How To Buy A New Car : The Unrepentant Tightwad Edition

By on December 17, 2018

There is an ugly reality when it comes to buying any new car.

Those tiny little loopholes that are today’s generous rebates and incentives aren’t designed for the average Jack, Jim, or Jane. Heck, even a career car guy like me who has liquidated over 10,000 vehicles a year for an auto finance company knows that to get the best deal on a new car, you have to be one rare bird these days. People don’t even realize that you can use a loan comparison website to help out in these circumstances.

Anyway, this is how you become that rare bird.

Be A Loyalist

Yes there are rebates for brand loyalists that can range anywhere from $250 for the hot brand to $2000 for a distressed brand with declining marketshare (like Volkswagen). You can even sometimes get $2500 off or more if you were kind enough to buy a specific model in the recent past: like the Chevy Volt.

But what I’m talking about is dealership loyalty.

Start by checking out the inventory of the nearby dealership. Find something you like? Go by for a test drive, open the door, and pay very close attention to the build date recorded near the opening of a driver’s door.

Take a month or two off and you now know approximately how long that vehicle has been sitting. It’s expensive for a vehicle to sit. We’re not talking about bankruptcy levels of expense. But a couple hundred bucks a month in interest and an overall lack of liquidity can be a big lingering pain for a small dealership. If you are the type of car buyer that does’t care about a leftover 2018 vs. a brand new 2019, congrats! You just found the auto industry’s sensitive spot when it comes to retail price.

Be Genuinely Nice And Map It Out For Them

A lot of folks in our industry promote the idea of buying the new car at the right time. The myth goes like this.

Dealership A will get a $100,000 spiff from the manufacturer if they sell 100 vehicles this month. If they sell 99, they get nothing! These stair-step reward systems invariably make the little guys less competitive than the big volume dealers. It’s not a fair fight, but that’s generally how it works in the car business.

The myth is in your ability to predict it. You can’t. But what you can do is be introduced to the new car sales manager, have a nice conversation with them along with the salesperson, and explain that you’re going to buy the vehicle within the next couple of weeks… with a few incentives.

Let’s take America’s only $12,000 hatchback a few years back: the 2015 Chevy Spark LS.

The TrueCar price was $11,319 for the entry model.

Deduct $1000 for the Conquest Cash offer. If you own a certain brand of vehicle, manufacturers will often add a rebate even if you decide that you want to keep that car. In today’s world of $100 to $300 junk cars at impound lot auctions or Craigslist, this can be easily done and I offer more details below.

Deduct $500 for becoming a member of ‘the loophole club’. Every manufacturer has their own version of the loophole club over the course of the year. One month it’s an Uber driver. The next month it’s a local rebate or Costco membership, and the next month it’s a college grad rebate or military discount.

One more deduction: $100. One C-Note with several choices. USAA, AAA, American Express. If you don’t have AAA the current rebate will likely pay most to all of that membership. I like USAA because they provide healthy discounts if you happen to drive a car only 2500 to 5000 miles a year.

You’re now looking at around $9700 for the vehicle. Can you do better than TrueCar? Sometimes yes, sometimes…. HELL YES! Look at TrueCar as the Internet Marketing Manager for that dealership because often times, that’s what it amounts to.

Introduce yourself to the new car sales manager and after a friendly conversation ask them a couple of quick questions.

1) If you plan to finance the vehicle ask, point blank, if there is any possible deduction by working with a specific bank or credit union. Dealerships will often get a referral fee and credit unions in particular have promotions that can help lower your price.

2) Let them know that you’re only interested in the out-the-door price if you plan on paying cash or have the financing already lined up. Also show them that you plan on using a few deductions that you already qualify for and make sure you bring the original and copies so that they know you’re not pulling their leg.

When it comes to inventory that’s been sitting, you’re at the advantage.

Can you get it down to $10,000 out the door? That depends on your negotiating skills, your luck, and honestly, the size of the sales tax along with those nasty bogus fees named after the dealer’s rottweiler.

Buy A Dirt Cheap ‘Rebate’ Car With A Squeaky Clean Title.

Automakers are deeply in love with the idea of ‘conquest sales’. The act of seducing that 45-year old accountant out of his 1999 Saturn and putting him into that automaker’s brand-new version of a 1999 Saturn is a huge deal inside today’s corporate car world.

It doesn’t matter if the car they’re conquering is a rolling turd from a defunct brand that is worth more dead than alive. What matters is that you own that car with a title that proves it.

A dead Daewoo? A smashed up Saturn? A purple Plymouth minivan with doors made out of duct tape? All of them are equally owned once you get that car registered and titled.

The first step to getting what usually amounts to a $500 to $2000 rebate is owning a car from a brand that was not sold by that manufacturer. At TrueCar, under the rebates section, they highlight this type of Conquest Cash under the ‘View Incentives’ section. It can be a Chevy, a Hyundai, or a Mitsubishi or even a Suzuki that blew its head gasket back when Howard Dean was running for the Presidency. As long as the car has a clean title with no liens, you’re good to go.

So if you happen to live in a place where emissions and other inspections aren’t mandatory, go buy the cheapest $200 junker you can find on Craigslist or local impound lot auction and register that vehicle under your name. Once you register it, bring that title and/or registration into the dealership when you’re ready to buy that new car.

After you buy the new car, take that junker (you usually aren’t required to trade it in) and either resell it or donate it to charity.

Prepare First, Shop Second

The sad reality is that buying a new car these days is still a brutally pointless stupid game. If you want to do it yourself then remember that extreme couponing can yield far better results than going at it blind. Do your due diligence, learn the rules, and become a keeper of whatever car you decide to buy. In the long run it’s always cheaper to be a keeper.


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