The Fool Fax-a-thon is a strategy you can use when buying a car to shift the bargaining power back to you. Once you know exactly what car (and options) you want to buy, gather the fax numbers of the dealers closest to you -- and get yourself to a fax machine. Ideally, you'll want a list of at least one or two dozen dealerships. The more you include, the better chance you have of getting a great price. If there aren't too many dealerships in your immediate area, spread your net wider. You won't mind driving 90 minutes to pick up a great bargain.
To locate fax numbers, check manufacturer websites or just call the dealerships and ask for the fax number of their sales departments -- without letting them rope you into any discussions.
Ideally, you won't have shopped at the dealerships you fax to. If you have shopped at one, and took up the time of a salesperson there, then it's not really right to go behind the salesperson's back with the Fax-a-thon. If you've not shopped the dealership, then address your fax to the fleet manager, and ask that any sale be considered a "house sale," which is non-commissioned. If you have shopped at one, perhaps address your fax to the salesperson you spoke to at that dealership.
Once you're all ready with fax numbers and names, fax a letter to all the dealers. In it, specify exactly what car you want to buy, including all the options, the color, etc. Include your fax number (but not your phone number) and invite them to fax you an itemized price offer, including options, fees, and taxes. This way, you can compare apples to apples when the bids arrive.
Give them a firm deadline by which to respond -- ideally a few days, but no more than a week. Some dealers won't reply, but others will, and you'll probably get a wide range of prices. If you get an utterly amazing bid among the responses, rush to that dealership, checkbook (and faxed bid) in hand. If you think there's still room for improvement on the price, take the lowest bid and do one more round of faxing. In the second round, include the itemized best price you've been offered and invite all the dealers to beat it. Then walk into the winning dealership with the firm offer.
Online at the Fool, we've heard from many people who've saved thousands of dollars using this tactic. Give it a shot!
Heads-up, though... this creative strategy was devised some years ago, and since then you have some additional options. A number of websites now permit you to essentially utilize the Fax-a-thon method -- but online. Enter the kind of car and options you want, and wait to be e-mailed some bids. The car-buying world is changing!
Here are a bunch of websites that should help you decide what kind of vehicle you want to buy -- and they may even help you buy it: Edmunds.com, Autobytel.com, CarPoint.msn.com, Autoweb.com, Autosite.com, and TheCarConnection.com.