Buying your family’s new car: here’s how it’s done
Do your research
1. Build your shortlist and keep it short. In a very generic sense, the majority of new cars today feel good (or good enough) to drive, and they’re always going to be better to drive than your old car. I guarantee it, so don’t gush and fall head-over-heels too easily.
Counterintuitively, this actually means you need to have strict criteria about what you need your new car to have and be able to do, and crucially, you need to have a rock solid idea about what features and comforts you’re prepared to go without. This is important when it comes to negotiating and deriving a better price.
Okay, let’s say you’ve decided on a shortlist between the Mazda CX-5, the Kia Sportage and the Subaru Forester.
By considering the Forester you’re committing to all-wheel drive and a Boxer engine, and that car is inherently a bit more expensive than the other two, but relatively speaking, they’re all in the same vicinity. The Sportage is soon to be replaced, so you’ll likely get a solid discount right now, so you need to decide if you care or need AWD because Sportage only offers that in top-spec GT Line. And I’d argue neither are as luxurious as an upper-spec CX-5 which has on-demand AWD, and both it and the Kia have a lockable AWD option. But these systems are not as robust as the Subaru, so you need to know definitively if you wanna save big and stick to front-drive, or if your family actually goes camping or beaching etc.
Do your test drives long before you ever intend to buy. This will again disconnect you from any pressure to buy now. Drive your shortlist cars and when doing so, tell the dealer sales person you’d like to take your own drive route. This is important. The local dealer will have one or two standard drive loops they take customers on, which will be easy, simple and free of anything remotely technical.
But you, you want the technical stuff. Find a tricky roundabout, find a road with some twists and turns, go into built up residential areas and use the reversing camera/sensors combination and then do another parking manoeuvre with only your mirrors, get on the freeway and give it a squirt when you hit the on-ramp, use the adaptive cruise control and lane keeping, find a deserted area and push the brakes hard from about 50km/h, and bring a child seat to clip in and out to see how easily you can work the buckles, straps and whether you need to climb into the boot for the top tether. Remember, you’re about to drop tens of thousands on this car and live in it for the next 3-5 years, so it needs to work for you - don’t worry about inconveniencing the dealer. They either want your business or they don’t.
Once you’ve gone away and spoken with your other half, considered all the benefits and compromises it’s time to decide which vehicle you’re going to buy, including what engine you’re getting, making sure the transmission will suit you, and that it’s going to tick most of your boxes.
This means you both accept the inherent compromises you’re making with that vehicle, such as accepting the noisy operation of the engine, or perhaps you can deal with the narrow egress of the boot, maybe you’ve accepted that buying the diesel means routine 20-30 minute highway runs once or twice a week to upkeep the DPF’s regeneration requirements, or you acknowledge the space-saver spare wheel’s 80km/h speed restriction might be a pain in the arse sometime in the future, or you’ve digested the fact you can’t turn off all the noises and warnings (or that they return to the ‘on’ position every time to restart the car). And hopefully you’ve decided colour, trim or specification level, and if you’re getting any accessories (low priority).
2. Understand the vehicle you’re interested in purchasing and its price. This is where you need to be very aware what the car’s retail price is on the showroom floor. Let’s say it’s $45k. You should aim for a 10 per cent discount - this is a healthy, negotiable area most people should be able to understand, even if you’re ‘not good with numbers’. The dealership is very good with numbers, so you need to know the price, remove 10 per cent, which in this case would be $4700 off the retail price, leaving you with $40,300. Let’s call it $40,000 - that’s your rock solid budget, not a dollar more.
You and your wife/husband/partner/whatever need to be completely unified in this budget wall. It’s going to be crucial in your negotiating with the dealer.
3. Check for stock in multiple dealerships, including interstate if possible. More research is required here, meaning you need to pick up the phone and call three or more dealerships, and try to find dealers outside of the same dealer group. If you’re looking at dealerships inside the same dealer group business, they’re less likely to care if you take your sale elsewhere - and you’re absolutely entitled to buy a car from any dealership in Australia. Broome, Port Hedland, Hobart, Rockhampton, Woollongong, Albury/Wodonga, Barossa Valley, even Alice Springs dealerships are all able to sell you a car.
