Your Nuclear Option at a Car Dealership

The single best tactic we could possibly use in negotiating a deal for a car is painfully simple and at our disposal any time we choose to use it. Here it is: If you don’t like the deal they’re offering, just get up and leave! It’s your nuclear option at a car dealership.  It’s the one action that’s guaranteed to stack the negotiations in your favor no matter what else is happening.

When is the right time to pack up and leave?

  • When you feel pressured
  • When you feel confused
  • When you’re certain you’re paying more than you can afford, even though the dealer says otherwise
  • When you sense based on your research that you’re being given something less than the best deal available
  • When you feel like the sales staff is ganging up on you in the classic car dealership ambush
  • When that little voice inside is screaming “something isn’t right” (the little voice is never wrong)
Your Nuclear Option at a Car Dealership
Your Nuclear Option at a Car Dealership

Exactly when should you do it? Optimally, it would be best to do it anytime after you’ve established your intent as a serious customer, but before signing the final contract and turning over your trade-in or check.

The reasons you might not use your best negotiating tool

If walking out is so simple and easy, why don’t more people do it? I’m no psychologist, but I’m guessing the reasons for this are rooted deep in the recesses of our emotions.

For example…

  1. You feel like a victim (you’ve always been a victim, and buying this car will be just another example)
  2. You want the car more than the salesman wants to sell it to you
  3. You know nothing about cars, you don’t think you know anyone who knows any thing about cars who might help you, so you’re prepared to throw yourself on the mercy of the salesman
  4. You hate negotiating
  5. You didn’t bother to (or don’t think you can) line up your financing and/or to sell your old car and bring your down payment in cash before going to the dealer, so you’ll have to rely on them for that too; you hope they’ll give you a good deal on those but you’re worried and don’t want to push them too hard
  6. Though you you’ve only known the salesman for 30 minutes, you’ve convinced yourself in that time that he really is a nice guy (has your best interests at heart, would never cheat you, knows your third’s cousin’s second wife’s former mother-in-law, etc)
  7. You hate making major purchases and you just want to get it over with
  8. You need to get a car today (a.k.a., the car dealer’s nuclear weapon)

None of these, or any others we could come up with, are legitimate reasons for not walking if the deal doesn’t look right.

Why you MUST be prepared to walk out of the car dealership at any point in the negotiations

For a variety of reasons, it’s absolutely critical that you be prepared to leave the store even before you get there!

  1. You can’t out-deal a good salesman. A good salesman has, shall we say, a killer instinct. It may be this quality more than any other that drives the most successful people in sales. They can sense when and where you’re weak and they know how to exploit it. They’re keyed into certain words, facial expressions and even your body language (there are sales courses devoted exclusively to this one!). Your only defense is your will to resist, best demonstrated by your willingness to walk.
  2. You’re on the dealerships home turf. To put the situation into sports parlance, you’ll be the visiting team in this game, and all the “officials” on the field will be pulling for your opponent, the home team salesman. Your best defense in this hornets nest is to be prepared to remove yourself from unfriendly territory at any time.
  3. To keep you from paying too much. It’s a reality that you and the dealership are on opposite sides of the fence when you’re buying a car. You need to establish this early on as a counter to the salesman’s attempts to convince you that he’s your friend. He’s not.Absent recognizable resistance from you, he will charge you the highest price he thinks you will tolerate, and then pack the deal with extras that will raise the price even more. A bankable idea on when to walk: set a price in advance that you won’t exceed – when it does, you’ll know it’s time to make your dramatic exit.
  4. To keep you from closing the sale before you’re ready. To the masses, a car dealership is where people go to buy cars. To the dealership staff, it’s a place where sales are made. Do you see the difference? They’re on commission – the more cars they sell, the more money they make. They need to sell. There are quotas – they need to sell a lot. They need to sell now…like tonight…like before closing.Every effort by the salesman and his management buddies will be geared toward making a deal happen before closing. That’s they’re problem – not yours. Be prepared to walk when it starts looking as if you might be caught in that trap. If fact, if they really need to make a deal (they usually do), threatening to walk increases your bargaining power considerably.
  5. It tells the dealer you can’t be pushed around. Every advantage the dealer and his salesman have in the negotiations collapse in the face of a customer who can’t be forced to do anything against his will. Unless you’re a skilled (and fully prepared) negotiator yourself, the best way to let the dealer staff know this is by making it clear from the start that either you get what you want or you walk out the door. You can do this simply by dropping hints that you’ve either spoken with his competitors, or fully intend to do so.

 

Walking out isn’t a substitute for smart negotiating, but it can cover a multitude of sins if things aren’t going the way you want. Use it wisely, use it sparingly…but use it when you must.

Have you ever left a car dealership in the middle or even at the end of negotiations? Do you think it’s something you have the nerve to do?

( Photo by epicfireworks )

18 Responses to Your Nuclear Option at a Car Dealership

  1. Absolutely! Did it once when in the process of buying a truck. It was a sweet dark green pick up truck that sat on the lot and it was in pretty good shape with low miles. But the salesman wouldn’t budge on the price at all nor negotiate for car mats or anything at all.

    Then they tried to totally screw me on financing with a high rate. The loan lady was one of those fast talking in and out of the room type and after we thought about it for a bit, bolted out of there – faster than you can say – where are they?

    They literally chased us down to our car. The loan lady was furious. lol. Needless to say we never went back and scored a much better deal in another part of town, later that same day.

