Last post on Sep 08, 2009 at 9:40 AM
You are in the Smart Shopper
What is this discussion about?
10 Tips: How To Buy a New Car - Here are 10 time-tested new-car buying tips culled from Inside Line's collective experience, which includes buying hundreds of new cars both professionally and as individuals — not to mention some experience working inside dealerships.(more)
#35 of 42 Re: From The Writer [micosilver]
Sep 07, 2009 (11:25 am)
Thanks for the kind words. Keep up the insightful commentary. I've forwarded your comments to my mother so she can appreciate what good work I'm doing.
#36 of 42 Re: From The Writer [pearley]
Sep 07, 2009 (11:29 am)
All good stories need a villain... yours seems to have it out for the F & I guy.
About the only thng I didn't like about your article is it generalizes and brush strokes all F & I guys as someone looking to rip you off. Not directly spelled out in your article as such, but quite clear in the "beware"," buy nothing" and other comments. Sure, one has to cautious with any big ticket purchase, but to give a one sided slant of the F & I office that is all negative isn't fair.
#37 of 42 Re: From The Writer [jipster]
Sep 07, 2009 (11:44 am)
As far as buying pitfalls go, the F&I process is among the most perilous for a first time car buyer. Did I go too far? I, of course, don't think so. But I understand your criticism and don't think it's unreasonable.
For first time buyers however, I can't emphasize too greatly to be aware that when you're with the F&I guy, the sales process is still going on. Knowing that will itself likely save you money.
#38 of 42 Re: From The Writer [pearley]
Sep 07, 2009 (2:15 pm)
I am glad you made this response. Tough to give such general advice that is fair and balanced on this subject, and I hope you weren't responsible for picking the lead picture. Here are my thoughts:
First, the time the dealership asks for your drivers license should be immediately before the test drive. You obviously need your license when you test drive the car. I am just wondering how you negotiated for an hour and a half before even test driving the car. Doesn't make sense to me, and could have easily been solved with a little intestinal fortitude.
Second, more people than not base their purchase decision on the trade in value. While there are two numbers, the difference is really what matters. And most buyers want to know if that number is close early in the negotiation if they are sincerely interested in the new car. No sense grinding down to the bottom number only to find you are unhappy with the trade amount unless you like wasting time. And keep in mind that on a busy day, with limited appraisers on staff, it may take a while to get to your car. Not to mention that wholesalers may have to be called for a final number. It just makes sense to have that done while you are test driving and negotiating.
Third, in most stores the F&I department does sell some beneficial items. Some are more convenient if purchased with the car, as they can be rolled into the note or lease. Obviously, you still have the choice.
Fourth, sites like Edmunds do have many buying tools which are valuable to the buyer. But it omits some important information that builds distrust amongst buyers, such as not showing all Adv. charges from the manufacturer to the dealer in the invoice price. Edmunds needs to make these differences much more prominent, as the consumer needs to have accurate numbers to begin with. Perhaps they could use an average Adv. number to start with, and at least insert it in the invoice pricing rather than the small footnote on the start page.
Fifth, of course buyers should drive the car as many times as necessary to determine its suitability. But be aware that most dealers have set routes for their test drives, for several good reasons but primarily saftey. To suggest people take their own routes and drive around looking for RR tracks is ludicrous from many perspectives. For this large of a purchase, perhaps suggesting a consumer rent the model they are looking at for a weekend would make more sense.
Sixth, most "good" dealerships have good service departments. The same person (General Manager or Owner) is responsible for both. And in many cases, you will get much better treatment (loaner cars, timeliness, etc.) if you actually bought the car there. A well run dealership is one that charges a fair price for both, and may be a little higher than the sketchy place that saved you the hundred, but got you a point on your note, or doesn't provide you with a loaner.
Seventh, Edmunds should strive to be the best, and that includes boiler-plate articles such as this. The pricing information should be totally accurate, including all Manufacturer to dealer charges. Trade numbers are impossible to accurately predict, and this site (and others) generally don't take nearly enough into account. The market/condition factors should be explained to a much greater extent, rather than just giving a number which is invariably wrong.
All buyers and dealers do want the same thing. To buy/sell a car. But keep in mind most cars only carry a 6%-15% markup, and no other business has a whole industry, including websites, devoted to purchasing strategy and pricing. While arming buyers with a merchants cost benefits the consumer, it is only natural that dealers find creative means to bolster their bottom line and cover expenses. Any business would do the same, even Edmunds. To think otherwise is extremely naive.
#39 of 42 Re: From The Writer [jipster]
Sep 07, 2009 (2:37 pm)
"...seems to have it out for the F&I guy..."
Maybe he was abused by the one who was a former bank hiester like in the "Confessions of" series.
You must remember, the regular readers of Edmunds are a lot more savvy than your typical customer. The sales guys have even said this. What seems to be a hatchet job to an experienced buyer might be just what a baby seal needs to hear to wake them up.
I remember talking to some well-off but very naive friends about their house purchase. The wife kept referring to how great "our real estate woman" was. I asked her how much she had to pay her agent. She replied that "Oh she was so nice she only charged the seller". They both got offended when I noted that ment the agent was working for the seller not them.
