My friend Michael Galpert was telling me about his best car buying tips and his experience buying a used car in four days.
Here’s what he did to save $4,618 on buying a used 2017 Honda CRV near San Francisco.
I asked him to share his best tips and tricks and what he learned, so here it is:
Hi, I’m Michael. I live in San Francisco with my wife and two daughters.
My wife and I wanted to buy a car. We came across this listing on TrueCar we liked:
We wanted to see if we could get this car any lower price. So we went to the dealership to ask.
I posted the following to Twitter while we were waiting at the Honda dealership:
Any tips on negotiating with a car dealership?
This is everything that I learned.
New Car Cost
A brand new 2019 version of the car we are trying to get (Honda CRV – EX L) is listed as $29,750 before taxes and fees.
From our understanding, nothing really notable has changed from the 2017 model to the 2019 model. So we were intrigued by this basically new car.
We didn’t end up getting that exact car from that dealership. The car mileage was not as listed and we were kinda treated poorly.
So on Sunday morning I started reviewing all of the tips people sent me.
Car Buying Tips We Got From Friends
- Never pay over invoice
via Daniel Rakh
- Start with invoice price. Work with two to three dealerships in a form or reverse auction.
via John Frankel
- Call with a low ball offer to get their best offer
via Kyle Wharton
- Find the car you want. Call multiple dealers and tell them you’re shopping for price. Have them give you offers… some won’t, since they know you’re looking for price. A few will go for it
via Alex Blimes
- Go in on the last Tuesday of the month. Tue is the emptiest day and the end of month is better to negotiate because of quota pressure (either behind quota or ahead, both work in your favor).
via Lino Gill
- Silence and awkwardness are key
via Kyle Lawson
- Don’t bring a knife to a gun fight
via Josh Felser
- Carvana was suggested by
- Hadn’t heard of them in the past. Here’s what they currently have for the model we want:
- Honda CRV EX-L 2017 18,097 miles all in for $31,888 [link]
- Hadn’t heard of them in the past. Here’s what they currently have for the model we want:
- Mike Demarais suggested I listen to the This American Life episode to get in the mindset of a car dealer It is a real entertaining listen even if you are not in the market for buying a car I recommned giving it a listen.
Corey Hendersonhad similar advice about understanding the mindset of the car sales person and suggested I watch this YouTube Channel which consists of tactics for car sales people and there are some good ABC’s but i didnt really learn anything specific as a buyer but it did give me a better spider sense to when I’m being sold to.
- I also received this video suggestion via
Turner Novakwhich gave nothing of substance but brought the lols and introduced me to Ben Mallah for the first time
Besides Twitter, I did a rudimentary DuckDuckGo search and found these tips via Clark.com:
How to beat the pricing from online car-buying sites
- Find the best price offered by dealers on your favorite car-buying website. Get both a price for the car and a detailed “out-the-door” price, including motor vehicle department fees, sales taxes and any dealer charges for documentation, etc. Then keep that number in your hip pocket.
- On the weekend before the last 3, 4 or 5 consecutive weekdays of the month, check dealer inventories online. Many stores list it there. Choose 5 or 6 stores (ideally, but not necessarily, with cars you’d buy if the price were right), even if some are 50 or more miles away. More remote dealers may see you as a sale they’d never make and sell at a better price than they’d offer their neighbors.
- Call their Internet sales managers on the 1st morning if there are 3 consecutive weekdays, the 2nd morning if there are 4, the 3rd if there are 5. Describe the car you want in detail, say you’re ready to buy by month-end, that you’re contacting a limited number of dealers to get price proposals and you’d like to get one from that store. That you need both the price of the car and an itemized out-the-door price (with the details listed above) by phone or email by 11:00 AM the next morning. (Be sure they know your location, so they can figure the sales tax correctly.)
- Say you’ll call all responders that next afternoon, tell them the best out-the-door price and give them one shot at beating it. (It’s none of their business where it came from.) You’re ready to buy, and you want someone to knock your socks off at month-end. But you won’t buy from anyone who doesn’t participate from the beginning.
- The next morning call those you haven’t heard from by 11:00 AM, tell them you have proposals from other dealers and you’re waiting for their response. If any responses have been incomplete, call and ask for the missing info. Call everyone that afternoon with the best out-the-door offer. If the initial o-t-d price from the online car-buying site is the best Round 1 offer, use that price in those calls. (When you’re eliminating the cost of the middleman, that won’t happen often. But it could happen.)
Now that I had the confidence from my friends and tips above, I started the process of…
Buying a car in 4 days
Here’s what I did:
4 days before end of month:
3 days before end of month:
Once I got all the websites for the dealerships, I sent the links to fancyhands.com (a virtual assistant service) with the following request:
Can you please get me the email address for whoever is in charge of sales of used cars from the following car dealerships: [links]
You might have to call them or chat via their website since it may not be listed directly on their sites. Please put all results in a spreadsheet. Please take up to 3 tasks to do this.
