We recently had to get rid of Jeff's Camry, which meant it was time to buy a new car. After deciding whether we wanted new or used, hybrid or traditional, and after reading up on the top recommended family cars for this year, we decided it was best to buy a brand new Honda Accord 2014 lx.
This was my both Jeff and my first time buying a brand new car from a dealer (my current car, I bought used from a friend and Jeff bought his Camry used from Cerritos Auto Square). What an experience this was!
Why we had to get rid of Jeff's car:
The big headache started a year ago, when Jeff's check engine light went on. Busy with demanding-needy-Caitlin in our lives, we never took it to a mechanic and instead, continued driving with the check engine light on. Come September 2013 and it was time to renew the car registration and get a smog check.
The smog check failed. We take Jeff's car into our mechanic and he is unable to determine what was wrong with the car because the error log was completely flooded with bogus errors due to us driving with the check engine light on for months. Whoops.
The mechanic cleared the error logs and told us to drive on the car again and when the check engine light comes on, bring the car back in, as the error log should show the appropriate error code. Although he suspected there was something wrong with the catalytic converter since the car was emitting a yucky smoke.
With the car error code free, we brought the car back to the smog check, and voila! we passed! You can ignore the part where the car is emitting yucky smoke. Since the error log is clear, the car passed the smog check and we walked away with a renewed car registration.
And then we got on with our lives
The check engine light went back on and we never brought the car back to our mechanic.
Fast forward to June 2014. We probably all have lung cancer by now from inhaling the yucky smoke. Jeff drives to work one day and notices that the car has trouble accelerating and the entire car rattles!
Hmm. Perhaps it's time to bring the car to the mechanic. (This happened right before our Palm Springs trip, so we had to take my lame-o car to Palm Springs. Such terrible timing).
Our mechanic examines the car and says the catalytic converter needs fixing (for the smoke) and the rattling may be due to an axle issue. He doesn't handle catalytic converters nor axles so he sends us to a different guy. However, Jeff takes the car to a place walking distance from his work instead. This new mechanic says he isn't able to fix the catalytic converter and we would need to take it to the dealer. He estimates that job would cost $2,000-$3000. As for the rattling, he opens the hood of Jeff's car and saw that the engine mount was broken! Everytime the car rattled, the engine was *this* close to falling out of the car. He fixes the engine mount, charges us $100, and sends the car home with Jeff.
The car still rattled on the drive home.
It was obvious that the broken engine mount was a side effect of the rattling, but not the cause of the rattling. The car was still unable to accelerate as well. Since when do we pay people to not get a job done correctly?
We bring the car back the mechanic and he takes over a day to examine the car further. Finally, he discovers the issue. The power to the front right wheel was broken so the car was powered on a one-wheel drive! That was why when the car was moving at high speeds, the car would rattle: a car running on a one wheel drive is like a person trying to run on a limp -- very wobbly. On top of that, the part that connects the wheel to the car was broken too. To fix the right side of the wheel and replace the power on both sides of the car, it would cost $750.
So we are looking at potentially spending $3,750 to fix Jeff's car.
We had to decide whether it was worth it to fix all the issues and try to sell (or trade in the car), or to just scrap the car.
If you go to Carlypso.com, they can give you an estimate of how much they think your car could sell for, and they will also help you find a buyer for your car (and they take 5% commission from the sale of your car).
Carlypso.com estimated that if we fixed everything in our car, we could get ~$6,000 (really? that seems generous). After talking to a Carlypso agent, they said to get the $6000, this would also mean that we would need to fix all the dents, dings, and scratches in our car. Fixing the dent and a new paint job would run us... what.. $500 to fix the dent, and $2000 for a new paint job (I'm just throwing ballpark estimates here)? So $2,500 + $3,750 (for the mechanic to fix the catalytic converter and the front wheel drives) comes out to $6,250.
More than the value of the car.
Not to mention, not worth the time and headache.
So now what?
We cannot trade-in the car in it's current state. In CA, if you are selling or trading in a car, the car needs to pass a smog check within the last 90 days. For us to pass the smog check, we would need to pay $3000 to fix the catalytic converter. But trading it in, we may only get about $2000 for the car.
Not worth it.
What other options are left?
We could scrap metal the car for ~$300. But that would do such a disservice to Jeff's car. It's worth more than that. I mean, passing a smog check is a CA thing. If we lived in a different state, we would just pay the $750 and the car would be driveable and sellable. The smog would not be an issue at all. So I didn't want to scrap metal the car.
