StreetWise Home > GM announces a “red tag” sale.

GM announces a “red tag” sale.

Remar Sutton, DCU StreetWise Spokesperson

GM has announced a new incentive program of ”red tag” prices on most 2005-2006 Buick, Chevrolet, GMC, and Pontiac models cars and light trucks. It is to run from November 13, 2005 through January 3, 2006. According to GM, you won't pay a penny more than the “red tag” price.

The question for new car buyers: “If the ’red tag‚ is the maximum price, could I pay less?” The answer is perhaps. But you won't know unless you still do your homework. There are several things you need to know.

Sales like this aren't new, and don't necessarily save you money.
Though dealers may mark down the “red tag” vehicle, they may give you less for your trade-in than they normally would, and may try to sell ’add-ons’ at higher prices than they normally will. The dealer ends up making more than they would if the vehicle weren't discounted.
The only way to buy is to negotiate up from cost, never down from ’sticker.’ We show how in the StreetWise Auto Buying Guide.

The Bottom Line: Don't automatically fall for what sounds like a deal. Do your homework. Always find out what the new car cost the dealer. Set the bargaining in your favor by bargaining from cost-you won't know if you can do better than the “red tag” price unless you try. Be aware of the other profit centers and negotiate all costs.

And for your financing, check out the rates at your credit union and get a pre-approval before shopping. Comparison shopping has proved for hundreds of members that credit union financing could save them big bucks over other financing sources.

Breaking news analysis prepared for DCU by Remar Sutton & Associates, November 2005.

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