If you want to make sure you don’t get tricked by clever sales tactics when you go to buy a new car, truck or SUV and end up paying too much, I’m going to tell you about 13 car salesman secrets to look out for the sales team will hope you don’t know about.
Car dealers and car salesmen (and women) are ranked by most people about as trust-worthy as real estate agents, lawyers and politicians, but I want to put the record straight by saying they no longer deserve that kind of reputation. Short-term thinking and sharp practices have largely been replaced in truly professional dealerships by more long-term, customer-focused ways of doing things.
Even so, there are a lot of dealerships and sales execs out there and there are always gone to be one or two rotten apples in every barrel. Most of the practices I’m going to reveal to you here have been consigned to history by the best car dealers. However, it’s still a good idea to be aware of them just in case you come across someone who is still trying to pull the wool over your eyes. When you’re familiar with these car salesman secrets, you’ll be able to turn the tables on any unscrupulous salesperson trying to get one over on you.
Some of the tricks I’m going to tell you about might not always seem like dodgy techniques at first, but I’m going to explain what’s really going on and how you should react to avoid being taken in.
- Rapport building
- Running the clock down
- Time-limited offer
- “If I can, then will you?”
- Selling a payment
- Deal stacking
- Pros and cons list
- Assumptive or alternate choice close
- Rounding up
- Over allowing
- Subject to approval scam
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After you’ve been greeted by a sales exec and given a coffee, which you always will be, you’ll probably be put through something that’s called the orientation. This is part of a time-honored sales process dealerships have followed for decades, and on the face of it, there’s doesn’t seem to be anything subversive about it.
The sales exec hopes you’ll see the orientation process as simply an upfront guide to what’s going to happen so you’re fully aware of what to expect. What it’s really about is the salesperson taking absolute control of the process, and you too. They’ll tell you things like they’ll be taking a few details from you first so they can identify the right vehicle for you, they’ll then go and appraise your trade-in, you’ll then be going on a test drive, etc. etc.
Basically, they’re tying you into a lengthy process that’s almost scripted and entirely designed for them to have the optimum chance of getting you to buy a vehicle and make them the most profit possible.
How you should react: If you’re happy with this and you’re confident you won’t be taken in and if you have almost endless time to spend being sold to relentlessly, then, by all means, let them take control like this. If you don’t want to go down this route then you tell the salesperson what you want and how you would like to proceed. After all, you’re not a prisoner and you have gone in there of your own free will. If the sales exec refuses to deviate from the script I’d suggest you take your business somewhere else because that’s not the sort of place you should be spending your money.
Rapport building can happen before or after you’re put through your orientation, and to some extent, it can continue throughout the sales process. On the face of things, it can just seem like the salesperson being nice and friendly and showing an interest in you. In reality, this is an information-gathering exercise to identify things that can be used to sell a particular vehicle to you.
If you’re asked if you have children and you say yes, you’ll then be asked things like how many you have and how old they are. In normal life this is nothing more than being friendly, in a car dealership, it’s a way of ruling out some vehicles and identifying which ones should be sold to you. If you say you have four kids they’re not going to waste time showing you a Corvette, but they will usher you over towards the minivans or three-row SUVs.
How you should react: Be polite and friendly at all times, but don’t give too much away. There’s really nothing wrong with telling them about your kids and any pets you might have and that sort of thing, but don’t reveal things like your budget or how soon you might want to take delivery of a new car at this point. Keep those types of things to yourself and you say which vehicles you are or are not interested in.
This is often rolled into rapport building, but it can also be done in a more formal and open information gathering section of the sales process. If the salesperson is going their job properly, they’ll start with a little form-filling, which once again, all seems pretty straightforward and acceptable.
It’s probably only fair that they take your name, address, phone number, and even your driving license details. After all, you’re probably going to be driving one of their cars fairly soon. If you then start being asked about things like monthly budget, what you do for a living, if you have kids, do you own your own home or do you rent, how often do you change your vehicle and how much you expect to get for your trade-in, you’re then being profiled so they can tailor a stacked deal you’re likely to agree to.
How you should react: Only give the basics of your name, driving license and contact details and politely refuse to go into more detail. You may meet some resistance and may be told that you have to give the information they are asking for, but you don’t. Stick to your guns, and if the salesperson insists and the atmosphere turns uncomfortable because you refuse, just say goodbye and walk away.
Running the clock down
In some cases, the sales process can be something of a war of attrition where the sales department almost holds you captive until you give in and agree to buy something. The sales process is designed to have a start and an end, and the end is when you have agreed to buy. Sometimes, the salesperson will try and keep you there for however long it takes by constantly going back and forwards with ongoing negotiations.
The hope is that you’ll eventually become tired, hungry and worn down and agree to the sale just to get out of there.
How you should react: Be firm and call things to a halt when you decide you’ve had enough. If you’re not happy with something then tell them straight, and if they try to use that to keep you there negotiating, tell them to call, email or text you when they have the answer or have got to their best price.
