I just bought an EV. I like it, but I hate the process of buying a car. It's arduous because we allow dealerships to make it as difficult as possible to shop and get a fair price. Let me tell you my tale, and what we can do about it.

Trading In

It all began when I brought my Honda CRV in for service at a Honda dealership. A salesman offered to buy my car, and I figured it's as good a time as any to switch to an EV.

So I looked up the Kelly Blue Book value of my 2020 CRV: on median, a bit over $18,000 in my area. Of course the dealer tried to low-ball me, offering $15,500-16,500 at first. I countered with $19,000 (the top of the KBB "fair value" range), and after they looked at my car we settled on $18,200. Perfect.

The dealer didn't have a used Prologue, and I didn't want to lease, so I walked out with an offer that expires in 7 days on paper, though the guy assured me, unofficially, that if it would probably last for 10 or so.

Browsing: Used car dealership

After some research and discussion with my spouse, we decided to buy a Honda Prologue, but used Prologues are hard to come by. I went on Autotraders/CarGurus/whatever (which I highly recommend; see why below) and found just two within an hour's drive: a used car dealership in my town, and a Honda dealership one hour away.

I got lucky. Both places had Prologues from the same year, 2024, and both cars had about the same miles, so they'd be way easier to compare. The catch: the nearby used car dealership only had the Touring trim. I wanted the lowest trim, the EX, because I don't care about fancy features.

First I test-drove the Touring and negotiated a tentative, after-trade-in price: a bit over $8,100. They'd match that $18,200 that the Honda dealership offered me. But we still didn't want the Touring trim, so (after some effort) we walked out with offers in hand.

As we were leaving, they even offered $19,000 for the CRV. I didn't get that in writing, but that was still within the KBB fair range, so we kept in mind that this price was possible for us.

Buying: Official dealership

The next day, we drove the hour to the official Honda dealership that had a single Prologue EX, the basic trim we wanted. We test-drove it, then got to negotiating.

Right off the bat, I should warn you: always shop online for a used car using Autotrader, CarGurus, or whatever. Because guess what? Online the car was listed for ~$22,000, but when we arrived the sticker said $23,500. The salesman openly admitted to me, "Oh, that's the price we ask for people who don't shop online." So anyone who doesn't shop online starts from a worse negotiating position. I then knew I was dealing with an honest business.

Of course, they tried to low-ball us for our CRV, offering just $17,000, even after we showed them the $18,200 offer from another Honda dealership. How could they? Well, there are multiple, competing car appraisal sites: I used Kelly Blue Book, they used Carfax; the Carfax value was just $17,000, so the salesman gave us the ol' "I don't know how that dealership was able to offer you more, but [we have the car you want and you drove all this way, so] this is all we can do."

After initial negotiations, and after I stepped out to call the used car dealership for a lower price, we had the following options before us (prices are out-of-pocket, after trade-in):

• Used car dealership: Prologue Touring (fancy) for $7,100
• Honda dealership: Prologue EX (basic) $7,500 (lol)

After several trips to speak with his manager, the salesman finally agreed to $6,000, and we bought the EX. Three hours total spent at the dealership, plus two hours of travel, and all the time we spent researching and shopping elsewhere.

(You might wonder: how could the salesman offer us more for a lower trim? He initially tried to scare us away from used car dealerships, insisting that a lower trim car with the official Honda seal of approval deserves to cost more. Carfax kind of puts this tactic to shame; neither car had an accident history and both had extensive service histories.)

Bonus: You're Bound to Dealerships

We wanted an adapter so we can charge our Prologue at any station, just in case. Honda sells them on their website, but you must select a dealership to buy and ship it to you. And guess what? The price varies widely by dealership. It starts at $225 before selecting a dealer.

The closest dealer wanted $506 for it--before shipping. Thankfully I got the random idea to try a different dealership to check if the price would drop; it did. Another dealer not much further away wanted $283, then we found $225 from a Philly dealer. Sucks that we had to know to shop around for the base price.

Funnily enough, when I called the dealership that wanted $506, they said they only charge $225 if you pick it up.

