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Vehicle shopping is getting more challenging than ever. The Internet is both a source of information and confusion. There are many so called “experts” sharing tips with consumers but rather than inform they often only serve to scare the public rather than educate them about the auto buying process.

In a car-buying transaction the salesman and the customer have mutual goals. The customer wants to buy a vehicle and the salesman wants to sell a vehicle. It’s important for both of you to work together towards your mutual goals. Do not mistake a low price for the best value. There are other aspects of the sale to consider in addition to price. Do your homework on vehicle pricing but look at the total transaction. Prices for vehicles vary based on many factors and of course the law of supply and demand will impact pricing too.

When you shop for a vehicle there are certain things you expect. You should be treated with respect, obtain honest and candid answers to your questions, and have things explained to you which you might not understand. Additionally you should be given various options throughout the buying process. Consumers buy cars once every three to five years and salespeople sell cars every day; so do not hesitate to ask “a dumb question.”

If at any time you feel you are not being treated properly I suggest you leave and visit another dealership. You also have the right to ask for another salesperson to help you, if you feel your original sales person is not meeting your needs. Sometimes people just don’t click, so speak with a manager and politely ask to work with another team member. If the salesperson did something specific to offend you, inform the manager of that too, so they can address the issue.

1. Let the salesman know if you love the car
Why pretend you could care less about a vehicle if you really want the vehicle. The fact that you like the vehicle is a good thing. If there are functionality issues the salesperson can provide information that can validate your love of the vehicle or point out potential issues and steer you to a better solution. You might love a little two door coupe, but you shared you are getting married in three months and that may mean a family is coming soon. The salesman can point you to some sporty sedans that are fun to drive but have more room for car seats. To think they will boost the price of a vehicle just because you like it is silly. Most dealerships mark the price on the vehicles. Don’t be afraid to ask the price and how it compares to the market values.

Whether you like, dislike or love a vehicle will not change its price. If you want to buy an unloved car there are often odd colors and cars that have been sitting on the dealers lot for awhile; and dealers will be happy to show you them and provide more aggressive pricing.

2. Tell them if you need a car by tomorrow
Often you’ll hear, “never thell them you need a car immediately.” Let’s bust this myth right now. Just because you need to buy a car right away doesn’t mean a consumer will pay ridiculous money for the vehicle. If you need a car quickly let the salesperson know so they can make sure title work and all the purchase documents can be prepared in your time frame. If financing has to be arranged the dealership can expedite that too. Consumers still need to be aware of vehicle values, budgets and their credit standing. If a consumer feels they are being rushed or pressured into a purchase, they can always leave the dealership, rent or borrow a vehicle for a few days, and look for other alternatives.

Believe it or not dealers can be sensitive to your timeframe and some dealers even have return policies which let you select another vehicle if you feel the first one you chose is not the right vehicle for you. Ask about their policies upfront.

3. Share your monthly budget
Uninformed consumers fear if they share the monthly payment that is acceptable they will be oversold a vehicle for an extended loan term and the dealer will make a fat profit. For as long as I can remember customers have been asking for a payment of $250 a month. Today $250 a month will finance a $10,000 car for 48 months at a 9% interest rate. Not a realistic payment if you are looking for a new car selling for $18,000 and you have no money down.

Before going to the dealership, consumers should use online loan calculators and figure out the most they can finance, and remember to include the down payment (and/or trade in equity) and taxes in your calculations. You can also call any bank branch or credit union and they will quickly calculate loan payments for you. Your sales person at the Dealership can also provide generic payment information from their managers to keep focused on vehicles within your budget.

4. Talk about your trade-in up front
So called experts often mis-advise people and say, never tell the salesman you have a trade. This is a big mistake and also makes you a liar. You don’t want to start any relationship by lying. If you have a trade-in and still have a balance due to the bank or credit union, you need to call them and get a payoff quote. You need to know whether you have equity in your trade-in or negative equity. Negative equity means you owe the bank more than the vehicle is worth in the market. Obviously this is not good unless you have lots of cash around to make up for the negative equity.

The challenge comes when trying to figure out what your vehicle is worth. Well it’s worth exactly what someone will pay you for it. Also, please don’t tell the dealer that the book says your car is worth $$$$. Books do not buy cars. That’s why they are called guides. Do not expect a dealer to pay you the retail book value for your trade-in. If they pay you retail how can they mark it up and sell it on their lot for more than retail?

There are certain realities in the marketplace and that means some vehicle depreciate more than others. Do not be insulted by the value a dealer puts on your trade-in. You can certainly negotiate, but if you have a vehicle with a V8 engine or large SUV be prepared to deal with a valuation below market value as these units are not desirable at this time. Remember if you don’t like the deal you can always shop elsewhere or take your trade-in out of the transaction and sell it privately. By being realistic about your trade-in value and the monthly payment you can afford, dealers can try to help you reach your goal of buying a new or quality pre-owned vehicle.

5. Ask whether you should consider leasing
Leasing is a great option for some consumers. First off understand a lease is nothing more than a long term rental. You agree to lease (rent) the car for a specific term, not exceed the allowable mileage and return it in good condition. Ask yourself these three questions to see if you are a good lease prospect.

