How to negotiate the price of a new car

We hit the dealer forecourts as secret shoppers armed with our 10 top haggling tips to see if we can negotiate the best price for a new car

With the average new car sold in the UK costing about £33,000, getting money off wherever possible can really help your bank balance. But shopping for a new motor can be daunting, with a huge amount of information available, whether it’s a spec sheet, warranty data or finance quotes. So how do you get the best car for your money? We called on the help of Oliver Collins, sales director at our sister site, to let us in on some money-saving secrets.

Oliver has been trading in cars for decades, and has learnt every trick in the book during his negotiations with dealers. Armed with his top 10 tips, we posed as undercover buyers at a variety of showrooms to see if the tactics paid off.

So keep scrolling for our top 10 tips for getting the best deal on your next car at a dealer…

1. Be prepared to travel

Your local dealer may be staffed by friendly salesmen, but if it’s the only showroom for miles you’ll be better off looking elsewhere. You’ll get more of a bargain at a volume dealer, where high sales are the norm and discounts more common.

Many showrooms are grouped closely together, so if you are looking at two or more brands, visit your closest hotspot and play dealers off each other. We found this tip worked well, with one dealer telling us he’d “smash” a rival’s offer.

2. Do your homework

The industry is steeped in data and jargon, so know your mpg from your PCP. Research your shortlist of cars, finding out about monthly repayments as well as list prices.

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Knowing what’s included with each trim level is useful, as is understanding the engine range. A 1.4-litre might sound better than a 1.0, but it could be older, slower and thirstier. If you’re trading in a car, check online to find out what it’s worth as a part-ex; dealers should match this figure.

3. Make your expertise clear

Dealers will be less likely to waste your time with spurious information, and will take you seriously if you make it clear you know your stuff. One dealer started listing numerous CO2 figures without explaining their context. His whole attitude changed as soon as we clarified the impact CO2 has under the outgoing and incoming road tax systems.

It’s also worth dropping into conversation that you’ve visited a dealer’s competitors, and are giving staff a chance to explain why you should buy from them, rather than rivals.

4. Timing is key

Three of a dealer’s biggest annual events are the reg plate changes and the ends of the financial quarter and fiscal years. Showrooms offer big discounts on cars that’ll wear the old plate, as sales slow before 1 March and 1 September.

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Sales are measured against targets every financial quarter and year. If a salesperson is struggling to hit their numbers, they’ll come up with an attractive deal. For example, one dealer offered us £500 off if we bought a 68-plate car, and another stated he was up against it and could swing us an extra £1,000 discount if we bought before April.

5. Haggle options, not just price

Dealers are usually able to discount the price of options, as well as the car. They won’t tell you this unless you ask, but getting 10 per cent off a high-end stereo or advanced safety system could save you several hundred pounds.

We had mixed results. Some dealers said they couldn’t give free or discounted options, even when we kept asking; another threw in a free sat-nav, and a third offered the same reduction on options as he’d applied to the car itself.

6. Don’t believe all you hear

If a dealer says something can’t be done, ask again, and again. For us, on occasion, a discount that was previously “impossible” suddenly became a reality at the third ask.

Also look out for dealers consulting managers, or phoning head office. Any news that comes out as a result of these discussions is usually a sales tactic. If a dealer tries this one, expect prices to fall further even after you’ve been told a specific number is the best they can do.

7. Play hard to get

The keener you seem, the less incentivised dealers will be to chase your custom – it’s simple supply and demand. Play hard to get, don’t let on if you need a car in a hurry and never seem desperate. We tried this out at a few dealers, telling some we needed a car quickly and others we were in the early stages of the buying process.

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Interest levels generally rose as soon as we mentioned needing a car quickly – but for pushier dealers, telling them we were in no hurry had little effect on their insistence.

8. Start walking away

Keep this one as a last resort, as you can leave only once. Even so, many traders have a miraculous change of heart at the sight of a disappearing customer. Don’t just walk away immediately, though – give them a chance to stop you.

Make a show of putting on your coat, or checking you’ve got your phone and wallet. They will probably suddenly find a new bargaining chip. If they don’t come up with some form of deal, a rival will almost certainly be willing to.

9. Consider finance, not cash

Dealers’ new-car margins tend to be small, but finance packages are more lucrative for them. That means taking out a PCP agreement rather than paying cash can save you money, get you a better car or boost the included kit.

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Obviously, keep a close eye on the interest levels offered, and if you’re able to find a zero per cent APR offer, grab it. Even if you’ve got the cash to buy a car outright, that can sit in your account accruing interest while the dealer’s financiers worry about finding the requisite lump sum.

10. Inspect the car thoroughly

A new car is gone over several times before being handed to its first owner, but even so, mistakes can happen. Pore over the car as carefully as you can looking for any nick, scrape or scratch – however small it may be.

You probably won’t want to accept a new car with any imperfections, but if you find something very minor that you’re willing to live with, use this to get a discount. 

Finally, check that the car’s spec precisely matches what you’ve ordered. If you paid extra for a spare wheel and upgraded stereo, these should be present and correct.

How do you haggle when buying a new car? Let us know your top tips in the comments…

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