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GAMES DEALERS PLAY

Adapted from www.edmunds.com, perhaps the best source of car buying information on the web.

Common Setups and How to Turn the Tables:

Let's start by making it clear that not every car salesperson is a con artist or scheming liar. In fact, more and more used-car dealers are trying to build a loyal customer following by being completely up-front, fair and honest in all negotiations and dealer-to-buyer relations. But since you can't know if your local car dealer is one of these salt-of-the-earth saints, you must be prepared for every situation.

Even salespeople with the best hearts are trying to pay the bills. It's not rocket science: the more you spend, the more money they make. Salespeople have lots of experience dealing with many different types of customers, and they know all sorts of tricks and techniques that will work on different types of people. It is best to avoid dealerships with salespeople that play these games, and don't be afraid to call them on it when you see it. But if you do encounter one of the tricks below and are informed about the techniques that might be used, you will be much better off when it comes to combating them. Below, we've outlined some of the games that you might encounter in your quest for a new or used vehicle.

Lost Keys

Always take along an extra set of car keys. If you're a serious buyer and you know that you'll likely trade in your current car, the dealer will also need the title in addition to any extra sets of keys you may have.

But even if you don't plan to buy a car that day, taking along an extra set of car keys to the dealership is a good idea. That way, if you decide you are curious about what the dealership would offer you for your current car, or if you get fast-talked into letting them have a look at it, you'll still be able to drive away in the event that the sales staff "loses" your car keys.

When our features editor first moved to Denver, Colo., in 1997, she and her husband decided to see how much a dealer would offer them for their two-year-old Ford Explorer. The salesman promptly took their car keys and disappeared with them. They had clearly stated they were "just shopping around," but when they wanted to leave, the salesman suddenly couldn't "find" the keys or the person who was supposed to be looking over their sport-utility vehicle. They were stuck at the dealership while a string of salespeople tried to pressure them into buying today. If you bring another set of car keys and this happens to you, you can easily walk around the lot, find your vehicle and leave. Tell them to mail the other set of keys back to you.

Take it or Leave it

These are powerful words that can convey strength and resolve. However, when a car salesperson says "take it or leave it" at a price you don't feel comfortable paying, don't panic. He is just trying to force you into an early decision. A good rule of thumb is always to leave it before you take it. Regardless of what the salesperson may say, you can always come back and take it later. Chances are if you say, "Sorry, I'll leave it," and get up to leave, that salesperson will be on your heels offering to "work things out" or "see what I can do." Even if the salesperson lets you leave and you can't get a better price at any other dealerships, you can still return and tell them you've thought it over and changed your mind. Once in a very, very great while, you may have to take it at the price offered if you really want the vehicle (such as with high-demand vehicles).

New Kid on the Block

In this scenario, a salesperson will tell you "in confidence" that she just started this job and is a little "green." By doing so, the salesperson places herself on your side of the table, so to speak. It's as if they're saying, hey, we're in this together--I don't know much more than you do about the car-buying process. In this way, they try to make you buddies--victims of the same crazy world--like your old college roommate. Well, they're probably lying. He is probably a veteran at the car-selling business and thinks he can win you over using this tactic. Don't be fooled. A common prop in the "New Kid on the Block" act is the blank business card. The salesperson always needs a business card, but the card may lack their embossed name and title. "See? I'm so new, I had to personally sign all of my business cards!" Odds are that if you return to that dealership in six months, the same "new" salesperson will still be using the same, personally signed business cards.

"What do I have to do to get you into this Car Today?"

This question may pop up over and over during the negotiation of a sale. Most people buckle under the pressure of this question because it puts the buyer on the spot, which can make many consumers uncomfortable.

The immediacy of this question is as old as the profession of selling cars. If a customer is on the lot looking at a car, why isn't he or she buying? That's what the salesperson is there to find out. Is it the price, color, financing? What's the problem? The salesperson's job is to find out and help you overcome your objections.

If you answer, "I'm not interested," the dealer won't believe you; because if you weren't interested, you wouldn't be there, checking out that shiny red Acura. So the dealer will continue to ask you until you say something dumb like, "I can't afford the monthly payment."

Never, ever, talk about payments. Instead, your response should be, "Well, I'd get the car today, but the price is a bit too high." Then you've given the salesperson something to work with. The "buy today" question is actually your invitation to start negotiating, so use the opportunity to your advantage and start talking about the most important factor: the vehicle's price.

Good Guy/Bad Guy

This technique is a play on "Good Cop/Bad Cop" and requires two salespeople. The first salesperson becomes the "good guy," acting like your friend. A second salesperson, the "bad guy" (usually the sales manager), keeps bringing up problems while the good guy tries to help you solve them. For example, the first salesperson may agree to certain prices and services with you, then go "check" with his manager and return saying his manager won't OK the deal, leaving you to negotiate all over again. The most frustrating aspect of buying through a salesperson is that the sales manager has final approval of the sale. So just when you think you're done, the salesperson comes back to the table only to say: "I made a mistake! The correct price is actually $999 more. My manager told me I had to change it." The purpose of this tactic is to slowly wear down the consumer.