If you use fancyhands or another virtual assistant service, I recommend creating a Google Sheet in advance with your ideal structure and formatting. I ended up re-doing the spreadsheet I received.
2 days before end of month:
I added a mail merge “add on” to the Google Sheet that I was using that connects to Gmail. It lets you send mass emails individually. It even included email tracking to see if the email was opened.
This is the one I used: Yet Another Mail Merge: Google Sheets Add-On
Thanks to that plug in, with 3 taps I was able to send the following email to 21 dealerships:
Hi, My name is Michael and I’m ready to purchase a 2017 CR-V EX-L that has less than 20k miles on it.
I’m emailing a few dealers to get price proposals since I’m ready to make the purchase by the end of the month. I’d like to get one from your store if you can you provide an itemized out-the-door price by 2:00 PM tomorrow (January 30).
If you respond to this email with all the detailed info I’ll call you tomorrow after 4 PM with the best offer I have received and give you a shot to beat it.
Like I said I’m ready to make this purchase in the next few days, I just want to make sure I’m doing business with someone who wont waste my time
Looking forward to hearing from you.
You will probably need my zip code to calculate the total taxes. Its ###
I received 12 responses to this email and 1 bounce back.
- 9 of the emails followed the instructions and gave me a detailed breakdown of price.
- 2 people said I would need to come in to discuss full pricing. (aka smell ya later)
- 1 email gave me a detailed breakdown of a different vehicle since they no longer had the model I was looking for. (thanks but no thanks)
Also of note: 2 people who received the emails forwarded it to someone else since they were not available to help out. This was appreciated because one of those is who I ended up buying the car from.
When I received the out-the-door price, I added them to my spreadsheet along with the phone number of the salesperson. I usually found this info in the footer of their email.
1 day before end of month:
When 4 PM rolled around, I sorted the prices from highest to lowest and started calling the sales people as I said I would. I told them I appreciated them taking the time to respond to my email with the information that I requested and that unfortunately they were outbid. I told them what the best offer was and asked if they would be able to beat that price.
Here’s how that worked out
- 2 voicemails were left unreturned
- 4 did not provide a counter and said that was their best offer
- 1 countered with $53 more than I stated
- 1 countered with $12 lower
- 1 countered with $62 lower
The thing that I didn’t mention about the lowest offer I received is it wasn’t really the lowest TOTAL price. It was located 7 hours away from my house and would require a delivery service that would probably cost an additional $700.
When I called them to tell them that I would go with them if they would be willing to cover the delivery fee to which I was told a manager would contact me to discuss the details but that never happened.
What I Purchased And Why
Out of the 2 lowest counters I received, I ended up going with the one who provided the $12 under asking since it had 10k less miles.
All in, the additional effort of having the salespeople compete for the best price saved an additional 4.3% from the price they originally offered.
And the entire process that I went through saved me around 14.48% ($4,618) of buying directly online at Carvana.
BTW: If you don’t want to bother with this whole process yourself, there are local services that will do this for you.
- cartelligent.com charges a fee and will track a car down for you and have it shipped to your house supposedly for cheaper than online prices.
- carblip.com is another service that will handle buying a car for you
A note about talking on the phone when discussing counter offers
I decided to do this part via phone because I wanted to communicate that I was serious about doing the deal but even more than that I just wanted to hear the negotiation at play.
After all, I did listen to the glorious This American Life episode and watched enough YouTube videos on how to sell a car to mess with my algorithm for days. And I’m glad I did because I was able to hear one of the best questions I heard in the entire process:
When I mentioned that they were not the lowest price they said sure let me see what I can do and while clicking away at their keyboard they said something as if they had just thought of it
“Hey Michael, can I ask you something, do you like our car better?”
And I was smiling ear to ear because I knew exactly why I was being asked that. They wanted to know how much they needed to beat my best price by; if I liked their car, not by much; if I didn’t like the car they would have to try a little harder.
Some other notes about dealerships and email
- Some use shitty systems that will send a different subject line for every email they send and will not comply nicely with Gmail’s threading system.
- Some dealerships send emails that are automated and they can’t edit when discussing pricing so they end up sending up follow up emails to see if you got their email. smh
- Some emails will go into your spam folder.
Bottom line: Check All Mail and Spam folders not just your primary inbox when interacting with dealerships via email.
The entire process that I went through saved me around 14.48% ($4,618) compared to buying directly online at Carvana.
I ended up going with the counter-offer that provided $12 under the original listing’s asking price since it had 10k less miles. The additional effort of having the salespeople compete for the best price saved an additional 4.3% from the price they originally offered.
One last piece of advice: Don’t agree to a final price until you hear back from all of the dealerships who agreed to provide competitive prices.
Questions? Talk to Michael on Twitter where he is @msg
2020-05-11 UPDATE: reader Zach Shefska has started a business with his father that helps “automate” this process (aka hire his dad to help you do all these things). You can check them out at www.yourautoadvocate.com