Buying from a dealer - negotiating position

[Flook]

Going to buy a commuting run-about for the 5 mile city centre trip to work & 'dings-r-us' car park.

Looking to spend no more than £5k, and looking for the most reliable, low insurance group, low running costs, 5 door small hatch I can find for that budget.

Planning to buy from a dealer for a little extra peace of mind.

I suspect this might be a stupid question, but here we go...

Question is, never previously having been so ambivalent about precisely which car I end up with, is there some sort of 'rule of thumb' people would advise on what percentage of sticker price I should realistically expect to end up paying, and what percentage of sticker price should I go in with to end up at the right place?

Thanks in advance...

[edo]

Flook said:

Planning to buy from a dealer for a little extra peace of mind.

False economy.

[Ozzie Osmond]

The world is full of second-hand cars so if you're "holding" (i.e. fist full of cash and not looking for anything in particular) you're in a very strong negotiating position.

At that price level I agree that you would be better to look for a good private sale than get involved with dealer margins. If you go low enough you may be able to buy something that's still got manufacturer warranty on it in any event.

Make sure you buy a car with a good reputation for reliability and cheap repair costs. Any remaining warranty is a bonus.

[Aviz]

Youll even have some change to buy a paper bag



http://www.autoexpress.co.uk/carreviews/grouptests...

[Save Ferris]

I'd have said £300-600 off the sticker price would be a reasonable discount for £5000 car from a dealer.

[Petrolhead_Rich]

Option one:

Buy a 3k car from a dealer for 5k so if it breaks i can get it fixed Argue lots with them and get a little bit of money back.

Option Two:

buy a 5k car for 5k, but give it a good going over, look for one with a good service history.

hmmm

[Flook]

Aviz said:

Youll even have some change to buy a paper bag



http://www.autoexpress.co.uk/carreviews/grouptests...

'kin ell...I thought my ambivalance was unlimited...you, my friend, have proven me wrong.

[Jasandjules]

Spend 4k on the car privately and use the 1k over as a slush fund for any repairs.....

[Carrot]

edo said:

Flook said:

Planning to buy from a dealer for a little extra peace of mind.

False economy.

Not always.

I purchased my runabout (1.4 auto corsa) from a dealer, pricing was about £200 more than private roughly looking on autotrader (Car was £1200) and this was exceptionally low mileage.

A week after buying, the headgasket went - all repaired by the warranty, and then two weeks after that the alternator went, all done under warranty.

So that was £500 for the head gasket work, and £150 for the alternator, all of which I paid nothing for.

Reading on the forums, HGF on low mileage corsas are pretty common, not as bad as Rover (whereby it is pretty much built into the cost of a service ), but still fairly prevalent.

So if I had purchased privately, I could have had the same problems, and the car would have cost £450 more in total.

My last car, mondeo, was purchased from a dealer - suffered an injector fault 2 months in, replaced and cost the dealer £300 in total. The car was not far above private prices as well.

Of course, it depends from car to car, and no doubt this being Pistonheads I will get some snob on here berating me for daring to use such a common cheap couple of cars as an example for my post, but my butler has told me that my Aston Martin has never failed yet, so it is all I have to give.

I will always buy lowish end cars from dealers, as it has always worked for me.

[Mr2Mike]

If you are buying from a dealer then it's pointless trying negotiate your position. It's either bent over and well lubed up or nothing.

[POORCARDEALER]

edo said:

Flook said:

Planning to buy from a dealer for a little extra peace of mind.

False economy.

Tell that to all the buyers who buy privatly to find their "little gem" is on the VCAR register when they come to swop it in.....so saving a grand has cost them £4 or 5K

[CampDavid]

You can find great cars at dealers, private sellers and auctions.

You can find bad cars at dealers, private seller and auctions.

Aiming to get "a big discount" isn't a great idea. You should figure out what you want, figure out how much profit is in it for the dealer and try and cut that as much as you can. £3k discount on a car priced at £8k is only ever a good thing if it was worth more than £5k to start with...

[1598]

Save Ferris said:

I'd have said £300-600 off the sticker price would be a reasonable discount for £5000 car from a dealer.

This ^.

Bear in mind the dealer probably has a margin of around £1000 for a 5k car. 17.5% of the profit is paid to the VAT man, ie £148.94, plus the costs of prep come out of that margin too. The more you screw the dealer, then possibly the less the car gets prep'd - possibly being the key word there.

Dealer would be looking to net about £500 profit out of the deal, 10% profit is around the industry standard. But the cheaper the car the small the margin, discount and profit that is there.

[n_const]

Mr2Mike said:

If you are buying from a dealer then it's pointless trying negotiate your position. It's either bent over and well lubed up or nothing.

so many of you experts actually work in the motor trade then ?

[1598]

n_const said:

Mr2Mike said:

If you are buying from a dealer then it's pointless trying negotiate your position. It's either bent over and well lubed up or nothing.

so many of you experts actually work in the motor trade then ?

I do, over 20 years so far in Sales & Service Departments for my sins

Edited by 1598 on Wednesday 29th September 16:25

[edo]

POORCARDEALER said:

edo said:

Flook said:

Planning to buy from a dealer for a little extra peace of mind.

False economy.

Tell that to all the buyers who buy privatly to find their "little gem" is on the VCAR register when they come to swop it in.....so saving a grand has cost them £4 or 5K

because they didnt do a £10 check.

[edo]

aside from the argument of buying a cheap car from a dealer, it is impossible to speculate as it depends on so many factors:

What the dealer paid for it (of course)
How long they have had it
How desperate they are to get rid of it
Whether you need finance
How much needs doing to it
etc etc

[CampDavid]

edo said:

aside from the argument of buying a cheap car from a dealer, it is impossible to speculate as it depends on so many factors:

What the dealer paid for it (of course)
How long they have had it
How desperate they are to get rid of it
Whether you need finance
How much needs doing to it
etc etc

Indeed. Expect to haggle a bit more out of the poor dealer trying to sell a bright yellow old shape S tpe Jag with the 4.0l lump and vegan spec interior than you will of of a chap selling a nearly new Golf diesel.

[Denis O]

Carrot said:

edo said:

Flook said:

Planning to buy from a dealer for a little extra peace of mind.

False economy.

Not always.

I purchased my runabout (1.4 auto corsa) from a dealer, pricing was about £200 more than private roughly looking on autotrader (Car was £1200) and this was exceptionally low mileage.

A week after buying, the headgasket went - all repaired by the warranty, and then two weeks after that the alternator went, all done under warranty.

So that was £500 for the head gasket work, and £150 for the alternator, all of which I paid nothing for.

All that says is that the dealer was less than careful when he bought the car for £200 and didn't give a toss anyway because of the warranty. No doubt you wern't inconvenienced by getting the work done because of course the dealer handled everything and provided you with a courtesy car delivered to your door.

[confused_buyer]

Ozzie Osmond said:

The world is full of second-hand cars so if you're "holding" (i.e. fist full of cash and not looking for anything in particular) you're in a very strong negotiating position.

That's not actually true at the moment. There is a real shortage of good used cars so much so that even the trade guides have revised prices up this month which is totally unheard of in September.

Most dealers have made an on-paper "book" profit simply by having stock sitting there in the last couple of months....