Updated on: July 22 2019
Arguing about prices doesn’t come naturally to most of us. However, when it comes to buying cars, knowing how to negotiate can potentially save you hundreds of pounds. Here’s how to do it.
Research Is Key
In order to decide at what price to start haggling, you’ll need to know roughly how much the car in question is worth. If you’re looking at a used car, you can harness the CarGurus Instant Market Value, which is included in all of our listings, and instantly tells you how a particular car’s price compares with similar models on the market. If the advertised price is higher than the Instant Market Value, print out listings for similar models to show the seller.
Even if the advertised price is below the Instant Market Value, it’s still worth making an offer, but don’t be surprised if the seller doesn’t want to budge. In this instance, also take note of how long the car in question has been listed (again, CarGurus includes this information for every car offered on the site). The longer the vehicle has been listed for sale, the more likely the seller will be to accept a lower offer. Also, undesirable colours or absent features will make a car more difficult to sell, and thus a discount more likely.
When buying a new car, it’s worth spending time searching various broker and leasing websites to see what kind of prices are being offered. Your local dealer might not be able to match them pound for pound, but by knowing how similar models are priced online, you’ll be well placed to make a competitive offer.
Dealerships selling new cars also have sales targets to hit. These are usually set on a monthly basis, so approaching a dealer toward the end of the month can increase your chances of achieving a discount. If they don’t want to shift on price, ask if they’ll throw in some optional extras instead or even just a tank of fuel.
Finally, remember to check specialist car news and reviews websites to see if a model is about to be replaced. A dealer will rarely tell you this information, but it can be a good reason to expect a significant discount, because the arrival of a shiny new model will inevitably force down the value of its less-desirable predecessor.
Although the concept of haggling seems confrontational in nature, there is no reason it can’t be carried out in good humour. Simple things like smiling and making eye contact will help to lighten the mood, which will in turn increase the chances of a deal being reached. The trick here is to let the seller know you are a serious buyer without revealing your maximum budget.
Whether you are buying new or used, the seller will need to attain a certain price for the car, and it is not unreasonable for this price to include a profit margin. Therefore, if you make a silly offer just for the sake of starting the bidding low, it is quite possible the seller won’t take the negotiation process seriously.
It is also good practice to be able to explain why you are asking that money be knocked off the price. Take a good look around the car and note any scratched alloy wheels, damaged paintwork, or scuffed interior trim. All of these will cost money to repair and can thus be used as reasons to pay less than the asking price, as can any faults picked up in an independent inspection. Similarly, if the car has a short MOT, you are well within your rights to ask for a reduction in price to reflect this, or better still for the seller to put a 12-month MOT on it for you.
The Part Exchange Factor
When you’re part exchanging a vehicle as part of the buying process, the value offered for your part exchange is just as important as any discount you can negotiate on the price of the new vehicle. As such, it’s important to do your research and know how much the part is worth, being realistic about its condition and specification compared with similar models on the market.
With all this in mind, the value you need to focus on when part exchanging is what is called the ‘price to change’. That is, the difference between your part exchange and the cost of its replacement. By setting your budget early in the buying process, you will know for certain if the price to change is one you can afford.
Be Prepared to Walk Away
If you can’t agree on a price that is right for both buyer and seller, it is absolutely fine to walk away. Until you have paid a deposit, you are under no obligation to buy (just as the seller is under no obligation to sell). So, if the numbers don’t add up in your favour, you can simply thank the seller for his or her time and continue your search elsewhere.
There’s no harm at this stage in leaving your contact details in case the seller changes their mind. In many cases, sellers cave when they realise the potential buyer really might be about to search elsewhere, meaning that walking away sometimes represents an effective tool in the haggling process, rather than the end of it.
Following these simple tips can transform negotiating the price of your next car from a daunting prospect into an experience that’s altogether more rewarding.