Hiring a broker to help you buy a new car is a key trend in the pandemic
Hiring a broker to help you buy a new car is a key trend in the pandemic

Why using a car broker could save you $20,000

Hiring a broker to help you buy a new car is emerging as a key trend in the pandemic as people look to the experts on haggling.

While some people enjoy the cut and thrust of the showroom negotiation, most find the pressure of doing a deal awkward and uncomfortable.

A car broker can take away the stress and save you money on a new car, although you'll need to pay for the service. It's a combination proving irresistible to a growing number of customers.

Ashley Woolnough bought her new VW Tiguan through a car broker, Motor Scout, saving her thousands compared to a quote from a car dealer. Picture: David Swift
Ashley Woolnough bought her new VW Tiguan through a car broker, Motor Scout, saving her thousands compared to a quote from a car dealer. Picture: David Swift

James Whitbourn shifted from a career road-testing vehicles as an automotive journalist to buying vehicles for clients through his Car Helper business.

"People know about mortgage brokers, but car brokers are less well-known," he says. "It's using an agent which means buying your car from a fleet department rather than through a retail sales person. "You would do it for two reasons: saving money and avoiding the sales or showroom experience a lot of people don't like."

So what are the key steps you need to take:

UNDERSTAND YOUR PERSONALITY IS PART OF THE PROCESS

While some folks back themselves to match wits with sales staff, others recognise haggling isn't part of their skill set.

Ashley Woolnough bought a Volkswagen Tiguan through brokering service Motor Scout and swore she "would never go back to doing it myself". "You don't feel the pressure and you don't have uncomfortable conversations you're not used to," she says. "I found it a really seamless experience."

While some customers buy a new car once every few years, Motor Scout founder Peter Gee says professional brokers are intimately familiar with the process.

"We do this every day," he says. "We have relationships with dealers - we know what they can and can't do. We're able to get a much better deal than what someone walking into a showroom is able to achieve."

KNOW WHAT YOU WANT - BUT BE READY TO COMPROMISE

A broker will ask what sort of vehicle you want, so it's helpful to have done your homework. If you ask for a specific make, model and colour, they will contact a number of dealers and come back with bids for your business. Sometimes they will have exactly what you want, but if the car isn't in stock, you might have to settle for something similar or be prepared to wait.

Gee says News Corp Australia's 2019 car of the year, the Toyota RAV4 Hybrid, is in hot demand.

"The most popular car we're selling is the RAV4 hybrid," he says.

"But the Mazda CX-5 is becoming popular because the RAV4 isn't available. The new Isuzu utes are also hot at the moment, but as of today the top models have been pushed out to an April delivery. It's going to turn people off."

Customers can expect to save about 10 per cent of a car’s purchase price. Picture: David Swift
Customers can expect to save about 10 per cent of a car’s purchase price. Picture: David Swift

TRANSPARENCY IS KEY

A good broker should come back with a range of choices rather than bowling up a single car from a friendly contact.

Both car brokers advised customers should insist on open communication and know exactly where their money is going.

Payment strategies differ between businesses. Dealers pay Motor Scout a commission of $250 and $1000, while Car Helper asks clients to pay $165 up front, plus the balance of 1 per cent of the car's value. A $30,000 sale costs the customer $165 up front, plus a further $135 when the deal is done.

As a rule of thumb, Whitbourn says customers can expect to save about 10 per cent of a car's purchase price. "If I can't get someone a good deal or end up with a good result for them, they're going to get their money back," he says.

SAVINGS CAN BE SUBSTANTIAL

Car Helper's record discount is $20,000 stripped from the price of a luxury Porsche. Gee says he saved a BMW-buying client $24,000 "with just one phone call".

Woolnough says the difference between her first quoted price and eventual deal was $8000.

"The dealer put forward a price that was, to be honest, ridiculous," she says.

"But when you go through a platform like this everybody puts their best quote up front, because they know they're competing with other dealers. It was a massive saving."

 

 

Originally published as Why using a car broker could save you $20,000



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