NEW AND USED CAR PRICING GUIDE INFORMATION
A used car pricing guide and a new car pricing guide will give you a great bargaining edge on car dealers. Whether it’s new or used, you need to know how much the dealer paid for the car you want to buy. You need to know the lowest reasonable price he will accept. And you need to know the fair value of your trade-in. _________________________________________________________________ _________________________________________________________________ NEW CAR PRICING The amount a dealer pays for a new car is called the invoice price. You may have seen ads offering to sell cars for invoice price or maybe even a little less. How can a dealer sell a car for less than purchase price? The secret is that invoice price isn’t the actual ‘bottom line’ price that a dealer pays for a new car. Manufacturer’s have a hold back of 3% or so on each car that is paid to the dealer on a quarterly basis. It also often happens that when slow moving cars have buyer incentives, they also carry dealer incentives that are given back to the dealer. So if a dealer sells a car with a sticker price of $35,000 for an invoice price of, say, $33,250 minus another $2,000 in customer incentives, which gives a price to the customer of $31,250, he may realize an actual profit of $1,000 to $3,000 or higher. Buying a new car for invoice price is a good deal for the buyer and still gives the dealer a good profit. The trick is to find dealers that will sell new cars for invoice. Some will, some won’t. There are a couple of cautions. Hot selling cars like, say, a new Corvette are very unlikely to be purchased for invoice price. In some cases, you may find that a really hard to get model that’s in high demand will sell above sticker price. There are also a few unscrupulous dealers who will claim to sell at actual car dealer invoice prices, but then load hundreds, or even thousands, of dollars of bogus special charges into the sales agreement (See Dealing With The Dealer ). An online service like Edmund's
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USED CAR PRICING If you’re in the market for a pre-owned, or just plain used, car you can also research the used car pricing guides to find out with reasonable certainty what the dealer paid for the car, and what a fair trade in price should be for your old car. Used car pricing guides list used car prices for a huge number of models and model years and typically show three prices. The wholesale price is the price that the car will probably sell for at a commercial auction. Wholesale is the price a dealer should offer on a trade in. Retail price is the price that will give a dealer a decent profit margin above the wholesale price. The retail price shown in a used car pricing guide should be the starting point in a price negotiation. Private party price is about halfway between wholesale and retail. It’s the price that an individual would typically expect to get if he elects to sell his own car, rather than taking wholesale on a trade-in. Many also feel that it’s about the lowest price a dealer will commit to on a sale of a vehicle from his lot. Edmund's
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As you shop the different sites for your favorite model, you may find some price differences on the same model car; whether new or used.
But even with these discrepancies, you are in a far better bargaining position than you would be if you relied only on the dealer’s price. _________________________________________________________________
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