My mom told me about this gov program where they pay you $1000 to retire your car if your car failed a smog check within the last 90 days. We thought that was a good plan, EXCEPT Jeff was not comfortable driving the car from the mechanic to location where you surrender your car because with the front right wheel not powered and not properly connected to the car, the wheel could fall off at any minute during driving! And I could imagine that the driver could easily lose control of the car if the car is completely powdered by it's front left wheel. For Jeff to safely drive the car off the mechanic's lot, we would need to pay the $750 to make the car driveable. Then pay an additional $50 to get a smog check certification, showing that we failed the smog check. That's $800! That means, after getting $1000 from the goverment, we would only have $200 in our pocket.
Would be more worth it to scrap metal the car.
Instead, I asked Jeff to propose this deal to the mechanic that is holding our car hostage:
instead of fixing the car, we will sell the car to the mechanic for $1000, and this would include the cost of his labor for investigating our car further.
The mechanic countered with $800, and Jeff wanted to accept, but I counted with $850, and he accepted.
and that was that. We got $850 in cash and handed the title over.
Our Honda car buying experience:
I started by doing a ton of homework at home. Thank goodness we can do almost everything on the internet. Gone are the days where we have to drive from dealer to dealer getting quotes. You can find quotes online all with one tool. First, I used TrueCar.com to determine how much I should expect to pay for a car in my area. You put in the car you are looking for, your zip code, and they tell you the lowest, average, and highest price paid for your desired car in your area.
For Honda Accord 2014 lx with cvt transmission:
The factory invoice is $21,828 (this is the value that dealers pay to the manufacturers)
The MSRP is $23,545
The average price sold is $22,020
The lowest price sold is somewhere in the range of $20,089 - $20316
The highest price sold is somewhere in the range of $23,497 - $23,724 (now why the hell are people paying over sticker price).
Ok, so now I know that I ideally want to pay between $20,089 - $22,000 for a car. I have no idea if this is the out-the-door price or the base price. It would make most sense if these values are the base price.
I went to the website for the 3 nearest Honda dealers near me and filled out their "contact us" form, saying I want a Honda Accord 2014 lx, and to give me a quote via email. I got 2 quotes via email ($20,228 at Honda Airport Marina and $20,663 from Honda Santa Monica) and 1 dealer phone called me (they didn't follow directions (I said I wanted a quote via email) so I never returned their call). I made an appointment for Honda Airport Marina for the upcoming Sunday morning.
I also went to the website of this Chinese car dealer place that my parents referred me to, and I also filled out their Contact Us form. I never got a response. Oh well, their loss.
After that, I went to Edmunds.com, and at the top of their site, I clicked on the "Price Promise. Get upfront pricing" button. I filled in the car I was looking for and the zip code that I lived in, and they pulled up the upfront costs for my desired car of all the dealers in a 25 mile radius. The lowest quotes I got was $19,837 from Nelson Honda (all the way in El Monte. Jeff didn't want to drive that far) and $19,891 from Gardena Honda. I printed out these quotes and kept them in my purse so I could use them for leverage while haggling at a dealer. I made an appointment for Gardena Honda for the upcoming Sunday afternoon.
I learned from both my mom and my brother-in-law that Costco also has an auto program where they sell cars at a no-haggle price. It may not be the lowest price but it's a decent price and you can get in/get out with a car in a snap. It's great for those wanting a deal but are too busy to take the time to price shop (we tend to fall into this group). Jeff contacted the nearest authorized Costco auto retailer and made an appointment for the upcoming Saturday morning.
So great, we were armed with 4 prices and 3 appointments.
Saturday morning comes and we go to the authorized Costco auto dealer (Culver City Honda. walking distance to my home, which was nice).
The sales rep first shows us the car selection and I decide that I liked the gray with the gray interior the best (What can I say. in my mom's words, I am a "gray person". Ask me in person what a "gray person" is, if you are really curious to know). Jeff tests drives it while Caitlin and I rode in the back seat and we all had a jolly good time. The bluetooth connection to smartphones was cool and I really like the "economy" button on the car. It helps you save gas. And I couldn't get over the new car smell.
We were really happy with the car. Then, it was time to talk no-haggle pricing.
The Costco price for the car was $21,278.15.
Unfortunately, the car has accessories installed on the car (they get installed at the manufacturers so the dealer doesn't have a choice about this) and they wanted us to foot the cost of the accessories: $1,295. With costco membership, we get 15% off parts, so the accessories came out to $1100.75. We wanted to add on the "remote start" feature (you can start your car from 400 feet away and get the AC running, so by the time you arrive to your car, it isn't nasty hot in there), for $2,300.
In total, with the Costco pricing, it would have come out to ~$24,679, and this isn't including the cost of sales tax, titling, licensing, etc.. (which is roughly about 10% more).
Sorry, but the Costco price wasn't good enough.
In addition, I was not happy that they were forcing me to pay for accessories that I never asked for. They cannot remove the accessories since the cost of the labor to remove it is more than the cost of the accessories themselves.