Do you like to trade in your vehicles every four years or less?
Do you take very good care of your vehicles?
Do you drive less than 18,000 miles a year?
If you answered yes to these three questions and have very good credit, you are a good lease prospect and should inquire about lease programs on the vehicles you are considering buying.

6. Discuss your credit situation up front
While some people underestimate their own credit rating, dealers work with a number of lenders to help shoppers with varying degrees of past credit problems. Here is another case of doing some preliminary work to understand your credit score and to calculate a debt ratio. Lenders look at your past credit, your ability to pay based on your current obligations and the amount of equity you have in the vehicle.

If you put no money down the lender is taking a greater risk on the loan and this may impact the loan term or interest rate tier. Most finance and lease ads from dealers or vehicle manufacturers always indicate the loan payment shown in the ad is reserved for those that qualify, meaning they have good credit.

You may want to call your local bank or credit union and ask what their current loan rates are for new and used vehicles and take that info with you. Dealerships work with a variety of lenders and can usually match or provide a lower loan rate than what you may have been quoted.

Mark R. Dubis is a writer and auto retail expert with over 25 years working in the automotive and financial arenas. He was a vice president for the automotive finance divisions of KeyBank USA and National City Bank in Cleveland, Ohio.

6 Things to Always Tell a Car Salesman by Mark R. Dubis is licensed under a Creative Commons Attribution-No Derivative Works 3.0 United States License.

They are everywhere. Any major website – banners follow you, get a Gmail with  ”car” in the subject – they are on Gmail, they are even on TV – Vehix commercials. VWdealersecrets.com, whypaysticker.com, carbargainsweekly.com, prettymuchanythingrelatedtocars.org. Anything to make you go to their website, pick a car, any car, and give them your email address. In exchange – you are going to get that super-secret deal that suckers don’t know about, and you will get that extra hard-to-get car for nothing. The truth? – If it is too good to be true – it isn’t, that is just the law of the universe. So why do they do it, and what is in it for them? Money of course, and you are going to pay, there is no free lunch. It looks free to the consumer, but if the dealer pays for it – you will pay for it in the end.

Let’s play with some statistics and numbers: the closing ratio for Internet Sales varies from 3% to 15%, depending on a dealer and a method of measuring. Let’s say the nation average is 6%. This means that out of 100 Internet inquiries that a dealer gets – he will sell 6 vehicles. The going rate for third party lead is $20, so to sell 6 cars – a dealer will spend $2,000, or $333 per vehicle. Now what kind of pricing a shopper will expect going to a whypaysticker.com? I am going to guess that he is not expecting to pay $2,000 dealer mark-up, and more likely – he/she is going for that super-secrect below invoice insider deal. So who is going to pay the $333? Anybody? The answer is simple – we do. You and I. The cost has to be added to the price of the car or service, and passed along to the buyer, there is no other way to get it. At least auto brokers are honest about it, and they charge you upfront (Cartelligent.com charges you $500 per car, without even telling you what is the price of the car is going to be)

Of course Whypaysticker.com is an extreme example (even though a real website), but let’s look at a more respectable website, like Zag.com. Punch in 2011 GTI 4-door DSG Autobahn, and in a second it tells you: MSRP is $31.475, and your price is $30,652. But wait! There is more: there is a link to Truecar.com, which will tell you that good price is between $29,838 and $30,773, but GREAT price is below $29,838! Hold on, you think, what is going on? I don’t want to pay good price when there is great price, how do I get it? Piece of cake, says Zag.com, just click “locate your dealer”. You do, and it tells you – these three are our Highly Rated Certified Dealers, that will offer you specific numbers off MSRP, plus “dealer perks” such as test-drives (Wow!) All you have to do is give away your name, email, phone, address, and the madness begins. Some dealers will start calling you, other dealers send you screaming emails with unbelievable prices and promises to beat any price. Did I mention that this model IS NOT EVEN ON DEALER’S LOTS YET?!?

They make it so easy, that button is everywhere, teasing you to click, and you don’t even know that your phone will explode 2 minutes later. They have two goals: on the website side – to get as many people to request quotes, and on dealer side – to get as many dealers as possible to pay for your information. As a result, some websites send your info not to the dealers you requested, but to all the dealers that pay (they usually forget to mention that to you, letting you think that a specific dealer is simply ignoring you). Other websites go further: if you express interest in a Cadillac – they will say, oh good, you want a luxury car. Let’s sell your information to Cadillac, Audi, BMX, Lexus,  and Huindai (they do have a luxury model, after all). So I get a lead: John Smith is interested in Audi A8, I call him, and he yells at me that he doesn’t even know what Audi is. Awesome, $20 and 5 minutes I will never get back.

