Top-Rated Car Dealerships in Dunedin

Updated 23 August 2024

Summary:

MoneyHub Founder Christopher Walsh offers 15 must-know tips to consider when buying a new or used car:

For a $5,000 - $10,000 budget, reliability is key: The best advice for a tight budget is to go for a car with a strong reputation for reliability, like a Toyota Corolla, which are known for their longevity and low maintenance costs.
Consider trade-ins from larger dealerships: Major dealerships like Toyota and Nissan often trade in cars that aren’t up to their retail standards. Instead of immediately sending them to auction or a smaller used car yard, you can sometimes purchase them directly for a good deal before they’re offloaded.
Get a pre-purchase inspection: If you’re serious about a car, ask the seller if you can take it to a mechanic or VTNZ for an inspection. If they agree, it’s a positive sign the car is in good condition. If they resist or make excuses, it’s often a red flag to walk away.
Know the market value and be prepared: Doing research ahead of time is crucial. Compare similar cars at different dealerships, and if you find a better deal elsewhere, use that information in your negotiations. Even differences like colour or minor features can become bargaining chips.
Use competition to your advantage: Some buyers have success by getting multiple dealerships to compete for their business. Sending out an email with your budget and car requirements to several dealerships and asking for their best offers can lead to competitive pricing, even it seems like an unusual approach.
Haggling works if you’re ready to commit: Successful negotiation usually happens when you’re ready to buy on the spot. If you make an offer lower than the asking price and are prepared to buy after a successful test drive and inspection, dealerships may offer discounts or add perks.
Remember, car prices are negotiable: Don’t be shy about haggling. A 5% to 10% discount is often achievable, and dealerships can add value through extras like servicing, accessories, or extended warranties.
Negotiate for added perks: Even if you can’t get a big discount on the sticker price, you can still ask for extras like a fresh service, new tyres, or an extended warranty to sweeten the deal. Things like tow bars, roof racks, or additional features can often be added at no extra cost if you bring them up during negotiations.
Cash offers can give you leverage: Buyers willing to pay cash on the spot often have more negotiating power. Taking the time to scope out multiple dealerships before committing can also help you identify those more willing to work with you.
Mention other options to get the best deal: Letting the dealership know you’re considering similar vehicles at other locations can create urgency, leading them to offer discounts or extra perks like free servicing to close the deal.

Christopher Walsh
MoneyHub Founder

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Buying from a Dealer - What you Need to Know

1) Buying a used car from a dealer gives you protection, but you may pay more compared to a private seller

Dealers will check cars over before selling them, and often offer warranties for used cars. A private seller will offer no such warranty. If something goes wrong and you’ve bought it from a dealer, you'll have options such as a refund, repair or replacement to fixed the problem.
A private seller won't be able to help you, and you'll have to deal with the problem on your own.

2) You should still get a pre-purchase inspection even if the dealers says the car is AA Appraised cars

Many car dealers will advertise themselves as “AA Appraised”. This means that the appraisal is a "dealer-only" inspection – it’s a small, basic cosmetic check to let the dealer know the condition of the vehicle before putting it for sale in the yard.
This “AA Appraisal” is not enough, in most circumstances, to provide any confidence in the condition of the car.
Furthermore, the check performed does not give any indication of the vehicle’s components. As such, we recommend getting a pre-purchase inspection. The only information validated will be the odometer.

3) Most dealers are honest - but you need to research to find them

You can check that the trader, individual or company is registered at the Motor Vehicles Trading Registrar. Under the Motor Vehicle Sales Act (MVSA) all car dealers must be registered.
Beyond this, Google is a big help – online reviews and the Facebook page of the dealer will make you aware of any red flags (i.e. angry customers complaining). We also recommend asking friends and family for recommendations – buying a new car is an exciting but uncertain time and people will be willing to share their own experiences of dealers.

4) Ask relevant questions about a used car's history to minimise the risks
Many New Zealanders get anxious when we don’t know what to ask, but don’t want to miss anything either. A car dealer is (probably) not out to cheat you nor will it force you to buy a lemon. But, to be sure, it helps to know what to ask and to trust your instincts if you feel the vehicle and/or dealer isn’t for you. To give you the most confidence, we’ve created a list of questions to ask.

Questions to ask:

Can I see the last WOF report?
Who was the previous owner?
What is the service history?
Are there any faults with the car, i.e. features or parts not working (radio, aircon etc.)
Has it been involved in any crashes or accidents?
What is included in the price?
How many KMs has it done, and can you prove it’s real?
What warranty is included, and what does it cover?

