but I always try for $500 under - if there are incentives (money back to the dealer from Honda - add that amount in). It will be a little tougher to get this with the first few shipments of a new model year or for a brand new, first year model of an in demand vehicle (the old supply and demand equation) but once all the dealers are plentifully stocked up it is definitely doable! Remember too that though we are excited about the E, to the sales manager, fleet and internet manager it's just another unit he is paid to move off the lot and make a profit on. Plus, they have dozens of other Honda models and the E is not their best seller. Avoid showing excited emotions about your purchase until you are driving off the lot. If they sense you are hopelessly smitten, you will pay for it at some point in the transaction! Also, never mention you have a trade-in until you've got a firm price commitment on the new vehicle. Trading almost always means you will get less than you could if you sold it yourself but I understand that some people just don't want to hassle with it. I've sold lots of cars on eBay, Auto Trader or Cars.com with good results but I've also traded in a few too. When I did, I never mentioned my trade until I had a firm deal at my price on the new vehicle. Early in the transaction if they asked if I would be trading, I've just mentioned I would probably be selling it myself. Just an fyi: Car dealerships make way more profit on used vehicles than new ones!
One more tip: Carefully read over http://www.carbuyingtips.com for discussions on the pitfalls of buying a new car. BEWARE when you are signing the papers in the "lie-nance" manager's office!! That's when all your diligent efforts to secure your great deal can come crashing down in a few moments! My personal philosophy is don't buy anything extra, ever - though I wouldn't quibble over mud guards and wheel locks for less than a hundred bucks! Even Honda brand extended warranties can usually be had for less online, though i would never get one of these myself, mostly because i never keep a vehicle for longer than three years.
A few final points: DEALER FEES. In their never ending, creative way to pad their profits, some dealers have what they call "documentation" (or some other made up name) fees as high as $300 or more dollars. NO! I think that up to $50 might be fair but anything over that and it's time to find another dealer unless they agree not to charge them - which I've seen them do lots of time. I would also be okay with paying from $50 to $100 extra if they have to do a dealer trade (depending on the distance) and have to go pick it up at another dealer's store for you. Always beware of transit damage by the way! Don't assume because it is new that it's not had damage. This can happen on trucks or trains during transit or during dealer trades. I always look it over closely when I take delivery and even ask, "Has this vehicle had any transit damage?"
GOOD LUCK and happy motoring in your new E!
Click here to read my 2006 EXP buying experience, which I got for $500 under dealer invoice the first few weeks it came out.
Read this thread too! Very helpful!
PSS - I reluctantly parted with my EX-P on August 19, 2006 - ten months to the day from when I bought it. I sold it for $600 under what I paid for it (minus my extras) - which reinforces the old adage that you make your money on something when you BUY it:
http://www.elementownersclub.com/forums/showthread.php?t=26294
I did however buy my THIRD E recently (pictured in my sig) and will ALWAYS be in da club! ;-)
To begin, AVOID going to the circus atmosphere of the dealership as an "up" (a customer about to be pounced on when he innocently walks on to the lot) except to make your decisions on exactly what you want. In fact if you must go, do this at a dealer you are sure you won't buy from if possible. I like to do it at the high priced margin dealerships that would never meet my price, just to get back at them for being rippers. They think I'm a stroke - a time waster that will never buy, and because of their policy of making too much on each vehicle (imho), they are right. They'd call me a stroke, but I call them a rip. Again, don't go cold into a dealership except to decide what you want.
Once you are positive what you want, my strategy then is to use the FAX BLAST METHOD. You simply fax the Sales Managers of as many Honda dealerships as you can and YOU TELL THEM exactly how much you are willing to pay - it is most important that YOU SET THE PRICE and not waste time fishing for their best price or a quote, also specify the exact color and model you want and make it clear you are ready to buy NOW. You also include the following wording: "I am ready to buy TODAY! Please don't waste your time or mine trying to bump me on the price. We both know you could probably eventually sell one of these to someone else for more than I am willing to pay, but why not sell BOTH of us and roll another unit today?" Some of this is car dealer lingo so use those exact words in the last part. The important point here is that you don't fax, email or call around for quotes. Quotes will always be too high and you risk getting into ego based power struggles with the person giving you their price, which can mean that someone that might have met your price if you were just civil, calm and stated one time what you are willing to pay and stuck to it, will get emotional watching his profits get cut down and down and just refuse to sell you anything at all! Again, you state to them exactly what you are willing to pay. YOU must control the pricing! If you're shopping around by attempting to get a dealer's best quote, you will usually end up paying more than you have to and you will likely have gone through lots of back and forth frustration! Why put yourself through that?
