It goes without saying that purchasing a new car is one of the biggest financial decisions you can make in a lifetime, so you want to do everything possible to get your dream car at the best price. 

While negotiations can be uncomfortable at times, they’re a necessary part of securing the best possible price on a new car purchase.

Studies have found that just one-third of the Australian car-buying public don’t negotiate on price, which means there are a lot of Australians missing out on potential savings. With that in mind, let's unpack your best strategies when negotiating the best price on a new car purchase to help you out with your purchase. 

The Basics of Negotiating a New Car Purchase

As a buyer, your aim is to find your dream car at the dealership and get your purchase price as close to the price that they’ve purchased that vehicle from the manufacturer, which is otherwise known as the ‘invoice price.’ 

While we often see only the ‘sticker price’ attached to vehicles on sale, sticker prices are significantly higher than the invoice price, and takes into account things like that dealership’s markup on the vehicle. 

The best negotiation strategies position you in front of any given dealership as an informed buyer that is not in a hurry to purchase, unless the price is right. Let’s talk about how you can prepare yourself. 

How to Negotiate the Best Price on a New Car 

Let’s break down a handful of the most important things you can do to prepare yourself for a price negotiation.

Do Your Research

The more preparation and market research you can do ahead of your purchase puts you in good stead to negotiate a better price down the line, as you’re less likely to be misled or taken advantage of, especially in a high-pressure environment. 

Important things to research include a shortlist of your preferred vehicles and their direct competitors in the same segment, and a comparison of model variants within those lineups to see which features are included in the base model, and which are reserved for higher-spec models. 

If you’re happy with the features included on a base model vehicle, you’re better positioned in the negotiating phase and can assert that upgrading to a more expensive variant is not needed. 

Shop Around and Compare Quotes 

Shopping around for each dealer’s best possible quote is arguably the most time-consuming part of the process, but remains the most important step in the negotiation process. 

Sticking to the ‘three dealership rule’ is a must, and will give you an idea of each dealer’s best possible pricing for that make and model. 

If you find a better price, tell them, and you’ll get an idea of how willing they are to move their vehicles, or if they’re looking to simply maximise their profits, with more flexible dealerships proving a better investment of your time. 

Be Realistic About Your Offer

While your aim is to get a price below the sticker price and as close to the invoice price as possible, you need to be realistic about your offer, particularly if demand is high for that model. 

Setting a fair price shows how much you’re hoping to pay, but also shows that you’re aware of the market value of the vehicle, which helps to keep negotiations moving along to a place that leaves both you and the dealer satisfied. 

Secure Finance Ahead of Purchase

Getting pre-approval for a car loan is a great way to speed up negotiations and show the dealership that you’re ready to buy- so long as they present you with the right opportunity. The team of expert brokers at can help you find the best deal on your car loan from their panel of almost 30 reputable lenders.

Showcase Your Knowledge 

With all that research done, it’s time to show off your knowledge and show the dealership that you know exactly the make, model, engines and features on offer for your preferred car. 

If you can show that you know exactly which vehicle you’re after and even show evidence of some written quotes you’ve obtained beforehand, you’ve given yourself far more credibility when it comes time to negotiate a final price. 

Be Flexible

Today’s car landscape is filled with waitlists for popular models and less flexibility overall for buyers, which means that to get the best price, you might have to budge when it comes to things like your chosen colour, the model or even your preferred manufacturer, if you’re in a hurry.

Be firm on things that you aren’t willing to sacrifice, and flexible when it comes to the small things that can help keep negotiations moving, or wait lists as short as possible. 

Be Prepared to Walk Away 

The negotiating process can take time, so if you’re not happy with the offer on the table, the best strategy is to simply walk away, take stock of your options and keep comparing the most competitive rates from other dealerships. 

Pressure is one of the most commonly-used tactics, which more than often leads to rushed decisions that benefit the dealer, rather than yourself in the long run, so if you’re feeling the pinch, it’s best to walk away. 

Use the ‘if’ and ‘then’ Technique 

One of the best ways to keep your negotiations moving is to make a small concession, whether it be on the speed of purchase, price, colours, equipment or extras, and see if the dealer reciprocates. 

An example of this technique in practice will play out something along the lines of, “if you (the dealer) are willing to budge on your sticker price, I’m ready to make the purchase,” which shows the dealer that you’re a genuine buyer that is ready to move to the next stage. 

Double-Check the Trade-in Value Offer

If you’re trading-in your existing car to help finance a new car, be sure that you’ve been offered a fair market valuation. 

It’s common for dealerships to offer a generous price on the new vehicle, but fail to offer a competitive price for your current vehicle in the hope that buyers opt for the easiest possible upgrade process. 

Don’t Rush 

A common sales tactic is to put a limited time frame on the purchase of a car, which taps into our brain’s scarcity mindset and can often lead to some rushed decisions. 

Afford yourself the luxury of time, and if you’re doing your research ahead of your purchase, you won’t feel the same pressure, and a cool head makes a huge difference when comparing quotes to find the best deal. 

Biding your time can also prove fruitful if things like end-of-financial year (EOFY) sales, model run-out sales, and plate clearances around the New Year present themselves. 

It’s also worth visiting dealers either in the middle or the end of the month, where they might be under some pressure to hit a monthly sales target, and could be more flexible on pricing.