How to haggle for a car

Whether you're buying a new or used car, from a main dealer or a private seller, haggling over the price of a car is an essential part of the buying process, and doing it effectively could save you thousands of pounds. Many people feel uncomfortable about haggling – but you shouldn't do. The salesman is expecting it. Okay, if you haggle the price down, he'll get less commission, but if he doesn't lower the price he may not sell the car at all.

If you're buying used from a private individual, the laws of supply and demand are even more on your side: there are millions of used cars for sale, so it's a buyer's market.
They key to effective negotiating is confidence, so here are a few pointers to help put you in control and clinch a great deal.


Do your homework

  • Before you start negotiating, get clued up on the car you're looking to buy, including the equipment it comes with and the cost of any options. This way, you know what the salesman is talking about if he tries to talk you into a more expensive model. He may also try to bamboozle you with special offers, so check these in detail before negotiations begin. 
  • For new cars, check the What Car? Target Price – this is the most you should pay for your car, based on ongoing research by our team of mystery shoppers. Put some effort in to your haggling and it should be perfectly possible to not just match the Target Price but to beat it.
  • You may even want to call the Target Price team on 0845 272 6000 to find out which dealer is selling at Target Price, then make a beeline here. Alternatively, use this information to know when it's worth defecting to the Target Price dealer even if it'll take you more time and money to get there.
  • If you're buying used, you could check the free valuations tool at whatcar.com to see what you should be paying for a specific model, or research online classified listings to see what other sellers (dealers and private individuals) are asking for similar vehicles.
  • Mumsnet's used car valuations tool is also the place to check the value of your part-exchange, if you have one. This means you'll be forearmed if the salesman tries to hoodwink you into accepting less, particularly if he claims he's giving you a big discount on your new purchase. A common salesman's trick is to quote the ‘trade' price rather than the ‘part-exchange' price, so make sure you know the difference.
  • For used cars at dealerships, check the terms and conditions of whatever warranty is included; you don't want any nasty surprises once negotiations are under way.
  • Find out if the new car you're looking to buy is about to be superceded. If this is the case, your car will take an instant depreciation hit as soon as the new one comes out, but your dealer is more likely to slash the price in the first place in the knowledge that he'll find it very difficult to shift an outdated car. 
  • Brokers, internet companies and car supermarkets also publish price information online. Print out the relevant pages from their websites and make sure the salesman knows you have them. He'll probably dismiss them as irrelevant but they'll show that you've done your homework and that you know how much you can get the same car for elsewhere.
  • Unless you've got ready cash, you'll also need to arrange finance. The salesman will happily handle that for you because dealers make a big profit from selling finance. However, chances are it won't be at the best rate, so first check the manufacturer's website for any special finance promotions, and get some quotes from high-street loan companies. Dealer rates are rarely fixed, so if you've found a better finance deal direct from a bank, ask the salesman if he'll match it.
  • Read up, too, on payment protection insurance (PPI) and guaranteed asset protection (GAP) at whatcar.com/car-advice so you're prepared if the salesman tries to sell you these.


Time your visit

  • For the best chance of a good deal, visit the dealership at the end of the month. Many car industry sales targets are set on monthly sales quotas, so if a dealer is falling short at the end of the month they'll be much more likely to cut the price or offer free options if that's means you'll make a purchase.


What to say and do

  • Be pleasant, but retain a professional, detached approach rather than an overly friendly one. A friendly atmosphere could lull you into thinking you're getting a great deal, when in fact the salesman is still focused on making the most money from you.
  • Make it clear you've done your homework – discuss the car with the saleman in detail so it's obvious you know which model you want.
  • Take a copy of the latest What Car? magazine into the dealership and point to the figure in the Target Price column in the Buyer's Guide at the back. Then invite the local dealer to look it up at whatcar.com. It's a good plan to do the online comparison as well as the print one, and in that order, because the online Target Price is likely to have dropped since the print magazine went to press.
  • Show commitment. If you look as if you really want to do buy the car, the salesman is likely to try harder to reach a deal, because a sale is still the ultimate goal to him even if he has to drop the price to get it.
  • If you want to include cost options on your car, make sure the salesman applies the same percentage discount as he has to the base vehicle. If he insists on discounting only the grand total, ask for some time to yourself to work out if this is still a good deal. Assume that the dealer has at the very least met the Target Price, and see if he has applied the same percentage discount to the options. If it looks like the salesman has dodged the Target Price, or failed to discount the options at all, ask for a better deal.
  • If you're struggling to get the deal you want, deliver an ultimatum: promise to close the deal straight away if the salesman can drop to the price you're happy with. Again, the temptation of a guaranteed sale may persuade the salesman to give up a bit more of his commission.
  • Don't take along cash to tempt a salesperson to do a good deal. Now that electronic banking is easily done on the spot, there's no need to compromise your personal safety this way.


Reaching a deal

  • Once you've agreed on a price, ask the salesperson to put it in writing straight away.
  • Even if you're happy with the deal, it's best to sleep on it before signing on the dotted line. Take time to scrutinise every aspect of the agreement in the cold light of day. Ignore any nonsense about special deals that are only available today; unless the salesman is feeling particularly confident about selling his month's quota, you'll get the same price tomorrow. Remember you can always put down a deposit over the phone.
  • With used cars, if you want time to think before you commit, be prepared to have to put down a non-refundable deposit or reservation fee to prevent the car being sold to another buyer before you settle the funds.
     

If you're not happy

  • Don't be afraid to leave if you can't reach a deal you like. You might not be an expert car salesman, but being in a buyer's market does give you a massive advantage, and plenty of ways to buy. In a depressed market, any dealer with one eye on sales targets is keenly aware of your financial mobility and if they think they'll be the ones to lose out, they'll quickly do something to close a deal.


Wear the trousers

The way you ask certain questions can make all the difference to the results you get:

Don't say
‘I want to buy this car'; do say ‘I'm thinking about buying this car'

Don't say ‘Can I have a discount?'; do say ‘How much discount will you give me?'

Don't say You're sure you can't meet the Target Price?'; do say ‘I'll buy elsewhere if you won't meet the Target Price'

Don't say ‘Is that all my old car is worth?'; do say ‘I can only buy if I get more for my old car'

Don't say ‘Is that the best finance rate you can offer?'; do say ‘I've found a lower finance rate elsewhere, thanks'

Making the salesman work for his sale means that when you've reached an agreement, you can be confident you got a good deal.