    In a car dealership – you HAVE to be prepared to walk out.

  2. Danny – It’s amazing how many people won’t do what you did, and they end up paying too much, or even buying a car they really didn’t want. I also think that the fact that you walked on one dealer might have had a hand in the better deal at the next one. There’s a certain confidence that comes once you establish your willingness to walk away from a bad deal. I think dealers and sales people can sense it too.

  3. I walked out of a dealer when they told us we were getting 0% and as I was signing the docs I noticed a 4.9% rate!! I was furious!

    I told the sales manager to shred the docs and I followed him to his office where he put the papers on his desk – I stood there and waited for him to shred them – he finally did.

    As we were walking out, there was a horrible thunderstorm going on and the sales manager was yelling at his salespeople from across the showroom to NOT give us an umbrella! It was a crazy experience!

  4. Jason – That’s an excellent illustration of how the dealer and it’s staff are not our friends. It’s too bad you had to go through that, but a lot of people do. What’s worse is that so many sign the paper work without reading it, so they’d never catch what you did.

    I tend to be anal about reading documents. I know it ticks people off, but I find things like that all the time. What’s worse is when they tell you one thing, but the documents say something else. Guess which one will stand up in court?

  5. It’s amazing how some dealers will think that doing things like that equals good business practice. I’ll tell you, I’ll choose an honest dealer that deals fairly with you, every time, and I’m much more likely to recommend them to others as well. We went to one dealer that was extremely honest with us – and we didn’t end up buying with him – but – because he was so honest with us and dealt with us fairly, we recommended his dealership to friends/family – and I’m sure others bought through them.

  6. Peter – When you get a good, honest dealer who actually means what he says and stands behind his product, he’s worth his weight in gold.

    From what I’ve heard from those who work in car sales, the system conspires to produce the other kind–the fast talking, bait-and-switch, wheeler-dealer types. The shelf life of a car salesman is incredibly short, so the stereo type seems to be more the norm. It’s very much a “churn-em and burn-em” environment, in regard to both the sales staff and the customer base.

  7. On our last car buying trip, we walked out of a number of dealerships. I had my laptop and a couple of spreadsheets to calculate financing and all of the extras they tried to sneak in as well.

    It was a bad experience all around because we had $5,000 and they all kept pushing us to buy a new car! We settled on one that was 2 years old – practically got called idiots for doing so!

  8. Khaleef – You must have driven them bonkers with those spreadsheets! Most car sales people aren’t technical types–that’s part of why they’re in sales to begin with.

    No surpise they though you were idiots. They’re looking for a quick sale by their book, and if you’re out of the box and don’t cooperate you’re an annoyance.

  9. As you probably know, I ALWAYS walk out on the dealer (only after the test drive that is). I handle the negotiation aspect entirely over email, so if I’m unhappy with a deal I just close my email and move on to the next :).

    And your right, you do have to negotiate trade-in and financing at the dealer, and at that point, occassional use of the nuclear option may be required if they are not playing ball.

  10. CNC – The email method is brilliant. No need to deal with the theatrics at the dealership, we can keep it all business and not get distracted. Email has made it easier for any of us to negotiate. We can be tougher on email than with face-to-face.

  11. I have walked away a couple of times, when I couldn’t get a reasonable deal. The one time I had “that voice inside of me” and I wanted to walk away, I didn’t. And, I got a bad deal. Listen to that voice. It’s always right.

  12. Bret – In my younger days I’d often ignore the little voice. Now I know better! Maybe it’s that our subconcious is busy processing negative information that our concious minds can’t articulate. With business deals, such as cars, the little voice is probably our best friend. Especially with all the shouting that takes place in dealerships…

  13. Great follow-up to your previous post on dealing with car dealers. The reasons most people won’t bail on the sale when they get pressured are ALL psychological. The dealership sets the stage (it is as you say their “home turf”) and uses every influential and persuasive trick in the book.

    Even when you know you’re being manipulated, most people give in anyway (Robert Cialdini’s “click-whir” reaction from ‘Influence: The Psychology of Persuasion)

    My only disagreement on this post might be your final point. I don’t believe that walking out diffuses EVERY advantage that the dealer has … just a lot of them.

  14. John – The whole presentation is a well rehearsed dog-and-pony show that they put on everytime a prospect walks in the door. They know it will work enough times to make it worth doing again and again.

    When I wrote “every advantage”, I should have clarified that its the one big one underlying all–the sense of control over the process they assume they have. And that we give to them.

  15. My father sold cars:>)
    We went into the dealership with documents from other dealers from the net on the price of the car we wanted(knowing WHAT you want should be first).
    We had cash (other times we had the credit union ready to finance).
    We were loudly called the “Cheapest customers on the face of the earth”.
    We drove out in a new car $7,000 less than sticker. That is pretty good on a low end commuter car!

  16. Jan – That’s all from doing your homework and being both aware and prepared.

    The more prepared the buyer, the better the deal he gets and the less the dealer can pull the wool over his eyes.

    Dealers probably love the unprepared. They’re completely at the dealers mercy, and they’ll always pay more for it.

  17. Good post. But it solidifies my resolve to just *not buy a new car*. I just am not sure I have the necessary psychological resistance to the dark forces of the dealership sales masters.

    Therefore, *my* nuclear option is just not to walk *in*–in the first place. Well, at least until I can increase my Jedi powers. 😀

  18. I’m with you completely on this – used cars all the way. But this post was written for those who prefer to go the new car route.

Leave a reply