Some websites want to differentiate themselves: supposedly they work only with “certified dealers”,  price is guaranteed, and the service is exlusive. Example – Costco buying service. Let’s review: the service is exlusive to the billion people that have a Costco card and anyone they know, because I can give you my card number, and boom – you get the same service. The price is guaranteed – but not the LOWEST guaranteed, there are exceptions and when it comes to incentives and financing -all bets are off. Certified dealers: from experience – to be a certified dealer you have to pay to Costco $1,500 a month, and you have to agree to their terms. Customer satisfaction, inventory, sales techniques – all that doesn’t matter, as long the check is good. Same with Zag.com – you are certified if you are willing to pay per lead, and if you are willing to pay more – you move to the top of the list.

So, for every lead they get and transfer to a dealer – they get $20 on average. By very conservative estimates -there are 16,000 dealers in USA, let’s say 100 leads per month on average  - this is $32 million per month industry! With all that money they can afford TV commercials, but mainly – flooding the Internet with banners, pop-ups and search engine optimization.

Now, what does it do to the way dealers work? A dealer has to sell cars, but they also have to make some profit, and you cannot make profit if every dealer promises to beat any price, because there is alway a point when a deal becomes a loser – if you fight for price with another dealer. So the name of the game is to get you in at any cost, and deal with consequences later. Here are some of the techniques:

• Lie. That is the most common and there are ways to do it legally. A dealer will send you a quote, and when you come in – they tell you that they had a car at this price, but it was sold. Impossible to prove it wrong, even when you ask for a VIN number – they can give you one for that car they just sold.
• Withhold information. Price will not include destination charge, will be subject to financing, require military rebate, a quote will specify only the general model, but not the trim level.
• Make it up on something else. “Steal” your trade, bump up financing, add fees, etc. People get stuck on the lowest price, and get screwed on other items.

In general – Internet Sales for these dealers is business as usual. They used to do screamer ads in newspapers for cars that didn’t exist, or if they did exist – pressure you to buy another car or grind you until you agree to something you don’t even understand, and pull your hair at home once you read the contract. Now they use the Internet to get people in the door, and then they will hold you hostage and pressure you until you give in.

So how do you shop for a car? Should you even go on line to get prices? Absolutely, it is a great way to compare pricing, get information, and gauge dealer’s service, responsiveness and clarity, but there is no reason to go through another party to do that. Manufacturer site is always the best place to start, dealer website is the second best. If you want quotes from multiple dealers – it might be not as fast as Edmunds.com, but you will get better results: you will get priority with the dealer as a more serious buyer, and you know for sure that your inquiry will go through.

One of the biggest decisions we face when we are getting a new car  is to buy or lease. Opinions on this matter vary widely, almost  as if it was a political issue. If you visit Craigslist Auto forum, and ask whether you should lease or buy – within 5 minutes your mental abilities will be questioned for even considering leasing, because according to the frequent posters of that forum – everybody should buy only 10 year-old cars and pay cash, the only disagreement will be whether you should buy Japanese or American, which will trigger another wave of heated discussion and name-calling. On the other hand, if you visit VWVortex forums – the response will be more reasonable, and you actually will get serious advice. The reality is that millions of people lease cars every year, a lot of them are very smart and successful, and leasing is something everyone should consider when shopping for a new car.

So let’s define a car lease: When you lease a car – you get the right to use the car for limited time, in return you pay for its depreciation, interest and fees. At the end of the lease you have the option of buying out the car for a predetermined amount or return it in a reasonable condition (or pay for excessive usage, such as body damage and high mileage).

Common questions people have about leasing:

• What about mileage? Yes, a car lease has restriction on miles, but it is not as bad as most people imagine. First of all, mileage matters only if you returning the car to the bank after the lease, in which case they will charge you for excess miles,  between $0.10 and $0.25. If you going to buy out the car – you buy it as is, and the mileage will not matter. Also, you can trade the car in, in which case miles will affect the trade-in value just as they would if you were trading a car you own. Another misconception is that you cannot lease if you drive a lot, and you cannot get more than 15,000 miles per year. In fact – you can get as many miles as you want (withing reason – up to about 35K miles per year, depending on the car), you just have to pay for it. Also, VW Credit always contacts leasees mid-term to offer them to buy more miles.
• What about excess damage? Same thing as miles – only matters if you were to return the car to the bank, and they will charge you the going rate for fixing the damage, so it will cost you the same as if you owned a car and wanted to trade it in, or same as what you would have to pay to fix it. Also, you can always buy insurance for the excess wear. The program that our dealership sells covers up to $5,000 of damage for about $650 total.
• What about insurance? In California you have to have same coverage whether you finance or lease.
• What if I need to get out of my lease? Again, you can do it in the same way you would get out of a car loan: there is a payoff to the bank, which changes every month, and you need to pay it to get out of a lease. You can either sell the car privately, or sell it to a dealer. If you sell the car for the same amount as what you owe – you are free and clear. If you sell it for less – you have to come up with the difference, if you sell it for more – you make profit.

And the biggest question: Is leasing for me?

