By on February 6, 2015

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While visiting a dealership is de rigueur for most, an increasing number of consumers are turning to technology to buy their cars.

Detroit Free Press reports that consumers visit 1.6 dealerships on average prior to purchasing a vehicle — down from an average of five 10 years prior — four out of five compare prices and vehicles from an average of 10 dealerships through sites like eBay Motors, Edmunds and TrueCar, and half of millennials purchased their vehicles from their smartphone or tablet.

The challenge for those who conduct their car-dealing business online is to convince more traditional dealers that technology is a tool for increasing sales, not a new competitor out to steal sales. Ebay Motors general manager Bryan Murphy considers his site a sales channel and “not a retailer,” citing scale as the main selling point; dealers can connect with 155 million eBay customers around the world through eBay Motors.

Dealers, as well as automakers and lenders, would also be able to make financial offers tailored to a consumer’s given economic history, zip code, insurance, and other factors that may not be relevant to buying a car, thanks to data mining and other information-gathering tools.

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82 Comments on “More Consumers Turning To Technology For Vehicle Purchases...”


  • avatar
    an innocent man

    I was unaware of this.

  • avatar
    Lie2me

    Am I missing something here? Isn’t it getting rather common to do most of your auto “pre-shopping” online before you even leave the house?

    • 0 avatar
      PrincipalDan

      Yes and most dealers are failing to keep up and with the exception of Tesla there really aren’t any manufacturers trying to break the backs of the dealer cabal so that they can sell directly to consumers.

      The startling # to me in the report is that people would physically visit 5 dealers but now virtually visit 10 dealers and only physically visit 1.5. Dealers need to figure out how to get into that tiny category of dealers actually visited.

      • 0 avatar
        spreadsheet monkey

        Best ways to get into that small number of dealerships actually visited? High quality photography and realistic pricing.

        • 0 avatar
          319583076

          I would settle for decent website design. Most car dealers have terrible websites that are difficult to navigate. Chrysler somehow mandates their dealers use the same terrible template. But, then again, Chrysler Dodge Jeep corporate sites are garbage, too.

          No one is doing it right, in my experience.

          • 0 avatar
            Lie2me

            +1 Manufacturer’s sites are the worst with all the overlays, running videos and BS, they give me a headache

          • 0 avatar
            an innocent man

            Yea, some (most) of the manufacturer websites are terrible. The spec drop downs or the configurers are nearly indecipherable.

          • 0 avatar

            I am a web designer, and I am employed by a car dealership, so a new, responsive, non-cluttered website is in the works for us.

            I know BMW mandates a certain template, as does GM (at least the Chevrolet division). Many dealers will have some obscure, unadvertised domain point to the manufacturer-mandated website, but will use their primary domain on a website that features their unique, *tacky* style.

          • 0 avatar
            vtnoah

            The reason Chrysler “Forced” their dealers to use that “Terrible” template is because what they were using prior was far worse. They partnered with an industry leader to unify the look and feel of all their dealer sites and improve the customer experience across the board. Just because it doesn’t look good to you doesn’t mean that it doesn’t perform well as a site. In this case a dealer site’s primary focus is to showcase inventory and drive people to submit a lead. Chrysler took the hint and is reaping the benefits of a dramatic increase in vehicle leads and sales.

        • 0 avatar
          duncanator

          Exactly. One stock photo and “Call for price” doesn’t make me want to shop with that dealer.

      • 0 avatar
        Lie2me

        “Dealers need to figure out how to get into that tiny category of dealers actually visited.”

        That’s easy, give the customer the best deal online then don’t dick him around when he shows up to buy the car

      • 0 avatar

        Dealer cabal? Why would an auto OEM open a direct sales point, or sell direct online, thereby undermining their dealer partners?

        Tesla is intending to do business through franchise dealers. Despite their rhetoric, they have known they would have to do so all along.

    • 0 avatar
      spreadsheet monkey

      “Four out of five” as reported by the article sounds about right. I can believe that 20% of buyers (mostly elderly) just go to their favourite dealer selling their favourite brand every 3 years or so, and simply buy whatever they like the look of on the showroom floor, without doing any form of internet price research.

    • 0 avatar
      energetik9

      “Am I missing something here?” No, the article seems a statement of the obvious. shopping, research, dealer ratings, auto magazines, car forums, on and on.

      My last car, purchased it on line, sight unseen (except for pictures). I researched fully. It was entirely a technology purchase. I don’t know of anyone that shops without on line tools.

