A Tale Of Two Car Dealers: Always Have a Plan B

September 17, 2010

I recently helped a friend buy a used car. The problem was that she had to trade in a high-mileage older car. Even though I had pre-negotiated its trade value in advance with the dealer, that value could not be confirmed until the dealer inspected the car in person.

If you’re reading this cold, meaning you haven’t read the previous segments, let me catch you up quickly. We dealt with two dealerships and had a bad experience at the first one when they attempted to “steal the trade.” I had pre-negotiated a value of $3,000 for the trade-in and, without any justification, they had reduced that to just $1,000 when we arrived in person. 

As an ex-Internet Manager for a major car dealer and someone who teaches people how to buy and sell cars, I did what I teach: we walked out and went to Plan B.

Plan B

It’s good to have options when you are out and about buying new or used cars. Our Plan B involved buying a similar used car from a nearby dealer. I had also spent hours pre-negotiating the trade value to $3,000 with the second dealer. It’s always assumed you can get this figure after the dealer inspects the vehicle in person--if the car is as described with no surprises.

From the start, my “gut” feel about the second dealer was a good one. The salesperson seemed honest and above board, and was far more transparent in how he put the deal together than almost any other sales person I had dealt with. For example, the car my friend hoped to buy from him was priced slightly higher than the first dealer’s. Based on my experience in the industry, I knew there was still some room to negotiate the price downward, calculating that the dealer still had $500 to $700 profit in a car that they needed to sell because it had sat unsold on their sales lot for too long.

Then when I talked with the salesperson, he told me he had almost $600 profit with the current price. It’s rare for a dealer to admit to how much money they’re making on a deal. In this case, my experience confirmed he was telling the truth. Had he guessed that this wasn’t my first rodeo?

Surprise! surprise!

My friend and I were sitting at the salesperson’s desk at the second dealership when he came back with the figure they would allow on her trade. He began by saying he was surprised, that when they ran a vehicle history report they discovered that the trade had been involved in two previous accidents. I hadn’t provided the vehicle identification number (VIN) to this dealer prior to arriving in person, so there would have been no way for him to know about the accidents prior to quoting the $3,000 estimated trade value.

My friend had purchased the trade years earlier from a personal acquaintance and didn’t know about the accidents either.  This was a valid excuse to lower the trade value. In fact, the salesperson said his manager wanted to offer $2,000 and was willing to split the difference and accept $2,500. I thought this compromise was more than fair, but before I could say anything, he said, “However, we want to be true to our word, so we’re offering the full $3,000 for the trade.”

I was blown away. After our experience the previous day where we were lied to, manipulated, and literally walked out of the dealership with the salesperson and manager trying new tactics to drag us back in, here was a dealership going above and beyond to earn my friend’s business. They were honest and transparent in how they conducted business. Was this great, or what!

A happy ending

Needless to say, my friend bought the car and we drove away thrilled with the deal, the people we dealt with, and a dealership that countered the bad reputation of the car industry.

Yes Virginia, there are honest car dealers out there. You simply have to be willing to walk away from the bad ones first.

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