As of last Friday night, my two best options were a 2012 Kia Rio EX and a 2013 Hyundai Elantra GLS. The Elantra was bigger and better to drive, but cost $1,400 more. Both deals were pretty good, so I had already notified family, friends, the media, the police, and the Joint Chiefs of Staff that I was going to buy a new car on Saturday.
I called Hyundai to see if they could make my decision easier by lowering the price. The sales rep asked how much more I wanted them to lower the price. $50? $100? I said I was thinking more along the lines of $500, because that was the difference between Hyundai’s and Kia’s offers for my trade-in. I asked her to talk to her finance manager, either that night or as soon as the dealership opened in the morning, and to call me back in the morning.
What made the choice so difficult was the fact that the Rio offer was ridiculously good. The price was low because it was a 2012 model on clearance. A new 2013 Rio would have been priced at least $1,000 higher, which would’ve made the Elantra the obvious choice.
And that made me curious about other cars on clearance. So that night, I got online, dug around a while, and found a 2011 Corolla LE at a nearby Toyota dealer. It would be worth checking out, since this dealership opened at 9 and Hyundai wouldn’t call until they opened at 10. But if Toyota offered a low enough price on the 2011, then the previously disqualified Corolla might be back in play.
Saturday morning, I rolled over to the Toyota dealership and asked the salesman about the 2011 Corolla. He said it had already been sold; they just hadn’t updated the website yet. He offered to let me test drive a 2012 Corolla LE. I figured I had some time to kill anyways before Hyundai called, so why not? The test drive was just like the one earlier in the week: comfortable car, good view in all directions, good engine, good interior layout, good gadgetry.
The salesman asked to appraise my car and show me some prices, even though I’d come to the store looking for a 2011. Once again, I had some time to kill, so why not? We went inside the dealership and sat at his desk. I gave him the key to the ‘Rolla for the appraisal, answered a few financial questions, and said to run the numbers as if I were putting X dollars down. He took the key and the paperwork into the back.
Ten or fifteen minutes later, he came back with the key and a finance manager. This was, by my count, the billionth time I’d been through this act in the last week: they show me some numbers, thinking I don’t understand what they mean, go back and forth between the sales desk and the finance office in hopes of wearing me down, asking what they can do to put me in a car that day, blah blah blah. It’s tiresome, I’d rather they just get to the point.
The finance manager introduced himself, said they’d appraised my car, and showed me a piece of paper with some numbers on it.
I looked at the bottom and saw a number that was about $800 less than the Rio offer. It confused me. It seemed too low to be the total price of a new Corolla, especially considering that at the other Toyota dealership, the base price of the same car was ridiculously high, so I thought it was the sum of the principal and the interest on the loan, but it seemed too high to be the loan repayment, and for the interest to be that high, the interest rate would have to be pretty high because my credit is pretty good and bright lights and colors were everywhere and–
I short-circuited my own train of thought by asking if that number was the total repayment.
The finance manager asked, “What do you mean?”
I said, “I mean, is this how much I’d pay in addition to the down payment? Is this the principal and the interest?”
He looked at me oddly and said, “No, that’s the price of the car.”
I was still confused. Based on my experiences that week– the car magazines, the online research, the test drives, the dealing with finance managers, the haggling– that number was way too low to be the price of a new 2012 Corolla LE. So I asked, in what I hope was the least stupid-sounding way possible, “What do you mean?”
HIM: “I mean if you give me your trade-in and give me that much money, then the Corolla is yours.”
ME: “…but then I pay tax, tag, and title?”
HIM: “It’s already in there.”
Now that I got it, my jaw dropped. Before I could pick it back up, he excused himself, went back to his office, and returned with a new offer sheet. The number at the bottom of this offer sheet was another $800 lower. It was now $1,600 lower than the Rio offer. It was now $3,000 lower than the Elantra offer.
He asked, “Can I sell you a car today?”
I had resolved not to buy a car on my first visit to any particular dealership. So I said, “Not today, but you might’ve just sold it to me first thing tomorrow morning.” Then he threw in a few more options, and I said I’d probably be back as soon as they opened the next day.
By the time I got home, Hyundai had called back and left a message. The message was that they were willing to drop the price a little more. No specific numbers, just “a little more.” Well, given the $3,000 gap between the Corolla and the Elantra, “a little more” wasn’t going to cut it.
I alerted everyone that I was delaying my decision by one day, and summoned the Council from far and wide. We examined the offer sheets for the Rio, the Elantra, and the Corolla. We tried to think of reasons to not buy the Corolla. The only reason we could think of was the warranty, because Kia and Hyundai offer great warranties on every new car. But the Corolla offer was so insanely low that I could afford to buy an even better warranty and still save an ungodly amount of money.
The Corolla deal was too good to be true, but there it was on paper. What’s the worst that could happen? They might claim they forgot to include something in the cost, they could change the price– fine, I’d still have the two other decent offers to fall back on.
I went back at 10 on Sunday morning, and sure enough, the price had changed. It was another $100 lower. Nobody said anything about it; nobody asked; it was just magically lower.
By noon, I’d bought a new silver 2012 Corolla LE. If it works as well as my old car did, then Toyota can expect my business again in 2022.
3 thoughts on “Replacing the ‘Rolla, part two.”
I may not be one of those car guys, but i was always told cars that are used as a tool (So not mustangs, ect…) are the worst investments you can make when it comes to strict dollar amount, so you try to buy a new car as little as possible, so why give your cars a 10 yr expo date?
I’m not sure I follow your question entirely, but here goes.
Most cars depreciate significantly as soon as you drive them off the lot, so they’re generally not great investments in strictly monetary terms. I generally prefer to buy a new car because I like not having to worry about what previous owners did to the car and I want to take full advantage of the manufacturer’s warranty.
Something else to consider is that as people buy more used cars, the gap between used and new decreases. I just looked up the prices of used 2011 and 2012 Corollas on CarMax.com. In most cases, I would have saved as much as $1,000 by buying from CarMax. In the other cases, I would have spent more than I paid for my new car. Those cars have miles on them, and the clocks on their warranties have already started ticking.
Buying used is a good idea, but through careful research, shopping, haggling, and dealing with financial managers who must’ve been high if they gave me that good a price, you can get excellent deals on new cars.
Why ten years? It’s a nice, round number.
Another reason why there is a smaller gap between new and used – Cash for Clunkers. That took a lot of used car inventory out of the market.
I also seem to remember seeing a cost-benefit analysis a while back that said if you held on to a new car long enough that it was actually cost-effective to buy new. I think the Hmnahmnas have been holding onto cars for an average of over 12 years before replacing them. That should put us on the right side of that curve.
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