So you’re thinking about buying a brand new car?
Well, you’ve come to the right place. How do you get a great deal with the least amount of frustration? That’s what we’ll be discussing below. First, we’ll briefly explain why we decided to buy a Subaru Forester. If you’re not interested about reading about Subaru, skip to the next section. We’ll be describing our experiences buying a Forester in Toronto, Ontario, but our general advice below should be applicable anywhere.
Which car to buy?
After considering various options, we settled on the Subaru Forester 2.5i Touring with Technology option (Canada) for the following reasons:
Negotiate via email only
Buying a car can be an unpleasant experience. If you are anything like us (or in our opinion like a majority of the population), car salesmen always keep you on guard — am I being ripped off, is he/she taking advantage of me? Now, thanks to the internet, the consumer has all of the power. Everything is on the internet — car reviews, dealer reviews, reliability reports, dealer costs, etc. By far the best way to get a good deal on a new car is to conduct all of your negotiations via email. In our opinion, if you step onto a dealer lot before getting the lowest quote via email, you’ve already put yourself at a disadvantage. Why? Well, dealers can only use sales/pressure tactics when you’re physically in the dealership. Such tactics don’t work too well over email. Don’t give up your advantage by going to their turf. You will probably get a better quote if you email the dealer than if you walk in and talk to a salesman in any event. Why? The dealer knows that if you email them asking for a quote that you’re a savvier shopper and that you’re probably comparing prices. This is generally referred to as “shopping”. Therefore, the dealer’s more inclined to give you a competitive quote compared to if you just strolled into the dealership. In short, email is a car dealer’s worst nightmare. Who knew being lazy could save you money?
If you can’t be bothered to email dealers yourself. You can try using www.unhaggle.com (Canada only). This website will send you a dealer’s cost report for the car that you want for free. Its real beauty is that if you pay the website $99 CAD +tax, they will contact the dealers closest to you and ask them to give you their best quote. We tried using Unhaggle, but decided to ask for a full refund as they were only going to contact 10 Subaru dealerships. We figured that we could do better at no cost at all. We guess we’ll never know for sure, but we may have ended up getting the same exact deal if we used Unhaggle. We really wanted to see what would happen if we contacted 26 Subaru dealerships ourselves. Even though we didn’t use it, Unhaggle is a great option for people who don’t have time or can’t be bothered to email dealers themselves.
Costco Auto broker (USA) & Edmunds (USA)
If you live in the United States, we understand that Costco has a service where they will help you get a good deal on a brand new car. Edmunds.com will also let you contact various dealers through their website’s ‘dealer quote system‘. We’re not too familiar with these programs as we live in hockey nation, so you’ll need to do additional research. We just wanted to let you know that these programs exist.
Try to only email the sales manager or the general manager
From our understanding, sales reps have near zero power when it comes to pricing. The sales manager and general manager have all of the power. That is why we always try to email management directly–straight to the decision maker. The manager may respond to your email directly or he may forward your inquiry to a sales rep. That’s up to the manager to decide, nothing that you can do about that.
No sales commission?
This is all supposition, but if you end up cutting a deal directly with the general manager, it’s possible that no one is getting sales commission. That means that the dealer will have lower expenses related to the transaction and those savings can potentially be given to you (lower quote on the car). We can’t verify this, but it’s possible.
How many dealers to contact?
This is up to you, but the more the better. We live in downtown Toronto and there are 10 Subaru dealerships in the Greater Toronto Area. However, we ended up contacting 26 dealerships in Ontario–some as far as 500 km away. Why so many? It takes very little effort to send a few extra emails and you’ll never know what they may offer. Also, one of those far away dealerships may give you an aggressive quote that you can use to negotiate with the dealership down the block from you. It really doesn’t hurt and it can potentially help you save thousands–why not?
The easiest way to find a list of dealers is to search Google. Something like “subaru dealership ontario” and you’ll get a list like this. In our example, there are 30 Subaru dealerships in Ontario and we ended up contacting 26 of them (as the other 4 were really too far). Also, you can search Yellowpages online and search for Subaru dealerships (by proximity/distance) and it will display all of the dealerships closest to you. This list will likely be incomplete, but it’s a convenient way to see how far certain dealers are from you.
