Car Buying Services - Your Thoughts

[Amethyst]

What are your thoughts and experiences with car-buying services (Penfed, United Buyers Service ((UBS)) that pre-negotiate prices with selected dealers for specific models/options?

Do they really save money over traditional negotiations?

Thanks,

Amethyst

 

[Car-Guy]

I once negotiated a cash deal on a new car (with no trade in) only to discover that my company had already setup an arrangement with the manufacture for special employee pricing. Fortunately I hadn't bought the car yet so I called the dealer and he gave me the special pricing my company had negotiated with them. (About $300 less than the price I had negotiated)

So it was a little better than I had got on my own, but not by much. (IMO) Of course it could have saved me the time and hassle of my own negotiations with the dealer. But then I would have never known if I was getting a better deal.

 

[REWahoo]

Do they really save money over traditional negotiations?

No facts to back it up, just my opinion - I suspect you'd have to be an above average negotiator to do better, and you'd have to be willing to put in the time, effort, and hassle of driving a hard bargain.

 

[jerome len]

1st of all you have to decide on a car after you drive it......different options can make the same make and model feel different......then after you find the car you like, get a price from the dealer, ask whichever buying service your working with for a price on a comparably equipped car and if it is lower take it back to the dealer....my bet is he'll match it if he/she hasn't already beat it. And......I would ask the dealer for his manufacturer's customer satisfaction scores......you're going to own it for quite a while and you'll want to have loaner cars.....you'll want the dealer to have a large parts department or you'll wait an extra day or two for most warranty repairs.....I own my 1st Kia....dealer service department is rated best in his Regional area.....his price was about $300 cheaper than Costco......and, I'm not sure, however, that they have an arrangement with Kia and that they even wanted my business. I've never tried any other buying service. I'd try one, however, if I was looking for a true luxury car....like BMW....it's been tough to get those guys to budge on price.

 

[Midpack]

It all comes down to your personal makeup IMO. I always start with an online car buying service, it's a good place to start, but I almost always get a lower price after negotiating. A few relatives have taken me along to negotiate for them because they know I like doing it.

BUT then I understand and enjoy negotiating on cars (and most purchases). As I understand it, most people do not enjoy it, and for them a car buying service is probably a good idea. If you don't understand the other (dealer) side of the negotiations, you probably won't do that well on your own. Car dealers do this every day, they know all the different ways to hook customers, it's their job.

 

[Bamaman]

Every car dealership now has an online auto sales department. It makes it so easy to shop at every dealership within reasonable distance from your home without hassle. If you shoot them straight, the internet sales department will shoot you straight.

The trick is to find THAT dealer who's willing to compete for your business with a fair or low price. Don't forget to get the complete bottom line price--including add on's, taxes, etc. I warn you about dealers' Documentation Fees that are just a profit they're not paying a salesman commission.

I try to avoid dealerships that are part of National Chains. They often put unreasonable pressures on their salesmen and local management--and I call'em Slam and Jam operations. They're the type that has a non-negotiable $699 Doc Fee.

And as a 24 year automotive professional, I can do better on my own buying virtually any brand of car.

 

[Meadbh]

I tested a car buying service about 20 years ago but was able to negotiate a better deal myself. I think they are aimed at people who don't want to kick tires and do the research and are afraid of getting screwed on negotiations. The buyer can be much better informed nowadays with all the information available online.

 

[Big_Hitter]

Every car dealership now has an online auto sales department. It makes it so easy to shop at every dealership within reasonable distance from your home without hassle. If you shoot them straight, the internet sales department will shoot you straight.

agreed - just get a few internet quotes and have them get in a bidding war for your business

 

[Amethyst]

There is a large dealership "cluster" 2 miles from where I live. I guess we could test-drive their cars, then do the internet bidding war thing.

agreed - just get a few internet quotes and have them get in a bidding war for your business

 

[Big_Hitter]

There is a large dealership "cluster" 2 miles from where I live. I guess we could test-drive their cars, then do the internet bidding war thing.

that's what I would do - it's funny to watch them flip out when you show them the e-mail with the quote

 

[robnplunder]

I used Truecar.com service for buying the last car. It found a dealer with a price tag that is $1000 cheaper than others for the car I was interested in. I printed out the quote and went to the dealer thinking it was going to be a short buying experience. Present the quote, pay the dealer, and drive it out - that's how Truecar.com supposed to work and others users have done exactly that. But this dealer did everything to recoup the $1000 "discount" and I ended up stuck in the dealership for 4+ hours. They tried all the old car dealer tricks - bait and switch, taking turns at sending different salesman -> manager -> other salesman in the midst of the deal, trying to sell options that I didn't need, .... Multiple times, I've got mad at them and lost patience. I still bought the car at the Truecar.com quoted price but it was an horrific experience (the exact one that I was trying to avoid by using Truecar.com).

