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Licence to deal

In the world of car shopping, sticker prices are for suckers


Ever wonder what your local car dealership paid for that showroom model you’re hankering to buy and how much markup is in the sticker price the dealer is offering to you? Now, the guessing game’s over. If you’re a woman armed with the right information, you may save more money than anyone else at the car lot.

Save time and bargain like a pro by finding out what your dealer actually paid for most new vehicles sold in Canada, along with current rebates and incentives. Since October 1999, more than 8,400 people have signed up at www.carcostcanada.com to get dealer invoice costs on new vehicles. (See The inside scoop, below, for service details and prices.) “People just want to know that they’re paying a fair price,” says Paul Timoteo, president of CCC Internet Solutions, the company behind Car Cost Canada. “They don’t care about $100 more or $100 less. But if it’s $1,000, that makes a huge difference.”

Consumer Reports magazine has been offering the inside scoop to U.S. consumers for a fee since 1983. “We’ve had tremendous demand for this information because it really levels the playing field,” notes Paige Amidon of Consumer Reports New Car Price Service. She says surveys of customers who have used the service show that women saved more on average than men. “Historically, white males have been quoted better prices by dealers than women and minorities,” says Amidon. “Information really is a great equalizer.”

Along with dealer invoice costs, the Car Cost Canada Web site gives average national markups on vehicles by model. The typical car buyer usually ends up paying a markup of only about six to eight per cent. That can be a real eye-opener for skeptical car shoppers, says Dennis DesRosiers of DesRosiers Automotive Consultants, who cites surveys indicating that consumers greatly overestimate the amount of profit on a new car sale. But even that markup can be whittled down to a respectable five or even three per cent depending on how hot the vehicle is and how low you start your offer.

Timoteo won’t guarantee that car shoppers armed with a dealer invoice price and markup will automatically get a better deal, but he says buyers have saved $300 to $3,000 per purchase by being better informed. Car Cost Canada members can also select three dealers from a master list to receive a purchase quote. “I can’t see somebody being able to negotiate a better price without all this info,” says Timoteo.

However, invoice price is only part of the deal. Even if consumers bargain down the cost of a vehicle, slick dealers can still cash in by low-balling a customer on a trade in or padding the sale with inflated pre-delivery charges, administration fees or pushing overpriced rustproofing, fabric protection or paint sealant. Be aware of all the dealership add-ons.

“You shouldn’t go in as a naive buyer,” notes George Iny, president of Canada’s Automobile Protection Association (APA). “If you don’t haggle, you’re probably paying too much.” The APA has offered invoice pricing to members since 1989, along with a new-car buying service that provides shoppers with a discounted quote from a dealer who agrees to abide by a code of ethics. Iny estimates shoppers can save about $300 to $1,500 on a purchase by using the service. Equally important to Iny, members in some cities are referred to trusted repair shops. After all, the dealer with the best-selling price may not offer the “I find the fascination with saving $150 on a $20,000 car a bit misplaced,” says Iny. “It’s like saving 10 cents on a can of beans. The problem is, dealers will usually take $2,500 if they can get it. That’s a lot of money.”

Maryanna Lewyckyj is consumer advocate for the Toronto Sun. She conducts car care seminars for women through her company, Autophobics Anonymous.