      • 0 avatar
        Lie2me

        I bought my first car online in 2002, it was such a pleasant experience that I have ever since. Though, subsequent purchases weren’t always as smooth it’s still a better starting point

  • avatar
    darkwing

    And the dealership response is…”Hi, I’m the website greeter, how can I help you today?”

    • 0 avatar
      TMA1

      Every single damn one of them. I’ve been doing some shopping recently, and every dealers site I visit has a floating chat window. Even if it’s 2 a.m., “Jim” at XYZ Ford is available and ready to answer my questions!

      It would be a great feature, if they weren’t all completely useless. I’ve tried chatting twice, and both times it turned out to be a phishing maneuver. They just want your contact information, so a salesman can contact you. What is the point of that? I know how to call a salesman, if that’s what I wanted to do.

  • avatar
    Mr. Orange

    Haven’t we always used technology to buy vehicles?

    Bleached wood paper, books, newspapers, radio, telephones, televisions, fax machines, the internet and computers if I’m not mistaken are all technically “technology”.

    • 0 avatar
      Lie2me

      I know, right? I remember a dealer sending up a smoke signal on an outrageously good deal. I sent up a smoke signal that I was on my way to buy, but when I got there the covered wagon with the 36″ wooden wheels had already been sold to some sooner :(

      • 0 avatar
        Mr. Orange

        Was it a Conestoga? Cuz I got a cousin who made it to Denver with one of them in the summer of 1857. Loaded up his whole family. They were moving from Kentucky. That thing carried his wife, Mary Dean, their, five kids, Roger, John, Pete, and Kenny. But sadly Keith died on the way.

        Took um 3 months. But they made it.

        • 0 avatar
          Lie2me

          It was the Conestoga Xi sport activity coupe with 4-horse drive… I wanted it so bad

          • 0 avatar
            Mr. Orange

            If it had been the 4-ox drive you would have gotten a better hay per mile average. Their like a diesel equivalent.

          • 0 avatar
            Lie2me

            Ox are stinky compared to horses. Have you checked out the new wind driven sail models?

          • 0 avatar
            Mr. Orange

            Firstly if owners took the time to occasionally wash their oxes that wouldn’t be an issue. If owners cared about their oxes as much as horse owners did that would not be an issue. Lazy owners have created this stereotype that oxes are dirty and stinky.

            Secondly if I’m traveling through Erysipelas, Shoshoni, Ute or some other violent Indian country or an area controlled by white bandits will I will trust my life to a wind driven model? NO. I don’t be having no time to be waiting on the wind when I know I’m close to Apache country.

            Besides if the wind is blowing east, how can you travel west?

          • 0 avatar
            ClutchCarGo

            “Have you checked out the new wind driven sail models?”

            Oh, puh-leeze. Those are nothing but green toys for the celebrity set like Jenny Lind. If it wasn’t for that socialist Lincoln pushing them with tax credits nobody would ever buy one.

        • 0 avatar
          WildcatMatt

          I’m sorry about Keith, dysentery is a bitch.

    • 0 avatar

      Certainly, consumers have always used the latest technology to buy their vehicles. The more things change the more they stay the same. The technology changes but the human nature driving the perception of the deal doesn’t.

  • avatar
    DeadWeight

    This is an unstoppable trend since normal human consumers of products would rather deal with an app than the odds of getting one of the roughly 87% of new or used sales “professionals” who are greaseballs lacking any semblance of ethics and living up to each and every Hollywood stereotype of their “profession” as depicted in movies such as ‘The Goods – Live Hard, Sell Hard’ or ‘Cadillac Man.’

    • 0 avatar
      energetik9

      Very true. Many consumers are desperate to avoid the current car sales model and will spend even more time doing as much as possible to avoid the face to face in a dealer.

      A couple cars ago, I factory ordered a BMW. I researched EVERYTHING, even detailed pricing. I built a spreadsheet with retail and invoice pricing on every option I wanted. Ended up paying $100 over invoice. It was nice to walk in, say “this is what I want” and be done with it.

      • 0 avatar
        DeadWeight

        I only deal with ethical, professional salespeople.

        They do exist.

        It helps that I know exactly what I want and what I’m willing to pay before ever contemplating answering their return calls, let alone stepping foot in the dealership.

        My purchases take about 1.25 hours, total, on average, from the time I step into the dealership, as everything is already set to go (insurance binder, funds, etc.).

