This will be my first new car purchase, and I’m realizing that I don’t actually know how most of this works. I’ve googled a bit and read on ConsumerReports and even here the basic idea, but I’m hitting a stumbling block with Truecar (and other sites like it, although I think many of them are using Truecar as their search engine anyway). In essence, I’m pretty settled on a 2016 VW GTI SE 4 door manual with lighting package. MSRP is about $30-31k, invoice is around $28ish, but on Truecar it’s giving me Truecar Estimated prices of <$27. I’ve read the fine print and I see that since the car isn’t in stock at that dealership (which is odd, because even when I tried for a model that I know they do have in stock it still says there’s nothing that matches) it is not a guaranteed price. Can I still use this price to negotiate with other dealers? It seems super low to me, but I also know that VW has taken a pretty big image hit lately. I’ve also read reviews of Truecar and it seems like it’s not the amazing service it used to be when it first came out.
Any experience using Truecar, or Edmunds, or Costco auto pricing, or any of those things to buy a car?
You can use whatever you want to negotiate with dealers, but generally car dealers aren’t going to be specifically swayed by prices you bring in off the internet. TrueCar is useful not so much for negotiating per se, but in giving you a rough idea of how much room for negotiation there is for a particular car. I wouldn’t take the actual prices themselves as gospel* but if the range of prices is really narrow and closer to MSRP, that usually suggests a fast-selling car that the dealers aren’t going to budge much on, whereas a wide range of prices some of which are near or below invoice suggests a slower-selling one where negotiation and shopping around likely will pay off.
*A lot of the criticism of the service is that prices change quite a lot depending on what location you enter, with the cynics suggesting that it bumps the prices up when there’s an affiliated dealer in the area to make the TrueCar price look better. I don’t know if that’s true, but it’s still worth entering multiple locations to see what the price does.
I have been looking at car prices, and puzzling over the role location plays, and this is the best I could come up with:
Average income in an area influences the car market quite a bit. In poorer areas lower priced models and used cars move faster, so the dealers are less inclined to bargain. Higher priced models are slow movers, so tend to get haggled over more. The opposite is true for wealthier areas.
The prices I’m seeing aren’t that wide spread but they are all well below MSRP, and from the invoice sheets I’ve seen, they are lower than that. I figured it was due to the recent bad press VW has had, but the GTI is still a pretty good seller so I don’t know if that’s true.
What’s the best way to start getting a preliminary idea of prices? I’m terrible at negotiating and in person confrontation. I was going to email places to get quotes and then take the lowest ones and see where I can go from there.
I hate playing the negotiations game. What has worked for me is deciding ahead of time what the car is worth to me based on all the research plus my budget. Once I limited the monthly payment (when young and broke, that’s pretty much all I had) and once I decided that on car X with trade-in Y, I would not got over $Z additional. Each time, I was willing to walk out if the dealer couldn’t meet my requirements - once I even stood up and started heading to the door - and while someone else might have negotiated a better deal, I got what I wanted and I was satisfied.
I also understand that shopping near the end of a month is an advantage if the sales folks have to make certain numbers. Also, sometimes credit unions or other groups (like AAA) have buying services that seem to offer good deals. But mostly, you need to decide for yourself what your limit is and be willing to walk away if you can’t get it. The more research you do ahead of time, the better for you and the less likely a fast talking salesman can remove more $$ from your wallet.
Good luck!
I used truecar for my last purchase. I tried to use that as a starting price to negotiate, but it sort of went nowhere. I used this as a template. But, instead of negotiating, I just got a constant barrage of clueless salespeople calling me.
So, I just went with the truecar price, and everything went smoothly. Much less stressful than previous purchases.
You can use truecar to get a idea of idea what price is reasonable but cars.com will show actual dealer inventory with a price they should honor. For example here is a GTI for 24.3:
However it says msrp is only 26.6. Wrong car? That lightning package adds 5k?
Not always the case. In less densely populated semi-rural areas there are fewer dealers and even though incomes are lower so are car sales volumes and dealers in these areas are often not as willing to negotiate as someone selling 10X more cars in a large suburban or urban market. You do not always get the best deals in lower volume dealerships in less wealthy areas.
For some reason I can’t get that to load, but the one I was looking at was the SE, not S, which might account for the price difference. I’m looking at Cars.com though, thanks!
Ok, the SE with “Performance Package”, I see one dealer down in Florida advertising it for 26.8. The next lowest is 28 but there are a bunch of guys with this price.
When you go into the dealer, they will probably pretend they don’t know anything about the cars.com price, so it’s best if you bring in proof of their own price. And of course you can (should) try to negotiate even lower from there. You can probably also show a dealer prices from other dealers you see on cars.com, though this didn’t really work for me.
Dealers who only list msrp on cars.com I didn’t even bother contacting.
26.8? That’s a great deal. Unfortunately nothing around me (southern California) seems to be quite that good. Any alternatives to the GTI I should be looking at? I’m hoping for <$30k, smaller but still 4 door, ideally with good acceleration. Sporty handling is a plus as is comfortable and reasonable gas mileage.
You’re not kidding, I had to expand the search out to Phoenix to even crack 30K …
As for alternatives meeting your criteria - Ford Focus ST?
I would say the subaru WRX but its mpg is not great at 20/27. The Focus ST is rated 22/32 mpg, with 252 hp/270 ft-lb torque. And it has that similar small-but-4-door, stocky/muscular look that the GTI has. Only problem is it’s a Ford, lol.
Look at the Mazda3
Used Audi A5 or A4? I’m also looking at new base A3 because it looks like with some negotiation I could get them to the $30k point.
There’s also the issue that a lot of car dealers in poorer areas specialize in buyers with bad credit, and so they can often dictate the actual sale price of the car because the buyers can’t get financed anywhere else.
More generally, though, a problem with TrueCar is that you can’t see the whole deal. The buyers who got phenomenal prices may have gotten hosed on their trade-in or financing. Different dealers (or even different salesman) have different strategies for squeezing the most bucks out of their customers, so the very small-scale local variations you see may reflect that as well.
I’ve had very good luck with my last three cars and I searched Cars.com to actually locate them. I use TrueCar, Edmunds and KBB.com to get an idea of the minimum discount I could get. But I contact each dealer that has the car I want independently to get a quote and try to negotiate a deal.
I searched a 500-mile radius of my location (North Georgia) and found something interesting. For some reason, three dealers in the Tampa, FL area are discounting their 2016 GTI models by $4k+ while it’s only $2k or so elsewhere.
There’s even a 2016 GTI SE w/ Performance Package, 6MT, Driver Assistance Package and Lighting Package in Reflex Silver w/ Titan Black Leather. MSRP is $33,830 and it’s priced at $29,300. Heck, I want it! =)