Step 4 – Negotiate Using Email
How to Buy a New Car
Now that you've organized and ranked the initial price quotes from several dealerships, we're going to give everyone a chance to beat the best quote. Remember, these price quotes are all negotiable! We'll systematically pit each dealer against each other and create a competitive bidding situation where you will be the winner. And we'll do all this without ever having to talk to a dealer!
In addition you will not have to decode the dealer pricing tricks of holdbacks, incentives, rebates, etc. The dealers will be forced to give you a total price to beat their competitors, and they can shuffle their internal cost structure however they want. Remember, you don't care about these details; you are only concerned with the total price of the car. I call this process EPR™ (Email Price Reduction). Remember, cars are commodities just like a barrel of oil or an ounce of gold. The car is the same no matter where you buy it (if you get the same options of course); the only difference you will find is the price.
You will be sending a detailed email to everyone that has supplied you with a quote. Email template #2 (below) contains exactly what you need to ask to get a lower quote. Working your way down from the most expensive quote, you will ask each dealer to beat your current best offer, and you'll update that offer whenever you get a better one.
My approach is based on getting quotes from 5 dealers for the same type of car and completing the process within one week. If you decide to go with more or fewer quotes you can modify how many emails you send out at once and how many days it takes to complete the process. I suggest sending two emails out at a time and waiting for responses. You may not always get a better price or even an acceptable response, which is why you are better off sending a couple at a time.
The end result should be a very attractive offer price. However, if you are still unsatisfied with your results, feel free to cycle through the dealers one more time, but do not bother with any dealers that did not come down in price.
- If you haven't already, organize your quotes from most expensive to least expensive. The least expensive quote is the price you'll be asking everyone else to beat.
- Starting with the two dealers who provided the most expensive quotes, email them using Email #2. You'll be working your way down from the worst offer to the best.
- When you get responses (usually within 24 hours), update your car price comparison worksheet with each new quote for tracking purposes. And whenever a new quote is lower than all other offers, update that price within Email #2 before sending it out again.
- Repeat steps 2 and 3 for the next two dealers in order (from most expensive to least expensive). Again, wait for responses and update your car price comparison worksheet and email template.
- Repeat steps 2 and 3 for the dealer with the lowest original quote (unless his quote is still unbeaten).
- If you are satisfied, jump to the next section. If you think it can go lower, then use your lowest price and re-send the email to those dealers you think might come down even more.
Optional Step: As a courtesy after you've gotten a price you are satisfied with, feel free to contact the salesman who took you out for a test drive and ask if they can match your new best price.
In order to explain to the dealer that you have received a better price and want to give them a chance to beat it, copy and paste the email template below into a reply to the dealer's email.
Remember, every time you get a new “best price,” update it in the email so the dealer knows what they must beat. Use the best price from the Subtotal (Comparison Price) row in your car price comparison worksheet as most dealers will not include taxes in their quote. It's also important to include the MSRP so that the dealer can quote you on the appropriate configuration and he understands that you are comparing apples to apples.
Email #2 – Can you beat this price?
Use this email to negotiate with each dealer.
EPR™ Process – Example
You've received 5 quotes on a black 2010 Nissan Maxima SV (MSRP $34,650) and organized them from most to least expensive.
Dealer A: initial quote – $33,000 Dealer B: initial quote – $32,600 Dealer C: initial quote – $31,700 Dealer D: initial quote – $31,500 Dealer E: initial quote – $30,900
- First, email Dealers A & B, asking them to beat a price of $30,900. Wait for responses. Dealer A's second quote – $31,400 Dealer B's second quote – “that's as low as I can go”
- Then, email Dealers C & D, asking them to beat the new best price, which still happens to be from Dealer E: $30,900. Wait for responses. Dealer C's second quote – $30,500 Dealer D's second quote – $29,850
- Lastly, email Dealer E, asking him to beat the new best price, $29,850. Dealer E responds with $29,600. If you are satisfied, it's time to buy! If you think it can go lower, then re-send the email to those dealers you think might come down more. You decide to resend to Dealer C & D, and Dealer C responds with $29,499. You just beat your original best price by $1,401, your original worst price by $3,501, and saved $5,151 off MSRP. Close that deal!!!!
Email #3 – Confirm the offer and setup appointment
Use this email to confirm the offer and setup an appointment.
Bring the dealer's email with you to the dealership so you can compare these numbers to the figures on the contract.