        • 0 avatar
          duffman13

          For the last 2 cars I bought at dealerships this was the case. Of course, when I go to buy a car, as I’m sure most people on this site do, I already know every detail of the deal beforehand including having financing secured (so they can try to beat it) and a 95% solution on price.

          If a salesman/sales manager works with me and doesn’t give me any BS on what a fair deal for the vehicle is, it’ll be the easiest and fastest commission they make that month. If they don’t, I’m prepared to walk.

        • 0 avatar
          dtremit

          “I only deal with ethical, professional salespeople.

          They do exist.”

          Indeed — but how to *find* them? That’s the conundrum.

          At least around here, there are barely any reviews of dealerships on sites like Yelp, let alone individuals. Dealerrater seems to be unhelpful.

      • 0 avatar
        hreardon

        energetik9 –

        You (and I, and many other Best & Brightest) and the exceptions. History so far has shown that there is a big gap between what consumers *say* they want and how they actually behave:

        1) Consumers (read: enthusiasts) in the US want to be able to custom order a car. A friend who runs a BMW and a VW shop told me about a year ago that he can count on two hands the number of custom orders they do in a year. Lesson: the VAST majority of people are completely fine taking what’s on the lot. Now, whether this is because dealers and manufacturers have not made it widely known that buyers can do this, or if it’s really a case of this is how consumers want it is a completely different story;

        2) Consumers say they want one-price, no haggle shopping. History shows that dealerships that attempt the fixed price, no haggle model don’t last very long. Two shops here in Ohio tried it and failed miserably within about 18 months. Obviously two makes not for a trend, but these were done as experiments. Think of it this way: outside of red hot housing markets, how many people *DON’T* negotiate over the price paid for a new house? Cars are similar because every reseller has different motivations and thresholds for sales figures.

        I am in no way arguing that the current dealership model is effective or enjoyable. What I am saying, though, is that just like the 6MT+Wagon+Diesel crowd, those of us who think there’s a better way are a noisy, albeit relatively small group.

        I’m of the opinion that it would be beneficial to have a direct sales model option with manufacturer owned/direct sales like Tesla. How many people are willing to pay the premium for no haggle/no pressure sales? I think that luxury marquees would be able to pull this off far better than mass market brands, but I’d like to see the option.

        I’d love to see how the competitive landscape plays out in a world where the dealership franchise laws don’t prevent competition. That’s really the only way we’ll ever know if the direct-to-consumer model (eg: Apple) has any true legs, or if it is limited.

        My gut tells me that there is absolutely a market for this – I just don’t think it’s going to be quite as big as everyone thinks.

        • 0 avatar
          sirwired

          I expect the “no haggle” dealerships fail because people take their easily-acquired offer, and go to a “haggle” dealership which is more than happy to beat it by some small margin.

          There’s little market for custom-ordered vehicles for a couple reasons:

          – Many sales incentives only apply to in-stock vehicles.
          – The dealer is VERY motivated to sell through what he has in stock vs. using up one of his allocation slots for a custom vehicle. After all, if he sells a stock car, he can replace it with one of his exact choosing.

          P.S. Does VW even do custom orders for most of their cars? When I bought my VW, this was not an option, even if you were willing to wait.

          • 0 avatar

            VW? Probably not. Volkswagens are configured in such a way that you can usually find what you want…although I really wanted a “Toffee Metallic Brown exterior with Cornsilk Beige interior” Jetta SportWagen TDI, and there was none within 1000 miles of my home, so I had to settle for Black Uni on Cornsilk Beige.

            I will never buy another black car again.

          • 0 avatar
            TMA1

            Sucks about your paint, Kyree. At one time, I had a white car and black one at the same time, and the white car always looked so much cleaner. Black is great with a fresh wash, but that doesn’t last long, and every little defect shows up.

            When I was young, my mother told me the one thing about new cars is, you shouldn’t have to compromise. If they are making what you want, you should be able to buy it. I couldn’t never take the wrong paint color, for that reason. I can deal with it on a used car, because it’s a more limited market. If I know there’s another Brown VW rolling out of Pueblo, then that’s what I want.

          • 0 avatar
            Dan

            “I expect the “no haggle” dealerships fail because people take their easily-acquired offer, and go to a “haggle” dealership which is more than happy to beat it by some small margin.”

