How to negotiate a car price: top tips
Does the thought of haggling for the best new car price make you anxious? Read our guide and relax!
After buying a house, purchasing a new car is likely to represent the most amount of money you’ll ever spend, so it’s unsurprising that many people worry about making a mistake.
It’s an unfortunate fact of life that car salespeople have to focus on targets and that usually means maximising opportunities to sell cars and the services that go with them.
They may not have a great reputation generally but a good car salesperson knows they’re also in the business of making you happy. Part of that is helping you find a car you love, getting you a fair price and taking any stress out of the experience. Why? Because you may well tell friends about the dealer and be back again when it’s time to get your next car.
Our first piece of advice is this: don’t be afraid to talk to the salespeople you meet because they need you more than you need them. A successful negotiation starts and ends with a friendly relationship. Getting the best deal you can also means doing some homework before you start negotiating. Read on, and we’ll explain...
Doing your homework to choose a car
When you’re in the company of a car sales person, it’s of enormous benefit to have made a clear decision on exactly what car you’re after. This should be in your mind at the very beginning of your car-buying process.
When test-driving a car, or even looking at them online, pay specific attention to which aspects you like, and which you dislike. Build a shortlist of cars up and then eliminate them one by one. Once you’ve settled on a final choice, you’re in a position to decide on specifics, like your ideal specification, colour and whether you want a manual or an automatic gearbox. The more specific you are with what you want, the stronger your position in the showroom.
Of course, there’s a huge number of cars on the market, and we’ve created a guide to choosing a car that's right for you. We can also guide you through the many desirable features you can choose, with our feature about optional extras.
If you’ve decided on your perfect car there are useful steps you can perform before visiting the dealership. The website of its manufacturer may have specific deals that’ll help you – it’s commonplace to find financial incentives such as discounts or reduced rate finance – on certain models in a drive to increase sales. Our tips and advice section includes a feature that explains car finance to further increase your confidence in the showroom.
You may also find special editions available – these cars are often only on sale for a limited period, but can add desirable features for very little additional money.
Know the price
Before you can negotiate, you need to know what the official recommended price of the car is. It’ll usually be listed on the manufacturer’s website, and most carmakers publish brochures and price lists that outline the purchase price of a car and any optional extras available. If in doubt, our sister magazine Auto Express includes the latest figures in every issue.
Having a specification in mind, and knowing the manufacturer’s recommended price for it, puts you in a strong position to negotiate. You can also immediately pick up on any attempts the dealer might make to sell you a different model.
If you’ve set your heart on a specific model, be wary of offers of special deals on a lower-specification car. It’s rare that a dealer will go out of their way to save you money – suggesting an alternative model is often more beneficial to the dealer than it is to you. Unless the deal is demonstrably worthwhile, stick to your guns, as you could end up sorely missing features you were looking forward to in your new car.
Keep calm for a better deal
Car sales staff are often genuinely very pleasant people, but bear in mind that enjoying a relaxed, convivial atmosphere can lead to you dropping your guard. These days, sales executives are increasingly well trained and the most effective ones can exploit a relaxed, cheerful customer to their advantage.
Never lose sight of your objective. You haven’t visited the car dealership today to make a new friend, although this can often happen as a happy fringe benefit. Your sole reason for sitting at the salesperson’s desk is to get the best deal possible while his job is to make as much profit for his company as he can.
If the first deal a salesperson offers you actually exceeds your expectations, try not to make this immediately obvious. Remember, you’re about to spend thousands of pounds, so keeping a cool head is vital. Persistent negotiators can secure further discounts, so don’t accept the first figure you’re given.
Play your cards close to your chest
A dealer will usually offer a better deal on a car that already sits in their stock than one that has to be ordered for you specially. It may be that a dealership has a car in stock that exactly matches your requirements – but it can help if you don’t immediately admit this to the salesperson.
