How to Get Wholesale Price Cars

March 19, 2012

Getting cars at wholesale car prices requires a little more work than the average car buyer is willing to put in, but the savings are worth it.

Cars At Dealership

The price of wholesale cars is what the dealer pays from the car manufacturer. The dealer will then sell the car for more and pocket the profit. In order to get the best price on a new car, you want to try to see about purchasing it at wholesale price, or as close as you can get to this price. This will take some time and research, but it is worth it when you get that great price on a new car.

Get Car Information
You want to collect as much information about the car you are interested in purchasing. This information includes the make, year, model, engine size, type of package, audio, wheels, and mileage. The more information you have, the more accurate your wholesale price will be.

Use a Guide
You can use a guide to determine the wholesale price. There are many online guides that can provide you with this information. You just need to input the information you collected earlier. Some of the best resources for determining the wholesale and retail price of vehicles is Kelley Blue Book, Edmunds, NADAguides, and DriverSide.

Set Your Budget
Make sure you know exactly how much you are planning on spending on the car. You want to include registration, taxes, and other fees in the final price. You need to stay firm and remain under this set price. You may love a car, but it is above your price range. Be patient, as you will be able to find another one that meets your requirements.

Attend a Wholesale Car Auction
There are special auctions—sometimes government-sponsored—that occur in each state. These auctions are for dealers only and are used to rotate inventory. You can find all types of vehicles at these auctions such as a new, close to new, trade-ins and off-lease cars. In order to bid at such an auction, you will need to use a proxy dealer or have a dealer license. Once you have located your desired car at the auctions, you can start bidding. Just make sure you stay below the budgeted price, which was based on the wholesale price.

Negotiate
If you are purchasing a new car from a dealer, then you will need to negotiate to get as close as possible to the invoice price of the new car. The invoice price is another name for the wholesale price. You will be trying to reach the invoice price and the dealer will be trying to get the sticker price.

Factor in the Dealer Holdback
You want to be aware that a dealer will receive 3% of the sticker price back from the manufacturer when they sell the car. This means they actually purchase the car for less than the wholesale price. The dealer will still make a profit if you should negotiate the price close to the wholesale price. You want to use this price when you are negotiating.

Assess Other Incentives and Discounts
You want to apply as many incentives and discounts as possible to get the price down. The only thing that should not be included in this is the trade-in value. You may be eligible for cash rebates and other promotions, which can lower the price further.

How to Get Wholesale Price Cars Calculated

If you want to find the lowest prices on new cars and trucks, then you'll need to understand how car wholesale prices are calculated and determined. Knowing the wholesale or dealer invoice price of a vehicle can be valuable information when it comes time to negotiate a purchase price.

Learn the Dealer Invoice Price
The dealer invoice price is the price that all dealerships pay to the manufacturer for a particular make and model new car or truck. The dealer invoice price is determined by the manufacturer by adding the base cost of the vehicle to any added accessories are options.

Determine Other Dealer Costs
In addition to the actual purchase price of the vehicle, dealers have other costs as well. For instance, dealers need to pay for destination charges, or shipping costs, as well as other fees for dealer prep items such as anti-stain treatment, rust proofing and pin striping. Any additional services that the dealer performs or accessories that are added will increase the dealer cost of the vehicle.

Determine Hidden Dealer Discounts
Next, you'll need to determine if the vehicle is eligible for any rebates or if the manufacturer provides holdbacks for the dealer. Dealer holdbacks act as an incentive for selling new cars and trucks and usually amount to about 1% to 3% of the actual dealer invoice. Therefore, this is an additional discount that the dealer can take from the invoice price. In addition, dealers are awarded discounts in the amount of the rebate that you may take at the time of purchase.

In addition to the above costs, a dealer may also receive certain discounts for making vehicles available for fleet customers or very Internet savvy consumers. Therefore, you should do as much research on a dealer's to cost before negotiating a deal. One of the easiest ways to do this is to simply visit CarsDirect and browse thousands of new cars and trucks that are listed with a low price guarantee by CarsDirect. To get started, simply visit the cars direct new-car search page.

Other Ways to Get a New Car at the Wholesale Price

Public auctions that include bankruptcy auctions are another option, and these are increasing in number every day. Check the classified sections of you local newspapers, and other leading newspapers if you can go elsewhere to buy. Some may also be found by browsing the Internet.

Rental companies also conduct auctions for selling their older cars, or include them in larger public auctions. Most of the rental companies do this regularly when upgrading their fleets. Contact a few rental companies to find out how and when they dispose of their cars. Striking a good deal is all about trying new things, so you can even try talking to the rental company about a direct private purchase.

Banks and other financial institutions are occasionally in the car business. They may send vehicles to an auction, however, if you are in the right place at the right time you may be able to find an excellent deal for yourself.

Another great option for getting a new car at a wholesale price is to speak to the vehicle dealers directly. They have their own auctions that are normally restricted to licensed dealers, however some are open to the public. Dealers in today's economy are willing to negotiate prices as well. Never underestimate the power of a good negotiator and be willing to walk away if they are not flexible.

Visiting online used car stores and shopping at sites such as eBay will help you find used vehicles. The Kelley Blue Book offers wholesale buying tips, reviews, information on trade-in values and the suggested retail value on most car models. The Kelley Blue Book might be the best place to start in order to know whether you are finding a good value or not.

Always have a list of questions to be answered before you buy any vehicle, including the condition of the car, inside and out, the history of maintenance and repairs, and the possibility of an extended warranty. If you do not live in a cold climate, be aware that many cars driven in the north could have considerable rust from winter roads. Your extensive research can be an excellent advantage in getting a new or newer car at a wholesale price.

Related Questions and Answers

Is there an Equation to Determine the Wholesale Value of Your Car?

There is no one universal method of determining the wholesale value of a car. Individual vehicles depreciate at different rates due to different usage conditions and how well the particular car was taken care of. As an example, a 2005 Buick Century bought in California's Central Valley that was very well cared for would have a higher wholesale value than the same car that was kept somewhere like Minnesota or Wisconsin, where the roads are salted quite often during winter. This is true even if the same standards of maintenance and care were used on both cars because the cold weather car was used and kept in a harsher environment. General depreciation can be calculated if you know the salvage value, using the following equation: (Cost - Salvage Value) / Estimated Useful Life

Are Car Wholesale Auctions the Only Place to Get Cars at Wholesale Value?

Car wholesale auctions are great places to get excellent deals on used cars that are usually in very good condition. New car dealers will usually sell cars at these auctions that they don't want to, or can't put through the Certified Pre-Owned Programs of their parent organization. Sometimes this is because the paint or body isn't perfect. Or there may be problems they don't want to take the time to bring up to factory specifications. If you aren't a registered new or used car dealer, most of these auctions will charge you a small fee to enter the auction and be allowed to place bids.

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