6 Tips for Negotiating When Buying an Electric Vehicle
In 2022, new vehicle sales dropped by 8%, but according to Kelley Blue Book, electric vehicles are not to blame for the fall. EV sales surged by 65% last year over 2021, jumping from a 3.2% market share to 5.8%.
Find: GOBankingRates’ Best Checking Accounts 2023
Tips: 3 Ways Smart People Save Money When Filing Their Taxes
More: 10 Best New Items Coming to Dollar Tree in 2023
In short, demand is sky-high, so it won’t be easy to negotiate the price if 2023 is the year that you finally decide to go electric. But with KBB quoting $64,249 as the average price for a new electrical vehicle, most people will be priced out if they can’t work the dealer down at least a little.
In reality, many EV buyers simply won’t be able to bargain. For example, some automakers, like Tesla, don’t negotiate on price at all. In other cases, dealers are less likely to budge on the MSRPs of their limited electric inventory.
Even so, negotiating with a dealer is still part of buying a car — even an electric car in plenty of cases. Here’s how to get the best price possible on your next EV.
Be Flexible — and Reconsider a Hybrid
The COVID-era supply chain shortages that put customers on long waiting lists for scant dealership inventory have loosened up, but same as back then, the best deals go to flexible buyers — especially for EVs.
“The dealer might be able to offer you a sizable discount to move that stock if you’re open to considering a model with a slightly different specification or an older model,” said Mark Williams, owner and author of The Automobily. “But if the model is a new and well-liked electric car, you may face difficulty negotiating a significant reduction. If the model you desire is a hybrid, which has more model alternatives available, you may be able to negotiate a nice discount.”
And if the model you want isn’t a hybrid, maybe it should be.
According to the New York Times, hybrids are in much lower demand than EVs. They’re much cheaper to buy — up to $10,000-$15,000 less — and they can earn you big savings on fuel.
Research Before You Reach Out
After settling on a model, learn as much about the car as possible before contacting a dealer. EVs are complex and — for first-time buyers, at least — unfamiliar compared to gas cars. An informed buyer is much more likely to strike a deal.
“It’s essential to research the market and know the average prices for the specific EV model you are interested in,” said Aaron Telle, auto expert and CEO of Telle Tire auto shop. “This will give you a good starting point for negotiation and help you understand if the dealership is offering a fair price.”
Take Our Poll: Are You In Favor of More Inflation Relief in 2023?
Same as With Gas Cars, You Win When Dealers Compete
Another tactic that can work with EVs and ICE cars alike is stoking competition between local dealers. Simply expressing interest to multiple sellers in your area is usually enough to do the trick.
“Don’t be afraid to shop around and compare prices from different dealerships,” said Telle. “This will give you a better idea of the market and will also give you more leverage during negotiation.”
The trick is to let each of them know you’re talking to the others. Then, when you get a low price from one, inform the others that a rival dealer has them beat.
“Give them the option that they can either match the current offer or you will take your business somewhere else,” said Miles Walker, auto expert and founder of CarAudioWise.
If They Won’t Budge on Sticker Price, Negotiate on Financing
Make sure to get your credit in good shape before you enter into discussions. When dealers don’t have the wiggle room to negotiate on price, they can sometimes compensate in the finance office — especially if you’re holding the leverage of preapproval from a third-party lender.
“Try to negotiate the price as much as you can before asking whether they will provide you with a finance agreement at a decent rate instead of a significant price reduction,” said Williams.
Know Your Breaking Point and Be Prepared To Walk
Enter the discussion with a number that you’re not willing to go above and stick with it if negotiations prove fruitless.
“If the dealership is unwilling to negotiate on price or is not offering a fair deal, be ready to walk away,” said Telle. “Many dealerships will be willing to work with you, so don’t feel pressured to purchase if the value is not suitable for you.”
Remember, Gas or Electric, You Catch More Flies With Honey
Whatever you do, don’t try to play hardball. Dealers still hold most of the leverage, and pushy, rude and demanding aren’t traits that make people want to work with you.
“Be polite and professional,” said Telle. “Remember that the dealership is a business, and they are trying to make a profit. It’s essential to be courteous and professional during the negotiation process. This will help build a positive relationship with the dealership and may lead to a better deal.”
More From GOBankingRates
This article originally appeared on GOBankingRates.com: 6 Tips for Negotiating When Buying an Electric Vehicle
