How to Negotiate With Dealerships Online and Win
Buying a car no longer requires spending six hours inside a dealership showroom playing games with a salesperson. By moving the negotiation online, you can secure the best out-the-door vehicle price from the comfort of your living room. You just need to know how to communicate with internet sales departments and use local competition to your advantage.
Secure Your Financing First
Before you send a single email to a dealership, you need to know exactly how you are paying for the vehicle. If you plan to finance the car, get pre-approved through a third party.
Walking into a digital negotiation without your own financing gives the dealership all the power. They can easily manipulate the interest rate or stretch out your loan term to make the monthly payment look attractive, even if the total cost of the vehicle is incredibly high.
Check your rates with local credit unions like PenFed or Navy Federal, or use an online tool like Capital One Auto Navigator. Once you have an approval letter showing your interest rate and maximum loan amount, you have a baseline. If the dealership’s finance department can beat your credit union’s rate (like offering a promotional 1.9% APR through Honda Financial Services or Toyota Financial Services), you can take their offer. If not, you simply use your own bank.
Target the Internet Sales Manager
Every modern dealership has two distinct sales teams: the floor salespeople and the internet sales department. You want to bypass the floor salespeople entirely.
Floor salespeople generally make their living on commission based on the gross profit of the car. They want you to pay as much as possible. Internet sales managers and fleet managers are usually paid based on volume. Their primary goal is to move as many units as possible every month to hit manufacturer bonuses. Because they care more about hitting a quota than squeezing every last dollar out of a single sale, they are far more willing to give you a bottom-line discount.
Ask for the Out-the-Door (OTD) Price
When you start emailing dealerships, you must focus entirely on the “out-the-door” price. Do not negotiate based on the sticker price (MSRP) or the monthly payment.
The out-the-door price is the exact total amount you will pay to drive the car off the lot legally. It includes:
- The agreed-upon price of the vehicle
- State and local sales taxes
- Title and registration fees
- The dealership documentation fee (doc fee)
If you only negotiate the price of the car, the dealership will inevitably add surprise fees to your final contract.
The Initial Email Strategy
To start the bidding war, find 5 to 8 dealerships within a reasonable driving distance. Locate the exact vehicle you want in their online inventory and write down the stock number or Vehicle Identification Number (VIN).
Send a short, direct email to the internet sales department. State that you are looking at a specific stock number, you are ready to buy this week, and you want a complete breakdown of their best out-the-door price. Tell them explicitly that you are contacting multiple local dealerships and will go with the one that offers the most transparent and competitive pricing.
Pit Dealerships Against Each Other
Once the emails roll in, you will notice a wide variety of pricing. Some dealers will refuse to give you an OTD price via email and will insist you call or visit. Ignore them. Work only with the dealerships that respect your digital boundaries.
Take the lowest complete OTD quote you receive. Let us say Dealer A offers you an OTD price of $31,500 for a new Mazda CX-5. Reply to Dealer B and Dealer C with a simple message: “Dealer A has offered me an OTD price of $31,500 for this exact trim. If you can beat this price, I will buy from you today.”
This forces the dealerships to drop their prices to win your business. Repeat this process until the dealers tell you they can no longer discount the car.
Watch Out for Junk Add-Ons
When reviewing the OTD price breakdowns, scrutinize every line item. Dealerships often try to inflate their profit margins by forcing you to buy useless accessories.
Common junk fees include:
- Nitrogen-filled tires (often priced around $199)
- VIN etching (frequently listed at $299)
- Paint and fabric protection packages (sometimes pushed as high as $899)
- Pinstriping or wheel locks
If you see these fees on the quote, email the manager and tell them you refuse to pay for these add-ons. Ask them to remove the charges or you will take your business to a competitor.
Handle Your Trade-In Separately
Never mention your trade-in vehicle during the initial negotiation. Dealerships love to overcomplicate the math by mixing the value of your old car with the price of the new one.
Before you start negotiating, get cash offers for your current car from online buyers like Carvana, CarMax, or AutoNation. These sites will give you a firm dollar amount valid for seven days.
Once you lock in the OTD price on your new car, tell the dealer you have a vehicle to trade in. If they match or beat your CarMax quote, trade it in with them. If they lowball you, simply sell your old car to CarMax instead.
Frequently Asked Questions
What does MSRP mean?
MSRP stands for Manufacturer’s Suggested Retail Price. It is the price the automaker recommends the dealer charge for the car. It does not include taxes, registration, or dealer fees. You should always aim to negotiate a discount below the MSRP.
Can I sign all the final paperwork online?
Many dealerships now offer digital retail tools that allow you to sign the majority of your financing paperwork from your computer or phone. However, depending on your state laws, you may still need to sign a few physical documents when you pick up the vehicle or when they deliver it to your home.
Should I negotiate my car insurance at the dealership?
No. You should shop for car insurance before you finalize your vehicle purchase. Contact providers like Geico, Progressive, or State Farm to get quotes for the exact make and model you plan to buy. The dealership has nothing to do with your personal auto insurance policy.