The boom in car sales in the USA is long gone, and although the market is currently showing all signs of gradual growth, pre-crisis indicators can only be dreamed of. This forces dealers to be more willing to make cost concessions at the expense of their margins. For this reason, the official cost of the car indicated on the site does not mean at all that you will have to part with just such an amount. Remember that not all rebates are official and available at the moment, so hunting for a discount is a whole science. And we intend to bring you up to date so that you can save the maximum amount of funds allocated for the purchase – believe us, they will still be useful to you.
The present time can be rightfully described as a “buyer’s market”. This means that you can get a rebate on almost any car, even the most budget one. You just need to know how to do it.
Varieties of dealer rebates
The product market is interested in buyers, its task is to attract a customer using all kinds of marketing techniques. But nowadays the consumer is also fastidious and smart, therefore the effectiveness of advertising in all its manifestations decreases every year. But there is a mechanism that works flawlessly on a potential buyer. This is the provision of various rebates, from purely symbolic to very impressive. There is no official classification of such rebates, but we took the trouble to compile an approximate list of the most common offers.
So, what kind of new car rebates you can get in a car dealership?
- seasonal – provided for models sold outside the current season, or for seasonal lots of cars;
- festive – offered on the eve of the holidays and during the holidays;
- personal – offered for a certain assortment of goods to specific buyers, ranked according to one criterion or another to a privileged category;
- promotional – provided for specific models to all customers without exception with the aim of artificially popularizing the brand;
- dealer – provided to trading partners, regardless of the scale of their turnover (but taking it into account);
- special discounts – provided to those potential customers (categories of buyers), in whose orders the car dealer is most interested;
- progressive – offered on a contractual basis when purchasing multiple vehicles.
In all these cases, the cash equivalent of the rebate is calculated simply by multiplying the discount percentage by the official cost of the car. In many car dealerships, you can expect to receive several discounts, but with certain restrictions. Subsequently, the amount of the aggregate discount is deducted from the cost of the goods, and this price is fixed in all sales documents, and not necessarily with an indication of specific discount items.
There are also cumulative discounts in regular retail and wholesale trade, but they are useless in the automotive business: a vehicle is a piece goods that are bought for decades, so the probability of using such a rebate is close to zero.
When can you get a rebate from a car dealer?
Often colorful banners are posted on the official dealer’s website telling about certain rebates and promotions, but when you come to the salon, they politely explain to you that the car you like does not fall under the action for one reason or another.
But the opposite situation is even more common: when you can find out about a rebate at the last moment, and there are no advertisements on this account. Much depends on the case and your talents.
With a successful combination of circumstances, if you know how to get a rebate when buying a new car, it is quite possible to purchase a budget car with a $500-1000 discount. The bonus will be higher for a more solid car – from $2000 and more.
But it’s important to remember that buying a car is not the same as buying a refrigerator or TV. In a home appliance store, you are just another customer, and if you start to show excessive persistence, they will ask you to leave without a doubt. In a car dealership, you are always a welcome guest, each visitor is appreciated, so you can afford statements like “other dealerships offer cheaper cars” – all your claims will be considered and you are likely to be offered a compromise option.
When is the rebate usually provided? Here is an approximate list of situations when you can get a significant discount:
- change of generations. This information is not always present in the price lists, but during a personal visit to a car dealership you should inquire about the availability of such offers;
- getting a corporate bonus is unrealistic, but, nevertheless, it is worth finding out if your company is a corporate client;
there are rebates for regular customers, but if you managed to get a discount card, it may well turn out that it has a personal residence permit, and you will not be able to use it;
- another effective way to get a rebate from a dealer is to find out the cost of the same model with a similar configuration from neighbors, there is a great chance of getting a good bonus;
- promotional offers during a holiday or other significant event are a matter of chance;
- one of the most effective methods of getting a rebate: detecting a defect on a favorite car. But even here you may be offered other compensation methods instead of a cash bonus.
Now let’s look at specific debates in more detail.
Since the technical improvement of cars is a process that does not stop for a second, even the most successful model with the release of a modified one becomes obsolete, and the interest of potential buyers switches to a novelty. This situation is common, sellers are forced to reduce prices in order to get rid of stale cars, sometimes – officially, but more often – in the form of discounts.
This is a good way to get a rebate from an authorized dealer. The mechanism works according to the following scheme: the release of a novelty is usually known in advance, the dates of the start of sales are announced several months before the event, usually after the presentation at the next auto show. After some time, the price of specific configurations becomes known, and before the arrival of the new item, car dealerships begin to actively sell the previous modification. At the same time, rebates can be significant, and the difference between cars is insignificant. This is a great chance to become the owner of a new car, saving a significant amount.
Every city has well-known local businesses and companies. They are the subjects of corporate discounts since they purchase cars by updating their fleet quite regularly. It is likely that you are an employee of such a company, in which case you have a chance to get a solid 6-10% discount. Of course, if the conditions stipulate that employees of a corporate client can count on this. Typically, the corporate bonus is cumulative, so your company will be interested in you buying a car from a dealer under this program, receiving your additional half a percent. Do not forget that there are often other incentive programs for corporate clients – a discount on service, for example, or on the purchase of spare parts, there may be a loan/leasing program on more favorable terms, etc. The car service manager will tell you how to get such a discount from a dealer. You can inquire about the conditions for obtaining a corporate bonus in your company.
Bonus for regular customers
The car is one of the most expensive consumer goods, so it certainly does not refer to fast-moving consumer goods. So in this regard, the definition of “regular customer” looks somewhat far-fetched – the chances that you will contact the same salon for a second purchase are very small. So getting a car rebate as a regular customer is problematic. However, loyalty programs still exist and they are designed for wealthy people. Moreover, in most cases, they are not applicable to mass models. But if you have once purchased a premium model, then remember that you have a personal discount, the average size of which is about 5%.
