A guide to buying a car in Japan
“Life is too short to drive boring cars”
Hi there Stylish Friends,
So you have finally decided to buy a car in Japan but do not know where to start or what to look out for. After going through the process of buying a pre-owned car myself recently, here is a guide to buying a car while living in Tokyo, Japan. It was a learning process, and I want to share tips on how to get the best deal and how to deal with the maze of everybody`s favorite Japanese bureaucracy.
So you’ve set your eyes on the car you want, what’s next?
In Japan, you need a confirmed parking spot for your car to be able to buy one. You can not just park it somewhere like most other countries allow. This means there are steps between agreeing on the purchase and receiving your car.
Searching for cars
you start of by going to websites like Goo-net, Kakaku, Carsensor to find a car you like within the price you want.
let’s say you want to buy a Toyota for around 5 million yen. after searching the web you can contact dealers to set up an appointment. and this is where the negotiation starts.
Going to the dealer: what to expect?
Set clear demands for your car, think of:
- Year built
- Mileage
- Color
- Model/type
- interior color
- first impressions
- Options
I have noticed that the Japanese second-hand market is great in terms of the mileage and conditions of the cars. There is also a significant drop in prices compared to new.
I strongly recommend going to several dealers before making your choice. Car salesmen are the same around the globe, so judge the person, rather than just going with anyone. when you have a good feeling about both the car and the dealer, the money talks can start
Buying a car: Negotiating the price
The general image of Japan is that negotiating prices is not the norm. However, this is not the case when making larger purchases like cars, electronics, houses, etc.
For reference, we ended up reducing the total price by about 500.000 JPY. Another dealer only gave us a 25.000 JPY discount, so be strong, you have more options than they do! Of course, this is not guaranteed and depends on many factors, so take it with a grain of salt.
So where can you save costs:
When you receive your initial quotation, you will see many options and charges that add up to around 200.000 yen above the price you saw online. why? because they add optional services which they, of course, strongly recommend getting.
What kind of options are there? here is a list of what options I have seen and some price tags that came along with it:
Car Cover: one dealer recommended me to buy a car cover for parking, this added 60.000 JPY
Coating: This is a protection coating that they will install to protect your car`s paint. for the cars I was looking for the prices were 85.000 and 88.000 JPY (difference per dealer)
納車前点検費用: Getting the car ready for the shaken(車検、mandatory vehicle inspection), which occurs 3 years after purchasing a new car and every 2 years afterward. The dealer said that if I did this, the car would pretty much guaranteed to pass the vehicle inspection that was coming up a couple of months later for the car we were discussing. He wanted to charge me 160.000 JPY for what basically was a fluid change service.
Number plate preference: if you pay extra, you can get your preferred license plate number. This will set you back an additional 16.500 JPY.
Number plate and parking registration service (車庫証明手続き代行費用）: This means the dealer will take care of the registration of the parking and dealing with the police. Some prices I have seen: 18.700 JPY, 19.800 JPY. I wanted to do this myself, so decided to opt out for this.
These are of course all optional, so you can tell the dealer to get rid of these first. this is the start of your negotiation.
Negotiating price
Something you have to decide before buying is; how much do I want to pay?
this is not just the price of the car, but also the monthly loan payment, and the downpayment (頭金).
I set a monthly budget that included:
Loan payment (how many months/years, interest rate, and price per month)
Parking spot
Insurance
Taxes (these are yearly)
How much extra do you want to pay during bonus season (2x a year)
With this in mind, slowly start talking about prices. ask the dealer for a discount and see how he will react. don’t say a price you want, but ask him how much he can go lower. after going up and forth, here are some things I managed to change:
Base price
Loan interest rate
get rid of options that are cheaper elsewhere/unnecessary
The loan interest rate used to be around ~1.9%, but has jumped up to ~2.9% recently. One dealer told me 3.9%, but If I decided on the spot, he could adjust it to 3.4%. They most likely get a kick-back, so negotiations are on the table for this.
Tips to be more convincing:
Don’t be too excited: it shows how much you want it, which will bite back in the negotiations
Be very picky on imperfections: things you don’t like. The more you have, the more the dealer needs to adjust his price to convince you. Think of scratches, preferred color, type (i.e. want the sport version, but this is basic), some western cars have left-hand drive, which is inconvenient in Japan, the other car you are looking at, how is the maintenance history, etc.
Good cop bad cop: bring your partner/friend if you have: convincing more than 1 person helps with forcing the dealer to cut costs.
Take your time: I was at the dealer the entire afternoon, which gave us time to connect, which led to better pricing.
Timing: buying a convertible is easier in the winter due to lower demand. Buying a car around the time of the year where their KPIs are more important can help with pricing too etc.
Shaken(車検): Check when the vehicle inspection is due, this usually costs quite a bit so you’d either want this done directly or as late as possible. if it comes soon you can argue that this is a cost post you need to save money for.
Next steps
the next steps, if you decide to arran
Other things to consider
Drive recorder: In case accidents happen, you can record the event to have proof of the situation.
ETC installation: make sure to have your ETC card system installed. This is needed for paying tolls on the Japanese highway and saves you a ton of time and effort at the toll booths.
