Before Pre-Ordering New Cars into the mechanics of a factory order, it’s crucial to grasp the current market dynamics. Understanding the “why” behind the shortages will inform your strategy and give you better leverage in negotiations.
The Scarcity Landscape
The primary drivers of the current low-stock environment are multifaceted. They include the global shortage of semiconductor chips (microchips), which are essential components in modern vehicles; logistics bottlenecks slowing the transport of parts and finished cars; and, critically, pent-up consumer demand. This combination has resulted in dealers receiving fewer vehicles, which means most of their stock is often already pre-sold or earmarked for customer orders before it even arrives.
Why Pre-Order is the Pre-Ordering New Cars
In a market where desirable cars are selling instantly, a pre-order offers three key advantages:
Customization: You get the exact combination of trim, color, and options you desire, without having to settle for what’s available on the lot. This avoids paying for unwanted dealer-added accessories or packages.
Price Control: By locking in the price at the time of order, you can often bypass the massive “market adjustments” or dealer markups being applied to on-lot inventory. While finding a deal under MSRP is difficult, a pre-order makes paying a fair, agreed-upon price much more likely.
Guaranteed Vehicle: You secure an allocation slot in the manufacturer’s production queue, ensuring that a car is being built specifically for you, removing the uncertainty of hoping a suitable one shows up at the dealership.
The Pre-Order Research Phase: Your Homework
The research phase is the most critical part of the process. In a high-demand environment, an informed buyer is a powerful buyer. You must know exactly what you want and what it’s truly worth.
Finalize Your Vehicle Specifications
Start by narrowing down your make, model, and the essential features. Use the manufacturer’s official “Build & Price” tool on their website.
Model and Trim: Decide on the specific trim level (e.g., base, sport, luxury) that contains the features you absolutely require.
Options and Packages: Be precise about your desired options. Low-inventory times can mean that options packages are constrained, so be prepared with a few alternatives.
Color Choices: Have a primary and secondary choice for both exterior and interior colors. This flexibility can sometimes shave weeks off your delivery timeline.
Determine Fair Pricing (Invoice vs. MSRP)
In the current environment, your goal is to pay the Manufacturer’s Suggested Retail Price (MSRP), and hopefully, nothing more.
MSRP: This is the retail price suggested by the manufacturer. This is what you should aim to pay.
Invoice Price: This is the price the dealer theoretically pays the manufacturer. In a low-inventory market, negotiating below this is nearly impossible for most models, but knowing it gives you a negotiation baseline. Third-party sites and forums can provide rough estimates.
Factory Incentives: Research any current or historical manufacturer rebates or low-interest financing offers. Get clarity on whether the agreed-upon price will honor incentives available at the time of order or at the time of delivery—the latter is usually more beneficial, as incentives can change.
Shop Multiple Dealerships for Allocation
The dealership is your conduit to the factory. They are the ones who get a limited number of build slots, known as factory allocations.
Casting a Wide Net: Contact multiple dealerships within a reasonable radius. Ask them about their specific customer order process and, crucially, their policy on dealer markups for custom orders.
The Price Commitment: Your single most important question is: “If I place a custom order, will you commit to selling it to me at MSRP, or will there be a market adjustment?” Do not proceed with a dealer who will not clearly commit to a price strategy. Many reputable dealers will agree to MSRP for an ordered car, as it’s a guaranteed, no-risk sale for them.
Executing the Factory Order
Once you’ve found a dealership and agreed on a price, it’s time to formalize the order. This requires meticulous attention to detail.
The Order Sheet and Deposit
The order sheet is the contract that details your vehicle’s exact specifications.
Verify the Build: The dealer will enter your configuration into the manufacturer’s system. Ask for a printed copy of the Vehicle Order Confirmation or Factory Build Sheet. This document ensures the factory sees exactly what you ordered. Double-check every option code, color, and package to ensure accuracy.
Deposit: A deposit is required to secure the order. This is typically a few hundred to a few thousand units of currency. Crucially, ask: Is the deposit refundable? Most refundable deposits mean you can walk away if the dealer tries to change the price or if there is an unacceptable delay. A non-refundable deposit gives the dealer more power. Always push for a fully refundable deposit.
Final Price Agreement: Get a written, signed agreement that states the maximum price you will pay, referencing the MSRP on the build sheet, and outlining any applicable incentives and the non-negotiable out-the-door price.
Securing a Price Protection Clause
Due to long lead times (which can be six to nine months or more), prices can change. The manufacturer might issue a price increase before your car is built.
The Clause: Ask the dealer to include a clause guaranteeing you price protection. This means you will pay the lower of the price agreed upon at the time of order or the MSRP at the time of delivery. This is a common and reasonable request for a factory order.
The Waiting Game and Tracking Your Build
Patience is a virtue in the pre-order process. Long wait times are the biggest downside, but staying informed can reduce stress.
Order Status and Tracking
Once the order is submitted, the manufacturer assigns an order number or VIN (Vehicle Identification Number).
Manufacturer Tracking: Some manufacturers offer online portals or apps where you can track the status of your vehicle using the order number or VIN, showing stages like “Order Submitted,” “Scheduled for Production,” “In Transit,” and “Arrived at Dealership.”
Dealer Contact: Maintain regular, but not excessive, contact with your salesperson for updates. They can often access more detailed information on production scheduling than you can online. A good cadence is once a month for an update, unless the timeline passes a major milestone (e.g., shifting from “scheduled” to “in production”).
Handling Trade-Ins and Financing
Your trade-in value and financing must be handled closer to the delivery date, as they can fluctuate.
Trade-In: Get a few written quotes for your current vehicle from various sources (online buyers, other dealers) when you place the order to get a baseline. Do not lock in a trade-in price until your new car is on the way, as its value can change dramatically over several months. Re-evaluate its value two to four weeks before delivery.
Financing Pre-Approval: Similarly, financing rates change. Get a pre-approval from your bank or credit union about 30 to 45 days before the vehicle’s estimated arrival. Having this external approval in hand provides leverage when discussing the dealer’s financing options.
Delivery and Finalizing the Purchase
The moment your vehicle arrives at the dealership, the final steps begin. This is where you must be vigilant to ensure the deal is honored as agreed.
Final Inspection and Test Drive
Do not sign any final paperwork until you have seen, inspected, and test-driven the vehicle.
Exterior and Interior Check: Verify the VIN on the car matches your paperwork. Check the paint, wheels, and interior for any signs of damage during transport.
Option Verification: Confirm that every single option, package, and color you paid for is present and functioning correctly, from the advanced driver assistance systems to the specific floor mats.
Mileage: Since you ordered the car, the odometer should have very few miles—usually under 50, reflecting only transport and pre-delivery inspection.