Finding dealer email addresses
The easiest way to find the sales manager or general manager’s email is to go the dealership’s website. The website may not always list the sales manager’s or the general manager’s email address, in that case, we just emailed a random sales representative. In some cases, no email addresses are listed at all, so we just filled out the online form and hoped that someone would read the email.
For those dealerships with no email addresses, another option is to call the dealership and ask to speak with the dealership’s internet sales manager. We decided that it wasn’t worth the hassle, so we didn’t take that step.
Internet sales manager
Most dealerships have a dedicated person that takes care of all online sales. You will generally get a better quote from this person than from other sales representatives (especially, compared to walking into the dealership).
What is your best price? (1st email)
Feel free to type up your own email, but if you need inspiration, here’s a sample email template that you can use.
My name is _____ and I would like to order a Black 2015-Forester 2.5i Touring Package with Technology Option. What is your best on-the-road price (with all taxes and fees already included, except licensing fees)?
Price is my biggest factor. Therefore, please send me your best on-the-road price so that I may compare with other dealers. Based on the responses, I will be making an order in the next 2 weeks. I look forward to hearing from you.
Thank you for your help.
- Use a normal/serious sounding email address. It’s hard to take a price quote enquiry seriously when it’s coming from email@example.com
- Use your real name. It adds credibility.
- Don’t put your telephone number. Some people argue that you need to put your telephone number to demonstrate that you’re a serious buyer, but we decided against it as we didn’t want to receive sales calls.
- Specify exactly which vehicle you want, the color, the year, the make and the trim level.
- Always be polite. It makes everything easier (in life as well).
- You need to be able to compare different quotes from different dealers. Therefore, specify that you want the on-the-road price. Mention it TWICE as dealers are reluctant to give out quotes via email.
- Mention that you will be comparing prices with other dealerships.
- Mention that you plan on making an order in the coming weeks to demonstrate that you’re a serious buyer.
- Stay organized. Keep a spreadsheet and update it often!
Common dealer responses (1st round)
- No response. [12/26 dealers] This is normal. In our experience, almost half of the Subaru dealerships did not respond to our initial email asking for a price quote. It’s not that surprising as they know that they won’t make a lot of money from you. They also know that you’ll only use their quote to get a lower offer elsewhere and they most likely won’t be able to sell you a car except at the most aggressive prices. Our answer is that if these dealers are so insecure/noncompetitive/lazy to spend 30 seconds to email you, then it’s probably for the best. Do not worry. We’ll get back to these dealers later.
- We don’t give price quotes via email, please call us. [2/26 dealers] That is fine. Call them and they’ll give you a quote via the phone. Once you’ve received the offer, send them an email back to thank them for the price quote of ___$ for the color, model, year, trim. It’s a good idea to keep a paper trail to avoid any future misunderstandings.
- I need more information from you first. [2/26 dealers] For example, where do you live? How many dealers have you contacted? Are you leasing, financing or paying cash? Have you test driven the car yet? We’re generally reluctant too give too much information to the dealer. Information is power. In our view, none of these questions are relevant as the price should not be dependent on these answers. Our suggestion is to ignore all of the dealer’s questions and to reiterate that at this stage, you’re really only interested in pricing. Respond by asking for the best ‘out-the-door’ price again. If they push back again by saying that ‘We’re really only trying to help you! Can you at least answer some of my questions?” You can then say that you’ve contacted a number of dealers and that you’ve test driven the car and that you’ve already received a number of responses, but that you’re curious what their best out-the-door price is. The dealer wants to know where you live so that he can factor in potential servicing profits if you live nearby. The dealer wants to know how many dealers you’ve contacted, so that he knows what his odds are of getting the deal. The dealer wants to know how you’re paying for the car, so that he can factor in his potential profits from financing/leasing. The dealer makes the least on a cash deal. The dealer wants to know if you’ve test driven a car, so that he can invite you down to the dealership.
