Car buying: Six slippery sales strategies

September 9, 2009

Courtesy of ARA Content

Even with the success of the “Cash for Clunkers” program, the auto industry is limping through the recession, and most car dealers are still in need of increased sales. It may be a buyer’s market, but that’s no reason to let your guard down in the showroom. Experienced salespeople have one goal in mind: to put you in a new car today. And it’s their job to get as much profit out of every sale as possible.

While most car salespeople are honest and forthright, says Howard Krueger, a former car salesman, others may be looking to take you for a ride. So, before you set foot on the lot, be aware of sales tactics that could bait you into paying hundreds or thousands more than you should. Krueger, now an Internet auto sales manager for USAA, offers a few of the more common sales strategies:

The four square

A salesman puts four numbers in front of you: the new vehicle price, your trade-in value, your down payment and the monthly payment. He’s looking for your “hot button.” When you focus on one of the numbers (say you demand more for your trade-in), he knows he can hook you by meeting your terms on that part of the deal. Problem is, the other three numbers are already inflated to favor the dealer.

The waiting game

“Let me go talk to my manager and see what I can do,” says the salesman. It’s a classic technique. After what seems like ages, the salesman returns, ostensibly exhausted from negotiating on your behalf. “My boss is willing to come down—this is the best deal we’ve given anyone on this car.” Don’t bite. The dealer’s betting that the longer you sit, the more eager you’ll be to reach an agreement.

The turnover house

Sometimes the sales manager comes to talk to you himself. Now that you’re talking to the boss, you’ll know you’re getting the best possible deal. The truth is, the “boss” is a professional closer, brought in to win you over when the first string can’t. It’s not uncommon to go through three layers of sales people before you reach the dealer’s true best offer.

The sympathy play

“Hey, I need to make a little money on this deal, too,” he says, citing the struggling economy or, worse, four kids to feed. It’s only fair for the dealer to make a reasonable profit, but don’t be guilted into paying too much. Rest assured, the dealer won’t knowingly lose money just to earn your business.

The now-or-never

“This deal is only good for today,” or, “there’s another buyer interested in this car”—whatever the salesman’s story, some dealers rely on fear tactics to rush you into a sale. You know better.

The free extras

To sweeten the pot, your salesperson might throw in pinstriping, rust-proofing or fabric protection at no extra cost. But unbiased experts agree these add-ons aren’t worth much, despite what the dealer usually charges for them. Your best bet is to ignore them.

Being street-smart about sly sales techniques is one thing; sticking to your guns and actually getting a good deal is another. So how can you tilt the odds back in your favor? The answer is simple: research.

The Internet has helped level the playing field for consumers. Thanks to sites like Edmunds.com and member-based resources such as USAA’s Car-Buying Service, you can enter the dealership armed with more information than the salesman himself.

Not only can you research your preferred vehicle and every available bell and whistle, you can find out the dealer’s invoice (also known as dealer’s cost) and uncover special incentives and rebates.

It’s also smart to know the fair value of your trade-in (visit Kelly Blue Book at kbb.com), get a quote for insurance on the new vehicle, and get pre-approved for auto financing. Lining up these numbers in advance simplifies your negotiation in the sales office. Still, be sure to set aside plenty of time for your visit to the dealership, and avoid distractions while you focus on getting the best deal.

An even simpler approach to consider is having the price negotiated for you before you step foot on the car lot. Taking advantage of car-buying programs that offer these special member prices and services can save you time, money and the hassles of negotiations.

With solid knowledge about what you want and how much it should cost, you’ll know how to spot a good deal. And all the slick salesmen in the world won’t be able to change your mind.

From the September 9-15, 2009 issue

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