 

[travelover]

If you go to Truecar, you can see the actual prices paid for a specific model in your zip code. They present you with a bell curve of actual prices paid, so you can compare an offer to see if it is actually a low one.

I sent an email to a half dozen dealers and took the lowest offer. Alternatively you can get a fixed price from Costco, AAA, Consumer Reports or others and use that as your initial negotiating price. The dealer pays a third party a cut, so you are basically negotiating against that cut.

Getting an out the door price is essential or they will try to claw back profit with phoney document fees, paint and interior treatments and anything else they can get away with.

 

[REWahoo]

I tested a car buying service about 20 years ago but was able to negotiate a better deal myself.

My experience with a car buying service a couple of years ago (USAA) and one 20+ years ago was strikingly different. I may have been able to negotiate a slightly better deal than the USAA service got me but the aggravation (aka 'The Dealership Dance') would not have been worth it.

 

[easysurfer]

If you have a personality that likes to negotiate and bargain, then go for it. Otherwise, a car buying service could be well worth the non stress.

 

[easysurfer]

There is a large dealership "cluster" 2 miles from where I live. I guess we could test-drive their cars, then do the internet bidding war thing.

When I got my previous car (many years ago), I used a car buying service called "Car Bargains". I just chose the make, model, options I wanted in the car and the service let local dealers do the lowest bidder thing.

Overall, worked put pretty well.

Now I don't mind just getting used at Carmax and avoid the "Let's negotiate" dance .

 

[timo2]

I used the USAA car buying service twice now, and I was happy enough with it to use a car buying service again.

 

[Lakewood90712]

I you have a personality that likes to negotiate and bargain, then go for it. Otherwise, a car buying service could be well worth the non stress.

+ 1.

I have gotten better prices by negotiating online and in person, but it takes effort and time. Often it depends on the class of vehicle and potential profit. The thinner the margin, the less likely to get a better deal.

On doing the dance, the first time the salesman says " How much per mo. can you afford " I bluntly say " If you ask that again, I'm walking off the lot " . Sets the tempo

 

[kaneohe]

I second the notion of getting internet quotes from dealers. Often the website for the manufacturer will have an easy way of finding out the location and e-mail addresses of the dealers in your area and then actually sending an e-mail to the ones you are interested in.....e.g. within xxx mile radius. You can do that for any many as you can stand.....generate a form letter with your request, copy and paste and send, and then within 2-3 days you should have a bunch of replies that you can compare. No eyeball contact needed. As mentioned , you should be sure to ask for the out-the-door price so you don't get surprised by miscellaneous added fees later. It is an ideal technique if you don't like face-to-face negotiations. They know they have one chance or they're out.

The hard part is specifying exactly what you want. When we did this about 10 yrs ago, it wasn't too bad for Japanese cars since there were only a limited number of option packages. Not sure about the status today.

I have never compared w/ a buying service so I don't know how they really compare. My theory is that since the buying service gets a cut, the dealer is going to have less room to maneuver than if you dealt directly w/o the middleman.

Also when you do a test drive at the dealer, be sure to deal w/ the internet dept. If you deal w/ the regular folks, somehow that includes them in the final deal even if you then go thru the internet dept and the price will be higher, or perhaps the internet dept will not even deal w/ you if they know the other folks are involved.

 

[ERD50]

If you go to Truecar, you can see the actual prices paid on a specific model in your zip code. They present you with a bell curve of actual prices paid, so you can compare an offer to see if it is actually low one. ... .

Here's what I think is a problem with the TrueCar prices - it says these are the prices people paid before including any dealer add-ons.

So what if one person reports they paid $23,000, but agreed to accept $2,000 of dealer add-ons that are really worth next to nothing? And another person reports they paid $24,000, but avoided all the dealer add-ons? The dealer is happy to 'negotiate' the 'car price' down to the $23,000 if they know they get the added $2,000. But maybe $24,000 is as far as they will go w/o the add-ons?

... Now I don't mind just getting used at Carmax and avoid the "Let's negotiate" dance .

I used CarMax once, and it was a pretty smooth experience. But I do think their prices are high, and I let their multi-point check and good reputation (at least my impression from a lot of on-line searches) lull me into a little false security and faith. We looked at three of the same model, and I forgot to check things like tire wear on the one we picked. Later realized that I really wanted to replace at least two tires before winter. And then I'm thinking ' OK, they 'check' the brakes - but are they OK now, but worn to the point that you'll need a brake job in three months (fortunately not in this case).

Add some tires and brakes to an already high price, and it's not a great deal. But it was a good experience and I don't think you will get 'ripped off', but you will pay for the privilege (and it might be worth it).

