Car Dealer Sales Tactics 101

The Secret Methods of Car Salesmen

Car Dealer Sales Tactics 101
October 7, 2014

It takes a lot of focus and willpower to leave a car lot with the vehicle, price, and terms you wanted — or to leave with none at all. To develop such willpower, it helps to learn the methods used by sales people to steer you towards particular cars and terms, to pull in reluctant buyers, and to maximize their commission and the dealership’s profit. Watch out for these typical tricks of the car-selling trade.

  • Establishing Rapport – A good salesperson is excellent at establishing a common bond or icebreaker based on observations. Are you wearing clothing supporting a sports team? Did you mention your kids or your profession in passing?

    The salesperson will try to establish a rapport, not just to be friendly, but also to use during any sort of “negotiations” between your “advocate” (the salesperson!) and the recalcitrant manager or trade-in appraiser. This will give you the appearance of getting a better deal in the end.

  • Steering Your Attention – The sales staff will know the inventory in detail – not only to discuss a car’s features at great length but also to understand what cars have been on the lot too long and need to be moved. They will direct you toward what they want to sell if you do not have a clear preference or are just looking at possibilities.

    Many car lots have their inventory online, so do some homework on the available cars and to compare them with similar cars at other dealers and with their Edmunds or Kelley Blue Book value. A salesperson who notices you have done some research is more likely to address your needs instead of theirs.

    In any case, a salesperson will often get you to focus on a particular car at the earliest opportunity.

  • Trade-In Assessment – A dealer may lowball your trade-in assessment in order to negotiate with you later. Again, research is important. Determine the value of your car on the Edmunds or Kelly Blue Book websites, and research repair costs for any repairs that your car requires.

  • Gauging Price Level – A clever salesperson will frame costs in monthly payments instead of price to find out what sort of monthly payment you can afford. A clever finance manager can use that to set up loan terms and try to slip in added costs that keep the payments at that level but extend the profit margin for the dealer.

    The staff will also have knowledge of any incentives, rebates, specialized financing, and other temptations to the buyer that they can use at strategic moments if they need to do so to close a sale.

    During these discussions, keep an eye on the overall cost and interest paid as well as the monthly payment.

  • The Hard Sell – Car salespersons are skilled at subtly playing up the defects of your current car and contrasting them to the new car in question. If you are not careful, this effort can result in a crescendo of feelings for the new car that you lose track of the numbers – an effect that is sometimes called “putting the customer in the ether”.

    A common trick is to present options in terms of down payment and monthly payment combinations without discussing the loan terms.

    The salesperson will leave room in the monthly payment for the finance department to work on loan terms and stick on added costs such as rustproofing and paint protection, insurance, dealer prep markups, and other extras. Any useful knowledge the salesperson gained will be forwarded to the Finance Manager to craft a pitch for add-ons.

    A surprising number of people will sign papers rather than admitting they really do not know all the terms or the ramifications. Do NOT be one of those people. Look at the loan terms and the cost in detail, and ask for explanations of any costs that are not straightforward or seem excessive. Make certain you are comfortable with all contract terms before you sign, as there is no legal right of rescission for automobiles unless you can demonstrate deliberate fraud on the part of the dealer, which is extremely difficult to prove.

  • Move Them Out – The paperwork is generally quickly signed and placed in a neat packet for you to store, and the salesperson will walk you out with your keys and send you on your way with a hearty handshake.

This is in part to make you feel good about your purchase and in part to get you off the lot before you can have second thoughts, or, heaven forbid, read over all the paperwork you signed. Once you are off the parking lot, the car is yours – and the profit is the dealers.

Keep an eye out for any of these tactics as you shop for your new car, and you are less likely to fall prey to added and unnecessary costs. However, the best way for you not to pay more is to do your homework before you ever set foot on the car lot.

If you are interested in a personal loan, visit our curated list of top lenders.

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