Comments on: 10 Ways to Save Money on a New Car

By: Doctor Stock

Doctor Stock — Mon, 22 Mar 2010 02:39:32 +0000

Really appreciate the link to the car cost guide… didn’t know that existed. Every car purchaser should take a peak I’d think!

By: tripleBottomLine

tripleBottomLine — Mon, 22 Mar 2010 01:58:22 +0000

If you are a new graduate, many companies have discounts available directly from the manufactures. Do your research, and don’t mention you are a new graduate until after you’ve got the final price, as it is usually something you apply directly to the manufacturers for. It is available for used cars from the dealers too. I received $500 from Toyota when buying a used car a couple years ago, new car discounts ranged from $1000 – $2000. Most consider you a new grad if you graduated from a post secondary institution within the last two years.

By: Jan

Jan — Sun, 28 Feb 2010 05:06:29 +0000

Be prepared for the dealership to call you “cheap”. We went in with the lowest quote from a dealership 200 miles away and sat until they gave us the deal. This time standard was actually more expensive – since there were none on the lot.
The price we got was about $3000. under sticker. Considering the car was only $17,000 to start- I’d say we did ok.
By the way- cash is the ONLY way to go. Even “good debt” is debt. Save the money before and forget the debt!
But the chorus of “cheap, cheap, cheap” was a bit annoying as we left the show room.

By: Craig

Craig — Sat, 27 Feb 2010 02:07:08 +0000

I disagree that buying a standard is a good way to save. You may save upfront, but you really limit your buyers when you go to resell…unless its a Ferrari!

By: ethan

ethan — Tue, 23 Feb 2010 18:35:29 +0000

actually automatic transmission is more expensive to replace or service vs manual transmission.

By: Brendan

Brendan — Tue, 23 Feb 2010 17:15:49 +0000

JJ, you hit the nail on the head. I dont need stats to tell me it is harder to sell a manual tranny vehicle. I sold a manual years ago, and many people passed it on because it was manual.
Sports car, yes a manual is almost required.

*by tranny I mean manual transmission, and not transvestite. No intent was mean to reference one’s sexual choices/preferences.

By: J J

J J — Tue, 23 Feb 2010 15:57:37 +0000

@Kathryn I don’t think resale value is a moot point at all. Try selling a car with a manual tramission. Unless it’s a sports car, it’s difficult. As for repair costs, you may be right, but clutches aren’t cheap to replace either. Any tranmission work is costly.

@Future Money-Bags I said 50% could drive standard, but only 10-15% would actually go down to the dealership lot and be geniunely interested in purchasing a car with a manual tranmission. Most people just don’t want to be bothered. Think about the family person, or the retired person, or people who just can’t be bothered with changing gears.

The fact is you can think you will save money by buying a manual transmission. But you don’t know where you’ll be in 5 years, and you may need to sell for any number of reasons, and an automatic has much greater demand in the market than manual tranmissions. Just ask the sales people. I bet a lot of salespeople would rather not have anything to with manual tranmissions.

By: Financial Cents

Financial Cents — Tue, 23 Feb 2010 14:01:59 +0000

Good post, although I disagree with a few things.

1) I would never pay cash for a car given the time-value-money equation. Interest rates are far too low to pay cash for your car. Sure, put a large downpayment on the vehicle, but why avoid 0%, 0.9% or even 1.9% financing? That’s considered “good debt” in my opinion and small debt financing payments are better served on a new car since the day your drive that vehicle off the lot, it depreciates nearly 10%. Anything else, that costly, you can think of that depreciates 10% the day you buy it?

2) Automatic transmission is to good have, depending where you live and drive (we have automatic and standard in our yard). Yes, you may be able to save some money buying manual; but to your point # 3, the best way to save money on a new car is to take emotion out of your purchase and buy what you need versus everything you want. Mind all the upgrades and avoid all the upselling. Make your car purchase based on your needs and not on all your wants; the extra bells and whistles will cost you up front and in the long run, when you wear out the ringer(s).

By: Future Money-Bags

Future Money-Bags — Tue, 23 Feb 2010 10:55:28 +0000

I disagree that only ‘10-15%’ of people want to drive standard.
I just started this year and after 1 month I have mastered it and am just as good as I was before on an automatic. Its more fun, its easier on breaks, and the cars tend to last longer. (I have an 88′ accord and it runs great!)
I practically got it for free and its needed no repairs.

Everyone I know that has standard, loves it for first month, than hates it for 2nd, than loves it for life after. haha

By: Ken Siew

Ken Siew — Tue, 23 Feb 2010 05:27:24 +0000

Hey guys, this is my first comment on this blog, but it definitely won’t be the last!

I agree with most of your points Kathryn, and to clarify on Point #10, it’s important to call your existing insurance company (such as the one you have on your house or other stuffs), because they will give you a better quote for the combo.

As for Point #8, I have to differ. If the amount of cash is significant, it’s better to put the money away at an S&P 500 index fund and earn the average returns over the long run (about 8% in general), rather than paying off the car payment interests (around 3%).

As for minding upgrades that’s a good point. Car dealers are great at negotiation. They often make you commit to buying the car, and THEN tell you to add additional accessories to it. When you compare the cost of a $500 stereo to a 20 grand new car, you probably will just snap it up.