The answer is: It depends. Here is what you have to consider:

• Your past: how long do you usually keep a car? Do you get attached to a car, and a thought of replacing it brings tears to your eyes? (I actually had people cry when trading a car) Or do you drool over new cars a month after you get one? if you get a new car every 2-3 years – you are throwing money away, but at least with a lease – you will throw much less of it.
• Your future: are you going to live where you live right now for the next 6 years? Any expected changes in your family? You might move to a city where you can’t or don’t need to have a car, or you might need a bigger/smaller vehicle in a couple of years.
• Specific lease vs. purchase analysis for a specific car – some cars have better lease programs than others, and if you are on a fence – check the numbers. For example, right now gas Jetta has a great leasing program, but Jetta TDI doesn’t, plus if you lease a TDI – you not going to get the Tax Credit, so in this case – it will be smarter to lease a gas Jetta, but buy a TDI.
• Your tax situation: are you going to use the car for business purposes? If yes – you should be able to use the lease payment as a write-off.

Now, how do we check these numbers? How do we know if a lease is good or bad? As I mentioned earlier, when you lease – you are paying for depreciation and interest. Depreciation is determined by the residual value, or lease-end value of the car. This is a projection made by the bank as to how much this car will be worth at the time of lease expiration. If you want to have lower payments, and have no intention of keeping the car at the end – you want this number to be higher, so you will pay less depreciation. Interest is determined also by the bank, and it is called money factor. While the residual value of the car has to be disclosed, and cannot be changed by the dealer – money factor can be raised for some banks, while some (like Mazda Chase) don’t allow rate mark-up. Banks also adjust these numbers monthly to make sure that their lease programs are attractive and competitive.  As residual value of a specific model goes down as it gets closer to the year-end – the bank will also lower the rate, so the lease payment will stay in the same range. And the last piece of the puzzle will be the selling price of the car, or “Cap cost”.  Selling price in a lease can be negotiated in the same way as purchase price, so if the selling price is lower – you have less depreciation to pay, since depreciation is always a percentage of MSRP.

Complicated? Kind of… Does it have to be? Absolutely not. All you have to know is the total drive-off, monthly payment, and if you are planning to keep the car after the lease – the residual value. Here is an easy rule of thumb: for every $10K of MSRP you should not pay more than $150 a month with $0 down and minimal drive-off, or you can simply multiply the MSRP by 0.015. Let’s take two cars as an example: Jetta California Edition has MSRP of $20,344, and it will lease for $265 a month with minimal drive-off (about $600 after rebate). According to the rule – your payment should be less than $300 for a car in this price range, so the verdict – this lease is good. Now let’s look at a base Jetta TDI with MSRP of $24,004. This car will lease for 338 a month, which is still lower than $360 (the limit according to our calculations), but it is getting close, there is no rebate, so your drive-off will be higher – about $1,400, and you will not get the Federal Tax Credit since you are not buying the car. So the first car is definitely a great lease, while the second one will be a personal judgement call.

Now I will address the main objection to leasing: “But I want to own it!” My response is that in general ownership is overrated. Here is why:

• Cars are one of the worst investments ever. Why would you want to own something that will lose half its value in 3 years?
• Risk: remember when gas prices doubled? Remember what it did to SUV resale value? People could not give them away. As you are reading this – car manufacturers are working on new technologies, what if in 3 years they will come up with cars that get 100 MPG, how easy do you think it will be to get out of your car?
• Risk again: what if you get into an accident, and it gets recorded in your car’s history? Even after you fix the car – it will follow you everywhere, and most people that shop for used cars would not touch a car that has been in an accident – unless you will give it away.
• The myth of not having monthly payments – once the car warranty runs out you are vulnerable to unforseen expenses – tires, brakes, urgent repairs, timing belt – there is no way of knowing how much you will have to spend on your car, while a leased car has a fixed expense – monthly payment.
• Sales tax: in California you pay sales tax on your monthly payment only when you lease, but you do pay the full sales tax when you purchase.

In conclusion – sometime you don’t want to have a cow, you just want some milk. If you simply want to get to work and back , or want to get out of town on weekends – look into leasing. While it is not for everybody – it makes sense for many people, and you might be one of them.

Remember the days when a food critic could make or break a restaurant? A good review in a local newpaper was worth gold, chefs lost their businesses because of bad reviews by people that sometimes couldn’t even cook an omlette…  Today, in the era of social media – you can be that critic! Enter Yelp.com, one of the biggest consumer review websites, its motto is “Real people, real reviews”,which is questionable by itself – how decides if a person writing this review is real? -

“Don’t do it. Get ready to get yourself into serious debt and go home HUNGRY. (Don’t forget to stop off at KFC or Taco Bell on the way home.)”

This is a real review for a great French restaurant in San Francisco, posted year and a half ago. No way to contact this person, no way to tell if she actually been to the restaurant, or if this is the operator of KFC/Taco Bell down the street.

But let’s assume that these are all real people, they actually went to all these places. Still think of this concept: you own a small business, and you are serving a less-than-pleasant customer. We know that even though customer is always right – there are customers that would love to take advantage of someone else. So, this customer demands something he is not entitled to, didn’t pay for, being rude in general. Of course anyone can refuse to service anyone. But now this customer says: “you either do what I want, OR I WILL YELP YOU!” So, as a business owner – what do you want to be right, or do you want to pay your bills? We actually had customers like that, they will say: “you will sell me this car for this price, or I will post a negative review on Yelp”.