The sad thing is that the salesperson has no authority to sell a car. They can say whatever they want, but final approval must come from the sales manager. This is frustrating to anyone who takes the salesperson at his word, only to find that the sales manager doesn't agree. If you end up caught in this trap, negotiate only one item at a time. If you're talking about a trade-in and the new-car price and options all at once, the sales manager will likely have a few objections to the deal. If, on the other hand, you use the salesperson as a simple messenger, getting one item OK'd at a time (in writing), then the whole process gets reversed. Problems tend to arise when the negotiations affect several items at once. Then, you may negotiate a better price only to lose the value of your trade.

By deadlocking one item at a time, the sales manager has more to lose. One simple item, such as the cost of an equipment package, could ruin the whole deal, and by itemizing everything and getting written quotes, the good guy/bad guy technique is far less effective for the dealer.

The Written Word

The written word--or number--may seem like it is non-negotiable. But you should always assume that anything written is negotiable. Dealers' prices and rules should be questioned, because any item can be adjusted with a simple stroke on a computer keyboard. Even an invoice sheet can be typed up in a matter of minutes, and don't put it past some of these guys. The fact that a dealer has written something down, typed something up, or hung some "rule" on a wall doesn't mean it is so.

One example of the written word technique is something called D&H fees. D&H, "Delivery and Handling," is nothing more than added dealer profit. Some dealerships we've visited have had this term framed right on the wall. "Delivery and handling charges in the amount of $249 per vehicle are added dealer profit and apply to every vehicle sold at this dealership." They admit it right on their little printed sign: ADDED DEALER PROFIT. The secret is that the charge is bogus and does not need to be paid. What is "delivery and handling" anyway? It's a nebulous term, meaning anything the dealer wants it to mean.

Control Through Questioning

Remember that annoying guy from high school debate class, the one who always had something to say, even if it wasn't relevant or important? But because he was always talking or hurtling questions at you, he always seemed to be right. Well, he wasn't right, but he was tricky. That guy was using a simple negotiating tool that car salespeople use, too.

In the art of conversing, the person who asks the questions is the one in control. While salespeople do need to ask some qualifying questions to find out what you need, what you want, and what you can afford, you also need to be asking questions and participating in the flow of the conversation. When trying to control a situation through questioning, a salesperson will answer all of your questions with a question. A good response to this tactic would be to say, "You haven't answered my question." Or don't respond at all; just repeat your question until he answers you. If he is a slow learner, you could try reminding him that it isn't polite to answer a question with a question.

OAUA

"Over-allow, under-allow." You want $3,500 for your trade, but they've offered you only $2,000. They have to recondition (recon) the trade vehicle or wholesale it out, or keep it on the lot at a huge markup, etc. They know you'll walk, so they say, "Okay, we'll give you the $3,500." But watch closely, because the price of the vehicle you are buying just went up by that much. Don't concentrate too much on the price of your trade-in and then go and pay too much for a new used car. The best way to avoid this is to negotiate one transaction at a time. Don't talk about the purchase price when negotiating trade-in, and vice versa. Concentrate your energies on the task at hand--getting a good price for your trade and a good deal on a car. These should be two separate transactions that have nothing to do with one another.

Disappearing Trade

Another term for OAUA is disappearing trade. If you wait until the end of the negotiation to price your trade, it may vanish before your eyes. To pull off this stunt, a used-car dealer will have given you quite a deal on your purchase price of the car you're buying. By the time you are finished working out the details, you are so happy with your superior negotiating skills that you have completely forgotten about your old car. The dealer knows this by the glazed look in your eyes, and they will take advantage of the situation by giving you less than you deserve for your trade--or nothing at all!

Things to watch out for are arguments like this, "But we're already giving you $2,000 for your trade," referring to the $2,000 discount on the price of your new car. Unscrupulous dealers will turn their loss on the sale into a substantial gain: namely, your old car - by claiming that the money you saved on the new-car purchase was part of their payment for your trade. To keep things in perspective, it is best to separate the negotiations on the car you are purchasing and your trade-in. And, you may have to be the one to remind the salesperson to stick to the topic at hand.

Lowballing

This technique is used during the trade-in negotiation. Car dealers will sometimes lowball your trade-in or offer you less than what it is worth. This way they make a bigger profit on your trade-in and sell you another car for what you think is a good price. Lowballing allows salespeople to concentrate on giving you a good deal on the car you want to buy while making huge profits on your old car. If they determine that you are concerned about the used car's price, but are relatively unconcerned about what you get for your trade-in, they will focus you on an attractive price for the car and then lowball you on the price for your trade-in. It's very important to be cautious and alert when trading in a vehicle. Knowing the value of your car is mandatory.

