OT: Paying cash for a new car, tips?

[45K10]

My wife and I are looking at purchasing a new car in the next few months and I was wondering if anyone had any tips on how to deal with the dealership?

We paid cash for a new car ten years ago and the salesperson at that time was not very enthusiastic about us paying cash. I know dealers make money on the back end of the deal (financing, selling extended warranties, etc.) but I'm wondering what is the best way to approach a cash purchase in today's market?

P.S. I don't want to go through the motions of sitting with the dealers finance dept just to tell them I'm going to pay cash.

Thanks for the advice!

[JMT3]

I purchased my current vehicle in August of 2020. Back then dealers were way overstocked and we all know why. A local dealership was advertising a brand new vehicle at an unreal price. I stopped in and the deal was real. I did ask about financing. They told me the rate and I had the cash so when I went into the business agents office I sat my checkbook on his desk. He asked what I was going to put down or was I trading my old car in. I told him I was keeping my car, a gift to a daughter and told him I was putting nothing down, I was going to just pay for it. He didn’t blink an eye. I asked him how many people paid cash for a car and he quickly replied 36.8%. In about a half hour I drove off in my current vehicle.

[Peter P.]

The rule of thumb is to keep discussions about trade-in separate from the purchase price of the vehicle.

When the salesperson asks if you will be trading in your old car, tell them you haven't decided yet/you want to discuss that later/anything. After pricing is in concrete, THEN when discussions turn toward your trade-in you tell them you will not be trading in anything.

The reason is the dealer will adjust the sales price up in consideration of a trade-in.

I paid cash for my last car but it was a Saturn and they had a no-haggle pricing structure. They also required I pay with a certified bank check so I'm surprised JMT3 above was able to pay with a personal check. At that time (1995) I was told 1/2 of all sales were cash. But I question that number as buyers could have received financing elsewhere and merely brought in a bank check.

[reuben]

The only problem I had with paying cash was that I still had to be approved. I told the finance guy that I'd just write a check. He said they couldn't know if the check would clear so I still had to be approved. I told him I'd write the check and wait until it cleared, as I wasn't in a rush. He said he couldn't do that. Irritated the bejeebus outta me, but I didn't have any choice so I got approved - to pay cash.

This was Subaru after covid was largely past, and they had cars or could get them in a month or two.

[Davist]

I was going to pay cash for one of our cars, I ended up financing, as they had an extra $1k discount, then paid it off the next month or so, so be aware of that also.

[45K10]

Thanks guys!
To JMT3's point, I was able to pay with a personal check 10 years ago. I just had to show them the balance in my checking account on my phone before they would except it.

[saab2000]

I have no personal experience with this but I was told by a friend who did it and he told me that he negotiated the price and then when they went to the office to do the details he told them that it would be a cash transaction, at which point everyone tried to change the price upward. He held them to the price they had worked out.

He was ready to walk out and said as much. Eventually he got the deal they agreed to on the floor but he had to have some spine.

Some places will push back on this kind of deal. For the record, it was a Buick dealership in his case.

[superbowlpats]

If paying cash most dealers will insist on a bank aka certified check or wire transfer. There are some pretty reasonable interest rate deals out there if you dont want a ton of cash tied up in your new car. I just got .9% for 36 months on a new 23 Honda Ridgeline.

[AngryScientist]

Find the car you want and then deal with the internet sales manager on the phone. Do t go into the dealership until the deal is done and it’s time to pick up the car.

[Turkle]

Originally Posted by AngryScientist

Find the car you want and then deal with the internet sales manager on the phone. Do t go into the dealership until the deal is done and it’s time to pick up the car.

This is EXACTLY what I did when I purchased my latest vehicle. I negotiated everything on the phone first, including cash price. Then I showed up at the dealership and test-drove it to make sure everything was above board. It was, and I paid cash right there.

It was surprisingly and pleasantly hassle-free. No drama.

Got a darn fine price on it too, based on what I saw elsewhere.

[christian]

Originally Posted by AngryScientist

Find the car you want and then deal with the internet sales manager on the phone. Do t go into the dealership until the deal is done and it’s time to pick up the car.

This is the way. When I've done this, I've just faxed the dealers within 100 miles and told them what I wanted and what I was willing to pay. I had two dealers come back within $150 of my proposed price within 6 hours.

[NYCfixie]

Originally Posted by AngryScientist

Find the car you want and then deal with the internet sales manager on the phone. Do t go into the dealership until the deal is done and it’s time to pick up the car.

I did this on two brand new cars (for mother and mother-in-law), at different dealerships, in different states, and had the same outcome...

The deal was done. We went to pick up the car and pay in cash (i.e. bank check) but when we arrived at the stealership we were told the internet manager "was not available" and the delivery person "is backed up for a few hours". A salesperson tried to upsell us and when we kept saying no he complained that he was not making any money on the deal so I basically told him to piss off since I had never spoken to him before that day. Then the Finance Manager gave it a go with the same BS of trying to upsell us on crap we did not need or want and he was also complaining that he was not making any money on the car. After 20 minutes of this crap, I told them they had 10 minutes to get the car out front, get the paperwork ready to be signed, and stop wasting our time or we were walking out the door and going somewhere else. Interestingly, one dealership got it done in 15 minutes and for the other one we walked out at the 15 minute mark and called another dealer.

I was shocked that again we had a deal done for the second car at the third dealership but on pickup day they tried the same BS. I gave them 5 minutes to get everything ready or we were leaving. It took them about 15 minutes but we got the car at the agreed upon price.

Lesson leaned: when you show up at the dealer, show them the bank check and give them 15 minutes to get everything ready before they try any BS.

Moral of the story: I am glad I was with my mother and mother-in-law on delivery day for each of their vehicles because I do no think they would have been able to fend off all the high pressure sales tactics (and why they both asked me to get involved with their car purchases).

[tomato coupe]

Originally Posted by NYCfixie

I did this on two brand new cars (for mother and mother-in-law), at different dealerships, in different states, and had the same outcome...

Similar story, but without the dealer shenanigans. I made the deal via email over the course of 3 hours, and arranged for my mom to pick up the car the next day. (I'm in another state.) When she went to pick up the car, the salesman claimed to not know anything about the deal. It turns out they had two salesmen with the same (uncommon) name, and the wrong one responded to the initial page. It was an honest mistake, and everything was sorted out within an hour.

[Ryun]

Ill throw one more thing out there...

With current used car supply being extremely limited most dealers will be more aggressive on pricing if they know they are getting a solid used car they can retail.
Some mid line imports are still thin on new car availability and will actually prioritize new car transactions that will bring in a used car.

So the throw the trade in at the end from the 80s playbook may not work as intended.

[45K10]

Great comments everyone, thanks!

So what is the best way to handle the test drive?

We have a good idea of what type of car we want but we would like to test drive some different makes and models.

Do you schedule one online and and try and fend off the sales people?

Just show up at the dealer and ask for test drive?