Yelp reviews are never taken off. You may have just bought a coffee house, but if has a history on Yelp – now it is your history, until you are history. There is no one to complain to, UNLESS you are a paying Yelp customer, in which case they can take a review off, or they can hide it, just pay $300 a month (that is their sales pitch). There was actually an article in BusinessWeek, describing their business practices, or as others might call it – a racket.

For a while we tried to fight it, until our owner gave up, and now we are paying the $300 a month, but it doesn’t end there. You see – we are not a restaurant. If you, an average person, go to a restaurant, receive decent service, good food, pay for it and leave – you feel good by default. You were hungry, now you are not, you were lonely and bored, now you have spent a nice evening with some kind of a friend – life is good. So you might feel inclined to go on Yelp, and write a positive review. Now the same person drives down the freeway, and his 1998 Chord CE350 dies. He is stuck in the rain for an hour waiting for the tow truck, late to work, the car gets towed to a dealership, and 6 hours later they call you: “yeah, you need new engine, transmission and your brakes are worn out” How much, you ask? “$4,000 plus $1,600 labor”. When will my car be ready? “Well, 3 days until the parts come in, then weekend – Tuesday, maybe”. A week later you get your car back, it is not any newer, doesn’t drive any  better, and you are $7 grand poorer. What are the chances you are going to write a good review?

Here are a couple of examples of reviews for Royal Motor Sales on Yelp:

Posted on 10/30/2006 by Samantha W.: HATE royal motor sales. Rude Rip Off Rats

Posted on 7/26/2007 by Steve F.:  Just thinking about my two experiences there brings a little bile in my throat and makes me crack my knuckles and do a little chicken wing stretch in anticipation of a fight. Go anywhere else. It may sound terribly inconvenient to do so, but do it.

Posted on 2/11/2008 by Jeremiah M.: How do these guys stay in business? I will never go here again unless it’s absolutely necessary… both times I’ve gone I’ve been treated rudely (the last time I said something about it).

Then there are complaint about diagnostic fee, price, complaints that a certain model is out of stock, that a service advisor looked at a customer funny, etc. In the end you get 2 star review average.

So why am I writing about it? Two reasons:

1. We need your help. If you have done business with us, and you are happy – please take a minute, and post a review. If you have done business with us, and you are NOT happy – please let us know. Sometimes things don’t work the way they should, cars get damaged, employees are not doing their job – please let us know. You can contact me personally, you can call or Service Manager Mike Witt at 415 241 8178, or you can call our General Manager Andy Hansen at 415 241 8159, these are their direct lines. If after that nothing is resolved – I guess we deserve a bad review.

2. I want to thank all the people that wrote positive reviews, and I am putting them here together:

Posted by Lynn:  We had a great experience with Mico at Royal Motors.  From start to finish he was courteous, honest, knowledgable, and responsive — it was a pleasure to do business with him. We purchased a TDI Jetta wagon, which are still pretty hard to find.  At the beginning of our search, he quickly let us know that the exact configuration that we were looking for was unavailable in the Bay Area, and then offered to place an order for us.  (Other dealers tried to sell us a car we didn’t want.)   We agreed on a price, placed the order, and that was it!  Mico kept us updated on the progress of the order and let us know when it arrived.  It took us a total of about two hours at the dealer to finalize the purchase, including a long test drive, careful inspection of the entire car, and thorough walkthrough of all the features with Mico.  So straightforward.  We will definitely call him again when it’s time to buy our next car.  (Except we love our TDI, so it may be awhile…

Posted by Scott: Of all the VW dealers I talked to for a 2010 Jetta TDI, Royal had the best selection at the best prices.  After purchasing the car, I got home to find an e-mail from their internet sales manager (I had been shopping around earlier in the day) at a price below what I negotiated.  Amazingly enough, Royal honored this lower price and refunded me the difference.  I think that shows great integrity, something I don’t particularly expect from a car dealer.  And that I need to negotiate better!

Posted by Stephen: My experience at Royal Motors was excellent.  It probably helped that I knew exactly what I wanted (VW Golf TDI) and contacted the Internet Sales Manager (Mico).  Due to the scarcity of that particular model most VW dealers are demanding a “market adjustment” of $2k-$4k, a game I refused to play.  The policy at Royal Motors is to never charge more than MSRP.

Mico was great: friendly, knowledgeable, honest, and never pushy.  He kept me informed of the progress of my order as the car was built and shipped from the factory.  Once it arrived we completed the transaction without any surprise fees.  I was offered dealer financing and the usual extended warranty, paint protection, etc.  But my decision to use financing from my bank and decline the extras was respected and I wasn’t subjected to any sales tactics. I don’t know what the other sales people at Royal Motors are like, but in my experience Mico is a straight shooter.  And I love my new car!

