How To Negotiate With Car Dealers – And Win! Posted By: Jon Anders
The first thing you must do is determine the dealer’s true investment in the vehicle. If it is a new car, you may check a source such as Consumer Reports or similar sources that offer details such as dealer holdback, incentives, rebates, etc. New cars are the easiest when it comes to establishing true dealer cost. If, on the other hand, you are interested in a used car, you can refer to sources such as Kelley Blue Book, Edmunds, or NADA Used Car Guides to establish original trade-in or wholesale value. In addition, if you are buying a used car, you should calculate any additional investment the dealer has made in order to put the car on his lot in saleable condition. This would include inspections, fluid changes, transportation, necessary mechanical or electrical repairs, paint touchup, etc.
Now determine a reasonable amount of dealer markup. You must include the cost of any repairs (used car) as dealer overhead. Then, whether used or new, add approximately $75 for salesperson commissions. Add another $100 to $500, depending on the type of vehicle (a luxury car should result in a greater profit). Add these to the dealer investment calculated in the first step.negotiating with car dealers
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