With so many options available on most cars, it’s rare for any two to be exactly the same. With proper research, you’ll know which optional extras are available for the car you’re considering, so you can manufacture a requirement that means the car you’re offered isn’t a 100% match for the car you’re looking to buy. If the car that you’re offered is right for you in every way, only you can know that. Better still, if there’s a specific feature available that you know the offered car doesn’t have, you can exploit this to your advantage.
For example, on a car where power-folding mirrors are available as an option, you might add these as a requirement once you’ve been offered a car from the dealer’s stock. You’ll then have the upper hand – the sales executive will have to make the deal attractive to make up for it not being exactly the car you want. However, since this wasn’t actually a feature you initially had your heart set on, you won’t miss it.
Don’t be afraid of finance
If you’re planning to buy your new car outright, it may be wise to initially conceal this from your car dealer. It’s usually in a dealer’s interest to sell cars on finance, as there are often manufacturer-subsidised incentives that can make these packages quite attractive.
While being receptive to the idea of finance can pave the way to an improved offers, don’t be completely dismissive of the dealer’s financial packages. In some cases it really is cheaper to use finance provided by the dealer than to borrow money from your bank. Our guide to car financing explains the options open to you.
Remember that until you sign for anything, you can walk away from the deal at any point. An equivocal ‘I’m not sure yet’ can often help negotiations; until the contracts come out, how you’re going to be paying for the car is your business, not the dealer’s.
While car dealers are likely to be friendly and you need to be aware of this, playing hardball and coming across as aloof and stand-offish can dent your chances of getting a good deal. Entering into negotiations when buying a car can be compared to an elaborate dance, as you and the dealer work out where the other stands. Be sure to maintain friendly relations throughout this process, as the better the deal you get, the less money the dealer will make when it comes to bonus time. If they like you, they’re likely to give more ground.
It’s all too easy to buy a car in a rush: the alluring nature of a new car can be strong, as can buying motivations like a growing family or a new job. Whatever you do, keep it to yourself if you need a car quickly. If a dealer is given the impression that you’re desperate for a car, they may feel that they needn’t offer their sharpest deal to get your custom.
Do a background check
If you’re buying a used car, be sure to run a background check on it. Companies like HPI, the AA and the RAC will make sure there’s no outstanding finance on a car and it hasn’t been stolen or written off. All they need to do this is a number plate. While many dealers will provide background checks on the cars they sell for you, a quick phone call to the checking company to confirm the details provided is always a good idea. If any problems do show up, walk away from the deal politely, but immediately.
Get a detailed quote before haggling
Make sure you know exactly what you’re negotiating for when buying a new car. Some salespeople may use what’s known as a ‘stacked deal’. This is where they include loads of options (which you may or may not want) such as paint protection, floor mats or an extended warranty, before removing these items to drop the price when you start haggling. This allows you to think you’re getting a great deal and are an expert negotiator, when in fact it’s the dealer who’s deploying their (slightly underhand) skills. Our insider tips on the tricks used by car dealers should give further help in this area.
Ask for extra
If the dealer is adamant that there’s no room for negotiation on price, you can still ask for some freebies to be thrown in. The least you should expect with a purchase of this magnitude is a full tank of fuel and a set of car mats; a free sat-nav system or breakdown cover can also cost dealers little, but may sweeten the deal significantly for you.
It can be of great benefit to buy a from a dealer close to where you live, as it makes life easy if you need to report an issues with your new car. Warrantable items can be attended to with greater convenience, and servicing is made simple, too. Nonetheless, getting quotes in writing from a number of dealers from the same manufacturer or franchise before showing these to your local dealer can help significantly when it comes to negotiations – even if they can’t better the deal offered by other dealers, they may be able to match it.
Whatever car you’re after, or deal you’re offered, there’s one thing it’s always worth bearing in mind when buying a new car: with nearly 2.5 million new cars sold each year in the UK, the power and the choice is firmly in your hands.
If you're unsure about buying from a main dealer, take a look at our buying a new car from a main dealer article to show the pros and cons of this choice.