Posted by Kevin:  ATTENTION VW BUYERS!!!  There are a lot of bad reviews for Royal.  But I wanted to pass along my GREAT experience.  I’ll preface a little by saying we bought a 2010 TDi Jetta Sportwagen and we worked with Mico.  Most of the bad reviews seem to be from Audi buyers.  And several of the 4 and 5 star ratings are VW buyers who worked with Mico.  He rocks.The story:  We were looking for the TDi sportwagen.  A very popular car (for certain people).  All over the Bay area other dealers are marking these up about 3 or 4000 over MSRP and will not negotiate down from that.  Other dealers also weren’t interested in working with our trade in (2003 jetta wagon with low miles).  We first contacted Mico online.  He would send us updates from time to time telling us whenever a car would come on the lot.  Finally after having very bad experiences at 3 other dealers, Mico contacted us saying there was another car on the lot for MSRP.  We went down, they gave us what we needed for our trade in (no haggling), agreed on the price, car was detailed and ready to go when we finished.  Their finance dept even beat our outside loan. Now, I understand how many rules for buying a car I broke for this process, i.e. never pay MSRP, never finance through the dealer, never accept the first offer, etc…  First, the 2010 sportwagen TDi is selling all over the nation for 1000′s over MSRP.  To get it for MSRP is a deal.  I’m sure someone will find one for under MSRP, but that is by far the exception.  Second, we knew our trade in was a good car, but we also know that it’s not perfect.  They gave us about what http://edmonds.com suggested they give us.  Third, we know how to read a contract and know that our loan is a good deal.  Had we gone in trying to get $500 over invoice and haggle another $500 for our trade in, then maybe the experience would have been different.  I don’t mind the dealer making a profit off of our sale.  Mico was honest and fair with us.  And we ended up with the exact car we wanted.  and I LOVE IT!!!   If you are buying a VW I STRONGLY recommend Mico at Royal Motors!

Posted by Daniel:  I was in the market looking for a car for the past two months.  I had read numerous reviews and done a lot of homework window shopping at numerous dealers in and around the Bay Area.  Once I had decided on the Jetta, I sent out for a few quotes.  The first quote back came from the Internet Manager at Royal Motor Sales, Mico. He said that he had the car I was looking for at the best price I had been given.  I figured that I should try Royal Motors first, because of close proximity to my house and the fact that they responded to all of my questions via email and seemed to want my business. I arrived at the appointment time to look at my car, which was washed, waiting and ready for as spirited a test drive that could be had at 3:30pm on a weekday.  Mico greeted my wife and I and then took us on a demonstration drive.  We each took a turn on the route and felt like the car was going to live up to our expectations. We returned to the dealer and we sat down to discuss price.  I was a little hesitant at this point, because another dealer I dealt with tried the old switcheroo in the past, but Mico did not.  He opened up his emails, found the quote he’d given me and we went from there.  There was no haggling necessary, the price I was quoted was as good as the car. We decided to buy and it was a simple process of getting the promotional APR loan that was advertised–no shenanigans.  My wife and I felt as though they couldn’t have made the purchase any easier.  It was smooth and fast. I have been brow beaten before and flat out lied to by car dealers, but the people at Royal Motors totally blew me away.  If you are going to purchase a VW, use the Internet Manager and save yourselves the headaches most associated with buying a car. I can’t vouch for the service department as I haven’t used them yet, but the purchasing was great.  I wouldn’t hesitate to recommend them to anyone looking to buy a car.

Posted by Kenny: Thanks to these guys I am now a proud owner of  brand new 2009 Jetta TDI. I did most of the contact with Mico, the Internet Sales Manager.  Through him I was able to obtain a quote and he was prompt in regards to answering any questions that I may have had.  The sales process with Michael Perry was smooth and the only haggling was over my interest rate on the financing.  No BS and no dealer markups. I know that the Jetta TDI is a “high demand car” because it’s sips gas like a Prius and can run on biodiesel.  I know that even in these tough economic times (that phrase is starting to be cliche by now) it is a seller’s market for that kind of car.  I knew most dealerships would add a markup and I was able to negotiate a lower price.  But nobody else was willing to sell to me at MSRP. I’m in sales and I understand people need to make money.  I’m not trying to hold their feet to the fire and try to get them to sell to me at “X over invoice,” I’m just looking for a fair deal.  I’m glad to have done business with this dealership and after the nightmare that was Broadway VW in Oakland, I’m glad I was able to buy this magnificent automobile with very little hassle

Posted by Josh:  After reading all of the negative reviews, I had my doubts.  But then I met Mico, Internet Sales guru at Royal Motor Sales, and I am a believer.  Sure the dealership isn’t the flashiest in SF, and sure there isn’t a huge lot with 900 cars on it, and sure the sales guys dress slick.  My experience from start to finish was very solid.  I expressed my interest in a particularly new and rare Jetta TDI Sportswagen which wasn’t even out yet.  Mico gave me the short story, let me test drive the one version they had, displayed his incredible knowledge about the car, and then sent me on my way, with no high pressure sales pitch; just a commitment to contact me if anything came in.  A week later I swung by again and Mico had located the vehicle I wanted.  I put down a deposit to buy sight unseen.  Two weeks later and a week ahead of schedule, the Jetta was delivered and ready, and Mico made it happen for me in about an hour.  I’m happy.  Go see Mico.  He seems to love what he does and it shows.

