Get price quotes
Find the dealer's estimated cost, so you know how much room he has to negotiate, and get different dealers to bid for your business
This article appeared in Find the dealer's profit margin
You can estimate the dealer's cost by subtracting any dealer rebates or holdbacks from the dealer invoice price. Any of today's pricing guides list the invoice price. Find dealer rebates and holdback amounts at car-pricing Web sites or in Consumer Reports New Car Price Reports. The reports also provide CR's Bottom Line Price, which does the math for you to show the dealer's estimated cost.
Since some dealer incentives are hard to track, it's possible to find transaction prices below the dealer's "cost." Check a Web site such as www.TrueCar.com to see what other people are reportedly paying.
Expert tip
With many dealers recently going out of business, you might have to include dealers in other towns to get competitive quotes. Even if you don't intend to drive that far, it helps to have these prices to compare with local ones.
Red flag
Make sure the quotes are comparable. Sometimes a dealer won't have the exact vehicle you're looking for and will give you a price on a different version without telling you. If there's a question, ask for copies of the window sticker.
Get dealer quotes
The easiest way to get competing dealer prices is to use your computer or phone. E-mail or call a number of dealers in your area or in nearby towns. Specify the exact model, trim level, and options you want and ask for their lowest price.
Ask for out-the-door prices that include everything. But don't discuss a trade-in or financing at this stage. Dealers are listed at each automaker's Web site. The more quotes you get, the better.
You can also go to car-buying Web sites such as AutoByTel.com or CarsDirect.com and request e-mail quotes from several dealers. The service is free and you aren't under any obligation to buy.
With several quotes in hand, contact again the dealers with which you most want to work and ask if they can beat their competitors' lowest price. It might take several rounds of this. Be patient and don't rush the process.
Once you've settled on a price, have the dealer send you a detailed pricing breakdown; you'll need this when you go to the dealership to close the deal.
