More than 8.5 million transactions of new and used cars took place in the UK just last year, so imagine how many billions of pounds could be saved by initiating a negotiation. Buyers of used cars are probably more likely to start negotiating the price compared to those who buy cars straight from the dealership.
The almost £896 of savings represents an average of 11% off the total asking price of cars, which is not a tiny figure. Let's take a closer look at the age groups and see how their desire to negotiate and their success differ.
Buyers between 18 and 24 did best in bringing the price down, saving an average of £1,730 ($2,154). Next up, those over 56 managed to knock down the price by an average of £1,023 ($1,274). The least effective age group was 45-54, with only £753 ($937) in savings.
Regarding the regions, car buyers in the North East of England succeeded most in negotiating, saving an average of £1,395 ($1,737). On the other end of the spectrum were Welsh buyers, with savings of £723 ($900).
So, why did people avoid negotiations? The highest percentage of survey respondents (53%) found negotiating too uncomfortable. 16% didn't want to offend the dealer, 15% didn't know how to do it, and 9% found it was rude. It's unsurprising that younger buyers aged 18-24 were most polite – 55% didn't want to offend the dealer.
Of those that successfully negotiated, 40% declared that they compared pricing for similar car models online, while 25% weren't willing to budge regarding how much they wanted to pay. Furthermore, 18% brought another person along to help negotiate, and 16% rehearsed the conversation in their head beforehand.
Even though some dealerships won't budge on the price, negotiation is worth it as customers might get other incentives to complete a purchase. For instance, 26% of buyers were offered an extended warranty, 21% a free servicing period, and 20% got a discount for extras such as leather seats.
If you want to negotiate your next deal, here are some quick tips. Preparation is vital – research the vehicle you're interested in, find other comparable listings, see if you can trade in your car, and make sure the financing plan is fair if you're going for that option. Moreover, try not to rush into closing a deal; the less urgency you show, the easier and faster the entire process will probably go.
And no matter what you agree on verbally, make sure to always read the fine print. Oh, and don't be afraid to walk away – there's absolutely nothing wrong with that, and it might even prompt sellers to accept your offer in a last-ditch effort.