A few simple tactics can add up to about $800 in savings when you buy a new car, according to a recent study by three university professors published in the current issue of Quantitative Marketing and Economics.
The study, which was based on a survey of 1,400 car buyers, found that car shoppers could save about $800 by doing four things: finding out what a dealer pays for the car, visiting two dealerships, bargaining and doing research and price comparisons before buying.
The average dollar figures associated with specific strategies to save money when buying a car were:
- Knowing the invoice price = $121 savings.
- Multiple rounds of bargaining with the dealer = $302 savings.
- Spending time researching cars and doing price comparisons online = $287 savings.
- Shopping at two dealerships instead of one = $109 savings.
- Shopping at up to seven dealerships instead of one = $600 savings.
One of the study's authors is Jorge Silva-Russo, an associate professor of marketing at the University of California, Riverside, who previously worked at JD Power and Associates. In a statement regarding the study, he said, "This really shows that even the consumer who doesn't like to bargain can get the priced reduced if they are informed."
Tara Baukus Mello writes the cars blog as well as the weekly Driving for Dollars column, providing both practical financial advice for consumers as well as insight into the latest developments in the automotive world. Follow her on Facebook here or on Twitter @SheDrives.