I said “It feels bad to pay more than you have to for something. No one wants to be a sucker.”
That doesn’t mean you have to negotiate. But if you know the option is on the table and you don’t take it, you feel like you got played.
Choosing not to negotiate when the option is there is different than not having the option at all, both psychologically and (assuming markets are reasonably efficient) in terms of the actual price you’ll pay.
My last car purchase was at CarMax and it was a positive experience. I researched the cars ahead of time online, lots of information and pictures available on the website. I hate negotiating, so the no-haggle thing is a plus. Sure, while my research showed I probably could have gotten something comparable for a little less elsewhere, that would have depended on negotiating and ensuring that it had every feature I wanted.
Beyond that, the entire experience there and since has been great. The salesmen are paid a flat commission, so they’re not going to try to up-sell you a car you don’t want. And since I had done my research ahead of time and the car was local, I was doing a test drive within about 15 minutes, and the whole thing, including getting financing, was less than an hour. They even showed me the carfax and maintenance record without me having to ask. And I’ve had no issues with it that weren’t normal maintenance.
So, yeah, you’ll end up paying a little more than you might if you do more research and are a good negotiator, but between the easy buying experience and the confidence that the car was in good condition, I don’t mind paying a small premium for that. And, hell, most people were surprised I got the price that I paid, so I don’t even feel like I paid one.
Beyond that, as others said, they have a massive selection, they’ll ship from nearby to your local lot for free, and even across country for a fee. Unless you’re getting something particularly special, you shouldn’t need to ship one. So even when I went in, I had several other cars already on lot that I wanted to test drive behind my first choice.
So, really, unless I have a compelling reason to buy a new car or I really need some hard to find features, I can’t imagine my next car won’t also be from CarMax.
While I have never bought a car at CarMax, I have sold them two cars - a 2003 Infiniti FX35 and a 2001 Nissan Xterra. In both cases, when we were buying the replacement cars from dealers (a 2013 Toyota Venza and a 2010 Nissan Rogue respectively), I had taken the old cars to CarMax first and they gave me a quote that was good for seven days. I went to the dealer within that seven day period and when it came time for the trade-in value in the negotiations, they couldn’t even come close to CarMax’s price, which was right at Blue Book prices for our area in both cases. In fact, arguably, they gave me a few hundred over Blue Book for the Infiniti. I even showed them the dealers the quote and told them if they could match it, the car was theirs and they’d be saving me the hassle of going back. No dice, which was fine with me. While they washed the new car and did all the other prep work, I sold the old car and got the cashier’s check to apply against my new car. I will continue to take my used cars to them at least to get a competing quote. So far though, in my sample size of two, their trade-in prices are great. In both cases, the cars I traded in were in “meh” shape and were over 100,000 miles, so I can’t say how good they would hold up for the next buyer.
I’m certainly not doubting this psychological phenomenon exists, but what’s especially ridiculous about it these days is that the amount of money you leave on the table by not negotiating is pretty damn small.
The “ask ridiculously high and expect to be haggled down” approach John Bredin describes is almost entirely a thing of the past, IME mostly confined to small town dealers these days. Generally the price you see listed (especially on the internet) is pretty close to what you’re going to pay, especially on the internet. The dealers will still haggle, but unless you’re looking at an exceptionally slow-selling model you’re only talking maybe getting them down a few hundred bucks at the most. CarMax (IME) usually prices at thousands more than the local dealers’ asking prices, so going with them to avoid wringing your hands over possibly leaving a few hundred bucks on the table at the local dealer is pretty irrational.