Ten car dealership pricing tactics to watch for

March 19, 6:22 AMAlaska Transportation ExaminerGeorge Angus

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With new car sales the lowest they have been in 27 years, car dealerships are doing whatever they can to entice buyers to come and buy a vehicle.  Generally this is good news if you happen to be in the market for a new vehicle but it's important that you understand some of the pricing strategies and read the fine print.  After all, the dealerships are still in it to make money and there is a lot of psychology that goes on.

Back in October I wrote on article on how to not get taken in the finance department.  This article will have more of a focus on lot and desk tactics to watch for.

1. SALE! - Well of course.  Everything is on sale.  Unless you are looking at a very much in demand, latest and greatest car, you will be able to get just about anything on "sale".  These signs and ads are designed to make you think that if you don't act now, you may pay more later.  Trust me, you usually won't.
2. Below Invoice - That might be true, but don't think for a moment the car dealership is losing money on the deal - they still get numerous incentives from the manufacturers.
3. Additional Dealer Markup - If this is listed anywhere in the pricing structure, you just go ahead and tell them you're not going to pay it.  Additional Dealer Markup is a fancy word for PROFIT.
4. Ridiculously Low Price - If you see an ad that shows a price that seems way too low for the vehicle, be sure and read all of the fine print.  Chances are you get that price after financing with a specific lender and if you qualify for a military rebate, a Ricky Rocket membership discount, and if you show proof of purchase for more than 40 dozen boxes of girl scout cookies from their last drive. Read the fine print!
5. One at this Price - OK, maybe this is true.  However, if you head to the dealership and that one is already gone (usually) tell them you want a similar one for the same or close to the same price.  Chances are they will deal.
6. Perfect Credit - Be aware that the pricing may be tied to a "very well qualified buyer" clause.  If your credit has a blemish or two, be prepared to pay more in this instance.
7. Two For One - This is relatively uncommon, but it still pokes up now and then.  Buy one vehicle at full price and get the second one "free".  Well, nothing is free these days.  There are still taxes and licensing fees and by the time you figure out any discounts or rebates that you could have received on the first car, it's probably a wash in the end.  And besides, do you really need two cars?
8. Leases - Oh, do be extremely careful here.  Do your research on leasing terminology before signing up for a lease.  You want to pay attention to allowable mileages, residual rates and their definition of "normal wear and tear."
9. Today Only! - Please.  Go in tomorrow and chances are you will be able to get it for close to yesterday's sale price.
10. Ads Based on Monthly Payment - Never never never negotiate price based on monthly payment.  There are too many variables to consider and until you head into finance, you may have no idea what rates you may qualify for.

The thing to remember is that advertising is a game of psychology.  Remember that generally, they need to sell a car more than you need to buy one.  You have the power - not them.