Haggling 101: How to Set the Opening Offer for a Used Car

Oct. 11, 2010 — -- In our story, "The Art of the Deal: How to Haggle For a Used Car," we gave you 10 strategies for suavely, serenely negotiating a good price on a used vehicle, but we didn't explain how to set your opening figure. We left it out on purpose. It's such a critical step that it deserves its own article.

We partnered with Senior Consumer Advice Editor Philip Reed of auto website Edmunds.com for our undercover experiment. Edmunds has a pricing tool that provides the framework of a smart opening offer.

CLICK HERE to see our undercover experiment.

Edmunds offers what it calls "True Market Value" or "TMV" pricing. Edmunds' TMV is the average price that consumers are currently paying for a certain type of vehicle. Car dealerships around the country report their actual selling prices to Edmunds, which then averages that raw data.

Below is the actual TMV Pricing Report for the type of Certified used Honda EXL we were looking for when we went shopping. Note that you have to enter certain factors for an accurate report. For example, 2007 is the year we were looking at. The two vehicles we made offers on each had about 40,000 miles on them. And we were shopping in the Phoenix area (prices vary regionally.)

Here's a simple way to use a TMV Pricing Report like this to decide the amount of your opening offer. Notice that there are four different pricing categories on the page.