            Fitzmall, the major “no haggle” chain in the DC area ran into that problem, and now simultaneously advertises that they are both “no haggle” and will “match any competitor.”

            I used to use their listed prices as a sanity check when window shopping but when I was serious enough about buying to email other dealerships those no haggle prices turned out to be $1-2,000 high.

            Peoples’ fear of haggling keeps Carmax’s absurd prices afloat. Only a matter of time until the rest of the dealer body catches up.

        • 0 avatar
          duffman13

          re: no haggle sales

          Carmax seems to be doing just fine, and they’re no haggle. No haggle works if you’re realistic on pricing.

          Alternatively, I went to check out a couple used cars at my local Infiniti dealer a few years back, and they had moved to a no-haggle model as well. however, they’re pricing was ridiculous, and their refusal to negotiate was what made me decide to leave.

          • 0 avatar
            DC Bruce

            At least in my area, when I look at CarMax prices over other advertised prices at dealers (available on Cars.com), CarMax is 10-15% higher. When it first started, CarMax was cheaper, but those days are long past. As I think the late, lamented Steve Lang wrote one time, CarMax is a truly bad deal for a customer. There’s effectively no warranty of consequence (unless you pay for it) and you have no ability to have a mechanic independently evaluate the car’s condition. Even buying a CarMax car with some time left on the new car warranty carries some risk, because you have no idea how the car was maintained; and the lack of maintenance records can be used by the car manufacturer to deny an expensive warranty claim.

            The only benefit that CarMax provides is that it collects a lot of used cars in one place, so you don’t have to spend hours driving around dealers’ used car lots.

          • 0 avatar
            hreardon

            duffman13 – that’s exactly the problem: everyone expects to get ‘a deal’. The problem, of course, is that ‘a deal’ is different for everyone that walks through the door: value your time and sanity more than haggling? You pay a higher price. Willing/enjoy haggling down to the last nickel? You’ll get a better deal – but pay for it with your time.

          • 0 avatar

            Once a dealer advertises “no haggle,” they’ve painted themselves into a corner. If they advertise “no haggle,” but actually do, they open themselves up to a class action lawsuit.

        • 0 avatar

          Dealer franchise laws encourage competition among dealers. OEM/dealer franchise agreements prevent OEMs from competing with their own dealer partners. Why would they do that? Better yet, why would a business person make a massive investment if only to have to compete with their own supplier?

      • 0 avatar
        krhodes1

        @energetik9

        I have now ordered two BMWs in four years. Same experience – figure out what I want with their fantastic online configurator, make an appointment with the sales person for a quick chat and to look at a couple things in person, then negotiate the price via e-mail. More like $500 over invoice for me, but close enough. BMW seems to generally do it right.

        Surprisingly, my experience buying my Fiat Abarth was just as good. They had the car I wanted at the local Studio, I drove it, thought about it over the weekend, bought it on Monday. Was in and out in an hour with a great deal on it. The process does not have to be painful, if I had a dealer try to pull any of the stereotypical BS I would be out of there so fast I would leave skid marks.

    • 0 avatar
      DeadWeight

      Trivia about me regarding salespeople that would shock most:

      Although I am very driven on bottom line price, I have put (sometimes stealthily for practical dealership management reasons) between $250 and $400 in cash in the physical hands of the salesperson selling me or my spouse each of our last 4 vehicles.

      These were people (three men, one woman) who did exactly what they said they would do from the time they first answered my call, and pushed the deal through with no games at the numbers and exact vehicle discussed, even forwarding me binding paperwork (binding dealer) before I agreed to physically step foot in the dealership and consummate the transaction.

      All 4 were somewhere between surprised to uncomfortable when I first attempted to put cash in their hand, but managed to accept in the end (and deserved it).

      I don’t think very many people do this. I think dealerships frown on it and there are too many CHEAP people who don’t understand the difference between being financially savvy and being a dik/beyotch.

      When some salesperson busts their a$$ to get a supplier/employee priced vehicle for me the way, color, equipped as I wish, with no games, and their commission for this is officially $50 or $100, my conscience won’t let me NOT slip them cheddar (the last guy got 4 hundies when we shook hands at the end, was prob 60 years old, and was literally shocked as I calmly told him I appreciated his help and professionalism just before we departed).

