Buying a new car needn’t be a battle; arming yourself with the right information may be the only weapon you need.
Dealers aren’t the enemy. In fact, most will get great job satisfaction out of pairing their customers with the right car. But neither are they a charity. Car salespeople typically work on commission, often worked out as a percentage of the profit margin. While they want to move the stock, they want it moved at the highest price they can manage.
So you need to take the offensive, and nab that bargain by knowing what to look for and when to buy.
It’s easy to get bamboozled by the sheer number of vehicles and variants on the market. Information on the internet is equally vast, so if you aren’t sure where to start, try a good search engine (WhichCar is a good place to start) that can smartly sort the makes and models by price, shape, and even lifestyle.
If you want to start on the showroom floor, great, but recite this one mantra in your head: “I am only looking.” A stunning automotive example, coupled with seductive words from a savvy dealer, can tempt the most hardened shopper, but don’t sign that dotted line just yet. Look at other dealerships and offers; try other models; do some comparative research. A car is most likely the second-biggest financial investment you’ll ever make, so don’t rush it.
CHECK IT OUT BEFORE CHECKING OUT
There’s a big difference between test-driving a new car and a used car. A test-drive in a new car will not bring up areas of concern that you can use to haggle with the dealer – it is more a way of confirming that this is the right car for you.
Take time to walk around the car first; while the dealer will highlight the feature, you know how you will use the vehicle, and need to assess whether it fits your lifestyle. Maybe the car sits low, which isn't ideal ifyou have a steep driveway. It may have seven seats, but how much room is left in the boot once that third row is in place? Be as objective as possible.
The same applies to the interior – try not to be drawn in by the flash trim or the gadgets. Still, be sure to play with all of those gadgets, as a tinny stereo or unintuitive sat-nav can be pretty annoying after the new car gloss has dulled.
While on your test drive, remember to spend at least some time with every gadget turned off, as you want to drive with your ears as well as your eyes. For example, a performance car is probably going to have a loud engine note, boomy exhaust, tyre noise – or all three – so check you can live with it.
Try to open up the vehicle on a highway, if you can. A different set of potential problems can be revealed at higher speeds, such as less-than-optimal cabin damping or an annoyingly high-revving engine. The same applies for lower speeds; a potholed or uneven road will reveal so much about the handling, and whether the car could drive you mad with its overly firm/soft/uncomfortable ride.
SEAL THE DEAL
Timing is everything: sales targets for dealers are often monthly or quarterly, so the best time to start your shop once you know your ideal car is at least a week out from the end of the quarter. In order to meet their budgets, the dealer may be willing to negotiate on price or throw in some goodies to get you across the line.
Other great times to buy are the end of financial year, in the lead-up to Christmas when others are spending money on presents instead of wheels, and that quiet week leading up to the end of the calendar year.
However, don’t expect to be able to cut thousands off a car at the cheaper end of the scale. That wiggle room we mentioned is as tight as the proverbial tin of sardines when it comes to the cars in the $25,000-and-under bracket.
Unless they are selling high-end vehicles, your average dealer doesn’t make much profit on the actual sale of a new car. This is why dealers push the financing and servicing, and will offer low prices on your trade-in – it’s where they make the majority of their money. Cheaper vehicles and the popular big sellers will make the dealership a few hundred dollars at most. And with the Aussie dollar plummeting, it’s about to get even tighter.
So, haggling over a $15K runabout isn’t really going to work – try to get the dealer to throw in car mats or metallic paint instead, or if you are trading in, go for a better price there.
Cars above the $25K baseline, particularly under the 33 per cent Luxury Car Tax threshold ($63,184, or a higher $75,375 for fuel-efficient vehicles) will have more play in the price, and the higher you go, the more chance there is to strike some dollars off the bottom line.
When it comes to the financing, prices and offers can vary between dealerships. Be sure to check our bank deals as well.
And be absolutely, positively sure before you sign. If you have any doubt at all, give yourself time to think. You can always drive a better deal the next day.