How to Save Money while Buying a New Car? Negotiation Tips!

How to negotiate / bargain Save Money while Buying a New Car India

Buying a new car is one of the most expensive purchases we make in our life. It is about investing the hard-earned money in the wisest manner and enjoying the error-free ownership of the car. I have made a comprehensive guide on how to finalise a car that fulfils your need perfectly. Once you have finished the process of filtering the cars and finalised your choice, the negotiation part of your purchase process kicks in. Here is my comprehensive guide on how to negotiate and save money while buying a new car.

Once you receive the quote from the dealer for your finalised car, follow these sequence of the bargaining process. The quote includes ex-showroom price, road tax, TCS, insurance, extended warranty, RSA, accessories package etc. Let me clarify how this business actually operates.

Types of Discounts to save money on buying a New Car :

1) Discounts from the Manufacturer –

Check out the discounts on offer from the manufacturer itself. Visit the website and look out for the latest offers. Ask the dealer for the clarification on the same. Usually, this discount is collaborated by both the manufacturer and the dealer to enhance the sales volumes. What usually happens is, the dealer may try to save the percentage of the amount which he has to let go to comply with the collaborated discounts. So, be particular and look out for all the discounts you are eligible for.

2) Dealer Discounts –

Dealers order cars to the manufacturers and all the payments are made in advance. Now, if the car is lying in the dealer’s stockyard, it means that the dealer is paying the interest of the loan which he took to order the car. The dealer will consider letting go of his margins against pushing the car to the ageing the stock as well as paying the interest amount until it is sold.

If you approach the dealer when a month is about to end, chances are that the dealer may settle for the quote offered by you. Also, dealers have multiple types of margins on the products and services they sell to you.

  • Dealers have their clear margin on the ex-showroom price of the car
  • They sell you insurance and there is a huge margin on that as well
  • Dealers sell you extended warranty which also consists of huge margins
  • Moreover, accessories have huge margins as well to earn from

Here is the sequence on how to quote the dealer for the discounts & Save money on buying a New Car.

  1. You can get the car on-road by paying for the ex-showroom price, registration charges and insurance. Except that, everything is an optional service.
  2. Check the VIN of the car dealer is trying to sell you. Dealers are highly concerned with clearing the existing stock. If the car is older than a month lying in the stock, you can consider stiff negotiation on the same. Cars older than 3 months falls under the ageing stock and you can easily extract a direct discount upwards INR 25,000. Consider quoting a genuine amount of discount and in most cases, the dealer will close the deal. If you are purchasing a car in the month of January or February, you can easily get a discount beyond INR 80,000 depending upon the popularity of the car.
  3. If the dealer does not have the car in the stock and he has to order a new one from the factory, still chances are that the dealer will let go some margin to run the business. Ask for the direct discount from the dealer’s margin on the ex-showroom price. Also, verify the ex-showroom price with the price mentioned on the official website for your city.
  4. Road tax and TCS have no space to negotiate. But, consider verifying the RTO charges for registering the category of your car and check if the dealer is overcharging. In the case of overcharging, bring it into the notice and ask for clarification. TCS is 10% of the amount of the car.
  5. Dealers have their huge margins on the insurance they sell to you. Consider getting a quote from the outside broker. Show it to the dealer and ask to cut off their huge margins. Also, don’t forget to get the important insurance add-ons such as zero-depth, engine protect, consumables, return to invoice etc.
  6. Extended warranty also includes good margins. Consider intense negotiation on that part as well.
  7. Dealers usually have standard accessories package to sell to the customers. Check if you need the accessories the dealer is selling to you and if it fulfils your requirement. If it is not useful, ask the dealer to cut it or replace the same with other optional products that you might be interested in buying. Ask the dealer to offer you a discount on the accessories you are interested in buying. Also, you can get some amount of accessories as free by pushing the dealer.

Miscellaneous Pro-Tips –

  • If you find the above process uncomfortable to work with, ask the dealer for the on-road price with the services you need. After receiving the price, just drop the genuine quote you are willing to offer. Don’t show your hurry or intense interest at first. Show your area of options such as other dealers or a different product itself.  After quoting, leave it on the dealer to decide. Most likely, the dealer won’t disagree and will settle for the same or the nearest amount to the quote offered by you.
  • Negotiation is a Wait & Watch game. Sit calmly yet show your firm interest in buying. Most likely, within 15-20 day at max, the dealer will settle with your quote if it is genuine and not mad.



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