How to Buy a Low Price Toyota Kluger

QUESTION

Hi John,

I want to make use of the EOFY sales and want to buy a Toyota Kluger GXL. It advertises the full drive away price (12 month rego and ctp) as around $55k.

How much do you think I can realistically haggle it down to?

Thanks

Joe

ANSWER

Hi Joe,

I'd be aiming for about $50k. However, this is a deceptively complex question. Car dealers use overlapping and sophisticated strategies to extract as much money as possible from you. Every deal varies from customer to customer. The price of the car itself is not everything, and you need to consider this carefully when you walk into a dealership.

Other considerations include:

  • Low-balling the price of the trade-in to engineer in an additional few thousand dollars profit.
  • Selling in-house finance and insurance at a huge profit.
  • Selling useless add-ons (like paint protection and rustproofing) at a huge profit.
  • (If you are a couple buying the car:) Using one partner against the other from a negotiation viewpoint.
  • Building a significant and unjustifiable dealer delivery charge into the deal.

For this reason, you should always:

  • Separate the transactions - only buy the car from the dealer. Arrange independent finance, insurance and trade-in/private sale of your old vehicle. That way, these other 'deals' cannot be used to confused or lever you.
  • Just say no to that useless add-on crap. More detail on useless add-ons.
  • Enquire specifically as to the dealer delivery charge and negotiate that down to a reasonable level. More detail on the dealer delivery rip-off.

Lastly, remember that you are in charge, because the person with the most power in a  negotiation is the one who can most easily walk.

The process you should follow to get the best possible price is below. For starters, watch my video on how to beat car dealers below.

Now do this:

  • Go to the dealer - without a trade-in. Go alone, so you can tell the salesman you need to get your wife's/mother's/whomever's approval before you can put down a deposit.
  • Get a no-BS answer on the total, drive-away price for exactly the car you want. Say no to the finance, insurance and add-ons. Ge them to gell you the price first. Take $5000-$7000 off that (to a nice, round, convenient number). In your case I'd be saying that I didn't want to spend any more than $50k. Say your wife will cut off your nuts if you spend more than $50k (whatever) and see if they budge on the price. A dealer who doesn't is unmotivated.
  • Shop the price around using a broker. This is the only way I know to see if you're getting a good price. Basically a broker puts your purchase out to tender across a great many dealers and returns to you with the best price they can get (which includes their commission - that's payable by the dealer). If the broker's price beats your negotiated price, go with the broker. The car is a new car, bought from the winning dealer, with full factory warranty, etc. This process essentially engages dealers in a bidding war to achieve your sale, driving the price down.

I have passed your details to David and Ben from the brokerage I trust. They will call you to discuss. This is a very low-pressure discussion - much more pleasant than dealing face-to-face with a car salesman. Simpler, too.

I have more detail on the video in my full post on how to beat car dealers.

You have chosen a good time to buy - the car market has slumped a bit relative to last year, and dealers (many of them at least) will be under pressure to match last year's sales figures.

I hope this helps.

Sincerely,

JC

John Cadogan2 Comments