Can you still negotiate for a new car? How the car market is changing (2024)

Buy onethe billIt has often been a time-consuming affair involving visiting several local dealers and negotiating prices to reach a fair deal.

But several trends now point toward more shopperspurchasing carswithout the hassle – or potential payout – of haggling.

A growing number of major franchise dealer groups are advertising "no-hag" pricing, which generally means the price you see is their best and only offer, says Trent Broberg, CEO of Acertus, an automotive logistics platform industry.

At the same time,electric vehiclesis gaining market share and buyers often buy electric cars online at fixed prices. Only with EVcar manufacturers such as Tesla, this is often the only way to buy.

Overall, negotiating with car dealers has simply disappeared since a car supply shortage emerged in 2021. Car dealers generally aren't under a lot of pressure to move vehicles by offering discounts or negotiating with customers because their cars still sell quickly for about full price or more.

Despite high prices, new car sales have been remarkably strong so far this year, up 12% from the first half of 2022, according to Cox Automotive.

No dirty car dealers

According to Tim Mullins, vice president of national sales strategy and analytics at Capital One Auto Finance, it shouldn't be difficult to tell if you're looking at a car from a dealer that doesn't offer bargain prices. “It will be plastered all over their website,” he says.

No-haggle dealers claim this is a more efficient and less confusing process for consumers, and Mullins says Capital One's research shows some car buyers are actually willing to pay a little more for that kind of price transparency. Broberg adds that this model appeals to customers who want “to buy without friction.”

Other buyers now prefer to order their car, with the option to customize their car. In the past, car booking was mainly limited to luxury cars, but in recent years this has become commonplaceOrder standard regular vehiclesAlso. You can order a car online or from a salesperson at a dealership. Whether there is room to negotiate the price depends on your situation.

Additionally, warehouse clubs like Costco, which operate in the automotive industry, push for hassle-free shopping experiences for their members by negotiating prices in advance with participating dealers.

In the future, experts expect that in addition to the traditional car purchasing processes, there will also be no-negotiation options, which will not disappear completely in the near future. While it's no fun spending four hours at a dealership, talking face-to-face with a salesperson appeals to a wide range of buyers, experts say.

“Most consumers want to walk into the dealership, they want to look someone in the eye and they want to touch and feel a car,” Mullins says.

Buyers who go this route cansave timeand money by searching for model availability and comparing prices online, then taking their research to the dealer when they're ready to pull the trigger. You can negotiate a fair price more quickly if you know what the car you want usually sells for.

Car buyers have lost their influence

Three years ago, the average discount on a new vehicle was about $2,500, and for years it was common to pay thousands of dollars below the Manufacturer's Suggested Retail Price (MSRP). In May, the average discount was just $616, according to data from Edmunds, an auto research firm, as inventory remains tight for many car brands.

A year ago, buyers actually paid $722overMSRP average, so the landscape has improved for consumers. Cox Automotive reports that vehicle inventory is up 74% over the past year, with 1.8 million new vehicles available in the U.S., but that's still very low compared to pre-pandemic inventories of about 3.5 million.

For brands with the shortest supply, such as Toyota, some dealers arepresalethe vast majority of their new cars, and online listings for certain models show price increases of 10% or more over the sticker price.

While you can still bargain and get discounts on cars from larger selection automakers like Buick and Dodge, buyers don't have the same leverage on cars like Hondas, Kias and Subarus, according to Cox data.

Online shopping for electric cars

Electric car companies, including Tesla, Rivian and Lucid, sell their vehicles through a direct-to-consumer model, where you can buy a car online and have it delivered to your home. This often means that farting is not an option at all.

Electric car makers have been pushing for state courts to allow them to sell their cars without dealer involvement, though results have been mixed. In some cases, to circumvent state laws, a dealer still acts as a middleman in direct-to-consumer vehicle transactions.

In addition to carmakers that only make electric cars, industry giants like Ford are also aiming for price-free prices and focusing on ordering their electric vehicles online. Ford CEO Jim Farleysaid a maythat the company is rolling out 'non-negotiable' prices for its electric cars to create a 'modern and simple customer experience'.

Ford says customers will have a more enjoyable car-buying experience if they can skip the haggling, and the company plans to adopt no-haggle pricing on all electric car purchases in-store and online in January.

Experts say younger shoppers are more likely to prefer online ordering without haggling. It may also appeal to buyers who have specific preferences for the upholstery and color of their vehicle.

Overall, online vehicle ordering has become more customer-friendly in the past year as the industry has figured out how to get vehicles to customers with less delay, Broberg says. This points to less haggling in the future, as digital purchases are typically non-negotiable, he adds.

Online car buyers may have to be patient. Delivery time can be on the short side of six weeks, but can also take several months, especially if you have a queue of orders in front of you.

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