That was when I busted out the quotes that I printed out earlier. I showed them that other dealers were selling the exact same car for $19,837. $1441 less than the Costco price.
This was when the haggling began and we no longer were shopping through the Costco auto program (since Costco prices are haggle-free). We were simply shopping through the Culver City Honda dealer.
the text below is the cliff notes of our haggling process. there were even more numbers and counter offers flying around in the conversation, but I just highlighted the main points below:
Our sales rep called up the Nelson dealer to confirm that their ridiculously low price was final, and didn't have any hidden costs. Turns out, that price is the price that people "could" get for a car. Meaning, if the right requirements were met, such as, financing the car (we planned on paying cash), and if you qualified for rebates like military and recent grads discounts.
So the sales rep said he couldn't match the price of the other dealer since their price truly wasn't that low, but he could lower the asking price from the Costco price of $21,278 down to $20,879. But that would mean that I no longer get the Costco discount on parts, and instead of paying $1100 for the accessories, I would have to pay the full price of $1,295 for accessories. However, for the remote start add-on we wanted, instead of $2,300, he would sell to us for $2,000.
That will wasn't good enough for me.
Jeff was actually ready to say "Yes", so I handled all the talking. What can I say, even though I hate haggling, I'm a cheapskate.
I reminded him that I still had other appointments set up at other dealers and I wanted to hear what they had to say too!
I had him ask his manager if he would be ok with the asking price to be an even $20,500 (instead of $20,879), to give us the Costco 15% discount on the accessories, and give us the remote start for $2000.
While he was gone, I called Honda Airport Marina (remember they gave me an internet quote of $20,228 over email), and asked him if that price was contingent on things like financing, or if it included rebates I may not qualify for, like the military discount. I also asked if the cars on his lot included accessories that I would be stuck paying for, even if I didn't want them. His response was no, no, and no. I could pay in cash or finance, the price for the car is the same. It doesn't include any rebates and the cars on his lot were accessory free. He told me the out-the-door cost for the car would be $22,406.47 ( Selling price 20228.00 , tax 1827.72 , DMV Fee 233.00 , 80.00 doc fee 8.75 CA tire fee).
It sounded too good to be true.
I was this close to walking out of the dealer right then and there.
Hey, wait a minute.
Where was Jeff and Caitlin during this 4 hour haggling process? Oh, they were goofing around inside one of the cars on displays. I was all on my own. =|
When the sales rep returned from talking to his manager, he tried to sell me the car for $20,500 the accessories for $300 dollars (instead of $1100) and 3 free oil changes in addition.
Jeff was ready to say "yes". Well, he was ready 2 hours prior, so, it was all up to me.
But to me, that offer still wasn't good enough.
I tried to get him to understand that I really didn't give a rats ass for those accessories so I didn't want to pay a dime.
Then I told the sales rep that I just got off the call with Honda Airport Marina. I was completely honest and upfront with my sales guy and told him that the guy offered me a car for $20,228, no accessories, no payment restrictions, it doesn't include rebates I didn't qualify for, and it would cost me $22,406.47 out the door.
This sales guy needed to beat Honda Airport Marina's offer.
I told him that I had an appointment with Airport Marina the next day and I requested that he lock in his offer price for 24 hours, just to give me enough time to go talk to Airport Marina in person. He refused to lock in the price. If I walked out that door, the last 4 hours of haggling would be out the window.
With Caitlin 3 hours past her naptime, I really didn't want all of this for be for nothing.
My sales guy left to talk to his manager.
A few minutes later the manager showed up and explained that he really wanted our business, as, it was not only the end of the month (it was 2 days before the last day of the month), but it was also the end of the quarter.
The manager offered me:
Selling price for the car: $20,279 ($51 above the selling price for Airport Marina).
Accessories: $0 (woot woot)
Remote Start: $2000
A grand total of $24,655.06 (which includes tax, titling, fees, etc..) out the door.
I accepted the offer.
I'll be honest. I'm not 100% happy with the offer, but after being there for so many hours with a toddler so many hours past her naptime, I had to throw in the towel at some point.
I think Jeff was mentally checked out at this point too. His body was merely an empty vessel sitting inside a showroom car. Caitlin was still going to town, turning on and off headlights and pressing buttons.
After an hour of doing all the paperwork and exchange of monies (we paid $22,000 via check and the remainder on our AMEX card. The max they allow to charge on a credit card is actually $2,500 but he let us do $2,655.06 to make the amount due on the check easy), the keys were ours and I had to draft a heartbreaking email to Honda Airport Marina, thanking them for their time.
I drove Caitlin home in my ratty ol Civic and Jeff drove the beautiful new car home.