How To Know When To Leave A New Car Showroom

July 20, 2010

You know when to leave a car showroom when you've bought a new car--but how do you know when to leave when you're not getting anywhere?

There’s a tipping point in every new-car negotiation, when the buyer and the seller know the other won't budge. It happened to me once, and the car salesman threw his pen across the room.

For most car hunters, the signs tend to be more subtle. Sometimes, it's as simple as the salesperson "talking to his manager." Other times, it's as obvious as the salesman throwing your paperwork in the trash.

How can you tell when enough's enough, when it's time to walk out? You need to know when the music has stopped and the dance is over. It's a fitting metaphor. This is what buying a car from a dealer really is--a very formulaic ritual that involves a number of steps as far as the dealer is concerned.

Here's how I can tell when the dance is over:

The dealer wants to identify your needs. For the dealer, this is the way to find out if your priority is the price of the vehicle or the cost of the monthly payments. It lets them know if you are among the growing percentage of buyers who have identified the vehicle they want to buy before even visiting the dealership. You've pre-sold yourself the car;  now, the dealer only has to make his numbers work for you. Hint: it's also a way to determine if you're ready to buy a car today.

The dealer practices some sleight of hand. Confusion is the dealer’s friend and the higher he can confuse you, the more likely he will be able to hit the sales equivalent of a home run. Be ready--dealers have an arsenal of weapons to deploy, and to disguise a bad deal. They include trade-in value, selling price, and financing rates, as well as extended warranties, dealer-added extras, destination charges and tax and tags. If you thought the annual IRS headache was tough, figuring out the real cost of all these items--and the best price--will have you looking forward to April 15.

The dealer establishes a price. After the obvious give and take, a price will be floated. This may be after the sales person has left the area to “check something out.” The price may not be to your liking, but that's okay--the dance isn't over. You can decide to take it or leave it, but either way, you need to be prepared to walk away, even if it's just a negotiating tactic.

The manager or dealership owner gets involved. The owner will either deal with you himself or through the salesperson. Either way, once the final price comes down from on high, you know that it’s time to leave the showroom--or commit to the deal.Know the signs, and know your numbers before you walk into a showroom. And don't forget to be vigilant: the last time I bought a car, a last-minute discrepancy in the final price led me to ask for my tag back, which had been removed from my trade-in as we prepared for the sale. The owner followed me into the lot and offered to split the difference in the price.

The owner got involved--and that's when I knew the dance was over.

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