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Originally Posted by vasoo Looking to pickup a used car from Hertz. Going through the motion now. Will post a detailed update later. Finding a 2014 Sonata with 30 k miles interesting at about 12500 |
Don’t do that. Rentals are the most abused cars in the market. Look for privately owned cars. Leased cars are also somewhat OK but renal/ fleet vehicles are an absolute No No...
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Originally Posted by hybridpetrol A naive question: The final purchase price of a car in USA, should consider what all points? While asking this, I am thinking of the On-road price of a car in India, which includes the ex-showroom price advertised by the manufacturer, road tax, first year insurance, and mostly the dealers add basic accessories & handling charges.
After looking at the blue book for the fair price quote - what else should be paid for additionally to arrive at the final figure? Assume insurance is one of them. What else?
Examples with real numbers would be great! |
New car market in the US open to a lot of haggling/bargaining and things can get very confusing. Here are a few terms that will help...
Invoice Price - This is the price for which the dealer supposedly gets the car
MSRP - This is like our MRP. The price suggested by the manufacturer.
Your dealer will typically sell you the car for a price in-between the Invoice and MSRP. Look up KBB for a fair price. You pretty much want to get KBBs Fair Price or lower.
It is NOT uncommon to get your car for a price LOWER than the invoice. Typical happens for not very popular cars or unpopular trim levels of moderately popular cars or cars that are going to soon get replaced by newer model year versions.
Why sell below Invoice? Dealers get something called Holdback from the manufacturer which can be ~3% of Invoice after the car is sold. Dealers also make money from a variety of other items that they will up-sell you on - more on than later.
In addition to the cost of the car, which we said should be close to KBB fair price, there will also be a destination fee and a documentation fee. Destination is typically in the $800 range and documentation fee is upto $100 depending on the dealer. You may get away with the documentation fee but you will almost always get the destination fee added to the price of the car.
Then there are taxes. So final Out of the Door price will be = Car Price + Destination Fee + Documentation fee + Taxes + Registration Fee.
So dealers may include registration fee in the documentation fee, some charge it explicitly and may even ask you to write checks in name of DMV.
The only price that is variable in the above equation is the actual price of the Car. So bargain hard. But please be courteous and once you agree on a price, do not ask for more discounts. Dealers know you will bargain but will cringe if you ask for more discounts after they have accepted your offer. No freebies are included with the car e.g. Mats, Perfume etc. If you are looking for things like Mats, Splash Guards, Lock Nuts etc. make sure you ask for it to be included when you negotiate the price of the car and not after you settle on a price. You can of course ask the dealer to install those items and choose to pay full price after you settle on the price of the car. Note that this is one of the dealers biggest profit centre.
My take on a very good deal for a car is to drive out of the dealership at a price close to the MSRP of the car.
In India, Insurance is typically included in the price of the Car. Here it is a totally separate transaction. The dealer can buy the insurance for you but it will be billed as a separate transaction. If you finance, insurance will NOT be added to the amount financed. But you can get your insurance company to bill you monthly for insurance as against the typical 6 month price. It is almost always a good bet to shop for insurance on your own than get it from your dealer.
One last tip - dealers are more flexible with pricing at the end of a month and even more at the end of a quarter. So negotiating with the dealer on say 27/28 and finalising purchase before 30th will always get you a good deal.