      • 0 avatar
        krhodes1

        Can’t say I have given cash, but I did give my BMW guy last time a nice bottle of wine I brought back from Europe, and will do the same for my current sales gal. She might get two – I really like her! But ultimately, I am about the easiest customer to deal with ever. I know what I want, I know what I am willing to pay (and I am reasonable about it), and you will have no issues with the financial side of things with me. No trade either. So they are doing VERY little work to make their money from me.

  • avatar
    duffman13

    Consumers using technology to buy vehicles? That’s unpossible!

    In all seriousness, with the access to information that we have now, why would any dealership not try to leverage that?

    For new cars, you can spec and price them on manufacturer sites, look at local inventory online, learn about rebates and incentives, and find out the “hidden” numbers like invoice pricing. not to mention services like Truecar. Given all of that, any consumer can walk into a dealer, firmly offer invoice minus rebates minus maybe another $500 and be guaranteed a deal 95% of the time. And really if you do any better than that we’re maybe talking in the hundreds of dollar range.

    Used cars are a bit more difficult, but the same rules apply. We recently bought a newish used car and this was my process: I used cars.com and autotrader to locate one with the exact color/option combination we wanted. I came in with KBB, NADA, and Edmunds price estimates, and printouts of offers from other dealerships on similarly equipped models. I offered a lowish price, but walked out with the car we wanted at the price we wanted, whole process done in under 2 hours with paperwork, test drive, and everything.

    The only thing that gets me a little angry is some of the new car ads online I see with MSRP crossed out and some number $5-6k below it advertised as the price. I know they’re doing the whole stacking every rebate trick and the small print saying you need to be a military recent college grad single mom with excellent credit who already owns something from their brand, and I also know they’ve been doing it in print ads forever, but it still pisses me off.

    • 0 avatar
      TMA1

      Yeah, that “all discounts applied” bit is nonsense. Especially when they don’t even have that disclaimer. I see some dealers recently listing their “processing fees” as covering freight as well. Freight? That’s already on the window sticker and charged by the manufacturer!

      • 0 avatar
        Dan

        Another gotcha is putting $3,000 of fine print Scotchgard and pinstriping on the MSRP and then shouting “$5,000 off sticker!” from the rooftops when the number they’ve actually arrived at is simply invoice.

        Car salesmen have the rep that they have for a reason.

        • 0 avatar
          hreardon

          Sad but true. Thankfully, both mine and my wife’s last car purchases were breezes.

          Me: “I’ll give you $500 over invoice for the car.”
          Dealer: “Done. (shows me inventory list) Only issue is that the exact spec you want is in Minnesota, so we have to truck it in. You willing to pay $700 for trucking?”
          Me: “Sure. I’m picky, make it happen.”
          Car arrived three days later, signed papers and left. Beautiful.

          Wife: “I want a white CRV-EX AWD”
          Dealer: “We have one”
          Wife: “$350/mo., 12,000 miles/year and a million year old beater worth maybe $1000 to trade.”
          Dealer: “We’ll give you $900 for the car, otherwise the rest of the numbers work out. Here’s your paperwork.”

          Both of these were handled over several emails and then about an hour signing papers and waiting for porters to clean the cars up.

          I know there are lots of bad dealers out there, but I think they’re pretty easy to sniff out within a few minutes and avoid in perpetuity.

        • 0 avatar

          And dealers advertise the way they do for a reason. They don’t hope to capture the savvy buyer. They capture those who are not knowledgeable. You should be grateful for that if you’re a knowledgeable buyer. If the goal is to make 10%, some have to pay more so some can pay less. If you are in the “pay less” category, you get to do so because of your less knowledgeable brethren. Like it or not, that’s how it works. The FTC likes it that way. They like competition at the dealer level. If dealers try to fix prices so everyone can feel good about getting the same deal as everyone else, they put dealers in jail.

      • 0 avatar

        Dealers trying to charge twice for freight should be reported to the state attorney general office.

    • 0 avatar

      The biggest challenge dealers have today is unpacking and explaining the info consumers get off of the web. That can be hard because sales people typically don’t have access to all of the info.

      Consumers today have MORE information but actually know less because of the complexity of things. Back in the day, business was done based on MSRP and invoice. Invoice was a real number. Things were MUCH simpler. These days, not so much. So much for transparency. How many of you understand your cell phone bill? Your cable TV bill? Its like drinking from a fire hose.

      What does today’s car sales person do with a consumer who comes in with erroneous dealer cost information? Often, the sales person who straightens out the consumer is NOT the one who gets the deal. They win the battle but lose the war.

