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New car transaction prices hit another all-time high in August as tight inventories meet strong vehicle demand.
Shoppers are now paying more than $46,000, according to JD Power, but that’s not just the manufacturer’s average recommended retail price.
Many dealers have added “market adjustments” to make up for their inventory shortage, which can run into the tens of thousands for the most popular models.
Even mainstream brands like Kia and Hyundai have seen some of their vehicles sell 18% above the list, according to Consumer Reports, but Edmunds said the industry-wide average is closer to $700.
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Dealers also sometimes add accessories to cars in stock that can’t be removed, so it’s take it or leave it for interested buyers in a seller’s market.
However, according to Edmund’s senior consumer advice editor Ronald Montoya, there are ways to avoid or at least reduce these types of markings.
First, make sure you know how to spot them. Dealers must put an addendum on cars that have additional costs that are not on the traditional window sticker.
In addition to the market adaptation, some things to look out for are security systems, ceramic paint coatings, door edge protectors, and nitrogen-filled tires, which most experts believe are not necessary for typical cars. The practice was originally used in car racing because the nitrogen better regulates the temperature in the tire under high tension.
Montoya recommends shopping around for the same car without the add-ons, even if that means moving to another state. He notes that even if you like the accessories, they will likely be more expensive if the dealer installs them than if you make a purchase after you buy the car.
But while it’s hard to get a dealer to remove or lower the price of the accessories, market adjustment is a fair game of bargaining.
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“Dealers don’t always expect people to pay full price, so if the vehicle you really want has a market fit, try offering half the cost,” Montoya said.
“The dealer may argue, but this could be a win-win for both parties — you can save thousands of dollars and the dealer will still sell the vehicle for above MSRP.”
“Dealers don’t always expect people to pay the full markup”
For patient customers who want to avoid markings altogether, Montoya says it’s best to order a vehicle from the factory rather than buying one off the lot.
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You will want to get a contract of sale to fix the price if possible because a dealer can still try to add a surcharge on delivery if you don’t have a contract, and will just sell it to the next customer who is willing to pay the.