Some people are born hagglers. They love to match wits with car salespeople, hoping to wring out a jaw-dropping deal that they can brag about to their friends.
The rest of us -- well, many of us would rather have a tooth pulled than haggle over a car.
We can try to teach ourselves to be better bargainers. We can arm ourselves with Consumer Reports ratings, Kelley Blue Book values and Edmunds.com pricing guides. We can educate ourselves on the "four square," holdbacks and dealer cash.
Or we can just outsource the whole mess to a car-buying service.
Car-buying services come in several flavors, but the basic idea is the same: They do most or all of the work to connect you with the vehicle you want and present you with what's supposed to be a fixed price.
In an informal poll of my Facebook fans, the car-buying services offered by USAA and by credit unions won raves.
Liz Weston
"I used the service offered by my credit union," wrote Monica Gruber of Sunrise, Fla. "I gave the rep all of the things I was looking for (car itself, finances, etc.). A week later she gave me a call and said she had a car lined up for me. The next day, I had my car. No pressure, no BS sales pitches, very convenient. I will definitely use the service next time I'm in the market for a car."
Laurie Prentice Perkins of Juneau, Alaska, bought two cars in quick succession -- one in a deal that she negotiated herself and the second that she had outsourced to USAA.
"I enjoyed the USAA experience MUCH more," Perkins wrote. "It's not too hard to find what the dealership pays and add $500 and make that your final. But dealerships will make you earn that price with all the theatrics. It was soooo nice to have USAA cut through all that and come up with the same bottom line."
Not everyone has had a great experience. Some readers complained that the car-buying services they used served mostly as a marketing service for dealerships. Some wound up in the exact position they wanted to avoid -- down at the lot, haggling over a price they thought was fixed.
Ideally, you'd want a car service that offers:
- Decent prices. It may not be that rock-bottom figure your brother-in-law insists he can get, but it's likely to be significantly less than you'd pay if you wandered onto a typical car lot without much preparation -- which is how many, if not most, people buy cars, said Phil Reed, the senior consumer-advice editor for Edmunds.com.
- Decent treatment. Dealerships want to preserve their good relationship with car-buying services, because of the promise of repeat business. So they have more incentive to treat you well than if you were a one-off customer, Reed said. That usually means no hard sell. The expensive add-ons that tend to drive up your price -- security systems and weatherproofing you may be able to find elsewhere for less -- are offered, rather than pushed, he said. Some car-buying services will deliver the vehicle to your door and pick up your trade-in, and you never have to set foot on the lot.
There are several types of car-buying services available. One is the car broker -- typically a small, independent business, often run by former car salespeople, that negotiates with a network of dealers. Some car brokers get a fee from those dealerships, which raises conflict-of-interest issues. If you want a truly independent advocate, you may want to look for someone compensated only by the fees you pay.
Alan Granger of Spokane, Wash., turned to a car broker after getting kicked off two dealership lots.
"I looked at cars at a dozen dealers or so and quickly grew familiar with lot sales techniques and found them universally insulting to my intelligence," Granger said. "And because the scripts they used in each lot were almost word-for-word identical, I started to get more and more angry at a mere hint of a deceptive line. My response usually involved expletives, which caused the two dismissals."
The car broker he found charged a $500 fee to search for the car he wanted and to arrange the deal.
"Within four business days she had located a suitable vehicle and called to verify that I was OK with the price she could get it for," Granger said. "In the end, I had a car at a comparable price to what I could have negotiated myself, but in a fraction of the time and while dealing with someone truly working on my behalf instead of as my adversary."
Oren Weintraub, the president of Authority Auto, calls himself a "car concierge" to distinguish his car-buying service from that of car brokers who accept commissions from dealerships. Authority Auto typically charges a flat fee of $595 to $1,595, depending on the price of the car, although it will also review a car deal you've negotiated. If the company can wrangle you a better deal, it keeps half of the savings.
Weintraub said he much prefers his business model to that of his previous profession: He was the general sales manager of a large Ford dealership for 12 years.
"We were an ethical car dealership. We didn't have to lie, cheat or steal like many dealerships do today. But we were professional negotiators," Weintraub said. "Most people didn't stand a chance. . . . I got tired of developing good rapport with my customers and then out-negotiating them."
Weintraub said his company bargains over every aspect of the car-buying experience -- not just the price but the financing, the trade-in and any add-ons. That helps distinguish his company from the club car-buying services, such as those offered by Costco, AAA and Consumer Reports.
The club services promise transparent, upfront, discount pricing and connect members with participating local dealers. Once on the lot, however, people may discover the car they want isn't there, or if it is, they still have to negotiate financing, their trade-in and any add-ons.
"They may be caught off guard," Weintraub said. "They may get a good deal from Costco, but . . . the dealer will make all the money on the back end."
Still, the club car-buying services have their advantages. I tested Costco's "Build and Research" tool, for example, and found it clearly laid out the invoice and sticker prices not just for car itself but for all the available options. Consumer Reports' "Build and Buy" tool was a bit trickier to navigate but provided contacts with more dealerships (three, to Costco's one).
USAA's car-buying service, meanwhile, used a similar tool but offered a sweetener: a low-price guarantee that promised to refund the difference if you found the same car for less within three days of your purchase.
The dealership contacts were all in the companies' Internet departments, which Reed said tend to offer a better customer experience. Many of the initial emails I got from these dealers invited me to "come on down" to their lots. Once I made it clear I wouldn't be doing that, though, each salesperson responded to my requests for more information and firm price quotes.
Another option for those who want more personalized service is an online car-buying service: AutoNation Direct, which represents AutoNation's network of 200 dealerships, and Carsala, which primarily negotiates used-car deals.
Carsala positions itself as a consumer advocate, saying it's "not on the dealers' payroll." Instead, the service takes 20% of the savings it wrangles off the cars' asking price, with a $399 maximum fee, and offers a lowest-price guarantee.
AutoNation Direct makes clear it "is not acting as an agent of the consumer" but is instead a sales and leasing "facilitator." What that means is that it's working on behalf of its dealerships, but that doesn't mean you can't get a good deal, Reed said.
AutoNation offers "pre-negotiated competitive pricing." You're hooked up with a personal consultant who searches AutoNation lots for the car you want and gives you a firm price on it as well as a "true market value" price for your trade-in.
My consultant assured me he would provide prices only "on a car that actually exists" -- not a small thing, since some dealerships pretend they have the car you want just to get you on the lot. The value he offered for our trade-in was, in fact, about $1,000 above Edmunds.com's True Market Value for similar trade-ins.
For those who don't want to step foot on a lot, AutoNation Direct can deliver the car to your home or office and pick up your trade-in.
Most car-buying services offer a trade-off. You'll probably pay a few hundred bucks more for the car than the rock-bottom price a skilled negotiator could manage. But you also opt out of the hassle. And that can appeal to many a haggle-weary buyer.
"A car-buying service is going to save you lots of time," Reed said. "It's going to be an expedited, protected experience."
And that's definitely worth something.
Liz Weston is the Web's most-read personal-finance writer. She is the author of several books, most recently "The 10 Commandments of Money: Survive and Thrive in the New Economy" (find it on Bing). Weston's award-winning columns appear every Monday and Thursday, exclusively on MSN Money. Join the conversation and send in your financial questions on Liz Weston's Facebook fan page.
