Monday, September 19, 2011

Haggling for fair price on a Toyota Sienna

I purchased a new minivan a couple months ago. I hate buying cars. The whole process seems very confrontational. To speak in terms of 7 Habits, it feels very win-lose with me being the loser. That is probably why I put off making the purchase for so long. I am happy to say that I actually nailed it this time. I do not believe I took the dealer to the cleaners, but I feel good about what I paid and thing I negotiated well. I ended up paying $12,000 for a $17,000 car. Here's how:
  • My wife did a lot of research about minivans and narrowed us down to Siennas and Odysseys. By limiting the "serious" search to those two the search space became tractable.
  • I shopped at the end of the month. The dealer specifically referenced this as we were going back and forth, in that he wanted to make the sale before the end of the month.
  • I researched the prices of cars the night before, so I knew the internet price prior to stepping on the dealership. I do not know if they would have tried the higher price if I didn't know, but knowing the price on the web took the first $1000 off immediately.
  • I enumerated the available cars in our area and graphed the mileage vs. the price:
    Car Year Miles Price Town Dealer
    Sienna LE 1999 87391 $8,765 Burlington-ish Herb Chambers
    Sienna LE 2004 79136 $11,763 Woburn Woburn Toyota
    Sienna LE 2004 77313 $12,686 Woburn Woburn Toyota
    Sienna XLE 2004 87501 $12,889 Burlington-ish Herb Chambers
    Sienna 2007 74353 $13,997 Framingham Direct Auto Mall
    Sienna XLE 2004 96191 $14,555 Lexington Lexington Toyota
    Sienna 2006 76846 $14,597 Framingham Direct Auto Mall
    Sienna CE 2008 83783 $14,986 Woburn Woburn Toyota
    Sienna 2005 59732 $14,988 Woburn Woburn Toyota
    Sienna 2007 63706 $14,997 Framingham Direct Auto Mall
    Sienna XLE 2006 88967 $15,678 Burlington-ish Herb Chambers
    Sienna LE 2006 51593 $15,953 Woburn Woburn Toyota
    Sienna LE 2006 80134 $15,995 Tewksbury Tewksbury Toyota
    Sienna LE 2007 61517 $16,988 Woburn Woburn Toyota
    Sienna CE 2007 57668 $17,317 Burlington-ish Herb Chambers
    Sienna LE 2008 68134 $18,378 Burlington-ish Herb Chambers
    Sienna 2008 53970 $19,222 Lexington Lexington Toyota
    Sienna LE 2008 54830 $19,730 Woburn Woburn Toyota
    Sienna 2008 65614 $19,877 Burlington-ish Herb Chambers
    Sienna LE 2009 49274 $19,987 Burlington-ish Herb Chambers
    Sienna 2008 63053 $19,995 Tewksbury Tewksbury Toyota
    Sienna LE 2007 57863 $20,996 Hyannis Hyannis Toyota
    Sienna 2009 36132 $21,322 Burlington-ish Herb Chambers
    Sienna LE 2009 44968 $22,487 Burlington-ish Herb Chambers
    Sienna LE 2010 33505 $22,679 Hyannis Hyannis Toyota
    Sienna XLE 2007 42937 $23,782 Burlington-ish Herb Chambers
    Sienna XLE 2008 63772 $23,999 Lowell Lannan Chevrolet
    Sienna 2008 40786 $26,588 Burlington-ish Herb Chambers
    Sienna 2008 80244 $27,634 Burlington-ish Herb Chambers
    Sienna 2011 25508 $28,566 Burlington-ish Herb Chambers
    Sienna XLE-L 2008 37135 $29,834 Burlington-ish Herb Chambers
    Sienna XLE 2007 58888 $31,255 Burlington-ish Herb Chambers
    Sienna 2008 19025 $31,255 Burlington-ish Herb Chambers
    Sienna 2004 96708 ? Woburn Woburn Toyota


    This enabled me to to draw a "best fit" line and point to where the price for certain cars should be at certain mileages. The scientists among you may notice some problems with the graph, but I believe it still sends the right message. By pointing out that the price for my car was on a peak, I had some clear math to get another $4000 off.
  • Probably the most important is that I was willing to walk away. I made it very clear that I did not care if we bought a particular car at a particular time. I did not try to act like I didn't care, I really didn't care. That takes work.
Of course, this doesn't work for every dealer or every car. I could not have used my nifty graph to negotiate a price down if the price was one of the local minima. Also, the graph only allowed me to pull the price down to where it should be. I didn't get a "steal" on the car. I did walk away feeling good about it, which is worth a lot in my book.