By popular request, I've added what your fax or email should say:
Sometimes you can deal with fleet and internet people and get a comparable deal by email or on the phone but remember sales managers can do house deals (no commissions to anyone working there) and of course they make the ultimate decision on how little profit is enough, based on what their ownership has mandated. So, why not go direct to the source? Remember if you try doing this over the phone or by email that it is still important that YOU tell them the exact price you want to pay. DON'T ask them to give you their best price! If they tell you they can't sell it that low, which they usually do, just say, "Well, I'm ready to buy one TODAY. Here's my phone number if you decide you want to sell me one for this price. We both know that you could probably find a customer to pay more, but why not sell BOTH of us and roll another unit?"
Eventually a dealer somewhere will meet your price if there is a profit in it and the supply is not outweighed by the demand. How much should you try for? Well, I believe $300 under their total dealer invoice price (not msrp!) including destination is a fair deal but I always try for $500 under - if there are incentives (money back to the dealer from Honda - add that amount in). It will be a little tougher to get this with the first few shipments of a new model year or for a brand new, first year model of an in demand vehicle (the old supply and demand equation) but once all the dealers are plentifully stocked up it is definitely doable! Remember too that though we are excited about the E, to the sales manager, fleet and internet manager it's just another unit he is paid to move off the lot and make a profit on. Plus, they have dozens of other Honda models and the E is not their best seller. Avoid showing excited emotions about your purchase until you are driving off the lot. If they sense you are hopelessly smitten, you will pay for it at some point in the transaction! Also, never mention you have a trade-in until you've got a firm price commitment on the new vehicle. Trading almost always means you will get less than you could if you sold it yourself but I understand that some people just don't want to hassle with it. I've sold lots of cars on eBay, Auto Trader or Cars.com with good results but I've also traded in a few too. When I did, I never mentioned my trade until I had a firm deal at my price on the new vehicle. Early in the transaction if they asked if I would be trading, I've just mentioned I would probably be selling it myself. Just an fyi: Car dealerships make way more profit on used vehicles than new ones!
One more tip: Carefully read over http://www.carbuyingtips.com for discussions on the pitfalls of buying a new car. BEWARE when you are signing the papers in the "lie-nance" manager's office!! That's when all your diligent efforts to secure your great deal can come crashing down in a few moments! My personal philosophy is don't buy anything extra, ever - though I wouldn't quibble over mud guards and wheel locks for less than a hundred bucks! Even Honda brand extended warranties can usually be had for less online, though i would never get one of these myself, mostly because i never keep a vehicle for longer than three years.
A few final points: DEALER FEES. In their never ending, creative way to pad their profits, some dealers have what they call "documentation" (or some other made up name) fees as high as $300 or more dollars. NO! I think that up to $50 might be fair but anything over that and it's time to find another dealer unless they agree not to charge them - which I've seen them do lots of time. I would also be okay with paying from $50 to $100 extra if they have to do a dealer trade (depending on the distance) and have to go pick it up at another dealer's store for you. Always beware of transit damage by the way! Don't assume because it is new that it's not had damage. This can happen on trucks or trains during transit or during dealer trades. I always look it over closely when I take delivery and even ask, "Has this vehicle had any transit damage?"
GOOD LUCK and happy motoring in your new E!
Click here to read my 2006 EXP buying experience, which I got for $500 under dealer invoice the first few weeks it came out.
Read this thread too! Very helpful!
PSS - I reluctantly parted with my EX-P on August 19, 2006 - ten months to the day from when I bought it. I sold it for $600 under what I paid for it (minus my extras) - which reinforces the old adage that you make your money on something when you BUY it:
http://www.elementownersclub.com/forums/showthread.php?t=26294
I did however buy my THIRD E recently (pictured in my sig) and will ALWAYS be in da club! ;-)