PHOENIX — Car prices continue to rise due to shortages caused by the pandemic. But dealers are also adding additional charges above the suggested retail price, just because they can.
They're called "dealer markups" or "market adjustments" and they can be anywhere from a few thousand to tens of thousands of dollars extra.
"I saw a Jeep Grand Cherokee, but one of the Trackhawk ones with a really powerful engine," said Karl Bruaer, an analyst with iSeeCars.com, "for $50,000 over MSRP."
People have been posting photos online of sticker prices with $10,000, even up to $40,000 dealer markups attached to cars.
They don't even try to hide it," Brauer said. "They don't call it, like, 'ceramic coating' or 'Scotch-Guard on the seats'."
Brauer said those markups are not necessarily because the cost of the car went up, it's entirely up to the dealer and what they can get for a car. And with dealerships having inventory way below normal, Brauer said they can get it.
Here's what you can do to avoid paying that dealer markup:
Haggle
You may not have as much leverage in haggling as you used to, Brauer said, but it's still worth it to try, especially if you're serious about buying right then.
Brauer said sometimes a dealer will be more likely to bend if they know there's a paying customer in front of them.
Travel
Brauer said you may want to expand your search area much farther than you thought...maybe even to other states.
It may seem like a long distance to go for a car here you save $1,000 and it takes you 10 hours total on drive time," Brauer said. "That's $100 an hour that you just paid yourself."
Don't buy now
Brauer's simplest advice is to stop shopping unless you absolutely have to buy a car now. You have no leverage and car prices are still going up. He suggests spending money to keep your current car running and in good shape until the supply chain issues get better.
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