Posted by Julia: I didn’t read all these reviews before I went to Royal, if I had – I probably would have gone somewhere else, but my experience was nothing less than great, both in sales and service. I was looking for a specific Audi A4 about a year ago, called around, and no dealership in the area seemed to have one. Then I stopped by Royal, to see if they have something close to what I wanted. I talked to Mico, he was very straight to the point, went online and located the EXACT car I wanted at a dealer in San Diego, called them to check if the car was available, we agreed on the price in about 10 minutes, and 4 days later my car arrived.
Since then I have been taking my A4 to their service, and I never had any problems. Actually, they were extremely helpful considering how busy they are; once my car got broken into on a Friday night, and I brought it to service on Saturday expecting them to order the glass for the window and ready to wait a few days. Frank Lee had the found the right glass in stock, and I had my car ready in about an hour and a half.

There are more, but I think this will put the point across. Thank you everybody, and I look forward to seeing you back!

Buying cars online has been one of those insider secrets that everybody knew since 1999. Before that there was the “Fleet Manager” secret – that there is this one special person in a dealership that will sell you a car for cheap. Today when someone asks to speak with me – the fleet manager – my first question is “how many cars are you going to buy?”. Usually they mumble: “just one…” – “well then why did you ask for FLEET manager?” Plus our general manager told all the salespeople that for the purpose of that kind of phone calls – they all are fleet managers…

This is the same thing with Internet car buying: it is no longer a way to buy a car cheaper than other people. Everybody has Internet, if not at home – then at work (Internet activity actually spikes on Monday morning – when people get back to “work” after weekend), number of “smart phones” grows by hundreds of percent every year, and 90% of shoppers do some kind of research on line before purchasing a car. Does it mean that you shouldn’t buy cars online? – Absolutely not. Internet is a great resource, it helps the buyer, and a good dealer prefers an informed shopper with realistic expectations.

So how do you buy a car online? First let’s define your goal: most likely you want to make the right choice – it has to be the model that fills your needs the best, and it the right combination of safety, reliability and price. Once you know what car is right for you – your goal is to get it at the lowest price, without compromising the quality of the product or service.

Let’s get it going.

The beginning is the hardest: what kind of car should I get? Should I get an SUV so I can go skiing, or should I get a roadster so I can drive it on Pacific Coast Highway in weekends? Do I need a 7-seater so I could pile all my family or would it be better to have a small hatchback so my in-laws would not expect to ride with us? It is extremely hard to answer those questions correctly, while being bombarded by commercials, news and unsolicited advise from neighbors. There is a reason average American gets a new car every 2.5 years – they are not happy with what they have, or it doesn’t work for them anymore, or they simply can afford a new car – and you can always find an excuse to get a new car. There is no proven method to guarantee that you choose the perfect car, and I can’t help you there, so let’s assume you narrowed it down to 3 models, and you are ready to visit dealers and drive these cars. Since we are on the subject of Internet car-buying – I believe that you should start the process online.

How to contact a dealer online.

There are dozens of websites and car-buying services online, all promising you to get you the best price and the best experience. The majority of them sell your information to dealers, including major websites like Edmunds.com, cars.com, Yahoo Autos and MSN Autos, and car-buying services such as Costco, Amex and AAA. All of them try to encourage you to request a quote: “it is free, it takes only seconds’, so you think – why not? Let me plug in my email and phone number, and see what happens. Two minutes later your phone explodes, all dealers in the area that have contracts with this website start calling and emailing you with all kinds of offers that you have to take advantage off TODAY! You haven’s driven the car, you are still not sure that this is the car you want, and everybody tries to sell it to you right now. You get annoyed, dealers get frustrated because they paid for your information, and you are “not a buyer”, and the only party that benefits is the website, because they get paid no matter what. Another problem is that the specific dealer in your area may have opted out of buying leads from the website you are using, you are waiting for the response, but it will not come, because the dealer never got your inquiry.

What about car buying services?  They promise the lowest price and the best service, how do they work? On the same principle with some small differences: they charge a dealer monthly fee instead of fee per lead, and they limit participating dealers to one per region, so there will be no competition.  Some of them (like Costco) have preset price on each model: let’s say a dealer will commit to sell all GTI’s for $100 over dealer invoice. Does it make the process easy? Yes. Does it guarantee you the lowest price? Absolutely not.

So how do we do it? The best way is to contact the dealer through the manufacturer website or dealer website. This way you know that they get it, and the dealer knows that you are serious, and not just bored. Couple things about the actual inquiry:

1. Other than checking boxes – write a short note saying what you want to accomplish – a test-drive, inventory check, what type of price quote – lease, finance or purchase. Again, this way we know that you are serious, and we can give you the right information right away.

