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I negotiated my entire deal for my Element over the Internet but I did it with local dealers. I originally sent out 5 email request to the 5 dealers who were the closest to me. On that first email, I just asked for a price quote on the model and color I wanted. I received replies from 4 of the dealers. I then dropped the 2 who quoted me the higher prices. I then negotiated with the 2 lowest bids. Negotiated back and forth between the 2 and wound up with a really good price. As fate would have it, the dealer who got my business was located the most distant from me. I used a strategy where I was looking for a particular price ($1000 below MSRP) and when I got it, I negotiated to see how many accessories I could get thrown into the deal. Both dealers actually got down to my price but one of them would not add accessories and the other threw in floor mats, wheel locks, remote entry and splash guards. All this was done without any hassle and without ever going to the dealership.
 

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I used HondaCars.com to email something like a dozen dealers in a 100 mile radius. From then, same basic approach as HEMan, except I found it easier to negotiate without accessories at all and drive the price lower. Also really helps to buy at the end of month or quarter.
 

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I did all my negotiating over the internet. Got a great price with an end of month deal.

I have not yet seen anyone yet who's price was as good.

Also sold my car rather than trade in for a $3000 difference.

Take your time.
 
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