  • avatar
    Joss

    I use net for specs, reviews & price guide. I’m darn sure they won’t give me that price. I hate dealing with the assholes.

    When you think it’s no 2 ticket item and the way you get treated. Better service at a donut shop.

  • avatar
    sproc

    The one thing I don’t quite understand is how folks are doing any test drives with an average of 1.6 dealer visits. Friends and family vehicles? Auto shows? Or are that many purchases completely sight-unseen, without ever physically sampling the product? While I do a ton of research before buying any vehicle and get anxious and annoyed at just the thought of walking into a dealer showroom, I’m still a little Goldilocks when it comes to the final decision.

    • 0 avatar
      Fred

      Mini dealer is about 100 miles away, so I test drove a co-worker’s.

    • 0 avatar
      sirwired

      If you’ve done a lot of research, you may be pretty sure you want an “X” before you even go out the front door, and the test drive just confirms there’s nothing that absolutely annoys you about the car.

    • 0 avatar
      Dan

      Look at the volume sellers. What does a non hobbyist get out of test driving a Camcord? It’s a car. They already knew that. If you aren’t either NFL sized or compulsive there’s nothing annoying to discover about any of them.

      So they buy the one that they already had, or the brand they already had, or that one of their friends has and likes, or that they like the styling of, and that’s the end of it.

    • 0 avatar
      krhodes1

      A typical 30-60 minute test drive is pretty useless IMHO. I have had rental examples of my last three new car purchases, multiple times. Not in the exact spec, of course, but close enough to know I wasn’t making a huge mistake.

      • 0 avatar
        duffman13

        You can figure out 90% of whether or not you like the ergonomics of a car from sitting in it at a car show, friend’s, etc.

        As for how it drives, that has been a deal-breaker to me, but I’m an exception, being that I’m on this site.A quick around the block is enough for me to get a feel for the throttle response, steering, brake feel, etc.

        My father-in-law is currently CUV shopping and surprisingly (to me at least) wrote off the CR-V because “it drove like a lifeless turd.” So some normal people care about it too. He’s probably going to end up with a CX-5 because he loves that it drives like it has a soul.

  • avatar
    Hummer

    I must not understand how Truecar works, I’ve been putting in different configurations and it cannot do what I want.

    In this instance, a 3/4 Ram truck, I can get the body configuration but only in the 5.7, to make it recognize the 6.4 I have to add a massive package which makes no sense since the 6.4 is standalone. So I can’t actually put in the configuration I want, the only benefit I could see it for is a low volume car that only offers 1 engine option.

    Worse than that, putting in a zip code around me gives me a Truecar price a few thousand higher than what I can find at dealerships advertising the same vehicle 100 miles away, but put in that zip code and the Truecar estimate is thousands lower. Who the heck is going to ignore the exact same vehicle $3-6k lower because it’s 100 miles away? That’s useless to me.

  • avatar
    DC Bruce

    The reality is that all these sites do, especially TrueCar, is give the dealers contact information of prospective customers. I know, because I’ve been shopping for a pickup to pull my travel trailer for about 6 months.

    The second reality is that if the vehicle is not on the dealer’s lot or in its inventory, you’re not going to get much of a deal. If the dealer identifies the vehicle you want at another dealer, the dealer can get that vehicle for you, but only if you make a a firm contract on it sight, unseen.

    I found only one Ford dealer in my area who was willing to order a vehicle and discount about 10% off MSRP for it.

    The reason you test-drive a vehicle, even if you’re not an “enthusiast” is to “feel” it in a way that can’t be expressed verbally. For example, I test drove a 2014 Ford Lariat with leather seats, etc., etc. and determined that there was no way I could sit in them for hours on end. It was not a matter of dimensions; it was a matter of how the seat was constructed.

    • 0 avatar
      highdesertcat

      One reality, if a person can qualify for it, is the service that USAA can provide the potential buyer. All three of my sons have at one time or another bought a new vehicle through USAA (after shopping around on their own and finding way too much variance).

      I have never used USAA to buy a vehicle myself but I have been told by people who have used USAA that their service will locate (nationwide) the car the buyer specifies, at a firm no-haggle price, and arrange financing and insurance with USAA if the buyer needs that.

      I have also heard from others that many Credit Unions have such a service for their members and often will work with local dealers so the buyer does not have to travel.

      But the caveat is that a potential buyer should buy from big dealerships in large cities or metropolitan areas. The small town dealers simply do not have the selection or sales volume to make anyone a great deal. For many small town dealers every sale is existential.