2. Give a real phone number. If you don’t want to be called – make a note, but we need to make sure you are getting our emails, instead of them disappearing in spam folders, and if we don’t hear from you – we can follow up on the phone. Also – you can accomplish a lot in one quick phone conversation, so if a dealer calls you – there is no law that says you shouldn’t talk to him. Tell him what you want exactly, and if you want some information in email – just say so.

Communicating with dealers

How would you like to be treated? Would you like your emails to be answered in timely manner and your questions answered in full? Would you like to get a live person when you call, or your message returned within an hour? Well, we, the Internet salespeople are just like you, and your courtesy will go a long way – in terms of ease of negotiation, service and overall respect. So here are a few suggestions that are very easy to follow, and will pay off:

1. Respond to emails. Unless it is clearly an automated message or an email that doesn’t represent any value to you – please respond. If you don’t respond – we don’t know if you got our email, and we have to follow up and call. A short note will do: “Thank you, but we already bought a car”, “Thank you, but we decided to hold off”, “will get back to you next week”, etc.

2. Don’t input a fake phone number. That number could belong to a real person, and he is not going to be happy getting phone calls intended for you, and it makes you look bad. If you don’t want to be called – just say so, and back to #1. – respond to emails.

3. Don’t lie. My contact management system tells me whether you opened my emails, so if I call a customer to follow up knowing that he opened my emails, and he says that he didn’t get it – I know he is lying, and he becomes my last priority. If you have a better offer from another dealer – great, let me try to match it, but don’t make up numbers you cannot prove, because I am not going to sell you a car at a loss, unless I have a written proof that another dealer is willing to do it.

4. Don’t hide behind a computer. Some people think that Internet gives them right to be rude, mean and condescending. If I send you a quote, and you respond: “you have to do better than that” – we are done.

5.  Phone: we can save a lot of time by taking the time to talk on the phone, and emails sometimes don’t go through. By the time we exchange 20 emails and reach to some agreement – the car you wanted could have been sold, and there is no law that prevents you from speaking to an Internet salesperson over the phone.

Test-drive

So you contacted a couple of dealers, and established communication with the one that responded in a professional manner, gave you the information you wanted, and you are ready to come in for a test-drive. Some people and car-buying guides still think that Internet Department and the actual dealership are two different things, and that you can just roll in and ask to test-drive with the first person that greets you. Here are  a couple of problems with that: first they might not be ready for you. The car is not ready for a drive, no gas, no one to go with you, the only person available doesn’t know anything about the car, etc. Another problem is that you are taking someone’s time, and that person expects to get paid for his service, but he will get paid only if you buy a car from him. Some people don’t care about it whatsoever, some say that their goal in life is to run all “stealerships” out of business. I hope you are not one of these people, and that you – like me – believe that people should get paid for their work. No normal person would eat in a restaurant and not leave a tip, but for some reason it is OK to retain a car salesperson’s service for an hour or two and not to pay him. Car business is straight commission, if we don’t sell – we don’t get paid. Now, I am not saying that you have to buy where you test-drove – you buy where you get the best price and service, but if you MIGHT buy at a specific dealership – it is only fair to schedule a test-drive with a specific person, and then to give him a first shot at a deal.

Should you buy at first visit?

Most guides will tell you: test-drive a car and walk out. Don’t let them “sell you”. If you were cruising on your day off, stumbled into a dealership and test-drove a car – yes, you should not buy a car right away. but if you have done your research, you have a couple of quotes in hand, and you decided that this is the right car for you – buy it. Why? for a lot of reasons: first, when you are at a dealer – you are the priority. They know you just test-drove it, you found the car you want, they can smell the sale – it gives you leverage. Once you went back home and start to email every dealer in the area – you are not a priority anymore. Second, a car you wanted could be sold to someone else, the special interest rate might expire, your trade broke down, etc. Just get it over with, you are a busy person, car-shopping should not rule your life.

How to get a fair deal

Be prepared. Know what you should expect. Shop accordingly to what you decided to do – lease, finance or purchase. if it is cash purchase – have an Out The Door quote. If it is finance – know the rate. Special rates are always advertised on manufacturer’s website, just make sure you are looking for the right term. If you are not sure about your credit – have the dealer check it. In California a dealer has to let you know what your score is – once they check it, then you can just tell the other dealer your score – and they will give you your rate. If it is a lease compare apples to apples - full  drive-off cost and full monthly payment including tax. Keep it simple – don’t worry about residual, money factor, cap cost – all that matters to you is your initial investment and monthly cost. If you like to get into details – the best source I know is Carspace.com – Edmunds.com discussion forum. They have a “Lease questions” discussion for every model sold in USA, where you can find out specific numbers.

Lastly, once you agreed on the pricing terms – you are off to finance. Please don’t get mad if they try to sell you something. First, they also work on commission, and they HAVE to sell, or they will not have a job, and second – you actually might need one of their products.  Extended service contracts, excess ware insurance – these things take care of you in the long run, and you might need them.

Conclusion: car shopping doesn’t have to be a war. You don’t have to shop everybody, spend weekends driving from dealer to dealer, and still get a great car at a great price. Drive safely!