So, I bought a new Honda Accord Sport last week. Yes, I know, I’m a fool. Many of the gurus tell you not to buy a new car, but rather, you should buy one a couple years old to take advantage of the depreciation. From my experience and through the research I did, I found that the difference in price between an Accord that is a couple years old and a brand new one is not that big. I decided I’d rather buy it new so that I get the full warranty and know the car’s history. For some that’s probably controversial. For me, it was the right choice.
I actually didn’t spend much out of pocket. I had an Acura (that I bought used a few years ago) that was basically about the same price (retail) as the new Accord so it ended up being a very small check to write. (Financing cars is evil so I pay cash). I took advantage of the Costco car buying program which pre-negotiated a price that was below invoice and I checked that price on truecar.com to make sure it was a good deal.
There really wasn’t much to negotiate with the dealer, other than the price they’d pay me for my trade in. While most people say you shouldn’t trade a car in, I did a lot of research and figured out how much I’d likely get trying to sell it via Craigslist. While that price was a little bit higher than the trade in price, the HUGE sales tax savings I got, pretty much offset the difference and I didn’t have to deal with the hassle of selling it myself. (In Washington state, your trade in lowers the taxable price of the vehicle you are buying).
After doing my research, I had a price I wanted for my trade in so I gave them a number higher than that as a starting negotiation. I also asked them to include all weather floor mats and a factory trunk liner. I knew they were pricing those items astronomically higher than they should have but it was a good tool during the negotiation. By the time I was done negotiating (my salesman got really tired of walking back and forth to the sales manager so the sales manager ultimately came out and negotiated directly with me), I had the price I wanted for the trade in. When I got close to the final price, I told them to keep the floor mats and trunk lid (that they valued at $795) and just settle on my price. They did.
As soon as I bought the car, I drove home and got on Ebay. The trunk tray that they “valued” at $300 was only $80 including shipping. I could have also purchased the all weather factory floor mats for less than a third of their price but actually wanted the Weathertech mats (which are FAR superior), so I bought those directly from Weathertech at less than half the price of the subpar factory mats. I also picked up wheel locks for about a quarter of the price of the dealer and grabbed the factory splash guards that go behind the wheels for about a 3rd of the cost. All of these items were used as a way for the dealer to build profit in to each sale. By buying the car without any of the “add ons”, I was able to save nearly $1000. Installation takes about 5 minutes total for all of the items so that’s not an issue at all.
If you do opt to buy a new car, please pay careful attention to the items that the dealer has added on at their dealership. All of those items are installed to drastically increase the profit of a new vehicle. Ask for a car without all of those options and order anything you really want on Ebay or directly from a low cost factory dealer on the Internet.
All in all, I’m thrilled with the new car. My insurance went down by about $150 a year and my gas mileage DRASTICALLY increased from about 21 MPG to over 35 MPG on the highway. I’m still a bit in shock at the amazing gas mileage this full size car gets. Oh, and the ride is very smooth and comfortable!
You said that you “bought [Weathertech all weather factory floor mats] directly from Weathertech at less than half the price of the subpar factory mats.” How could that be? MSRP of the Honda mats is $143. Functionally the same thing from Weathertech is $100. Now I’m curious, how could you get Weathertech’s price reduced to under $70? (Hope my calculations are correct.)
Couple of weeks ago we bought a new Honda Civic. All price negotiation was done over email (car-with-no-options price, and out-the-door price). After a short test drive, the salesman started describing all the goodies they installed on the car – door edge guards, floor mats, splash guards, wheel locks – and how it should affect the price of the whole thing. I said “well, we will be leaving now, and you will get in touch with me when you find a car exact same color, but with no options, as we discussed earlier”. About five minutes later he offered to sell me the car as is, at the price that we agreed upon earlier (via email). The price was below dealer invoice, as far as my research leads me to believe.
Honda financing at 0.9% APR was also a nice thing to add. (A week earlier Capital One sent me a blank check which I could use to buy a new car, at 2.39% APR. Wells Fargo, with whom I have the longest relationships, first offered a new car loan at more than 4% APR, and then [after me yelling at the rep] generously redusing it to just 3.3%.) Honda loan will cost a bit over $400 over the 60 month term. I intend to pay it in full in about a year – there is no pre-payment penalty – so it should cost me about $160, and will probably push my credit score close to the upper limit.
Vards
The dealer was trying to include the floor mats as part of the deal for $300. I bought the Weathertechs for $179 so it wasn’t quite half. I found it ridiculous that they tried to mark things up so much. I think they figured a lot of people either aren’t paying attention or just don’t value the smaller things as much on a larger transaction. It sounds like you got a great deal! I bet you’ll love the gas mileage!
Hazzard
Ah, you bought the FloorLiners! I got these too – so much better than Honda original floor mats! Thank you for the tip.
Yep! I don’t think I’d ever buy anything but the floor liners. I have them in my wife’s car too. They really save the carpets and they look great!