For the above reasons and more, I don't enjoy encountering dealerships. I would like to minimize my contact with them. Unfortunately, I let them charge me $800 to handle registration and tax filings for me. I probably saved myself headaches, but was it worth $800? Hmm. (If only vehicle registration and tax filing weren't such headaches in the first place).

Lessons

I'm not an expert. I'm no good at negotiation. I don't know if I still got screwed or not. But these are my recommendations if you're buying a car.

First, obviously, always have outside options. We already had a car, so we didn't really need to buy another. And I already secured a good offer for my car, so I could throw it in the face of the other dealers.

Second, shop online. You'll get a better starting price.

Third, bring snacks. Negotiation is tough and dealerships only stock stale bagels and gruel coffee.

Fourth, ask about every fee. One was an extended warranty (no, thank you). Another was a "Loss Prevention" fee: if my car got stolen within two years, the dealership would give me $2,500 to buy from them again, and I pay $500 now for that improbable privilege. Salesmen include these fees by default in their offer.

Finally, contact your state legislators and ask them to check dealerships' market power.

Dealership Money In Politics

You cannot buy a car directly from a manufacturer. You must go through a dealer. For a while, NJ gave Tesla--and for some reason no other car company--an exemption from this rule. After Elon started destroying the country, my representatives to the NJ state legislature pushed to end Tesla's exemption.

I asked my reps: how about ending this exemption for all car companies, or at least all EVs? That way, both Tesla and dealers face stiffer competition and are much more constrained in the shenanigans they can pull. Dealers would have to prove their value-add instead of being the only way to buy a car.

One of my reps disagreed:

The New Jersey Coalition of Automotive Retailers (NJ CAR) is a 501(c)(6) nonprofit trade association that "promotes public policies that ensure a fair and competitive marketplace" by lobbying in Trenton and donating to political candidates through their CAR PAC. They were 8th among the "Top Ten Special Interest Spenders in 2024" according to the NJ Election Law Enforcement Commission's (ELEC) newsletter (available here), throwing $505,035 toward lobbying that year.

In total, CAR PAC donates more to Democrats than Republicans, probably because there are more elected Dems in NJ. But it looks like last year they bet big that Republicans would sweep the Assembly, donating $40,000 to a group named Assembly Republican Victory, over thirteen times more than their next-largest donation that year, and the 4th largest donation to ASV. Mikie Sherrill would win the governship despite expectations, and Dems easily held the Assembly. Oops!

Assemblywoman Heather Simmons of LD-3 (including Gloucester and Salem counties) is a proud recipient of dealership money. They gave her $2,000 in 2023, and already $750 toward her uncompetitive 2027 primary campaign.

The list of NJ legislators taking dealership money goes on, including Assembly Speaker Craig Coughlin. If your rep accepts dealership money, ask them nicely why they oppose affordability by promoting dealership interests. Dealerships restrict competition through franchise laws (bans on direct-to-consumer sales) and gut us with discretionary (read: predatory) interest rate markups. NJ allows both.

A 2023 NBER study found that, because dealers can charge higher interest rates on top of what the lenders they work with offer, 78.5% of auto loans made through dealerships are marked up: "for consumers that pay their loans as scheduled loan markups cost $647 at the median and $1,655 at the 90th percentile." Recent backlash against supermarkets switching to e-reader price tags demonstrates that people really hate the idea of price discrimination, so why do we allow car dealerships to do it to us? (Especially since, so far, it seems supermarkets don't actually do it, but car dealers definitely do!)

Industry lobbyists insist that franchise laws improve competition, but I don't see how restricting the number of competitors in the market does that. Dealerships just don't want to compete with manufacturers. NJ has two paths: we could follow California and Florida by allowing all EV manufacturers to sell directly to consumers, or we could ban direct-to-consumer sales entirely, as Assemblywoman Heather Simmons and her District 3 colleagues want on behalf of their big donor.

It would be a huge political lift to end franchise laws for gas cars, but I'm fine with leaving those in place. Ending dealership's monopoly on EV sales would make gas cars even less attractive. Win-win.

Despite all of the above, I'm not anti-dealership in the abstract. I use official Honda dealers for service and parts, though lately I'm reconsidering. Rather, I want dealerships to prove their worth, to compete on a level playing field, because right now they wield too much power over us, both at the negotiating table and in Trenton.