Remember: If you feel something isn’t right, you’re being pushed into buying or the situation feels one-sided, you are totally free to walk away. You know yourself the best, so trust your instincts. There will be other cars and dealers to visit next. 5) Understand when and what protection Trade Me offers

Car purchases are not protected on Trade Me unless the seller is a dealer.
Trade Me is a popular place to find a car. But don’t think that because it’s listed online you have more rights. Private selling is the same whether you see a car on online or advertised at your corner dairy.
Despite Trade Me claiming you can take your trader to the Motor Vehicle Disputes Tribunal, unless the seller is a dealer, this tribunal is only for people who have bought a vehicle from a registered trader.

Understanding the Most Common Car Sales Tactics

During the initial and ongoing negotiation process, you will likely encounter at least one of the most common sales tactics. We explain each of them alongside the most effective way to respond so you can anticipate their arrival and respond confidently.

1. Profiling (if you're relying on Car Finance to pay for the car)

One of the first questions a salesperson will ask you is how much you want to spend per month. If you're paying cash for the car, this question is irrelevant. However, if you're getting car finance, it's a strategic question.
Beyond the potential for conscious or subconscious gender bias, sales staff are trained to profile you with their first few questions. Asking you what you want to spend per month isn't the same as asking how much you want to spend on your new car.
Your financing can be spread out between 2 years and five years. So, this question is designed to determine the highest possible sale at the longest possible terms. The longer your loan terms, the more you spend on interest - a bad situation.
Your Response: "I'm here for a test drive. Tomorrow, I'll return and talk numbers".
You can expect pushback, but stand your ground.

2. Urgent Sales Deadline

One of the most common high-pressure tactics is offering you an exclusive "today-only" deal. This might be an advertised deal or one the salesperson offers up "just for you". The urgent sales deadline may be offered early on or only once you mention leaving to take some time to consider your options - but don't fall for it.
Take all the time you need to consider your options. If you return for the car, you can use the "today-only" offer as a very strong price negotiation tool.
Your Response: "I understand that I may not be able to access the same price if I walk away today, but I'm okay with that" or "Are you telling me you can't sell me the car if I return tomorrow?"

3. Wear You Down

Some salespeople rely on a negotiation tactic designed to exhaust you. They will bombard you with upsells, try to push other cars on you or employ countless stall tactics. The objective is to confuse or wear you down to the point that you just want to get things over.
If this is your salesperson's strategy, it might be best to walk away. You could ask for a different salesperson, return in a few days, or find a dealer whose tactics aren't so exasperating.
Your Response: "Let me think it over, and I'll return in a few days".
This response will surprise them, as they don't want to lose your sale. Once you say you're leaving, you must commit. If you stay after you tell them you're leaving, the salesperson will believe they're the one in control. The purchasing power is yours.
If you return, they'll be more open to listening and negotiating, knowing you have the power to leave (as you have demonstrated below).

4. The Hard and Fast Close

This sales tactic will consist of a shower of compelling offers. For example, "If I can get your monthly payment down to $X, can we sign today?" Or maybe, "If I throw in the X, Y, and Z you mentioned for free, will you buy today?"
This tactic distracts your attention from the item you're trying to negotiate.
Your Response: Simply say "no" and return to the item you were negotiating. If they keep offering "special deals", state that you're shopping around at a few different dealerships to find the best offer. Then, return to the item you're negotiating.

5. Pros and Cons List

This sales tactic entails the salesperson creating a list of pros and cons for why you should buy today. As you know the pros and cons, this is a bold move, and it's not for the salesperson to create a list.
Your Response: "Thank you, but I have my own list of pros and cons". Then, return to your negotiation.

6. Lot-Only Options

Also known as the alternative close, the best salespeople sell what they have on the lot today--not what has to be ordered. This is a top reason (beyond a higher price point) to persuade you away from the car you've already researched. It might be as simple as a different colour car or upgrades that add thousands of dollars to the initial purchase price—maybe even an entirely different car.
This tactic can be difficult to resist as it comes with pressure. However, you have the power.
Your Response: Remain relaxed, leisurely, and noncommittal. Stick to the topic at hand. "I've clearly outlined the make, model, and features I need, and that car doesn't fit my criteria."

7. Ask My Manager

This tactic's only objective is to make you anxious, but it's theatre, and you have all the power. 'Ask My Manager' is typically employed once you're seated and in negotiation. The salesperson will feign that they need to ask their manager's permission to consider what you're trying to negotiate.
This might be on price or to stall when you request to see the line items.
Your Response: Don't sweat because they're just stalling. This tactic is designed to make you change your mind. You're making a major purchase and have every right to negotiate price and terms, review line items, and decline line items.
Remember, it is your money and your decision about whether you buy the car, not theirs.

A MoneyHub reader from Wellington shares some must-know tips:

Check the Odometer: Ensure the odometer reading on the Sale and Purchase agreement matches the car's actual odometer - they don't always align.
Key Functionality: Verify the functionality of all keys provided - they need to be 100% functioning.
Ask for Two Keys: Make sure to request two keys at purchase - this way you'll avoid the cost of getting another key later on.

