As an investor with a bargain hunter mentality, I’m always on the lookout for opportunities to buy items selling at a discount from previous highs. This tactic has been made famous by investors like Warren Buffet (and many notable others) by buying just after the market plunges and sentiment is at its worst.
Clearly, buying an SUV is not for everyone these days. With gas prices hovering just below all time highs, buying a gas guzzling SUV is by far the easiest way to add a dollar sucking leech to your wallet.
In addition to the Employee Discount of 10% (on most vehicles), current market conditions have pushed the once popular SUV prices even lower. With the majority of consumers now focused on 30 plus mile per gallon (MPG) cars and the ever popular hybrid technology vehicles, the SUV is now the black sheep of the auto industry.
Case in point, CNN ran a story in May 2008 detailing the complete breakdown in value for people who recently purchased an SUV. Many of whom have tried trading in their 1 year old, or even less than 1 year old SUVs for a gas friendly hybrid only to find they have lost 20% to 50% of the SUVs value.
Shocking isn’t it. Something that no one wants is going to depreciate in value almost overnight?
Say it ain’t so!
However, there are a few consumers out there that find a SUV an attractive luxury, and sometimes, might find a SUV a necessary evil. Such as:
People with a large family, say those with 2 or more children.
People who live in inclement climates requiring a four wheel drive.
People who refuse to join the minivan, or “soccer mom” culture.
People who feel SUVs add safety to their driving experience, and that of their family.
People who use a SUV for their business and must transport goods to local markets.
Now, if you happen to be in the market for a SUV, this is music to your ears.
How can you take advantage of these market conditions?
For those chosen few who wish to purchase a SUV (either new or used) have several market themes working in their favor to create a very strong negotiating platform.
Take advantage of the GM Employee Discount at certified GM dealers, or use it as a bargaining chip at other car manufacturers to lower their prices.
Being mid-summer and the previous models are now hitting the dealerships, dealers will always offer special incentives to clear excess inventory.
Demand special packages or extra features on your SUV that would not normally be included.
Current SUV owners looking to sell could be in panic mode. Sure, it’s frowned upon to take advantage of those in a less fortunate situation, but business is business and you want to save money.
Get multiple written offers from dealers offering the same model and same options. Then, simply ask each dealer to give you the better price. Perhaps, you can create a bidding war between dealers.
Immediately ask for 40% (or some arbitrary number) off the original asking price. This will likely be rejected, but it makes it easier to haggle toward a price you had in mind.
These are just a few haggling tactics that have worked for me in the past, but use the skills you find that work best for you. Some people (including me) lack hardcore face to face negotiating skills, so use tools like email and online car dealers as an alternative means to get a great deal.