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RSSOne of Our Cars Died, Tapping the Emergency Fund
Well the engine went on my wife's car this past week. Long story it sucks and we either needed to cough up $3,700 for a new engine or look at getting a replacement car.
My wife's car is about 14 years old and we have been planning on replacing it with a more family friendly car. However when we bought our most recent house we agreed to hold off on a car replacement for at least another year until we were able to rebuild the savings that we put towards our home's down payment. Once the engine went that was out the window.
Luckily we did have money in our savings for our next car. However, I really didn't want to buy another car given the economy and the concern of further layoffs at my employer. Unfortunately our savings is no longer where it should be, placing added concern, but I guess this is what savings are for.
We dug into our car shopping over the past weekend. We started at Carmax and used them to look at a variety of recent makes/models. We settled on a 2008 Hyundai Santa Fe as our favorite. Then with quote onhand we went online and identified local dealership with very comparable Hyundai Santa Fes for sale.
We went to two local dealers by good fortune perhaps about 1 hr before each closed respectively. We found the car, did a test drive and about 20 minutes before closing started talking about price. We told them what we found at Carmax and they assured us they could beat them. Ofcourse they asked for our price and we deferred as long as possible.
Once we gave them our we'd buy it today price the salesperson as usual took it to their manager. Thats when things changed for us compared to my previous negotiations at dealerships. Gone was the hours of wasting time with a salesperson going back and forth to the manager trying to get us up little by little. In both our instances this past weekend the manager immediately came over and gave us a 20-30% reduction off their asking price. A big difference from the little by little price reductions that took my whole afternoon I have encountered in the past.
My big take away from the experience was that these negotiations were much easier than my previous car negotiations because we were the last customers at the dealerships. These people were ready to get out of the office, but didn't want to miss an opportunity to sell a car. The managers immediately came over, wasted little of our time and we quickly got to an asking price that they would let us walk out of the dealership with. Ofcourse Im sure the lack of a car market had something to do with it as well, but from now on I think I am only going to go car shopping at closing time.
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Comments (11)
Sounds like a great deal - thanks for sharing. Did you have a savings plan for the planned purchase of a car in one year? Or did you just have a single savings bucket...
Posted by fellow IBMer | March 25, 2009 10:28 AM
It's a buyer's market.
Posted by aa | March 25, 2009 10:31 AM
Sounds like you did your research prior, something I'm sure you would recommend to anyone looking to buy so they know what prices they should be seeing. Any research tips to recommend?
Posted by Craig | March 25, 2009 10:40 AM
Not that you had a choice this time, but if could wait until the end of the month and/or the end of the quarter (Tue March 31), they would have even more incentive to close a deal and probably more wiggle room. The reason is that dealers get discounts (aka holdbacks) from the manufacturer based on sales per month. They really want to hit the next target because it is real money in their pocket.
You were not explicit in your post. Did you buy the car? How many miles on the 2008 model? What was the saving on the used car versus a new one? What about the warranty? How much is left? Did you consider an extended warranty? Did you have a mechanic check out the car before you bought it?
Posted by buyme | March 25, 2009 12:17 PM
Good job, I've never really thought about negotiating close to closing time - good tactic. How many miles were on the old care before the engine blew? My 8 year old car is up to 134,000 and truth be told, I wouldn't be too disappointed if something similiar happened to it :)
Posted by EMS | March 25, 2009 2:53 PM
We have always gotten the best deal when buying through the fleet department. They have a set price...no negotiating...don't try and sell you add ons and extra warranty. Easy, stress free and lowest price. You might want to try it next time!
Posted by Laurie | March 25, 2009 6:50 PM
Glad you did your research prior to going in! Car salespeople can be sharks. But, I have to agree with aa, right now is a buyers market. I think the ease of negotiations you experienced probably had more to do with the market and economy than it being the end of the day. Those guys are hurting for sales, so cutting it close by 20 minutes of closing time probably wasn't that big of a deal to them. I remember my first car, I was in the dealership with them well after close and they were still trying to raise the price on me, inch by inch.
But, either way, it's great that they didn't waste too much of your time. So, did you leave with the car?
Posted by Kristy @ Master Your Card | March 26, 2009 1:44 AM
i don't think IBM has a plan that covers Hyundai...but would it have been cheaper to go with another model (assuming it was at all a decent substitute) and use the IBM plan? They are no hassle prices...take it or leave it.
Posted by Anonymous | March 26, 2009 12:01 PM
Car had 12k miles - we slept on it and went back and bought the car after we negotiated in a wash/wax, tank of gas, etc.
Posted by 2million | March 26, 2009 1:21 PM
I'm sorry you had to deal with this but it sounds like you got a great deal. I love the tip for going in right before closing.
When we bought our last car, I did all of the negotiating via email, and we were prepared to walk out if they deviated from that price (they didn't). Much less stress that way, and it saves time too.
Posted by Cathy @ Chief Family Officer | March 27, 2009 11:56 PM
Check out the April issue of Consurmer Reports before buying a used car.
It has the best info. on long term reliability, since it is based on actual owners of the cars giving the information.
Posted by Robert Cramer | March 29, 2009 11:16 AM