Car Dealership Finance vs Bank and Specialist Lender Car Loans

Know this first:

Many car dealerships offering financing deals on-charge car buyers 'brokerage' and 'introductory' fees.
These fees are often buried in the finance paperwork, which can be hard to find given the excitement and priority of buying a car.
Many car dealers also offer Mechanical Breakdown Insurance (MBI) and/or Guaranteed Asset Protection Insurance (GAP), both are policies we have reservations about and always make a car loan more expensive.
As this Stuff.co.nz article reported in 2020, if you contact the third party lender directly, you'll save these fees (which can be as high as $1,000 in total, and more by the time you've paid interest on them). If the car dealership adds a 'margin' to the interest rate, even 1% or 2% p.a., this can significantly add up on a $10,000 loan over 3 or 5 years.
Be aware: It's not uncommon for car dealerships to have an affiliation with an insurance company and finance company. The dealership earns a commission when you sign up to their 'deal'. They may also offer 'mechanical breakdown insurance', which sounds responsible in principal but can be grossly overpriced.
We believe that for some second-hand cars, there's more money in selling car finance than the car by itself - the commissions and fees can add up while the car's sticker price remains the same. This almost always makes the buyer worse off.
You always have two main options when financing a car – dealership financing and a car loan from a specialised lender or bank. Both options have the same outcome – you pay interest on a loan, but how you get the loan and what you pay differs, and the savings from avoiding the traps can be significant.

Our view is simple:

Before visiting any car dealer, consider arranging financing first via a specialist lender or a bank. Lenders will assess your affordability and pre-approve you, so you know exactly what your budget is before you go car hunting. Car loan brokers position the best offers whereas banks or car dealerships will give you one offer - and it may not be close to the best.
If you prefer to work with the dealer directly to arrange finance, keep in mind that every fee is negotiable and you will, almost certainly, pay more than you would have you dealt with the underlying lender directly. There is one exception - deals and discounted financing offered by a manufacturer.
Examples include Toyota Finance, Mazda Finance (various offers) and Honda Finance, among others. Such offers still, in most cases, charge fees, including an 'Establishment Fee' and ongoing monthly 'Administration Fee'. You can see an example of these fees below:

If your car is brand new, it will be a while before you need anything other than an oil change. The tips below will help you obtain fair pricing when you require more expensive maintenance and repairs.

1. Know That Manufacturers Always Cost More

If you go to a brand-name repair shop, such as Toyota, your repairs and maintenance will likely cost more. This is because brand-name repair shops use original equipment manufacturer (OEM) parts rather than generic parts.
They're also likely to charge more per hour for repairs, given their premium positioning. If you have a luxury vehicle, your parts will usually cost more.

2. Ask For Referrals

If you won't be going to a brand-named repair shop, ask friends and family for referrals from shops they trust. Don't just ask for the name of a shop; also ask for the mechanic's name. Be sure to let the mechanic know who referred you, as this will encourage a good impression. Our list of mechanics in Auckland is one example of a guide that has further options, with Hamilton, Tauranga, Lower Hutt, Wellington, Christchurch and Dunedin also covered.

Important:

With or without a referral, check consumer reviews about mechanics online.
Don't just look at the star rating - read the reviews to assess listening skills, quality of repairs, and integrity.

3. Check Prices Online

If you know what maintenance or repairs you require beforehand, search online for an estimate. If you aren't sure what repairs you require, check the price range online after you receive your estimate.

4. Request a Detailed Estimate

You might not need an estimate for standard maintenance, such as a tune-up, but feel free to ask for a detailed estimate for more extensive services and repairs. This will ensure you understand the price for parts and labour.

5. Ask Questions

A mechanic who works with integrity is always available to answer your questions. Feel free to ask:
What does the repair entail?
If there are any alternatives?
The likelihood of the estimate increasing?
How long will the repair take?
About their part and service warranty?

6. Obtain Multiple Quotes

Cheaper isn't always better, but don't hesitate to shop around. If you see a big difference in the price of parts, it may be the difference between OEM and generic parts. The biggest price difference is likely to be in labour costs.

7. Stick With Who You Trust

Once you find a mechanic you know you can trust, stick with them.

Top-Rated Car Dealerships in Dunedin

MoneyHub Founder Christopher Walsh offers 15 must-know tips to consider when buying a new or used car:

Buying from a Dealer - What you Need to Know

Understanding the Most Common Car Sales Tactics

Car Dealership Finance vs Bank and Specialist Lender Car Loans

Top-Rated Car Dealerships in Dunedin

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After Buying a Car – Next Steps and Must-Know Facts

Frequently Asked Questions

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