This is actually a tough one because sometimes this will be true, but sometimes it can be total BS. The difficulty is working out which it is at the time. Sales execs might try to tell you the deal you’re being offered is only for today and that if you walk away and come back another day, the deal won’t stand and it might cost you more to get the same thing.
You may also be told that another buyer is coming in to look at that vehicle later, especially if it’s a used model. Both claims might well be true, but it could also just be a tactic to pressure you into saying yes to a deal.
How you should react: If you’ve done your homework before going to the dealership you should have a good idea if the offer on the table is poor, decent or sensational. If it’s in line with what you were expecting to pay then don’t be afraid to leave it. Even if that dealer won’t stand on it tomorrow, one of its rivals will.
The used car situation is different. You can find out before you go to see it if it’s a rare find or if there are loads of similar vehicles around for sale if you don’t get the deal you want on this one. If you’re not prepared to buy there and then and you’re told another sales exec has someone coming to see it, you’ve no way of knowing if it’s true or not.
Even if it’s not true, another customer could walk in off the street and buy it, and that’s especially true if it’s a particularly good price or if it’s in especially good condition or has really low miles for its age. If you know it’s a good buy and you still want to go away and think about it, don’t be surprised if it’s not there when you come back.
“If I can, then will you?”
This is an absolutely classic way of coercing you into agreeing on a deal by backing you into a corner you might not fell you can get out of. It happens when you’re negotiating a deal, and it’s where the sales exec asks you to agree to buy if he or she can meet the condition you’ve raised as an objection.
The “If I can” could be any one of literally hundreds of things. It could be the color, it could be getting to a monthly payment, it could be meeting a particular delivery date, it could be a price you want for your trade-in. The salesperson may or may not already know if they can meet the particular request, but they’re trained to see an objection as an opportunity to paint you into a corner.
How you should react: Although you might think this is a tough one, it really isn’t. Just don’t say yes. Say something like “I’m not saying I’ll definitely buy, but it will certainly get us closer to a deal.” What can they do then? They can’t sit down in a huff and say they’re not going to ask unless you agree to buy, can they? If they do, tell them where to go and get up and leave.
Selling a payment
Some dealers will try to sell you a payment instead of a car. They’ll try and concentrate you on an affordable monthly payment to keep the focus away from the price you’re paying for the vehicle and how much they’re giving you for your trade-in. This can hide a multitude of sins, especially if you really like the vehicle they’re showing you and the monthly payment. There’s probably a lot of profit in there somewhere for them, and you should be trying to get a piece of it for yourself.
How you should react: If you like the vehicle and you like the monthly payment the great. However, before you agree to anything you have to see a full, detailed breakdown of the deal including the sale price, trade-in price, any extras, and the finance rate. If any of these things don’t sit well with you, keep negotiating until they do.
It doesn’t matter if you’ve been presented with a monthly payment or a “price to change” by the dealership, it could still be what we call a stacked deal. A stacked deal can include a number of things you might not have asked for, but you might not feel comfortable asking for them to be removed if you’ve already agreed on a payment or a price to change.
If you do find there are things in there like paint protection or GAP insurance that you haven’t asked for, be prepared to be met with more selling and pressure if you ask for them to be removed. For example, if you want the paint protection removed the sales exec could say they put it in there because you said you had it on your last vehicle or that you’d said you liked to look after your vehicle and keep it clean.
How you should react: If you don’t want it then be firm and tell them to take it out, but watch for other tricks to maintain profit when the items are removed. Make sure the price to change or monthly payment comes down appropriately. If the vehicle price, your trade-in value, or the interest rate changes, then point it out to let them know you know what they’re up to. If they insist on sticking to the original deal after removing the unwanted items and just alter the numbers to keep the monthly payment or price to change the same, tell them you’re no longer interested and go buy somewhere else.
Pros and cons list
A sales exec might draw a line down the middle of a piece of paper and one side they’re going to list the reasons to buy the vehicle and on the other side the reasons not to. The salesperson will “help” the customer with all the many reasons there are to buy the car, but they’ll clam up entirely and leave it to you to come up with the reasons not to.
The whole point of this is to get you to the point where you can’t think of any more reasons not to buy and then there’s an awkward silence. Silence in the sales process is like a game of chicken, and it’s one you’re probably not going to win with an experienced salesperson. They will keep quiet until you say something. The idea is to show you there are no more reasons for you to say no to the deal.
How you should react: Don’t play this silly game. It’s quite clearly nothing more than a pressure sales tactic and it’s of no benefit to you whatsoever. If a sales exec does start to go down this route, put your hand over the piece of paper and tell them you know this is the Ben Franking close. You’ll probably get one of those awkward silence moments, but this is one of the rare ones where you will beat the sales exec.