...
On doing the dance, the first time the salesman says " How much per mo. can you afford " I bluntly say " If you ask that again, I'm walking off the lot " . Sets the tempo

I basically did that, it didn't seem to make a difference. The guy still played the game. I should have walked, but the price was OK, and just wanted to get it over with. I don't like this 'game', give me a fixed sticker price please.

... As mentioned , you should be sure to ask for the out-the-door price so you don't get surprised by miscellaneous added fees later. It is an ideal technique if you don't like face-to-face negotiations. They know they have one chance or they're out.

...


Also when you do a test drive at the dealer, be sure to deal w/ the internet dept. If you deal w/ the regular folks, somehow that includes them in the final deal even if you then go thru the internet dept and the price will be higher, or perhaps the internet dept will not even deal w/ you if they know the other folks are involved.

How exactly do you do this?

-ERD50

 

[FIREd]

I you have a personality that likes to negotiate and bargain, then go for it. Otherwise, a car buying service could be well worth the non stress.

+1. I don't like to bargain personally, so I used the USAA car buying service for the last 2 cars we purchased and I was happy with the service. There was still some negotiating to be done on the trade-in but, overall, it was a better buying experience.

 

[Walt34]

What are your thoughts and experiences with car-buying services (Penfed, United Buyers Service ((UBS)) that pre-negotiate prices with selected dealers for specific models/options?

Do they really save money over traditional negotiations?

It can as has been pointed out if you do not like the negotiating process. We did that via Consumer Reports (turns out to be TrueCar anyway) and at the time I think it did better that I probably would have by myself.

Next time what I'll do is pick out what we want by test drives and such, then set up an E-mail address specifically for that purchase (we ended up getting a LOT of E-mail from dealers for a while) so I can dispose of it after buying. Then I'll let them bid against each other online. And I'll get the Consumer Reports dealer cost (not just the invoice, it includes dealer incentives and such) including any options and use that as at least a marker point.

And as has been pointed out, get an out the door price with any options.

 

[kaneohe]

k.......................Also when you do a test drive at the dealer, be sure to deal w/ the internet dept. If you deal w/ the regular folks, somehow that includes them in the final deal even if you then go thru the internet dept and the price will be higher, or perhaps the internet dept will not even deal w/ you if they know the other folks are involved.

ERD50....................How exactly do you do this?

k..............I'm assuming you're asking how to deal only with the internet dept? I don't know how much truth there is here since I've never done it but I did violate the rule and that dealer was not about to deal with me on as favorable terms. I would call one dealer that is convenient for the test drive. Ask to speak to the internet sales guy. Hopefully they have one. Make the appt thru him and when you do the test drive also go thru him.
If you don't do it that way, it's only a problem if they're the lowest bidder when you send your RFQ out for bid. If they're not, not a problem. If they are, it could be a problem if the guy who set you up for the test drive wants his cut since the price then may be raised if/when they find out a regular sales guy was involved. In both of the cars we bought this way, the test dealer was not the lowest bidder so it was not a problem in the end........but it could be.

 

[Lsbcal]

I haven't done this in quite awhile but have you looked into Consumer Reports service? They used to offer a detailed set of numbers. Edmunds might to it for free. Seems that one wants to know the invoice price for the car in your area of the country and with all the options you would want and even the color. Then you have the details to discuss things with the internet guy at dealerships.

I suppose it's a bit chicken and egg. One needs to get into the dealership and test drive a few cars before deciding on one. In the past I've gone to a dealership, unlikely to be the final place I buy, to do the test drive. I do give them a chance to bid to keep this an ethical method.

I think there have been discussions over at Bogleheads on how to buy a car. Methods seem to vary a bit depending on the state of the market, the popularity and availability of the model you want, etc.

 

[Forever Free To Be Me]

Used true car to buy my last car with cash. They did try all kinds of ad-one which i refused to pay for such as interior cleaning. Since they didn't want to turn away the $20,000 in cash, they had to do things my way. I love my paid for 2014 Nissan Rogue. Stick with your goals and you shall win.

 

[LitGal]

Our "Family Bible" for Car Purchases

I cannot over-emphasize the practical wisdom of this book: Don't Get Taken Every Time, by Remar Sutton.

DH and I started using his advice, back in the'80's, with excellent success. Sutton is a former car salesman who explains every possible way by which a dealership will try to sell you a car, and then teaches you how to negotiate for your own benefit and win. He now has chapters on how to work with on-line buying services, etc.

Plus, it's entertaining reading. His typical car salesman, "Killer Monsoon," uses all the ploys you will see once you enter a showroom. Yet, even if all you do is make donuts for a living (as do one of Sutton's customers), you can still pay a fair price and not get burdened with payments.

Fun reading, and a treasure trove of advice!

Enjoy!