Some people are really clueless. It might take a heavy hand to make them see that the "nice" salesman is really working for the dealer.
#40 of 42 Re: From The Writer [jwilliams2]
Sep 07, 2009 (3:00 pm)
Thanks for the thoughtful input. I didn't pick the lead photo, but it was an attention getter and that's what you want in a lead photo.
Back in the early Nineties I was more naive. We were out shopping for cars for my sister and the salesperson said he had to "hold on" to the license through the test drive for "security." He assured me that it would be with him and he'd be on the drive. When the Daytona proved to be (no surprise) awful, we were ready to scoot. And he somehow managed to disappear for an hour and a half with the license still on him. We weren't negotiating, we were stuck. And I still don't understand what he hoped to achieve with such an underhanded tactic. So I never let my license out of my sight now.
By the way I'm not one of those automotive journalists who only drives test cars. I own a 2000 Toyota Tundra (the beast), a 2004 Toyota Sienna and a 2008 Honda Civic Si sedan. All were bought new through regular new car dealers.
Basing your purchase on trade-in value is rarely, if ever, a good idea. I understand your point, but any buyer should have a good bead on what their used car is worth before driving onto a lot. And if you minimized the purchase price of the new car, you're already a winner. Confusing the two transactions is a big risk for the inexperienced. And giving the dealership control of the car you drove in with puts being able to escape at risk. Once you've decided to buy the new car at a dealer and are proceeding with the purchase there's a case to be made that that's an okay time to let the trade go in for evaluation. But I'm convinced that for most people it's better to spend the time waiting to get the appraisal done after the new car negotiations than trying to save some time.
I don't doubt that some F&I departments sell decent products. I just think that when you're closing a new car deal is the wrong time to be shopping for them. There are people who will spend the money for the peace of mind that comes with a service contract or extended warranty -- but you can't evaluate them well on the fly in an F&I office. The dealership will be there the day after you buy your car -- at least usually. And researching those products first is vital. It's hard to truthfully deny that most F&I products are extremely profitable for the dealership and alternatives outside the dealer are usually cheaper.
Edmunds is always trying to improve their buying tools. But even with the couple of hundred people at the company assigned to making sure everything is up to date, it's tough to capture every incentive, charge and holdback on every model out there. No company has a greater commitment to that task than Edmunds, and I don't believe anyone does a better job doing it. But of course it can and will get better.
I think renting the model anyone is considering purchasing is a great idea. But most dealers I find have very loose definitions of what a set test drive route is. I don't think expecting to take the car for a full afternoon 300 mile test drive is reasonable, but it's a good idea for the buyer to have an idea of where he wants to drive too. And railroad tracks, if they're nearby, are a great test of a car's behavior under stress. Both dealers and buyers should be reasonable in allowing a solid, well-thought out test drive.
Of course, good dealerships are run by good general managers. And often a good sales experience will indicate a good service experience. But what I've found is that the best dealers are usually ones with the best prices too. After all, any good dealer will at least match the price of any dealer on identical vehicles -- why lose any sale over a few bucks? Both my Hondas and Toyotas are serviced by the local dealers where I live and I bought the vehicles at those dealerships for good prices. And so far, they've been solid on the service side too.
We tend to think of the market as one big car market in the United States, and that's just not true. Subaru sells well in Vermont, not so well in, say, Nevada. BMW is popular on the coasts, not so much in Idaho or Iowa. We're really a country made up of thousands of little markets and while Edmunds strives to service all of them, it's a daunting task. There are more stories to done about individual markets and if someone will pay me to write them, I'm writing them.
Capitalism demands that every business be creative in bolstering its own bottom line or die trying. No one resents dealers for making money, but we all resent it when that creativity leaks over into dishonesty or trickery. I don't know what percentage of dealers indulge in such tactics, but I know that it's more than zero. And that's enough for the buyer to keep his or her guard up.
#41 of 42 my 2 cents
Sep 08, 2009 (5:16 am)
long time lurker here.
i thought the article was good for someone who doesn't really "understand" the process. oh sure, a few items were left out, or played down here and there, but overall, a good "car buying 101" presentation. thanks!
i have always found that doing thorough research, talking to others, and treating people with respect goes a long, long way in easing through the car buying process. if you go in with a chip on your shoulder, or cock-sure you're going to get ripped off, well then, it won't be fun. as well, respect is a two way street, so if you think you're getting 'abused', then ask for a different salesperson, or walk, your most potent tool.
lastly, to avoid drivers license issues, i always make a copy or two and take them with me before i go car hunting -that way you can give one copy to the dealer for his/her purposes. No doubt they'll want to verify the copy against your real DL, but you can always keep the original firmly in your possession while they check - like getting proofed when you write a check. (My DL usually never comes out of my wallet.) end of issue.
#42 of 42 Re: From The Writer [pearley]
Sep 08, 2009 (9:40 am)
This article was 100% SPAM.
You admit less than rigorous effort went into the article. You dredge up a memory of something that happened almost 20 yrs ago as justification for a ridiculous piece of advice, you find a stereotypical photo an "attention grabber"
Frankly, you have done more to re-inforce negative sterotypes than any dealer could.