Originally Posted by Johnny Footstool
After you look at the car and take your test drive, ask a few questions, then give the dealer your name and number, tell him you're still looking at other dealerships, and leave. Rest assured, he'll call you back with a better deal than the one he offered before.
This is the best advice I've read.
The key to negotiating anything, from the price of a car to a muti-million dollar contract, is to get people to start bidding against themselves. By letting a dealer know that you are shopping around and not seriously committed to buying from one place, it forces him to start guessing as to what kinds of deals you are being offered at other places and then to start bidding his own price down.
#1. Never tell the dealer what kind of a deal you are getting from another place. Let him guess. If he makes an offer that isn't better than other offers you've been seeing, then simply tell him "That's fine, but I'm confident I can do better someplace else."
#2. Be firm and decisive with the salesman. If you don't immediately like what you are hearing from him, don't waffle or waver. Simply thank him for his time, leave a number, and tell him you'll be in touch. Have your conversations with your wife about "pros and cons" of the deal someplace where the salesman can't hear and doesn't know how much you've been talking about.
#3. Never make a deal immediately after recieving a concession/price reduction from the salesman. Tell him you need time to think it over, even if you're dead certain that it is the deal you want to take. The time you take thinking it over may induce the salesman to continue bidding against himself and offer you an even better deal. If the salesman attempts to force your hand with a "Take it or leave it" offer, tell him that you don't think that's a professional way to conduct business and that you really do need time to think.