Buying a Car in Germany

Buying a new or used car in Germany can be a challenge, but there's plenty of help -- if you know where to look for it.

The car-buying experience in Germany can be both exciting and daunting. It can be exciting because there is a very wide number of manufacturers to choose from. It can be daunting because car prices tend to be higher and the whole thing has to be handled in a strange language. But take heart. It is not really that much different from buying a car at home and there are special programs designed with expatriates in mind.

New or Used. Whether you buy a new or used car depends on your circumstances. How long will you be over here? How much money do you want to spend? How many kilometers do you drive? What sort of driving do you do (more autobahn than city driving)?

New cars. There are plenty of sources to help you decide what car you wish to buy, including, among others, television commercials, newspapers and auto magazines. You can usually find someone at the showroom who speaks English, and German law generally prohibits the freewheeling bargaining that is so common in other countries. So, in theory, what you see on the sticker is what you should have to pay for the car.

There are still some ways of getting the price down. Dealers sometimes give discounts for payment in cash. Some dealers register cars for a day and then immediately deregister them. This turns them into "used cars", giving flexibility in pricing. There is also room for negotiation when it comes to the "extras"; sunroof, air conditioning, sound system and other accessories. Another way to lower the cost of a new car is to make sure the dealer gives you a very good price for your trade-in.

If you don't pay cash for a new car (and not many people do) then you will have to finance it. Many manufacturers offer internal finance programs, usually at a slightly better interest rate than a bank. But it pays to check out both possibilities. Interest rates may be better with the manufacturer but the loan may have to be paid back in three years, and you probably can't expect financing for a car that is discounted in any way. Depending on the price, financing can range from 24 to 60 months. The best interest rates are offered when a 20 percent down payment is made.

Used Cars can be a good value if you shop carefully. If you buy a used car through a dealer you can normally expect some sort of guarantee. (According to the German "lemon law", dealerships must honor a one-year warranty for all used cars they sell. They are responsible for defects that are present at the time of sale but not those that result from regular wear and tear or negligence. Defects are normally determined by a third party appraiser.) Some banks and even some dealers may finance used cars, but this is not as easy as with a new cars. Factors such as mileage, age and value are involved.

Good deals can be found if you check into buying a Jahreswagen or a demo model (Vorführwagen). Employees of car manufacturers are allowed to buy cars at a discount and can resell them after keeping them a year (hence the term Jahreswagen.) Normally these cars are in quite good condition and a good value for the money. A Vorführwagen has usually been displayed in the showroom and used for test drives. It's usually in good condition and has low mileage.

If you're adventurous and want to buy a used car from a private owner, the newspapers are full of ads. The key things to look for in the ads are mileage, date of the next inspection (TÜV), date of first registration (Erstezulassung or EZ), model year, type of catalytic converter and number of owners. It is wise to observe the normal precautions when buying a used car privately. In general, though, Germans take good care of their cars and you may find what you want for a good price. It is always good to get a contract when you buy a car. There are boilerplate contracts available.

When you buy a car from a dealer, whether new or used, you can expect help in the registration and insurance areas. If you buy a car privately you will have to do these things yourself. You'll need proof of insurance and proof of ownership of the car (Kfz-Brief). You'll have to take these to the local motor vehicle department (Kfz-Zulassungstelle), and if everything is in order you'll be given your license plates.

Buying a car Online is becoming more and more popular - as well as easier. The advantages of doing this are obvious. You don't have to go to a dealership, the selection is vast and it's possible to search for a car according to a large number of different criteria. The website offers the online user the opportunity to search for cars in Germany in English.