- Here’s our best offer. [6/26] Only 6 dealers gave us the price quote with no fuss following our email. After calling the 2 dealers, we ended up getting a total of 8 quotes from 26 dealers. You may think that this is a low number, but don’t worry. This is enough for our purposes. You need a low quote. You don’t care how many non competitive offers you get. We will try to get that low quote in the 2nd round of emails.
- Please contact us once you’ve received all of your quotes and we’ll try to beat it. [5/26] In our experience, about 20% of dealers fall into this category. These are the dealers who don’t want to give you a competitive quote to use as a leverage, but still want to stay in the game. We recommend saving these dealers for last. Don’t e-mail them on the second round; rather ask them to beat the best quote from the second round in your third round of emails.
Can you beat this price? (2nd round)
The highest quote that we received was $38,954 CAD and the lowest quote that we received was $36,600. The average price that we received from the 8 quotes was $37,933. As you can see, the price difference on the exact same car, trim and color was $2,354! We potentially saved that much without even leaving the house yet! So far, so good. The lowest quote that we received was from a dealer quite far away. Good thing that we expanded our search!
What to do now? Our strategy was to email back most of the dealers again (even the ones that never responded to our 1st email) to ask them if they can beat our new low price of $36,600. However, we left out all of the dealers that asked us to email them back once we have our lowest price and any other dealer that we felt was aggressive in pricing (we’ll save those dealers for last). Here’s an email template.
The lowest quote that I received so far on a Black Metallic 2015-Forester 2.5i Touring Package with Technology Option is $36,600 on-the-road (with all taxes and fees included except licencing fee). If you can beat this price, please let me know soon as possible as I’ll be making an order this week. Thank you.
Common dealer responses (2nd round)
- No response. [11/26] 13 dealers never responded to our 2nd round of emails. That’s fine. You can eliminate these dealers.
- We give up. [7/26] 7 dealers responded back saying that they can’t beat that price. Common responses were “That’s an unbelievable price!” “That dealer is losing money, unbelievable!” “Can you let me know where you got that offer?” Don’t believe what they say. No dealer will sell a car at a loss. Dealers get certain indirect incentives and holdbacks for selling a certain number of cars, etc. We don’t know the details, but rest assured that they won’t be losing money. Many dealers asked us where we got such an offer, sometimes very sneakily “Wow, amazing price! I want to buy one too! Can you let me know where?” We don’t know what they’ll do with this information, but they’ll probably tell their general manager that so-and-so dealership is selling this car at this low price. We don’t see how that will help our situation. So, we never responded to such questions.
- We can beat the price! [3/26] 3 dealers emailed us back saying that they will beat that price! One of those 3 dealerships never even responded to our initial email! Good thing we emailed all of those non-responsive dealers! The general manager of the non-responsive dealer emailed us back saying that he can beat that price, but we have call to him back. THAT IS WHY you email the management! Only they have the power to make such decisions. Another dealer offered $36,300 and a third dealer offered $36,289.05.
Can you beat this price? (3rd round)
Depending how low the prices have gone down already, you might want to do a 3rd round of emails. In our example, all of the dealers were squeezed dry after round 2. We emailed the most aggressive dealers (the dealers that we saved for last), but none of them were able to beat our new low price of $36,289.05. This is when you know that you’ve gotten the best price.
The deal is done
We decided to buy from the non-responsive dealer for $36,300 as the car in the color we wanted was available for immediate delivery. From the comfort of our own couch, we potentially saved $2,654! Pretty good! We emailed back the general manager saying that we’d like a test drive and we’d possibly like to start the paperwork. Also, we asked if there is anybody in particular we should ask for when we arrived at the dealership? We asked this question as we realized that no sales rep may be getting commission on this transaction (as we negotiated directly with the GM), so we wanted the GM to assign someone to help us and for the GM to brief the sales rep on the price we agreed to. When we got to the dealership at the agreed time, the sales rep was courteous and polite, but he was much more interested in serving other “commission paying” clients, for which we don’t blame him. In fact, the sales rep was so disinterested in us that we even test drove the car all by ourselves! We’ve never heard of that before. When we got back, we had to wait for an hour to speak with the sales rep to complete the 1 page bill of sale as he was too busy with other clients. Except for the wait, it was a rather pleasant experience as no one tried to up-sell us anything as the price was already finalized.