Playing on Your Emotions

It doesn't matter if she's your best friend. If a salesperson tries to "guilt" you into buying a car, don't fall for it. This is an especially obvious ploy that salespeople use to get you to feel sorry for them. They may say, "I really need this sale to make my quota," or even, "I might lose my job if I don't make some sales this week." Tales like these are used to play on your emotions and good nature. Don't give in to this tactic. It is not your job to keep a salesperson employed--or make him happy. In fact, it's the other way around--she should make you happy. If you encounter such a tactic, refrain from showing any emotion; simply change the subject in a businesslike manner. Everyone goes for the underdog. That's why, to quote one dealer, "The dumber the salesperson, the better off the dealership." If the salesperson is bumbling their way through the entire process, and keeps telling you they're getting in trouble with their sales manager for getting you such a good deal, you are likely to side with the poor idiot and give in to the dealer's demands.

If this is the case, just make the salesperson a simple messenger between yourself and the manager. Then get down to real negotiating.

Bait and Switch

If you are not careful, you could walk into a dealership to buy the car that you have thoroughly researched and come out instead with one that you didn't want initially but just fell in love with. This is called the "bait and switch" game. Basically, you were "baited" with one car and "switched" to another. What makes this technique so powerful is that auto salespeople are skilled at it. You may even be happy and drive away thinking that the dealer actually did you a favor.

Here's one setup: a bright red convertible sits in the front row of the dealership's used-car lot attracting plenty of attention, and you decide to have a look. Upon closer inspection, you realize that the car would end up costing more than you could possibly afford. The dealer's response? "Hey, I think I have a car for you that you can afford, so let me show it to you."

Or, perhaps you enter the lot knowing exactly which car you are interested in, but that shiny red convertible looks too good to pass up, and the dealer talks you into spending "only" $100 more per month on it.

If you find yourself in the midst of a switch, stop and think about what is going on. Can you really see yourself in a decade-old sedan when you came in looking for a two-year-old convertible sports car? Sure, it might be only $99 a month, but it's not what you want!

Another common bait-and-switch technique is the car that is advertised in the paper for only $199 a month. In the fine print, you'll notice the car has no air conditioning, no leather seats, and likely no aluminum wheels. Or, in extra fine print, the ad will state that there is only one vehicle available at that price, and may even list its VIN number. But for those who didn't notice these little tiny conditions and got suckered in by the ad, the salesperson will try to get you into something a little more luxurious - something with leather seats, A/C, cool wheels and a tan top - and for only $50 more per month!

This bait-and-switch is a move up and may even be accompanied by a switch to leasing. "Oh, you can't afford the payments for $529 a month? Well, how about leasing it for $409 a month?" But the bait-and-switch only works on gullible fish. So don't bite.

Nibbles

Salespeople are not shy. They are kind of like your irritating friend who is constantly asking you for favors. And after you've given a few inches, it suddenly turns into a mile. If you feel you are being nibbled on in this way, the best retaliation is to beat him at his own game: counter nibble. For example, if a salesperson asks you to agree to a higher price before the offer is again presented to his manager, use it as an opportunity to ask for free floor mats, a steeply discounted extended warranty, or a stereo upgrade. They just may give it to you! Never let a nibble go unanswered. Every time they ask you to concede, you ask for something else right back. Otherwise, you'll find that the salesperson has gotten everything he asked for, and you're left with a huge bill.

"If I ... Will You?"

The purpose of this bargaining technique is for salespeople to get a commitment from you. They can find out if you are a real buyer and single out your limits or weak spots. A typical "If I" question is: "If I can get you that car in green, at your price, will you buy it right now?" The best way to handle this tactic is to resist answering. A reply to the above could be, "Can you get it in green?" If they give you what you want, you will probably buy right then. You can always change your mind later, even if you've agreed to something verbally because you're the customer and it's your money.

Leasing is Less Expensive

To make leasing a used car more attractive, some dealers will suggest that leasing is less expensive than buying. They may have software or charts that depict a line graph detailing exactly how much money you will save by signing on to a lease. You need to keep in mind that leasing is cheaper only when payments over the same term are compared. By extending the term of a loan, you can often come very close to the quoted lease price (see Leasing Information and Advice).

Getting Sporked

It's happened to the best of us. You've just spent two-and-a-half hours negotiating a great deal on your "new" used car. You're paying a reasonable fee that matches what the car is worth in Edmund's Used Vehicle section. Now all that's left is to sign the paperwork, and you're on your way! You can barely contain your excitement.

This is where you'll get (what we at Edmund's call) "sporked." The salesperson's price sheet now shows a list of items you've never heard of, and you don't know whether you should just sign off on them or really negotiate further. One false step could throw the deal, so be calm, and review anything that looks like an extra charge. We coined this technique the "spork" because when used against you, the spork isn't strong enough to kill, but it still hurts.

There are several prongs to the "spork" technique, including such things as handling charges, administrative fees, appearance/protection packages or other add-on equipment. Check the dealer's list of charges for the following items:

Delivery & Handling-------------------$249

Appearance Package-------------------$1,429

Protection Package---------------------$789

Security System-------------------------$219

As you can see by these examples, these fees can quickly reach thousands of dollars. All of these items are negotiable, and most should simply be removed.

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