So, I just bought a new car. I thought I'd make some notes about it for myself and then figured others out there might find some of this info useful. So here it is:
My old ’96 Saturn SL1 was on its last legs (wheels?). I had nursed it along long enough to save a few dollars and scope the car market. I knew I wanted a hatchback with good gas mileage, but still enough spunk to make it worth driving. I got it into my heart and mind that I really wanted a gently used VW Golf TDI. Those are hard vehicles to come by; during my several months of monitoring vehicles in the area (dealerships and private sellers) I only saw 2 or 3 that fit my interest and price range. Other options I was considering included the Chevy Aveo or Cruze, Honda Fit, and the Ford Focus.
Over a period of time, I test drove the Golf, the Fit, and the Focus. The Fit felt like a tin can, the Focus more substantial but still nimble and peppy, but the Golf was the big winner! Solid yet responsive, the low end torque of the Golf TDI put a smile on my face both times I took it for a test drive.
After my Saturn almost stalled out on an evening commute and with a fresh paycheck in hand, I decided I needed to buy a car this weekend. VW Golf TDI’s new were running $25,000+, and even 2011’s with 50,000 miles were hard to find and cost almost $20,000. That pushed me towards the Ford Focus. My company's x-plan discount combined with $3,500 in rebates meant I could get a new Ford Focus hatch back SE (mid level features) for as little as $15,000. Nearly $4,000 off on a new vehicle brings the price near that of a comparable gently used version (~2 years and 30,000 miles). Obviously an older car will be cheaper, but the discounts and rebates outweigh the depreciation that occurs during the first year or so. So a new Ford seemed worthwhile. The 4 door hatchback (5 DR HB) is small enough to maneuver in traffic or a city, but maintains a large internal volume for utility and with the 6 speed automatic dual clutch transmission, gets 38 mpg’s on the freeway according to the EPA (lets see if I can beat that!) (also, the manual only has 5 speeds and is rated for 36 highway, so I went with the automatic).
Ok, the right car was chosen. Calling ahead, the dealership had 3 2013 Ford Focus SE Hatchbacks to look at in three different levels of accessories. The basic ran $16,000, had the 5 speed manual, no heated seats, etc.; the mid level ran a sticker price of $18,000, had the winter package, 6 speed auto (no tiptronic shifting) but minus the other bells and whistles. The top of the line had the “appearance package” which included fog lights, MyFord Touch Sync, leather interior, tiptronic shifting (“selectshift”), rear disc brakes, and ambient lighting. The extra $2,500 didn’t justify the minimal performance enhancements and questionably valuable extra features. Car selected, mid level with heated seats.
Buying at the end of the month, they gave me the car below the x-plan price at straight dealer invoice (basically an extra $250 off) and then the incentives to boot. At that point, the real selling begins. The finance guy sits down and gives you the quick overview of your warranty, title fees, and how you are paying for the car. Then, while he finalizes the numbers, they try and sell you aftermarket products. This includes paint protection film, rust protection, scotch guard, floor mats, and anything else. I made mental note of what was available and prices, but held off on actually purchasing (more later).
Then, you rejoin the finance guy and he pitches the extended warranty. They offered three plans, the high end, mid level, and “basic” coverage. The high end included prepaying for maintenance, the warranty itself, and tire and wheel coverage. The mid level offered the warranty and wheel coverage, the basic just the warranty. The prepay is for the mileage triggered maintenance like a fuel filter replacement or tire rotation that you’ll get done at a dealership – I didn’t crunch the numbers, but I figure it locks you into service and any savings made by paying upfront will be lost with missed service or contract squirming by the dealers (“Oh, that isn’t covered by the prepay…”). The tire and wheel thing didn’t make a lot of sense – it was unclear what it covered (not flats but some road hazard damage but not other stuff?)…
The extended warranty itself though, was interesting. At $2,024 dollars it extended the bumper to bumper coverage to 96 months (8 years) or 120,000 miles, that’s 1.7 cents per mile (2.4 cents for the extension from mile 36,000 to mile 120,000). It does not cover normal maintenance (oil changes) or collision induced damage, but in theory, it covers everything else. So, in 5 years, if my air conditioning fails, I get that fixed for free. So, it’s a gamble, will one large or two medium things that are coverable go wrong over the course of 8 years at 15,000 miles per year? Several other interesting points were the transferability of the warranty to a subsequent buyer (increased resale value), a pro-rated rebate at trade in (a few hundred dollars if traded in at 100,000 miles), and a full refund if the warranty is unused at expiration. I took the gamble and did it. We’ll find out if it’s worth while. Overall, this was a really stressful part of the buying experience as it was unexpected and a large sum of money. In the future, I would recommend that you ask about this early on in the process and make your decisions before hand. Also, I should have negotiated on the warranty price – any reduction in price would drive the economics closer to my favor.
The three aftermarket products of interest to me were the windshield treatment (Crystal Fusion), under body rust protection, and paint protection films. The general internet forum consensus is that anything sold by the dealer is a ripoff, to just say no and walk away. Crystal fusion is marketed as acting like a permanent Rain-x that reduces/eliminates chipping and cracking (backed by some warranty). Online user reviews are difficult to come buy and not very descriptive, but the one or two found were positive. At $400 installed by the dealer, it’s a chunk of change (ie, one could buy a lot of Rain-X for that price or pay many months of full glass coverage on their insurance). Rust protection research suggests that it’s a ripoff, as in overpriced and it may or may actually make the problem worse. Auto designs and materials have improved over the years such that rust is not as big a problem as it used to be. Also, the $600 rust protection cost goes a long ways towards winter car washes that will really help. Paint protection films seemed to get generally positive reviews. $400 installation of the film is about half cost of goods, but doing it yourself is supposedly difficult (and you could spend any savings on cleaning products and time doing a crappy job yourself). I need to call around and see what prices there are from other installers, but I’m leaning towards doing this one.
Summary of Advice:
- Know your timeline, start early and use the time – know what you are interested in and keep an eye on the local inventory.
- Look at available options and categorize things as deal breakers or bonus’.
- Heated seats are a deal breaker, tiptronic shifting is a bonus, ect.
- Try building a vehicle on the manufacturer website to see all the options
- Call around to dealerships to see what’s in stock, but know that anyone will get you exactly what you want (color, options, etc.) if you come to them.
- Check dealer websites and look for “see window sticker” to get all the details
- Its easier to see the stuff in person, but helps to know what’s there and what you are looking at
- Don’t feel pressured! Ask for space, ask for them to leave you alone, go home and sleep on it. No matter how good the deal is, there will be another good deal another day.
- Know the steps involved in purchasing a new car:
- Vehicle selection
- Finance intro
- Aftermarket upsell
- Warranty pitch
- Payment
- Haggle on everything – it never hurts to ask for a lower price, the worst they can say is “no.”
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