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Buying A Car in Austin, Lakeway, Round Rock and Cedar Park and Surrounding Areas - The Bidding ProcessBuying a car is like playing a game. Your leverage to “win” is the fact that you can go to anyone to buy a car. And you should. To start out, it can be a waste of time to physically go to a dealership to negotiate. Look at their lot, but when you find a car you like, call and talk with someone over the phone. The leverage a good salesman has on you is the emotional component. Most will try and persuade, entice and down right make you buy the car just by seeing that you are interested in it. They can be ruthless. By conducting the initial bidding process over the telephone, they see your facial expressions, body language and really just how much your dying to have that car. Also, it gives them the idea that you are also calling other dealers…it’s a lot easier to pick up the phone than it is to walk out the door.
When talking to dealers it is essential to know about the “factory invoice price.” This is theoretically what the dealer paid for the car. They are required to have a printed invoice of that price. The factory invoice price is less than the “manufacturers suggested retail price,” which is the list price shown on the window sticker of the car. Almost all cars are sold below the manufacturer’s suggested retail price and some cars are sold to customer’s below the factory invoice price. This is possible because the factory invoice price doesn’t actually reflect the true cost to the dealer. Dealers often get “holdbacks” or end of the year carryover allowances, factory to dealer incentive payments and other allowances that reduce the cost below what the factory invoice shows.
The factory invoice price is the same for all dealers. If one dealer bids $500 above the factory invoice price, and another bids $500 below, you can tell that the second bidder is offering $1000.00 less. Be sure to tell the dealer that you will expect to be shown the actual factory invoice for any car you are considering. Talk to at least seven dealers and get at least five bids. Do not talk with just any salesman, demand dealing with only the sales manager.
Ask them the markup or markdown they are offering. Let them know you expect that same offer on any car on their lot. You will expect to see the invoice for any car you pick. Find out if there are any additional charges they will expect you to pay such as document preparations, dealer add-ons, rust proofing, wheel locks, etc? See if they offer a factory-to-customer rebate. If so, make sure it isn’t already taken into account on your bid, it is supposed to be an additional savings. Often a manufacturer will offer a factory to customer rebate in which you are able to collect from the manufacturer itself or the dealer can apply it to the purchase price of the vehicle being purchased. Don’t confuse this with the factory to dealer rebate, which is money given to the dealer for each car that is sold. Dealers will usually use this money for advertising, employee bonuses, or extra profit. Once and a while, the dealer can pass this onto you, the buyer for an extra incentive. Is there anything else that would affect the price commitment? What if the dealer doesn’t have the desired vehicle on his lot? Will you be paying for the dealer exchange? And what about a factory-ordered car? Their responses The most common responses go as follows; “I can beat any price the other dealers give to you.” “What do you anticipate is a good markup or markdown?” “We don’t like to conduct business over the phone, we’d prefer that you come in and talk to a sales representative.” Your response should be that they absolutely have to bid, without you coming in, to be able to be considered. It may get frustrating, but go on to the next dealer, many will comply with your requests. Look carefully at all the bids you receive. There is no “magic number” to buying a car. The price of a vehicle solely depends on supply and demand at the moment you are buying the car. Try to receive a faxed or mailed confirmation of your bid to steer away from any problems or broken promises. Once you review the bids, talk to the managers again regarding options available for that price. Theoretically, the options shouldn’t differ with the bid but in some cases they will. Make sure to have a good understanding of the warranty offered. This certainly doesn’t mean you have to have repairs done at the dealership, find a repair shop that you are most comfortable with. Once you have settled with a price, options and warranty, you must find out the costs of financing, extended service contracts, rust proofing, sealant, and other add ons. Also know the true value of your trade in. Present these factors to your dealer only after you have determined a price for the new car. Back to Transportation Services Main Page What do you think? Our goal is to get more and better information out to Austin residents everyday. We can't improve without your help....Please let us know what you like, dislike and what we could be doing better. Email at feedback@austinsmartconsumer.com
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Austin Money Savers Tip There are lots of ways that dealers will try and get you to pay more than you should when closing on a car. Some of these fees may include delivery charges, dealer advertising, sales promotion fees or administrative fees. Refuse all of the above; these are all costs the dealer should be taking care of. 
Keep in Mind All dealerships on the Motor Mile in South Austin can scan eachother's databases for a vehicle. If you know exactly what you're looking for, it takes only minutes to see if there is a match at any of the dealerships. 
Be prepared! The buyer is expected to pay for taxes, registration, licensing, and destination charges. The dealer may expect the buyer to take car eof dealer installed options. Remember, this is not the buyer's responsibility. Privacy / Legal + Disclaimer