      On occasions I have gone shopping I always asked what a dealership has to sell that vehicle for. And then I’m amazed at the different amounts of profit the various dealers have to make in order to cover their fixed overhead, expenses and ancillary costs.

      Using tech and apps is just a different variance on the same theme of getting as much info up front as possible. But don’t expect the dealerships to sell at a loss. Best to look at many sellers to reap the best deal. There is a price for everyone.

      • 0 avatar
        duffman13

        USAA member here. I’m not sure, as I haven’t used the service, but when I looked at it before our most recent purchase, it was driven by truecar’s engine with another slight discount because you’re a USAA member. There was no mention of shipping cars or anything like that, but again I didn’t get very deep into it. We ended up driving 90 minutes away because that dealer had exactly what we wanted, but my wife’s sister and cousin lived up there so we made a day trip of it.

        • 0 avatar
          highdesertcat

          Ultimately, you did what works best for you.

          For many military (active and retired) people living in the parched desert southwest where selection is thin and prices at small dealerships are astronomical, turning to USAA or other services is the solution.

          When a lady friend of the family wanted to go shopping for a new 2012 Grand Cherokee Limited V8 4×4, she went to USAA (her husband was a member prior to his death), and found exactly what she wanted at the price she was willing to pay, in Albuquerque, 226 miles North of where she lives.

          It was near MSRP but not padded and it included the cross-shipping of the vehicle from Colo Sprgs to Albuquerque. Plus the dealership paid for her overnight hotel stay at the Hilton in Rio Rancho so she would not have to drive back home at night.

          Good experience. Fair price. She promotes USAA because of that good experience.

        • 0 avatar
          clkimmel

          I found the same thing at PenFed, their buying service is truecar but you can be eligible for discounted financing if you use it vice going to Truecar directly.

          • 0 avatar

            AND if you go through TrueCar, the dealer’s cost factor is increased by $300. on a new car or $400. on pre-owned. I presume you think dealers absorb that?

  • avatar
    Kendahl

    There is only one thing you can’t do on line. That is test drive the automobile you think you want to buy. Several years ago, it was time for me to buy my retirement toy. I was all set to buy a Porsche Cayman but the test drive caused me to look elsewhere. Half an hour of engine drone right behind my head was all I could take. I ended up with an Infiniti G37S.

    Once I know what I want to buy, I play the local dealers against each other to get the lowest price. The one exception to that was the Ford Focus SE we bought two years ago. I deliberately bought from the one local dealer who kept a few manual transmission models in stock. When the other dealers called me back, I explained why they had lost the sale.

  • avatar
    ponchoman49

    I would never ever purchase a used car this way without driving it and inspecting it with a fine tooth comb,see how the seats felt after and hour behind the wheel, check out the trunk to see if it will actually hold what I want it to, and make sure the drivetrain wasn’t noisy or harsh and everything shifted the way it’s supposed to. Yes the internet is nice for price comparison but I fail to see how buying online is so smart an idea. Even with a new car. Unless I was super familiar with that car and already knew what one drove like etc. Even then production line variances, missing items that you thought were there like bluetooth or the preverbal missing glovebox light late in the assembly run.

  • avatar
    Topher

    I purchased my first car new when I was 25 and had my first steady, high-ish-income job. I went to a couple dealers, looking for the model+options combo I wanted, found it, and then got dickered around on financing and trade in. I left after 2 hours without buying.

    On my second attempt, I went to my credit union, secured financing, and used the personal shopper, who found exactly what I wanted at invoice. I sold my used car private party, and then got dropped off at the dealership to sign the sales contract and take delivery.

    I might have gotten a better deal on my own, but it wasn’t worth my hassle. Every car salesperson I’ve dealt with has lived up to the negative stereotype.

  • avatar
    superchan7

    I used email to haggle on my first new car, but it works either way. Doing it in person is a little more aggravating (“let me speak to my manager…”), but takes less time.

    The best deals are always in person, not advertised on some website. It takes research, homework and people skills–the last of which our generation is accused of lacking (hence the articles about how we prefer doing everything over the internet to avoid real-life interaction).

    • 0 avatar
      highdesertcat

      “we prefer doing everything over the internet to avoid real-life interaction”

      I can believe that. Given the choice I would also prefer not interact with real-life people in person.

      People are the worst thing on the planet.

