Where to Buy
The greatest peace of mind when buying a new car comes at a franchised dealership garage that is contracted to one manufacturer. Even if you buy your vehicle from another source the chances are that your car will be serviced and maintained here. These centres have the experience of the brand and more sway with the manufacturer they represent.
Car supermarkets offer new cars from any brand where there are deals to be had – hence lots of Fords and not many BMW’s. These places are the antithesis of the franchised car dealerships – no flash showrooms, no test drives and an attitude of “Pile it high, sell it cheap”. Some of these cars have come from UK manufacturers and importers trying to offload surplus stock, but others will have come in as ‘parallel’ imports from Europe, which the supermarkets have brought over themselves. It is worth checking which type you are looking at: official UK cars will be worth more at resale time and may carry better warranties.
When the Internet first appeared, there was much talk of virtual sellers replacing “bricks and mortar” dealerships, but that hasn’t really happened. The Internet has become the main place to research cars (after all, you are doing just that), but Internet-only car sellers are still a tiny proportion of the total market. A few years ago, there was a brisk trade in Internet entrepreneurs offering ‘parallel’ imports. However, the recent strength of the Euro has made British prices look like good value, so only the biggest operators, like the supermarkets mentioned above, remain in business.
If you are looking at a parallel import, you need to watch out for:
- Delivery times: Some importers entice customers with attractive prices, but how long will you have to wait for the car? If they are quoting months and months, be very careful – prices have been known to creep up while you wait and delivery times can stretch almost to infinity. Nowadays many importers sell from stock, meaning you don’t have to wait for them to source a car – a much more secure way of doing business.
- Specifications: A Danish specification Ford may not be the same as a British one – generally speaking, specifications in Britain are higher than elsewhere. Get it in writing that the car will be to British specification and define what that specification is. Get a UK brochure and compare the list of equipment. It’s no fun taking delivery of your new car and finding steel wheels instead of the alloys you expected. Even if you don’t mind, the next buyer will. Also watch out for warranties. As described above, the standard manufacturer warranty is pan-European but that may only be for 12 months in other countries, whereas the UK-sourced model may come with an extended 36 month warranty as standard.
If you are sourcing a car from outside the EU, be extra-careful. This usually means a model from Japan and then you are pretty much on your own – a Japanese warranty is usually worthless in the UK. The car may have a completely different specification and may not even have rust-proofing underseal (that being unnecessary for the Japanese market). You will have to rely totally on the honesty of the company selling the car. A privately imported car from Japan will almost certainly be marked down in value when it comes to resale time.
Another option is pre-registered cars. These are new cars that dealers have bought and registered in order to qualify for discounts from the manufacturers. They then sell them on to customers at discounted prices. As depreciation is steepest when the car is first registered, this can be a great way to save money. It is not unknown for a model with 5 miles on the clock to be sold by a dealer at 30% off list price.
Getting the best price
How much should you negotiate? Sellers’ desperation varies hugely between car dealers. A fortunate few make customers wait months for sought-after vehicles, and are unlikely to budge on the asking price. However, it’s always worth asking for a discount and trying other dealers to see if you can get a better deal.
How much discount
As a general rule, the greater the demand for a car the less the discount. There may even be a waiting list for some models, like the Mini Convertible, in which case dealers are unlikely ever to reduce the price. At the other extreme, just turning up at a Fiat dealer has been known to generate discounts of 15% for particularly unpopular models.
Where models are about to be replaced with newer versions you can expect substantial discounts, although you may find that the car’s resale value has plummeted accordingly when you come to resell.
If your budget is tight, it may be worth looking around for special short-term promotional deals, such as 0 per cent finance, guaranteed trade-in values and free insurance. Most of these deals are simply another form of discount on the list price.
Taking the test drive
It seems obvious, but always test drive a car before you buy it. Some people get carried away in the showroom and open their wallet before they even sit in a car on the road. If you’re more than six foot tall, check you fit in a convertible with the hood up – will your golf equipment or family shopping fit in the boot of a supermini? Also make sure you get a proper test drive – not five minutes around the block with a 19 year-old salesman rabbitting on from the passenger seat. When you buy a £50 item of clothing, you probably spend a good few minutes trying it on – when you are spending thousands you owe it to yourself to test drive the car properly on a variety of roads.