Assumptive or alternate choice close
A good salesperson will never ask you a yes or no, or what we call a closed question until they are ready. Instead, they will always offer at least two options. For example, they will ask you something like “do you want the manual or the automatic?” They won’t ask you if you want the automatic because that allows you to say no.
This is what’s also called an assumptive close, and that’s because by giving a positive answer such as saying you want the automatic, you’re almost saying that you are going to buy the one with the automatic transmission. You’re not, of course, but the salesperson has solicited at least a little bit of commitment from you to make you feel like you’ve almost said you are definitely buying.
How you should react: Don’t take the bait. Adopt a relaxed, leisurely and carefree approach and don’t give a definitive answer. Say that you’re still deciding, you’re not bothered at this point, or something similar. When you have decided to rule something in or out then you tell the salesperson so you can avoid wasting anyone’s time on something you’re not interested in.
This practice might be called pencing or centing in some cases, and it’s exclusively done with finance deals. Let’s say you have agreed on a deal and the monthly payment being quoted is $327 per month. When the finance manager puts the deal to the finance company to produce the documents for you to sign, he or she might increase the payment to something like $327.68 or even $327.99 per month.
The customer is still paying $327 per month, but those extra cents add up to pure profit for the dealer and it can be quite a bit extra you’re going to end up paying. The original payment may have been something like $327.43, but if they add another 50 cents to it on a 60-month agreement the dealer is making an additional $30 profit.
How you should react: When you agree a monthly payment make sure you are quoted the full payment and not just a round number. In this case above it might only be $30, but that’s $30 that really should be staying in your pocket and not going in theirs.
A lot of customers get hung up about how much they’re getting for their trade-in, which is understandable. If you’ve spilled the beans during the rapport-building or profiling and told the sales exec the price for your trade-in is important to you, they might well decide to over allow when they present a deal.
What this means is they offer you more than they are actually valuing your trade-in at, but this money isn’t extra money they are giving you. What they are doing is taking some profit out of the vehicle they are selling and adding it to what they’re giving you for your trade-in to make it look as though they are giving you more.
You might think there’s nothing wrong with that because it’s there profit they’re cutting after all, but what’s really happening is your room for negotiating a discount on the price of the car you’re buying has been cut.
Let’s say the car you’re looking to buy is priced at $30,000 and they’ve offered you $6,000 for your trade-in, but you’re adamant you want $7,000 for your trade-in. To get a deal over the line the sales exec might say ok and give you the $7,000 you want, but if they had been prepared to sell their car for $28,000 before you walked in to get it moved, they’re now only going to be able to go to $29,000.
You might never know this, but sometimes they will write the correct figures on the invoice for tax reasons. In the case above, the final invoice would say $28,000 minus $6,000 for the trade-in, which is a balance to pay of $22,000. You might have agreed on $29,000 for the car you’re buying and $7,000 for your trade-in, but the balance would still have been $22,000 so what are you going to do?
It’s all smoke and mirrors really, but it’s a way of overcoming the common customer objection of not getting as much as they want for their trade-in.
How you should react: Even if you’re not happy with the amount you’ve been offered for your trade-in, concentrate on the price of the vehicle you’re looking to buy first. Once you’ve got to where you want to be with the price, then you can start trying to get more for your trade-in. The sales manager won’t be able to adjust the price of the vehicle they’re selling now, so the only option left is to try and genuinely offer more for your car.
Subject to approval scam
I don’t use the word “scam” lightly, and I will admit that I’ve been guilty of using every tactic and practice in the past that I’ve mentioned so far. However, although I know dealers that have used the subject to approval tactic in the past, this is quite simply a finance scam and nothing else and you should make sure you avoid it at all costs.
What happens is a customer goes through the whole sales process and agrees to buy a car on a monthly payment. The dealer then gets the customer to drive away in the car and leave their trade-in, but the finance hasn’t been processed because they’re still waiting for final approval from the finance company.
A day or two later the customer gets a call with the good news that they’ve been approved, but the bad news is the finance company wouldn’t approve on the terms as they were proposed. The payment agreed on the day might have been $274 per month, but now it’s gone up to $296 per month. The customer is already driving the new car and they’re used to it, so what are they going to do?
Now, finance companies will sometimes come back with a higher payment if there’s something in the customer’s credit record that means there’s a slightly elevated risk. It can even be that one finance company refuses the proposal so the dealer sends it to another company that will accept, but they charge higher interest rates.
The thing is though; no decent dealership will have a customer drive away in a car without the finance being approved and the documents signed. The only reason they would do this is to pull this scam.
How you should react: Never, ever, ever drive away from a dealership in a new car before the deal and the finance is agreed, signed and finalized. If there’s trouble getting you accepted this should all be done while you are there, or they may ask for a holding deposit to keep the car for you so you can go home and come back in a day or two when they’ve got you approved.
There’s nothing wrong with dealers who aim to get customers away in their new car on the same day they go in to buy, but not without every aspect of the deal being fully completed.