Sun Tzu And The Art Of The EV Tax Credit: How Not To Get Scammed By The Dealers (Part 2)

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This is the second part of a two-part article. You can find part 1 here.

Running the numbers

I can’t know the exact numbers for ID.4 in my example in part 1, but I’m assuming $ 750 for transportation and assume there are no national or local incentives (but make sure you to verify this yourself in your state). This means that the actual cost to the dealer would be around $ 42,785 (less invoice holdback) + $ 750 (shipping) – $ 12,500 (EV tax credit). So the total cost to the dealer in this scenario would be $ 31,035.

Obviously, they won’t sell it to you for what they paid for, because they have to at least do something about the car. So add $ 1,000 to the dealer’s estimated cost and tell them you won’t pay a dime more. In this case, it’s a little over $ 32,000.

They’ll say no to you first, and you might have to go to several dealers before they sell it to you for just $ 1,000 more than it cost them, but if you persevere and give in. not, you will end up getting that price or very close to it.

Some other tips to avoid getting ripped off

There are other shady things dealers do to make you pay more. Here are a few ways to stay away from it.

First of all, never worry about befriending the people at the dealership. If they didn’t hate you a bit when you go by car, you probably could have gotten a better deal.

Second, never talk about what you’re willing to pay per month for a car. They have plenty of room to make sure they’re getting more money than you think by making the monthly payment look good while they’re ripping you off below. All negotiations should be conducted as if you are a cash buyer.

It is much easier to do this on the Internet than in person. If you’re emailing offers, you don’t have to sit there and be bored and worried while the dealer forces you to sit there and sweat. Send the same offer to every dealer within 200 miles of your home, or even further. Some dealers will know they are competing for your business and will offer to drop the car off.

If you are financing, you must go to the dealership for the final sale with the paperwork on hand from your preferred lender with pre-approval information. If you want to give the finance manager a shot at getting you a better rate than the one you found, that’s great, but don’t let them determine what your payment should be. The same goes for insurance – talk to your own insurance agent (I guess you’re smart and already working with a trusted agent) about insurance products before purchasing any type of insurance. insurance or protection plan from the dealership.

If you need to figure out what a payment would be, there are amortization calculators you can find online to determine what the monthly payment will be based on the loan you are pre-approved for and its interest rate. when you are negotiating a spot price. . Don’t go to the dealership without this information, so you can determine payments on your own phone without asking them.

The “Yo-Yo” scam is one of the main reasons not to let them organize your fundraising. Even I fell in love with this one, although I myself have worked at dealerships in the past. They first tell you that you are approved, let you go show the car to your friends and family, and then call you a few days later to tell you that they couldn’t get some sort of final approval and you need to sign new papers or agree to lower rates. If you’ve already set up your own financing, you will know that this is pure cow dung and you won’t fall for it so easily. At the very least, you’ll have someone other than the crooked dealer to call in to ask questions at this point.

Don’t fall for scams to add anything to the car. The dealers sell things like VIN engraving, accessories, window tints and many other goods / services at ridiculous prices. Buy the car and shop around for better deals if you want. Factory accessories are also widely available online at lower prices than your local dealer in most cases.

Even when it’s all done, check with your lender and make sure everything matches the paperwork you received at the dealership. It’s not uncommon for them to create “administrative confusion” where your lender pays the dealership more and your monthly payment is just a little higher than you might think. If you’re not careful with this, they could very well rip you off for thousands of dollars.

The supreme art of war

After reading the last two sections, you’re probably wondering why someone would bother to go buy an EV from a dealership. Tesla does not have any dealers. Rivian, Lucid, Aptera – none of these new electric vehicle makers have dealerships either. It is generally bad for everyone involved to have resellers except… the reseller.

Resellers only exist because many states do not allow direct sales. Sure, they’ll pretend they’re better and that customers want or really need their fatherly hand to guide the buying process, but the myriad of ways they rip us off and the difficulty in avoiding it proves otherwise. . State jurisdiction ends at the state limit, and you can go to another state to buy a car directly if that’s your thing, but it can lead to hardship and expense, especially if you have need a service (something other than these states want to go through the dealers, by law).

Even in states that allow direct selling, if you want an electric vehicle from a traditional automaker like Ford, GM, or Stellantis, you will still need to go to a dealership as they have pre-existing contracts with those dealerships that exclude selling. direct. Sales. But not everyone wants to buy a Tesla. Some people want a car like the Volkswagen ID.4, which offers a very comfortable and familiar EV experience for current VW owners, and other people who want a normal car that just runs on electricity instead of gasoline.

But if you can find a direct sales car that’s right for you, WOPR is right. The only real winning move with croupiers is not to gamble. You can beat them at their game and get a good price, but it takes time and is stressful. As Sun Tzu said, “The supreme art of war is to subdue the enemy without fighting.”

Or, as the Mirror Man says in I’m going in 60 seconds‘famous “Volvo” scene, “Hey, time is money.” It doesn’t make sense to waste a lot of time to save a little bit of money if you can avoid it.

Featured Image: A lot of used cars selling Nissan LEAFs. Photo by Jennifer Sensiba.

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