Also, if you’re really not good at negotiating, you should hire someone to negotiate for you. Search for car negotiation service on Google, they usually will split the savings with you, giving them more incentives to get a lower price. If you don’t trust negotiators, get the quotes of all the local dealers by fax, and then fax the lowest quote to all of them and let them fight for deal. You only need to pick up the car =)

Thanks Kathryn!

By: Kathryn

Kathryn — Tue, 23 Feb 2010 02:06:20 +0000

Resale value is a moot point if the idea is to buy new and drive it for 10+ years.

According to consumer reports, manual transmissions are not only less up front, but they cost lest to repair and have better fuel economy.

http://www.consumerreports.org/cro/cars/new-cars/news/2008/10/save-gas-and-money-with-a-stick-shift-10-08/overview/manual-vs-auto-ov.htm

I’m curious where you got your stat about 50% of the population not being able to drive standard. I tried to find stats on that and couldn’t find any.

By: J J

J J — Tue, 23 Feb 2010 01:43:33 +0000

I’ll tell you why you should always buy automatic. RESALE VALUE! Less than 50% of the population can drive standard (competently). And I bet less than 10-15% would actually want to drive a car with a standard transmission on a daily basis.

When I went shopping for a used car, there were a lot of 5 speeds on the lot. The reason is they can’t sell them. There’s no buyers. That’s all there is to it.

As a follow up to resale value though, as a buyer you can really negotiate on a used car with a standard transmission.

So I will restate my response:
1. When buying new, always buy automatic.
2. When buying used, prefer an automatic, but if you can bargain down on a 5 speed, go for it.

By: Future Money-Bags

Future Money-Bags — Tue, 23 Feb 2010 01:06:07 +0000

All good points, nice input. Buying good quality cars at the cheapest price, is something everyone should be good at.
Buying from the states can be a good idea, but it has to be a fairly expensive and worthwhile purchase to be worth it. Or you lose money bringing it over the border.

By: Bilbo Bloggins

Bilbo Bloggins — Mon, 22 Feb 2010 23:36:17 +0000

I’ll give you one way to save 20% on a car over $30,000.
Buy in from the States!

By: Potato

Potato — Mon, 22 Feb 2010 21:53:01 +0000

If you do a lot of city driving, a hybrid powertrain will do you even better than a manual – save on brakes, save on your left knee, save on gas. They’re a no brainer in most provinces with rebates.

I borrowed the Lemon-Aid guide from the library before getting my car, and found it was appallingly inaccurate. I suppose if he’s going to write a book about every car he’s not going to put the kind of research into any single model that I did, but still… Maybe it’s better for the American manufacturers.

By: Kathryn

Kathryn — Mon, 22 Feb 2010 20:06:49 +0000

The other great resource I found since writing this is Phil Edmonston’s Lemon-Aid guides. For less than $20 on amazon.ca, it has a ton of information about different cars. There is a ‘used car’ version and an ‘new car’ version for each year.

By: Sarlock

Sarlock — Mon, 22 Feb 2010 19:46:54 +0000

And I agree with Chris: Huge savings on the breaks if you downshift to slow yourself down. We brought our Honda Accord with 110,000 km in to the garage a few months ago to have the breaks looked at and there was still tons of life left on the original pads. I also downshift a lot on my automatic, it all adds up.

By: Sarlock

Sarlock — Mon, 22 Feb 2010 19:44:49 +0000

Dealers usually get a better kickback if they sell the car on financing. You’ll often find you’ll get a lower price on the car than if you paid cash for it… and then just write a cheque to pay off the loan the next day (just make sure there are no penalties for early payment) and you’ll have effectively paid cash for it but paid less overall.
Those 0% financing deals aren’t all they are cracked up to be… you’re paying for it one way or another. Purchase a vehicle with no special financing options and you’ll be able to negotiate a cheaper price. Ask your dealer what financing method would produce the greatest return for them and you’ll be talking their language. Make it a win-win situation.

By: chris

chris — Mon, 22 Feb 2010 19:42:15 +0000

another reason to drive standard: fuel savings and brake savings. control your gears, use less gas. also coasting to a stop in gear uses zero gas and saves on your brakes. i went 140,000km without a brake change on my toyota, and when i did the brakes, they werent even at the wear indicators yet.

By: Brendan

Brendan — Mon, 22 Feb 2010 18:10:20 +0000

Car cost Canada is excellent. I use the 100 dollar service and let them punch it out with the dealer. I show up with a check. They ask if I want to trade as well.
Dealers ALWAYS give you black book, no more.
I do not like standard. One week of driving in shitty Winnipeg will convert the most die hard manual fan.If you cant afford another grand, take a bus. Gas savings are almost non existant in a standard. I do agree manual is a better driving experience, except in Winnipeg where we have bad traffic movement.
Familly connection is useless to most people, and in Manitoba any new vehicle will cost you 1200 per year to insure.
There is no such thing as a 2 year old well maintained car for a decent price.
If you find one, ask the seller if the unicorn is for sale too.
Personally I always buy new, and what i actually need, and afford. I drive it for a minimum of 10 years. After 10 years I am owed nothing from the car.