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Home / Buyer's Guide / Guide to Buying a Car
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Basic Information about Buying Vehicles Online:
In the past, local car dealerships across the U.S. have competed for customers in
their local markets. For the most part, these customers bought their vehicles
locally because there were no other options that didn't involve traveling to a
dealership in another area. In the Internet age, the dealership industry has
experienced a revolution. Now, customers can purchase a vehicle from any
dealership in America by using the Internet. You can avoid haggling with
commission-earning salesmen at your local dealership and purchase a vehicle from
your home. The greatest benefit of this new ability is that you, the customer, can
shop literally hundreds of dealerships across the country for the best price on
the vehicle you want.
The first question most curious online buyers have is: Do the prices of vehicles
really vary that much from region to region? Absolutely. As with any consumer
item, the cost of living is higher in certain areas of the country, so a stereo on
sale the stores in California will likely be more expensive than the same stereo
on sale in Montana. These economic realities apply to vehicles as well.
An identical new vehicle will vary in price depending on the area's standard of
living, the amount of profit the dealer wants to make per vehicle, and the level
of co-op advertising the the local area dealerships have built directly into their
invoices. While the MSRP may be the same on a vehicle across the country, many
areas (including most metropolitan areas) include co-op advertising fees that add
as much as 2% to the invoice cost of a vehicle. And yet, the customer never sees
this fee; it is simply built in to the dealership's invoice. Thus, you can benefit
greatly by purchasing a vehicle from a dealership in an area where these
advertising fees are applied at the minimum rate, saving you potentially $1,000 on
the cost of a vehicle.
Another frequent question is: Doesn't the cost of shipping the vehicle across the
country wipe out the savings? Not at all. If you buy a car online, that vehicle
can be shipped to you in the continental U.S. within a usual range from $200 to
$1,200, depending on how far you are from the dealership. Shipping to Hawaii,
Alaska, and U.S. territories can be higher, however. If you find a dealership with
low co-op advertising fees that also sells in greater volume, you can save several
thousand dollars by purchasing online. The latter is one distinct advantage of
buying online; whereas your local dealership needs to clear a large profit on each
new vehicle in order to pay the bills, a dealership with a strong online presence
makes its profits by selling in greater volumes at lower prices.
A related question about shipping is: How are vehicles shipped to the customer? All
dealers use the same kind of car carrier trucks that are used to ship the vehicle
originally from the factory to the dealership. These carriers are traditionally
open to air, although you can pay a higher shipping rate for an enclosed carrier
(a preferenced chosen, for instance, by many Corvette buyers). Shipping is safe
and can usually be done within a week or two of the purchase date of a vehicle,
depending on whether there are truckers heading in your direction at the exact
moment of your purchase. The customer can be given the name and cell number of the
trucker so that progress updates can be received at any time.
A customer can also choose to have a vehicle drop-shipped to their local dealership if that
vehicle is being ordered directly from the factory. You can save money by purchasing a new
built-to-order vehicle from a remote dealership and, for a fee usually in the $100-$200 range,
have GM ship that vehicle for delivery at your local dealership. Some dealers, as you might
expect, refuse to provide this "courtesy delivery" for people who didn't buy the car from that
particular dealership, so these arrangements need to be confirmed ahead of time. Corvette buyers
also have the option of ordering a car to be delivered at the Corvette Museum in Kentucky, an
awesome experience for those who have opted for it.
Procedurally speaking, what about fees, taxes, and signatures? When you buy a
vehicle online, the customer can make an earnest money payment via credit card
(for $1,000, for example) to ensure committment. Then, the paperwork requiring signitures
is sent by Fed Ex or UPS overnight to the customer, who then uses the return
express envelope to send the dealership the signed papers, a copy of driver's
license, etc. Dealerships usually charge nominal documentation fees to cover these
procedural costs. Registration fees and taxes will depend on what state you choose
to license the vehicle in. It would be highly beneficial, for instance, to register
the car in a state like Montana, which has no sales tax.
Finally, when you contact a remote dealership about a vehicle, you can use a
variety of communication methods, including phone, fax, and, of course, e-mail.
You can always get a good feel for a responsible online dealer if that dealer
responds promptly to your online query or call. Most importantly, buying a vehicle
online is not much more complicated than buying a CD or a book, and it can often
save you thousands of dollars.
Read why Karl Tyler Chevrolet is an excellent online dealer
that you can trust.
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