      That said, my last three buying experiences were driven by the low expectations I have of people. And they were successful because I went in to buy, not make new friends.

      After checking out the vehicle we wanted to buy, I merely asked, “what does the store need to sell this vehicle for?” Salesperson runs off to see the salesmanager…..

      If it was a price I wanted to pay, I bought. If not, I walked.

      I walked more than I bought, obviously, because I don’t dance and the dealership gets only one shot at me.

      But that’s the difference between “wanting” to buy and “having” to buy.

      • 0 avatar
        krhodes1

        I’m willing to let them chase me a little. On BMW order #1, I went in, told them what I wanted, and asked for a price. They came back with something a bit stupid – like $500 off MSRP. I thanked the guy for his time, gave him my card, and told him to e-mail me or call me when they wanted to order a car for me, I had other dealers to contact. I might have mentioned I had enough FF miles to vacation on Mars… Took about 2hrs to get the e-mail, and a couple back and forths to get to a price I was comfortable with.

        This time on #2 I told them right up front that since I was planning to do both European and Performance Center delivery, I was getting quotes from around the country. I got their first offer, which was actually pretty good, and simply told them the best deal I had gotten online, which they matched. They actually beat it, their fees are lower than the dealer out west.

        But certainly the critical thing is never be in a position where you HAVE to buy. Which going back to Jack’s article the other day, is easy for those of us with stable, steady lives and a garage full of cars to say.

        • 0 avatar
          superchan7

          Ding ding.

          I walked out of a Fiat dealer, unable to agree on price. We came to agreement over email the next day (met halfway). Well under invoice.

          Thinking of JB’s article on privilege, this shows that the privileged can buy a car without needing it. People who absolutely need a reliable car right this minute, for commuting to their hours-inflexible job, should look at Corollas or Buicks with > 100k miles. Even then, a thorough inspection is needed.

          The privileged (and all the other armchair internet commenters) can just play it like a game.

  • avatar
    brianyates

    Nice article Cameron, my last experience involved looking for and purchasing a 550i. I checked many delers’ websites, checked MSRP and decided on the dealer I wanted to buy from and a car that had all the options that I wanted.
    Working with the salesperson was a breeze, however, after the price was agreed to I was then directed to walk through a gauntlet of people offering extra warranty, detailing, insurance(for a price!!) After saying no to all of them, I left the dealership with my new car, I also bargained down the outrageous transportation fee and the exorbitant $395.00 documentation fee. I would go this route again.

  • avatar

    RE: “The challenge for those who conduct their car-dealing business online is to convince more traditional dealers that technology is a tool for increasing sales, not a new competitor out to steal sales.”

    Why on earth would online dealers want to convince “traditional dealers” to do what they do? What might be their motivation?

  • avatar
    7402

    Step 1: Go to a nearby dealer to test drive the target car. Be crystal clear and state two things before you drive, that you will NOT buy a car today, and that you will be soliciting bids from other dealers. No need to be chatty about price, you are gathering data about the vehicle, not about the pricing.

    Step 2: Once you’ve confirmed that you want that make/model, contact every dealer within your reasonable traveling distance by e-mail. Provide the details of your transaction (cash or finance, trade-in or not, precise vehicle configuration and options). Say you plan to make your purchase within X days from the dealer with the best offer. Tell them to make their best offer and provide the “out the door, one check” price that includes taxes, tags, etc. Ask what extras they throw in such as loaner cars for service, included oil changes, etc. etc. Provide your name and phone number so they know you are serious.

    Step 3: Compare all the offers. If the closest dealer’s offer isn’t the best, call the manager there and explain that you would really like to buy from a local business but they have to meet or beat your best price. If they are really close, ask them to throw in some all-weather mats or something. Buy local if you can.

    Step 4: Pick up the car. If you are a cash buyer with no trade, simply bring the cashier’s check with you–you’ll get almost no hassle from the F&I guy because you are simply paying for something that has already been negotiated.

  • avatar

    http://wardsauto.com/auto-makers/better-test-drives-and-service-quicker-throughput-toyota-s-radar-screen?YM_RID=CPENT000000003554&YM_MID=1045

  • avatar
    brianyates

    Actually Ruggles,the price for my 550i was was agreed upon on quite
    quickly. The dealer realised he would have lost the sale if therewas no movement on transport and document charges. I didn’t think that those things should spoil my experience and they didn’t. I wasn’t really haggling, I just said no the extras being foisted upon me.


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