How to negotiate a better deal on your new car


Six tips from the car buying experts on how to prepare for a negotiation on your next car.

Have you ever noticed how when you are about to buy a new car, everyone has some sort of advice for you. To help you sort through the good, bad and ugly, we’ve gone straight to the professionals.

Here are some tips from Macquarie Vehicle Selects’ Simon Arena, on how best to prepare yourself for a successful negotiation.

1. Know what you want

Before you even start thinking about dollar signs, you need to decide what it is you really want – the make, model, year, colour, specs, and extras. It’s easy to do a lot of this research online with comparisons, reviews and research available on websites such as

It’s also important to see the car. Visit a dealer, ask questions and take the car for a test drive. There’s no need to talk prices with the dealer at this point. Be honest and let them know upfront you are only gathering information.

Once you’ve chosen a car, start taking note of the prices online, in advertising and at the dealers. See if you can spot any trends over time. Also, break down the costs so you can use the information to negotiate when it comes time.

2. Know where to go

This is the fork in the road for some. Having done the research, it’s time to decide whether you will stay the course and do the negotiating yourself, or if you’d prefer to hand it over to a professional broker.

A broker negotiates all day every day so there’s no chance of nerves kicking in when it comes to the crunch. They understand the market and can capitalise on their relationships to get you a deal. However, you may pay a fee for their services – either a flat fee or a percentage. Just be sure you are comfortable with that before you commit.

If you believe you can negotiate a great deal yourself, go to your local dealership. This gives you the opportunity to initiate a relationship which may come in handy when it comes to service and maintenance. That’s a win for you and the dealership.

Also, by handling the negotiation yourself, you’re there to read the dealer’s reaction to your offer, you can accept or decline any alternatives on the spot (such as colour change), and make counter offers. For example, if you can’t get the purchase price down to where you need to be, you could ask for discount servicing for a set period or an extended warranty.

3. Know your limits

One of the first questions a dealer will ask is whether you have organised your finance. If you haven’t, some dealers may be able to help you arrange it – for a commission.

"Having your finance sorted puts you in a much better position to negotiate, especially if the car you want is in stock.” says Arena.

The amount you can save is subject to the basic theory of supply and demand. If you have chosen a popular car with a six month waiting list, your discount will be much less than if you’re aiming for a car that is in high supply with low demand.

4. Know when to go

Arena strongly suggests that you never start negotiating until you are 100 percent ready to make the deal. It will save you time and money.

Try to be ready to take advantage of the sales which run every year like clockwork. In December, there’s the end of year clear outs. This rolls into January for plate clearance sales when the new models arrive. And in June, there’s the end of financial year specials.

There’s also a good opportunity at the end of EVERY month if you are prepared to be a little more flexible on what you want in your car.

“If you visit a dealer on the second last day of the month and you are prepared to buy a car they are looking to get rid of, you  could be in a very good negotiating position particularly if they are a few cars short of their quota,” says Arena.

5. Know what to say

It’s time to negotiate. All you really need to say ‘I’m here to buy a car today. I would like x, y, and z and I would like to pay this much’.

“By stating exactly what it is you want up front and sticking to it, you change the dealer’s approach from ‘where can I take this customer?’ to ‘how can I get this customer to where they want to be?’”.

Start at a price lower than what you hope to pay, and they’ll counter it with a higher price. Work this through until you get close to your number.

The sales rep will need to get approval from the manager, so be prepared for them to leave the room to discuss the numbers. Generally speaking, when the manager comes to you, they’re generally there to close the sale. They’ve come to the end of their negotiating. It’s time to make your decision.

6. Know when to leave

If the price hasn’t come close to what you had researched, just explain your position to the dealer. They will recognise you are a genuine buyer but will let you know if they can’t match your price at that time.

Do some more research and try again. You may want to consider a different, make or model.

Buying a new car is exciting. But if these tips haven’t inspired you to tackle the negotiation yourself, you can outsource that step to a service like so you can focus on enjoying that new car feeling.

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