No-Hassle Car Buying at No-Haggle Dealerships

By Ali Koomen, who spent over a dozen years in the car business

While haggling over the price of merchandise makes most Americans uncomfortable, in many mid-eastern and Asian countries it is considered a normal part of doing business. In fact, in some markets it is almost an insult to the shopkeeper if one does not engage in some good-natured bickering before mutually reaching a price.

It is not in our culture to haggle over prices. Sure, we may ask for a ‘freebie’, like no delivery fee when we buy a washer-dryer combo, but it’s almost an embarrassment to haggle a price —except when it comes to buying an automobile. Could you imagine going into a nice furniture store, pointing out a thousand dollar sofa and then telling the owner: “I looked it up online and I know you paid $600 for it, so I am prepared to give you $650 because fifty bucks is more than enough profit.” It would certainly take chutzpah to do that, but conversations similar to this take place every day at car dealerships across the country.

If back and forth haggling is unsettling to you, a no-haggle dealership may be the best place to buy a car. The sticker posted on the vehicle is generally a fair price somewhere below the MSRP (Manufacturer’s Suggested Retail Price.) No haggling, no bickering, the price is what it is. The no-haggle price allows the consumer to get a fair deal and it allows the dealership to make a profit. The dealership still sets the prices, so the discount given will vary from car to car, just as it would on a regular lot. It’s easier than the standard way of purchasing a car, but in many cases a better deal could be made at a regular lot. However, dealing with a regular dealership involves a lot of time-consuming back and forth haggling. In today’s world, many do not have the luxury of the time needed to negotiate a traditional deal, while others are adverse to the pressures of such a purchase. For those people, the no-haggle lot presents a simple way to buy a car.

Saturn, a division of GM, is well-known for having no-haggle lots. It’s easy for Saturn dealerships to do so, as GM restricts the number of Saturn dealers in any given area. However, many other brand dealerships have turned to the no-haggle policy. An example is Autonation which is the largest car retailer in the U.S. with over 200 dealership locations, sells new and used cars at fixed, no-haggle prices. Carmax is another large automotive retailer that offers up-front pricing on used cars; Carmax has close to 100 used car superstores throughout the U.S.

Keep in mind that no car dealership sells any vehicle without making some sort of profit, and the no-haggle places are certainly no exception. While the price of the vehicle is a given—after all, it’s posted right there on the windshield—the dealership has all sorts of other ways to make money off any deal. One common trick is to undervalue the trade-in or to charge a higher interest rate than merited. Dealers also make a lot of money by selling unnecessary insurance policies and extended warranties and/or aftermarket equipment and add-ons.

The best way to come out ahead at a no-haggle lot (or any dealership, for that matter) is to sell the trade outright, obtain financing ahead of time from your own lender and by saying no to all pressures to buy additional policies and equipment. That’s how the dealerships juggle numbers, and without that, it’s quite easy to see if you’re getting a good deal.

However, if you do enjoy negotiating and prefer to buy a car at a traditional dealership, see tips on negotiating a great car deal. Here’s more tips for negotiating a used car.

If you have a question you’d like our experts and community to answer, please ask your question at http://forum.iseecars.com.  To start your used car search, visit http://www.iSeeCars.com

Related posts:

1. Inside the Used Car Business: How and Where Do the Dealerships make their Money? By: Sarah E. Sanuth, an insider in the automotive industry  with many years of experience in the car dealership and repair business Used car dealerships are very different than many of your...
2. Pros & Cons of Buying Used Car for Sale by Dealer or Owner When you are in the market for a used car purchase, there are a number of factors to consider. Your finances, your personal taste, and your experience with vehicles all play a...
3. Step-By-Step Guide to Buying a Used Car Used cars can save you thousands of dollars on cars just as spectacular as new cars and with relatively low mileage.   Used cars can be some of the most fuel efficient...
4. When Are The Best Times to Buy a Car to Get a Great Deal By Ali Koomen, who spent over a dozen years in the car business The price on any new vehicle is subjective. The make/model/trim level/units available/possible rebates/trade-in value and even the mood of...
5. Negotiating Tips for Buying a Used Car Finding used cars for sale these days is easier, thanks to the Internet’s help.  Classifieds websites like Craigslist, eBay, and especially car classifieds search engines like iSeeCars.com allow you to easily search...

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This entry was posted on Friday, January 30th, 2009 at and is filed under Tips on Buying a New Car, Tips on Buying a Used Car, Tips on Buying from a Car Dealership. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.