Buying on the Web

For new car buyers, the real wonder of the Web is how easily you can get reliable price information that will give you a much stronger negotiating stance. But the Web is also powerful if convenience and low hassle matter a lot to you.

If you plan to buy from a dealer, know your target price before you start shopping. Carprices.com can tell you the Manufacturer's Suggested Retail Price (often called the "list price") and the Dealer's Invoice Price, or what the car cost the dealer.

Focus any negotiation on that dealer cost. For an average car, 2 percent above the Dealer's Invoice Price (that would be $400 on a $20,000 car) is a reasonably good deal. The Web site Edmunds.com gives you another useful figure -- the True Market Value, or average selling price, for a particular vehicle in your region. Knowing that price will tell you immediately if you are being offered a good deal by an Internet service.

If you have no taste for going head-to-head on Dealer Row, you can choose two kinds of Internet service:

Dealer Referral

Autobytel.com, the major surviving service of this type, does not give you an immediate price quote for new car purchases (it does offer prices for used cars). Fill in the Autobytel form detailing what vehicle you want and your color and options preferences. Then you will get a phone call or e-mail from a local dealership (sometimes almost immediately, sometimes a day or so later). At that point, you will get a price quote and some idea of whether the dealer has - or can get - the vehicle you want.

Since you will already know the True Market Value price from Edmunds, you can tell if the offer is a good one. Autobytel prices are supposed to be non-negotiable, but dealers actually will sometimes budge from their initial offer.

The major drawback of Autobytel, however, is that each dealership gets exclusive territory, so you will get a price from only that dealership designated for your area. That means you won't get the advantage of competitive bids.

Direct Internet Service

With CarsDirect.com, you go to the Web site, fill in the vehicle you want and get an immediate, non-negotiable price. These prices usually are competitive and may be a little above or below Edmunds True Market Value number depending on the vehicle.

CarsDirect.com, which gets its cars through dealers, doesn't guarantee it will be able to deliver exactly the color and options you want on your new car. Your chances are good if you are buying, say, a Honda Civic, a Chevy pickup, or any other big-volume model in a popular color. When you find the price you want at CarsDirect, it really can't be any easier.

For another low-hassle option, consider hiring a car buying service. They do the hard part for you. For fees ranging from $190 to $750, depending on the level of service, they go out and get competitive bids from dealers and do all the negotiating for you. These services communicate with you via e-mail and telephone.