The 'Out-The-Door' Price Secret Car Dealerships Don't Want You To Know About

The car buying experience is one with plenty of sore spots and problem areas. Buying a new car isn't like purchasing any other typical consumer good. This process unfortunately involves plenty of interaction with a diligent salesperson looking to part you with as much money as possible. Because cars on the dealership lot are both simultaneously a one-of-one good and a commodity with plenty of alternatives, every car buying experience can feel like a sort of battleground that's riddled with tripwires and hazards.

Price is frequently the biggest landmine you'll encounter when trying to close on a new car purchase. Because dealerships have the ability to position the vehicle you are looking at as a singular commodity that can easily be purchased out from under you, the specifics of a vehicle's pricing are often quite murky and frequently difficult to break down into individual line items. This is simply a part of the dealership's efforts to turn as great a profit as possible. But there's an interesting pricing secret that you can use to your advantage that dealerships won't tell you about but are frequently willing to utilize when finalizing a sale. Indeed, the so-called "out-the-door" pricing model is a tool that you can use to your advantage when shopping for a new car and looking to take as many question marks out of the experience as possible.

The main problem that shoppers face when trying to buy a new car is usually the specifics of a vehicle's total price. Just about every car on a dealership lot will feature a price tag of some sort. This sticker price is aptly named because the cost is frequently listed on vehicles' windshields with the help of a sticker.

But the sticker price is rarely the actual price you pay when it comes time to finalize a transaction with these kinds of merchants. For one thing, taxes generally aren't considered in the sticker price listed at a dealership. This wouldn't be particularly problematic if taxes were the sole fee tacked on at the end, considering their exclusion from most advertised pricing in the American consumer marketplace. Indeed, taxes are just the beginning when it comes to additional costs. Dealerships are well known for adding all kinds of service charges to the bottom line. Some of these additions may be useful or even warranted. For instance, you may want to purchase a vehicle with upgraded leather seats or improved speakers. These kinds of amenities are often advertised as optional enhancements that come with an increase in price. However, nondescript price enhancers like a "handling charge" or even an upcharge to fill the gas tank that's added in without discussion are simple money grabs.

Instead of falling victim to a dealership looking to tack on potentially hundreds of dollars in junk fees, all you have to do is ask for an "out-the-door" price. This important step helps protect you against hidden fees that may come into the picture later on. An out-the-door price is the actual price you'll pay to drive home in the car. It includes taxes and other fees that are unavoidable, and helps to limit any hidden additions that a dealership may seek to wedge into the contract without you noticing.

This pricing structure simplifies the car buying experience and allows you to focus on the car rather than worrying about protecting yourself against at combative contractual negotiation. As well, when it's time to sit down and work through things like dealership financing – which you should always try to approach with an outside offer already in your pocket – and potential add-ons, you'll be far more prepared to handle a line item discussion of potential additions (or perhaps subtractions, if necessary). Out-the-door pricing seeks to minimize hidden additions, but you can't guarantee that a dealership won't look to impose at least one "non-negotiable" dealership fee as part of this. By limiting other hidden additions, you likely feel more confident in renegotiating any leftover charges like this that appear on the final contract. A dealer may not be excited about budging here, but it's important to keep in mind that the only expense beyond the price tag that's immovable is your tax obligation. Any other fees that may be introduced come with an element of negotiability.