But for the sake of reality, call a range of dealerships and ask if they have stock of the model and spec-level you’re interested in, and colour if that’s important. Take note of all the dealerships you’re prepared to visit in your region which have that car.
So remember this, and your rock-solid budget, when you walk into the dealership.
Set your budget in stone
Having that rock-solid budget which absolutely cannot be negotiated, is immeasurably important. Think of it as both your shield against being convinced by the dealer to spend-up, and also your weapon to make him or her come down on the price.
Remember, the dealer needs your cash. You don’t actually need that car; it’s not oxygen or water. You can survive without it. You can also shop elsewhere. You could be buying second hand. But no, you’re in that dealership, so use that position of power and leverage. Catch my drift?
The next tool you’re going to have on board is negotiating below your actual budget. Knowing the retail price, and what you’re prepared to pay (10 per cent off the retail price, $40k for example), you’re going to start your negotiating slightly below what your absolute price is. So, you’re going to start at about $37,000. You might think there’s no universe where a dealer would accept nearly $8k off the retail price, but you need to remember - it’s called a ‘dealer-ship - it’s their job to do a deal on this car. You just have to pressure them enough to make the deal.
Once you’ve lobbed your first offer onto the table, and they politely decline your offer, you’re then going to ask for their next best price from that figure. When they retort with a figure above your absolute rock-solid maximum of $40k, you’re then going to hit them with your big gun…
You’re then going to tell them, there’s absolutely no way you’re able to afford that much without being divorced or declaring bankruptcy. (This puts a subliminal pressure on them to not financially/emotionally ruin their customer, and means there are external factors the dealer cannot influence).
Your big gun is delivering your final offer at your absolute rock-solid maximum price. Tell them you won’t do the deal for anything more than your $40k (or whatever price that is 10 per cent off retail). Tell them politely you’re happy for them to call you if they can make the deal work, give them your number, and tell them you’ll keep shopping in the meantime. And, if they don’t ask you to wait while they speak to the manager, leave.
Knowing you might take your business elsewhere is such a powerful motivator, both against the dealer, and for you because even if they don’t call you back to accept your offer, you keep your money and have already done your research. You can simply call or visit the next dealership and repeat this process.
So, with your negotiation tactics ready, take a notepad and pen with you, or take notes on your phone when you approach the dealership. Always get the name and number of the sales person you spoke with, take their business card if needs be.
Bide your time
This is a game of strategy. You have to be prepared to wait patiently and lose initially on individual dealership approaches, in order to win overall.
It’s only you who is going to remember how much of a saving you made, so when your first two dealership attempts are declined and fall silent, don’t be discouraged because you’ve kept every single dollar they didn’t get simply due to you getting impatient or falling for their sales tactics.
Speaking of, you need to also be tight-lipped about any personal information. Don’t take the kids on negotiation day, and make sure your other-half isn’t left alone with the sales person like if you go to the toilet or are checking out another car waiting to be approached. When you visit the dealership, park down the road so your car isn’t within direct sight of the dealership, so the sales person cannot estimate what you earn or how old and decrepit your current shitbox is.
Avoid talking about your job or career, just be vague about your general line of work if you cannot dodge the question. Maybe you work in health, or the media, or construction, or you just work in an office. Do not give them information about what kind of salary you’re on. And don’t overdress; wear casual clothes, avoid expensive accessories like blingy watches and jewellery. Keep it low-key.
You also need to keep in mind that this is your money. So ultimately you have the final say where it goes and whether you should take a deal; a dealer cannot pressure you into taking an offer you’re not completely happy with.
Do not sign any contracts without seeing the exact vehicle you plan to potentially buy.
And lastly, take your test drives at the start of the month and DO NOT BUY until the last week of the month, when dealers will be desperate to meet their sales targets.
Good luck, be firm but polite, and remember, you’re the customer and you have the power.
If you need further advice on buying your family’s new car, get in contact below.