Roadshow How to buy a car from the factory and save money

While Americans have long been used to finding a car and driving it the same day, “build-to-order” is common practice in Europe, and is the method adopted by electric car manufacturers such as Tesla, Lucid, and Rivian. Now that supply chain delays have created bidding wars for vehicles landing on dealer lots, build-to-order is having a moment in the United States.

Ford is now allowing buyers to order select popular models online and have them delivered to a dealer. The company says it took 74,000 retail new-vehicle orders in November, up 64,000 from the month of the previous November.

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Most dealers also accept special orders.

“It seems to be the hot move right now,” says Matt Jones, director of corporate marketing for automotive shopping site TrueCar. “People want to get exactly what they want rather than buy what is available.”

See: Don't Be Fooled In This Car Market: 5 Mistakes To Avoid If You're Buying A Car Now

Is build-to-order cheaper? It can be

Ordering a car from the factory can also help you avoid dealer markups, says Ron Montoya, editor of the consumer advice and content strategist for automotive research site Edmunds.

Montoya's aunt was recently buying a Subaru Crosstrek and was offered a car off the lot at a local dealership for $3,000 more than the list price. Ordered one from the factory and only paid the list price. "And these days the sticker price is a good price," he notes.

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Indeed, today's market is brutal. Occasional buyers are competing against drivers who have lost their car to theft, accident or major mechanical problem. Some buyers take advantage inflated trade-in prices to make up for the thousands of dollars over MSRP they pay for a new ride.

A factory order allows both buyer and seller to breathe deeply.

For a dealer, a special order represents a guaranteed sale rather than the risk that you will find your ideal car elsewhere.

For the consumer, making to order gives you time to think things through and make smart choices. Kelley Blue Book calls ordering a custom vehicle a “smart life hack” because “it saves you the emotional process to see a car… and to want it now”.

How to place a factory order

If you have the luxury of waiting for delivery, here's how to navigate the build-to-order process.

Buyers typically order a vehicle in two ways:

Before signing anything, get these details from the dealership:

Time range: The dealership can't give you an exact delivery date, but their ordering system should be able to give you an estimate. Consider going elsewhere if the delivery date is too far off, as manufacturers assign cars to dealerships at different rates.

Changes: Clarify points of no return. With maybe months before delivery, you may change your mind about color or options. You may be able to opt out completely by a certain date.

Deposit: Typically, this is $500 to $1,000. Many dealerships won't cash the check or run the credit card number because the deposit is really "just to prove that the client has glue in the game,” says Jones. Ask what happens to your deposit if you decide to withdraw.

Documentation: Ask what documents you will receive after placing your order and how to track the arrival of your vehicle. Often dealers provide a build order sheet which lists the model, final negotiated price and delivery date estimated.

Price: Although not binding, agree the purchase price and ask that the documents you receive reflect this agreed amount. It should include the negotiated price of the car, any extras installed by the dealer on which you agree to, taxes, title and license. Ask if this is the amount you will pay when the vehicle arrives. Although rebates and incentives are rare these days, according to Jones , clarify which ones are reflected in the price and what happens if they change.

Before your vehicle arrives

Before your car lands at the dealership, be sure to track it periodically or follow up with the seller. Once you get a delivery date :

Arrange financing. Find a pre-approved car loan. You'll avoid surprises with your credit and get a rate the dealership will try to beat.

Have your trade estimated. A dealer won't give you a trade-in price until you're ready to sign papers for your new car. If you're considering a trade-in, quotes from online retailers such as Carvana can help you get the the most out of your car.

Ask about incentives. It doesn't hurt to check the manufacturer's website or ask your sales representative if any new incentives are available.

Check: 10 Best Cars of the Year

When your new vehicle arrives

Act quickly. If you have a delivery date or get a call from the dealership, ask if the car will be marked as sold and how long the dealership will hold it. Grab it as soon as you can, advises Montoya.

Inspect the car. Examine the car to make sure it is what you ordered and has not been damaged in transit.

Talk about any trades. Ask the dealership to appraise your old vehicle and show them competing offers. Keep in mind that the commercial sales tax savings can be significant.

Review the agreement with the finance office. If the agreed price is not honored, ask why. You are not obligated to buy a vehicle on new terms, just as the dealership is not obligated to honor the old ones. You can walk, or you may decide that the price difference isn't worth dropping the deal and starting the whole process over.

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