The Purchasing Pros and Cons of Used or New Vehicle from a Dealership
If it is time for you to start looking for a car, you have probably considered visiting a dealership or some form of a reseller. After all, failing to do so means that you are limiting yourself to private sellers or going directly to car manufacturers, which can be very pricey. Naturally, however, going to a dealership is also not going to be a completely painless process. The reason why is that the long list of benefits will usually include a few downsides that you should prepare for. So, what are the most important pros and cons of shopping for a used or a new vehicle from an authorized dealership?
Since car dealers have been around for about as long as the cars themselves, they remain one of the most popular alternatives for vehicle shopping. At the end of 2016, for instance, there were 16,708 dealers in the United States who combined for a whopping total of 17,465,020 vehicles sold. Thus, they supplied the largest quantity of new and used cars to drivers who were looking to upgrade or become a first-time owner. The following few will show some of the most obvious upsides of choosing to become one of the many millions of people who went the dealership route.
As per an experienced car expert who sold hundreds of vehicles in the past, Doug Ross, the first advantage of going to a dealership is the unparalleled variety. Unlike private sellers who are offering their cars or online companies who may have limited catalogs that you cannot test drive, dealers’ lots are known for always being full. Just try to remember the last time that you drove by a dealership that had a ton of empty parking spaces. Odds are, those have been very few and far between.
This benefit is perfect for individuals who may not be set on a unique model. For example, someone who decides to purchase an SUV will still have to make a lot of decisions before drilling down on a particular car make. By going to a dealership, they could see everything from the latest models of Jeep or Toyota to some used models of GMC, Chevy, Honda, or Ford. In fact, if you are set of finding a specific color, per se, dealers are one of the very few sellers who might be able to cater to such a narrow focus.
Since dealers re-sell their cars for a percentage above the original cost, which is considered a mark-up, they are often somewhat flexible in terms of pricing. More specifically, as long as they are staying within the expected rate of return, they will be willing to negotiate the transaction. Although you could also negotiate with private sellers, your range will be a lot smaller. Furthermore, keep in mind that you can always switch to a cheaper model of the car that you are looking for when you go to a dealer because of their seemingly endless line-up.
Although a lot of people overlook this particular benefit, you should always remember that the salespeople who work at dealerships are easily some of the most knowledgeable car enthusiasts in the world. The mere fact that their entire job revolves around knowing what types of vehicles they currently have and each of their characteristics proves this. So, when you visit them, you will usually be able to get all of your questions answered. Nonetheless, remember to always do your research beforehand.
If the car-buying process at dealerships was perfect, there would be no need to have any other alternatives. Unfortunately, that is not the case as there are a few drawbacks here as well. The most obvious ones, according to Doug Ross, are a potential lack of information on the vehicle’s history and the notorious sales tactics that the representatives may employ.
Potential Lack of Information
Even though the number of dealers who incorporate free CarFax reports and other historical information is enormous, there will always be a few cars that have no verifiable data on them. This tends to happen when the previous owner has not kept up with the vehicle well and the dealer cannot retrieve any files about their time spent using it. If you were to buy that kind of a car, you would be risking overpaying for something that could have a lot of issues just waiting to come to light. There are laws in place known as “lemon laws” that aim to rectify this problem, but the hassle remains.
Relentless Sales Tactics
The most important disadvantage, which often gives dealerships a bad reputation, is the ruthless approach from the salespeople. If you had to find another industry where haggling and constant pressure to buy is as high as it is here, you would probably be unable to do so. This is completely natural as the vast majority of salesmen and women work on a commission-based salary with very low, if any, minimums. In other words, if they do not sell any cars, they earn very little to no income. Thus, brace yourself for some very long conversations where you may find it borderline impossible to walk away.
Finally, you should keep in mind that a lot of dealerships make some extra revenue by putting their fees in place. Albeit relatively common in the industry, it is not something that every single dealer does, and you should almost always be able to negotiate these. If the salesperson is not giving you any wiggle room on those fees at all, it may be a good indication that you should browse some other lots in the area and see how their fees compare.
Even with some of these downsides, saying that a visit to the car dealership is not one of the easiest ways to buy a car quickly would be inaccurate. Additionally, there are many smaller perks that you should keep in mind, the likes of which include a lot better coverage through warranties, tons of free services such as oil changes, tire rotations, and car washes, and similar.