Should I haggle for a new hybrid?

September 21, 2006 10:30 AM

I've found a new Prius that I might be able to buy before the tax rebate gets chopped in half. Since it's a new, popular car, am I going to be paying full price no matter what or should I try my meager haggling skills? If the latter, what should I aim for and how should I go about it given the "next guy will pay full price" line I'll inevitably encounter?

I can't imagine a question like this hasn't been asked before, but searching didn't turn it up. Perhaps I am an incompetent searcher.

posted by ontic to travel & transportation (16 comments total)

Definitely haggle; the worst that can happen is they will say no to your offer. If they mention that the next person in line will pay full price, remind them that Honda makes some very nice hybrids as well (there is no need for them to know what you are willing to buy or how much you are willing to pay). The real key to negotiations like this, however, is being willing to walk away.
posted by TedW at 10:34 AM on September 21, 2006

The real key to negotiations is to know your market. There's long waiting lists for Priuses in most areas of the country. Walking away may not mean much to them. Try edmunds.com for real pricing information.
posted by kcm at 10:41 AM on September 21, 2006

I believe that demand for the Prius continues to be high and you're not going to be able to do much, if any, under the MSRP. On the other hand, this is the end of the model year, and 2007 Priuses will soon be arriving. This might give you some small leverage. But I'd guess the dealer really can sell the car to someone else within a couple of days at most, for full MSRP. Gas is expensive, you know.
posted by jellicle at 10:46 AM on September 21, 2006

You have to know the market, as stated, but you should at least walk away once to test them. Get to what you think is a reasonable offer (should be way below full price), and if they won't come near it, thank them for their time, and leave. You can always come back hours/days later and try going a little higher.
posted by allkindsoftime at 10:47 AM on September 21, 2006

The strategy to use when going after a very in-demand car like the Prius is to play on the competitive nature of salespeople.

My boss was able to get a prius at or below invoice at a time when people were paying thousands above by using this strategy. What he did in that case was to go to multiple Toyota dealers in the area and tell sales people at each that he was interested in buying the next Prius they got in. He gave them his cell number and told them to call him any time and he'd come right over and pay for it.

For this to work, you have to be able to move quickly. If someone calls you, you need to hustle over there with financing in hand (or, even better, be prepared to pay cash or check).

A competitive salesperson will be happy to get a quick and easy sale out from under one of his "colleagues," at his dealership.

In your case, where you have a specific car at a specific dealership in mind, you have to be prepared to walk away. If the salesperson says "next guy will pay full price," the answer is probably "yes, but if you sell it to me right now from what I'm offering, you are guaranteed that it is YOUR sale. If you don't, one of the other salespeople here could be the one to sell it."
posted by Good Brain at 10:50 AM on September 21, 2006 [2 favorites has favorites]

Edmunds says people are paying over MSRP in my area, which is pretty much what I found to be true when I was in the market (not really for a Prius) a year ago, and even a year before that when I was just doing some research. There really are waiting lists for these things, and bulletin boards that post each new "found" Prius in a given area.

MSRP $29,415
Invoice $26,440
What Others Are Paying $30,821

Good luck, but I think you're out of it. Get a Yaris or a bike if you want to save on gas.
posted by kcm at 10:52 AM on September 21, 2006

I just went out myself to look at the Prius since I'm in the market for a new car. Turns out, no deal in negotiating. People are paying above MSRP since it's in such high demand. I'm in SoCal though, and it might be slightly different in your area, but I doubt it.

And don't even bother with the lease rates for it.

Great car, though.
posted by ryecatcher at 11:18 AM on September 21, 2006

The thing about buying a Prius is that the salesman doesn't care whether you buy it, because someone will, so it is exceptionally hard to get any leverage. Plus, most dealerships don't have any on the lot - they're not taking up space, they're not in inventory, the dealership/salesman is not going to make any incentive money to move it.

If you find some freak dealership that's got a bunch of them, especially if their inventory mostly has the low packages (no NAV, no side-curtain airbags), you might be able to do something.

We paid pretty close to invoice on both of ours, though. Our salesman told us he'd had a few calls in the neighborhood of "I'll pay cash for the next one you get," but they'd get several of those calls, all of them got notified when one arrived, and he'd get several guys trying to outbid each other for the car. When I was afraid the car I ordered would arrive before 1/1/06, he just shrugged and said if that happened he'd re-order for me and sell that one to whoever. There's really no stress on them to get these cars sold.
posted by Lyn Never at 11:21 AM on September 21, 2006

I want to amend my post: I meant that my employer got his Prius at or below MSRP, not at or below Invoice. Also, this was in the Seattle area, which is a very strong market for the Prius.

As to what salespeople report to potential customers about their experience selling Priuses: I'd expect them to stretch the truth, or leave it behind all together.

It's worth emphasizing that a given salesperson's self-interest isn't exactly aligned with that of the dealership. A dealership has some incentive to get the best price it can on each car. A salesperson has the incentive to get a sale with the least amount of effort relative to their commision. Many of them would sell a car out from under their own mother.

I don't doubt that salespeople are playing other customers off eachother and selling cars for far above MSRP, but I don't think it's necessary to surrender without even trying to do better on your own.
posted by Good Brain at 11:38 AM on September 21, 2006

My friend just spent a good while contacting all of the Prius dealers in the Northeast (he's kind of obsessive) and still had to pay the MSRP. Good luck though.
posted by pinksoftsoap at 11:46 AM on September 21, 2006

In situations like this the best thing to haggle is extras and upgrades. "Well for that price you're going to have to give me the nice sterio" etc.
posted by shanevsevil at 11:47 AM on September 21, 2006

Wait for end of the month deals and whatnot. I bought a Honda Fit on memorial day weekend. They were flying off the lot, so the dealer wasn't inclined to deal very much. But he was willing, in order to raise his monthly totals, to throw in a service contract, a gratis warranty extension and accessories at cost.
posted by jmgorman at 12:15 PM on September 21, 2006

If he says "You won't get much of a deal because the next person will pay full price" just say "yes, but will they be buying it from you?"
posted by Cosine at 12:16 PM on September 21, 2006

You should probably check out the forums at PriusChat.
posted by SenshiNeko at 4:55 PM on September 21, 2006

I bought a Prius back in April. They come in various option packages 1-8. 1 is the lowest, 8 is the highest, with nav system and leather. The higher numbered packages are the most in demand.

I suggest this strategy. Find the websites of Toyota dealers well away from any major city (at least 200 miles let's say). Dealers often list their inventory on their web site. If you can find one with a bunch of Package 1, 2, 3s on the lot, then I think you've found a dealer you can bargain with.
posted by richg at 4:56 PM on September 21, 2006

Look here; my friend paid $500 to locate a Prius which he could be sure of paying no more than full price for, and this was 3 months before the tax benefit deadline, not 10 days.

Your mileage may vary.
posted by ikkyu2 at 10:35 PM on September 21, 2006