Why Consumers Still Dread Car Buying
Car buying continues to be arguably the most problematic consumer purchase experience of all time. Consider the recent research from LimeLight. It shows that 56% of consumers would rather clean their house than go car buying, and 54% would pay more for a better experience. The research also notes that consumers would like tools to help them make the best decision. The challenge is obvious- dealers want consumers to walk in lightly informed and then spend hours in the dealership so they can get them to pay more. Ultimately, dealerships are like casinos, both businesses know that the longer you sit at their tables the more you pay, and most importantly, the more the house makes.
If dealers didn’t believe they make more money by making consumers spend more time sitting in the dealership, they’d have changed the process. US auto dealers collectively spend over $2 billion dollars annually to train their teams on how to extract the maximum profit from each and every customer. This is why consumers would rather clean house or almost anything else to avoid “the ick” they feel when they walk into a dealership. As a consumer, don’t be fooled by a presentation of your deal on a pretty Apple ipad. Pro tip: Dealers get you to pay more through omission. It’s not the numbers they show you, it’s ones they don’t. Most often final negotiations come down to monthly payment. The number one thing every customer must do when negotiating a car deal is to see the complete line item detail with each presentation of price. If their screen shows a $500/month payment but not the term or rate, both will be higher than you want. Plus, over the years dealers have created an ever expanding list of fees (Dealer Documentation, VIN etching & myriad more) that are too often vague and sometimes bundled together. If you don’t address these it can mean overpaying by thousands.
Each time a dealer presents your deal it must include sale price, trade allowance (if applicable), sales tax, license, registration plus any and all additional fees in detail for a total amount due (cash) or amount to finance. Then and only then can you determine if you’re being overcharged. One suggestion here, pull out and review your last lease or purchase contract & bill of sale. You might find that you overpaid. If you can’t identify what comprises each line item of costs you overpaid!
See what doc fees dealers charge in your state: https://www.thornebriar.com/blogs/tips-insights/how-to-avoid-dealer-doc-and-other-hidden-fees-when-car-buying
What will it take to bridge the gap between the dealers’ demand for a lengthy showroom visit and a consumers desire for a more transparent, contemporary experience? The answer is teaching consumers how to buy or lease a new or used vehicle like those of us who’ve made a living in auto retailing- to buy like a Pro. First and foremost, negotiate your entire deal remotely. Don’t head to the dealership a moment before you verify your complete transaction. For financing the interest rate, term, sales tax, license, registration, and all fees for your total amount financed. With a lease you’ll need the money factor (lease rate), residual value, your purchase options at lease end, fees (acquisition fee, disposition fee at lease end), security deposit, license, registration, and any other fees. Once you receive these numbers from the dealership, you need to verify them.
Consumers need to understand that companies like True Car, Car Guru’s, and Invoice-Pricing.com don’t solve consumers’ problems, they exacerbate them. Each of these companies derive their revenue by enticing you with pricing info, only to turn around and sell your name, email, cell # & more to a dealer or dealers as a “hot” sales lead. Nothing is free- so now you are barraged by emails and calls begging you to come to the dealership.
Read this to save more: https://www.thornebriar.com/blogs/tips-insights/how-digital-documents-enable-overcharging-at-car-dealerships
The good news is that Thornebriar has solved this problem with its comprehensive Car Buyer’s Gameplan. It details the proven step-by-step path to purchase and provides the tools necessary to manage and verify your deal including offer/deal calculators, email negotiating templates, and transaction specific deal checklists (purchase-new, lease-new, purchase- used, etc.) that auto industry professionals use. For the price of lunch for two take control so you never have to dread car buying again.
Visit us at www.thronebriar.com/pages/buy-a-car to learn more and read our past blogs
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