Is there any more annoying and pointless process than buying a car? Unless you have balls of steel, have done hours of research and are willing and able to debate and haggle with a pro at the system designed to defeat you, you’re going to spend more than you should. Just what the car companies need right now; a process designed to keep people from wanting to buy a new car.
Why You Can’t Buy a New Car Online
Wouldn’t it be nice if you could cut out the middleman and just order your Prius straight from Toyota?
But you can’t. And there’s one reason why: the car-dealer lobby, which has worked hard to ensure that this will never happen. Since the late 1990s, car dealers have used their considerable political clout to pass or better enforce state franchise laws that in many cases make it a criminal offense for an auto manufacturer to sell a new car to anyone but a state-licensed car dealer. The laws governing who can sell new cars are among the most anti-competitive of any domestic industry. By creating local monopolies for dealerships and prohibiting online sales for new cars, they constitute a major restraint on interstate commerce; in 2001, the Consumer Federation of America estimated [pdf] that the laws added at least $1,500 to the price of every new car.
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Online sales would help companies like GM and Chrysler align production to sales better by allowing more people to buy their cars built-to-order from the factory, rather than having Detroit send out truckloads of vehicles to sit around on dealer lots for months in the hopes that a rebate offer will finally entice someone to buy them.Now that the federal government is bailing out GM and Chrysler to the tune of $13.4 billion, and Congress is demanding major changes in the way they’re run[. ...] You’d think they would find a sympathetic ear among deregulatory Republicans who take great umbrage over any state interference with the free market, but you’d be wrong. Most free-market Republicans have no interest in taking on the car dealers, who are among their strongest local supporters. Since 1990, American car dealers have given more than $66 million to federal candidates, with more than three-quarters going to Republicans.
Long live CarMax.
You simply have to be able say ‘no, thanks at that price’ at least once to the dealer. This gives them a strong message that you are serious about your research.
You should also bring a piece of paper to the dealership and make sure you do all the math of the finance calculations yourself. The point is not that they will do the math wrong. The point is you will see exactly how the deal is structured. Do not be afraid to take the time to do this or look like a fool for mapping out your car deal in the dealership.
My dad swears by this process, http://tinyurl.com/nxutm2