Yes, many dealers practice this type of promotion as well. So if you have saved up enough money to buy a car, you have to fulfill two conditions: wait for your birthday and find a salon where such an offer is valid. Of course, it is also necessary to carefully analyze the cost – it may turn out that another salon offers to buy a car of the same equipment without a discount but it will cost less than with an anniversary bonus. In this case, it makes no sense to get a discount from a dealer.
Strictly speaking, this custom is very common in the United States and Europe. There, sales volumes grow by an order of magnitude on the pre-holiday days (especially on Christmas), and consumers specifically save money for this date in order to make bulk purchases at prices that are half of the regular ones. This also applies to the car market, although not to the same extent.
Discounts for defective cars
Few people know, but almost any new car has at least one small defect in the form of a barely noticeable scratch, paintwork chip or even a micro-dent. This fact is explained simply – the car is delivered to the final melancholy of sale from the factory, not packed in a cardboard box but open. This can be sea transportation, delivery by air or on a car platform – in all cases, the probability of damage is not zero. It especially increases at the final stage when the car is unloaded at the car dealership.
Of course, dealers strive to eliminate such defects, but they are people too, and they can also miss something. In this case, you have a good chance of reducing the cost.
Such discounts are sometimes large – it all depends on the estimate of the cost of repairs.
End of the reporting period
Each dealer has a sales plan. A bonus fund is formed according to the results of its implementation, so sellers are vitally interested in its implementation. For most automakers, this reporting period is a quarter, but some practice analyzing sales reporting every month. The likelihood that you will be offered a car at a lower cost in the last days of the month/quarter exists, but it usually does not apply to all cars. In addition, they try not to advertise such bonuses. And if the buyer is determined to make a purchase, then he or she may not get a discount. Pretend that you are in doubt and are ready to go to another car dealership – and then you will be offered a quarterly bonus.
A car is not a very popular product, especially in a year of a noticeable decline in consumer activity. The assortment is usually replenished at the end of the current or the beginning of next year when the manufacturer already knows how much the sales target has been fulfilled. In any case, price tags reduced by 5-15% are offered for cars of the last model year in December-February. These are the largest discounts on cars that are only possible from a particular dealer. There is no need to complain that the model is already outdated – this is not true: often newly arrived cars of the same model are absolutely no different, they only differ in the year of production. If you plan to sell this car in 5-7 years, then you should not be afraid that the difference in one year will affect the price in a significant way. The condition of the vehicle will be much more important, and this is already your concern.
Strictly speaking, such an offer can only be called “a discount” – the cost of the car will indeed be noticeably lower, but you will have to leave the old car at the dealer. The amount of your discount in this case will be equal to the value set by the appraiser for your battered car. In other words, you simply exchange the old vehicle for a new one, paying extra to the seller. But this practice is widely used in the West due to high disposal costs.
Car dealers do not hesitate to actively use tactics of putting pressure on a potential buyer by offering various imaginary bonuses. But since today’s business is simultaneously conducted on the Internet, the transparency of pricing is forcing sellers to change their tactics. In other words, they will still try to sell you a car, resorting to various psychological tricks.
And since you have come to a car dealership, the main task of the manager is to lure you into the salon in any way. A powerful stream of words will fall on you, the purpose of which is to make you come to the stand with the cars on display. After that, most likely, you will be gently and imperceptibly persuaded to make a rash purchase.
Within this strategy, the following strategies can be used:
- you will be promised all kinds of discounts;
- an obligatory step is to change sellers. Perhaps some of them will be able to reach your decision-making center;
- they will tell you the attractiveness of deposit offers;
- exposure through colorful advertising, creating a sense of celebration.
In a word, there are many ways to put pressure on a client, and if you do not want to make a purchase based on a momentary mood with a high risk of financial losses, you should know about some standard techniques used by sellers and having high response efficiency.
“You are late”
The essence of this method is to publish an advertisement in which a car is offered in a particular salon at a very favorable price. Naturally, you have a desire to become its owner. But when you arrive at the place, bad news awaits you: it turns out that the desired car was sold literally 15 minutes ago! But since you are already firmly aiming at the purchase, you are immediately offered another car. You agree but then at home you discover that you have purchased a car at a significantly inflated price. Hence the conclusion: if you find a suspiciously good offer – treat it with skepticism, try to clarify the availability and relevance of the price through the contact form.
Many potential buyers spend months surfing the Internet, trying to find a dream car. And when they find it, they go to the nearest car dealership, where they are told with sympathy that this model is expected only in three months, but one of them is on the way. Of course, you immediately pay the deposit and go home with a happy smile. But after a few days, you are informed by phone that the delivery is delayed for a month, then for another one. This can be repeated several times. You are unlikely to decide to change the dealer, as it means you will be placed at the end of the queue. So you have to be patient and wait…
Conclusion: if there is no model you like in the salon, look for another dealer. Be sure to compare prices: delivery times for all sellers are the same.
If you are being offered a discounted vehicle that has participated in demonstrations, you should be suspicious of that offer, even if the run is purely symbolic, about one or two thousand kilometers, even if there are no visible damages or defects. The fact is that such cars often participate in test drives, which means that it has been used by more than one hundred customers who used the engine’s capabilities to the maximum. And, as you know, a gentle mode is recommended for a new motor. So you buy a “pig in a poke” and you may face problems in the foreseeable future.
So, you can buy a car in accordance with the official price tag, you can purchase a car at an inflated price, but there is always the option of getting a car rebate. Which one you choose is up to you, and we hope that the information provided on KCFEFCU.com will help you make an important purchase at a lower price.