Were you happy to discover that your employer, bank, credit union or membership affiliation provided you with any number of assorted discount car buying programs? Why of course you were, but your first thought was how do they work. I have administered, participated and sold cars to people that used these types of discounts for buying new and used cars including most of the warehouse clubs platforms. Like anything there are pros and cons to all the different car buying programs and different levels of effectiveness as far as saving money is concerned. I am not talking about any auto manufacturer programs for employees or family members of employees because those are very straightforward and offer fantastic price reductions. Unfortunately very few of us can qualify for these types of vehicle purchase programs. I am talking all the other platforms that promise automobile savings.
How Do Discount Car Buying Programs Work?
The first thing you should know about car buying programs are that in order for you to receive a discount on your next car the dealership when you buy your car must be willing to participate in the program. Some of the discount programs require dealers to sign contracts to participate in these discount car purchase platforms and some require nothing more than a verbal agreement. Depending on the entity offering the discount car programs, dealerships will pay a fee of some kind to these agencies in order to have customers referred to their dealership. These fees can be anywhere from a few hundred dollars a month or thousands of dollars a month depending on the platform and whether they are charged by sale, lead, referral or fixed rate per month.
Most car buying programs are handled very loosely and sloppy, but some are highly regulated, tightly managed and very effective, but which ones are which?
Well, I am going share some of the secrets dealers use to circumvent these programs and how you can make the most of these car discount platforms and avoid some others. Not all membership benefits for price reductions and markdowns are what they may seem to be, but some really can save you thousands of dollars on a car, especially if negotiation is not for you.
Automakers, Car Dealers and Car Buying Programs
The discount car buying programs I am talking here are not manufacturers programs and the automakers are not affiliated in any way with these types of purchase plans. When a car dealer signs on to one of these types of discount car policies they typically set the discount level of each make and model of car. This pricing can be done in different ways; one way is to set a flat discount off of the MSRP of the vehicle, a dollar amount or percent off the sticker price. Some programs and require the dealership to set the pricing by setting a price above or below the car dealers invoice. Such as $500 over invoice, dealer invoice price or $200 under invoice. Invoice price will be displayed and the customer price is displayed. The customer then decides if this is the vehicle they want and then they visit the dealership and buy the car, sounds simple, right?
The Disclaimers for Car Buying Programs
Just like any other automobile advertising and especially when it comes to car dealers, reading and understanding the disclaimers makes the difference between a smooth car buying trip and a miserable experience at the dealership. When you visit the website of a car buying program you will be invited to submit a limited amount of information and receive one or several prices directly from participating dealerships in your area. These prices are calculated from the vehicle pricing that dealers submit and some even allow you to build a car to your specifications. Caution, just because you can build a vehicle the way you want your car, it doesn’t mean that the dealer with the lowest price will have that car.
In fact it doesn’t even mean that the vehicle you build is available in the area or region. The car buying program website may allow you to add and change many different options and colors, but that particular vehicle may not even built that way by the manufacturer and you know from an earlier chapter that you wont be able to order a new car and especially not for that discount. The disclaimer will be shown somewhere that says the discount prices are for vehicles that are in the dealers inventory and subject to availability. Whether the dealer will try to locate you a car and honor that price is strictly up to the dealer because of this disclaimer. It most cases they will charge you more to find a vehicle to meet your needs so beware of the disclaimers.
You should also know that the pricing quoted by these car-buying programs includes all manufacturer incentives and rebates. Make sure you know and understand any incentive that you were counting on for buying or financing your new vehicle. For example; if you planed on using the 0% financing for 60 months on your new car be sure to check and see if the incentive stated that there was 0% financing or a $1000 rebate or does it say 0% and $1000 rebate. See the difference, if you got a price from a car-buying plan that you liked, you may have to add $1000 to that price if you want the 0% financing. See what I mean about disclaimers.
All of these programs have disclaimers and some may even impose an extra fee or fees, but if you read and understand the provisions you will be fine. There are many excellent car buying programs and discounts to be had that can save you lots of time and money. Below I have listed several of what I feel to be the best national auto buying programs with links. These links are for anyone that wants to receive new car price quotes that can save them thousands of dollars on a new car.
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