I've never bought a car from a dealer. Has the Internet affected car selling very much since this article was written? The author mentions the beginning of some trends like with carsdirect.
It's very frustrating, I bought three over the last couple years. I think the biggest help to consumers is TrueCar.com which basically uses the information they gather about prices people recently paid for cars to negotiate a fair price for both parties. Whenever I mentioned TrueCar the salesmen were kinda disappointed because they knew they couldn't squeeze any extra money out of you. I started a website to help people get good deals on cars and then just decided to quit because TrueCar was efficient enough. Even the dealers that didn't participate still respected their pricing. At that point it was just a question of making sure not to get screwed on the financing and trade-ins.
I had never seen TrueCar.com. Thanks for that. I bought my first new vehicle 4 months ago and have felt like I got screwed every since. Turns out, I actually got a decent deal.
I've bought three new cars in the last three years. In all three cases I've used following internet technology: communicate with the dealers via email to negotiate sale price, and only use dealers for the test drives and to finalize the deal.
I knew exactly what car (including trim, color and options) I want to buy. In one case I knew VIN number of the car on the lot. But I still negotiated with other dealers within 100 miles from my zip code in order to drive the sale price down by letting them 'beat the competitors'.
I had money or financing arranged before closing the deal. Only considered dealer financing if there were incentives to use them. Did not trade in any cars as part of the same transaction.
I've considered buying a 2-3 y.o used car, but dealers were not willing to negotiate. Main reason is that every used car is a unique snowflake, so it is harder to pitch comparable cars against each other. On the other hand, one can get exactly same new car from any dealer, and they understand this.
I've tried using Truecar and Edmunds to get a good deal on a car. No much success there. It's just a dumb lead generators for dealers. I would get great initial responses from participating dealers, but then they will not have the car that they offered to sell and would push something they have in stock.
Bottom line, when you send a copy of the competitor's email with the "out of the door price" for a specific car and a promised to close the deal tonight, dealers tends to become really accommodating.