Once the paperwork was drafted, it had to be approved by the dealership’s business/finance manager. We went into the manager’s office and he went over the transaction (i.e. you are buying this model car, with this trim level, etc.) to make sure that everyone was on the same page. The total cost was $36,375.00 (with $75 for a license plate). The manager confirmed that we had put $1,000 in down payment and we would need to bring a bank draft for $35,375.00 and proof of insurance when we pick up the car.
After that the up-selling began…
The manager began extolling the benefits of extended warranty. We listened politely, but we were not really interested. One of the main reasons why we’re buying a Subaru is because it’s such a reliable car. Keep in mind that Subaru comes with a 3 year bumper-to-bumper manufacturer warranty. So, if you buy a 5 year extended warranty, it only adds an extra 2 years of coverage. Also, you can buy extended warranty up until your manufacturer warranty runs out (so, you have 3 years to decide). Therefore, do not feel rushed to buy an extended warranty when you buy a new car. Go home and think about it. Dealers make a LOT of profit/commission with extended warranties, so don’t be surprised if they push hard. If you decide to buy an extended warranty, the warranty prices are negotiable like everything else. When the manager asked me what I thought about his presentation, I said that I would be more interested in purchasing extended warranty where the deductible was $1,000 or $2,000 (instead of the $0, $100 or $250 deductibles offered by Subaru). He was shocked and said that in his many years in the business, no one has ever asked for higher deductibles. I explained that I am not worried about small repairs. It’s the large/infrequent repairs that worry me. I suspect that Subaru doesn’t sell low cost high deductible plans as fewer people would buy the high cost low deductible plans. I declined to purchase an extended warranty.
We did a bit of research on extended warranties and practically no one recommends it. Consumer Reports polled 12,000 consumers and it generally advises against buying extended warranties as the warranty generally costs more than repairs. You can read the article here.
The manager is a pretty good salesman. He starts by asking “What kind of person are you? Do you take care of your car, do nothing at all or somewhere in between?” That’s a loaded question if we’ve ever heard one! What we should have said is that we do nothing at all and the conversation would’ve ended, but as he expected, we said that we take care of our car. In short, we declined the rust proofing. Consumer Reports says that modern cars don’t need rust proofing. Don’t bother. You can read more about this here.
Other accessories you might want to consider
If you live in an area where it snows/gets slushy, you may want to ditch the OEM floor mats and get yourself either a set of Husky or Weathertech floor liners. These are the top 2 floor liner manufacturers. For the Forester, the Huskies are less expensive, it looks cheaper, it’s thinner, but it has spikes beneath the mat (less movement) and it provides better protection behind the gas pedal (at least for the Forester). The Weathertech are more expensive, they look much nicer, thicker, but there is less protection behind the gas pedal (at least for the Forester). You can read more about the differences between the two brands in this thread @ Subaru Forester forum.
It is still unconfirmed if the 2014 Forester floor mats will fit the 2015 Forester, but chances are that it will fit perfectly. We ended up ordering the front and rear Weathertech Floorliner mats.
If you don’t want to buy from the manufacturer, you may be able to get them for cheaper on eBay, www.autoanything.com or www.autoaccessoriesgarage.com.
Husky Liners Weatherbeater Floor LinersWeatherTech FloorLiner DigitalFit
- Try to buy cars near the end of the month–as they have quotas to meet, so dealers are more willing to deal
- Never say how much you want to put as a down payment before the price is finalized
- Do not mention that you want to trade in a car before the price is finalized
- Negotiate only via email/telephone
- Don’t step into a dealership without getting the best quote via email first
- Try to email the sales manager or the general manager
- Email as many dealerships as you can within a reasonable distance
- Don’t buy extended warranty
- Don’t get rust proofing
- Consider buying a 3rd party floor liner
Here are a few other websites that you may find helpful:
17 Things Car Salesmen Don’t Want You to Know
Car salesmen of Reddit, what’s something you don’t want customers to know when buying a car?
Buying a Car: How to Negotiate With the Dealers
Negotiate using email
Get the Best Price on a New Car With 4 Simple Steps