Special Reports

Employee discount programs offered by the Big Three American automakers have been extended through September allowing bargain shoppers more time to buy 2005 models at record low prices. In some cases, 2006 models are included in the program.

GM was the first to announce that its popular "Employee Discount for Everyone" program will be extended through September 30. The "Ford Family Plan" and the Chrysler "Employee Pricing Plus" program were both extended through October 3.

Introduced in June by GM, the employee discount programs have brought a record surge of buyers into showrooms. Ford and Chrysler introduced their own versions of the employee discount program in July.

While consumers were pleased that the discount programs were extended, some cautioned that inventories have been depleted and that buyers will have difficulty finding the car of their choice.

Shoppers can visit the auto manufacturers' Web sites and learn how much to pay for a car before visiting the dealership. In the past, pricing information was restricted by dealers. To find out the lowest price for a car, buyers would have to negotiate, sometimes for hours and engage in tactics such as threatening to walk out.

Pricing information for the different plans is available at the following sites:
GM's Employee Discount for Everyone
Ford Family Plan
Chrysler's Employee Pricing Plus
Jeep
Dodge

Experts have said it is questionable whether the programs now being offered actually constitute an unprecedented savings. Some believe that these prices could have been previously available to informed shoppers or aggressive negotiators. However, the boost in sales clearly shows that many buyers have welcomed one-price shopping for cars. Knowing the price ahead of time gives the buyer a sense of security and has led to increased traffic in the showroom.

Edmunds.com editors have crunched the manufacturer's advertised prices under these saving plans to see how much of a discount is actually being offered. GM and Ford are offering their cars at 2.6 to 2.9 percent under invoice. Chrysler's cars are consistently priced at 3 percent under invoice. In addition, rebates are still available on some models. Some rebates have been increased on 2006 models when GM extended its program. Rebates are always deducted from the discounted price of the car.

Under these programs, dealers are selling the cars at cost and giving up the "holdback" money. The holdback is typically 2 or 3 percentage of either the MSRP or invoice price of the car paid to the dealer after the vehicle was sold. Even before these discount programs, dealers occasionally gave up the holdback to make a sale. Instead, they tried to make a profit from the sale of related items such as extended warranties or additional services such as fabric protection or alarms.

The Chrysler discount program does not include the popular Chrysler 300 sedan, the Dodge Magnum wagon or the new Dodge Charger. The Dodge Viper sports car and vehicles from Chrysler's SRT performance line are also excluded. Other cars exempt from the discount program include the Chevrolet Corvette, Dodge Sprinter, Ford Escape Hybrid, Ford E-450 and F-450-750, Ford GT, Ford Mustang, Hummer H1, Jeep Liberty Diesel and Pontiac GTO.

On the other hand, some car lines are now discounted for the very first time. Saturn, the first to offer the "no dicker sticker" pricing system, is now several thousand dollars cheaper. The premium automaker Saab, often commanding close to sticker pricing, is included in GM's program and offering bargains to buyers of the Swedish-designed models.

Here is our list of tips to help you take full advantage of these discount programs:

• Research all aspects of the transaction before going to the dealership.
  
  
• Print out prices from the manufacturer's Web site and Edmunds.com and bring the printouts with you.
  
  
• Decide how you will finance the vehicle ahead of time: purchase, lease or pay cash.
  
  
• Check your credit or get preapproved financing before you go to the dealership.
  
  
• Make sure you know about any additional rebates being offered on the vehicle you want to buy. Rebates are deducted from the negotiated price.
  
  
• If you want to try to negotiate below the employee discount, do this by getting comparative quotes from competing dealerships through the Internet.
  
  
• Steer clear of additional products and services offered in the finance and insurance office when you sign the contract.
  
  
• The price of your trade-in is still negotiable. Don't assume that you're getting such a good deal on the new car that the trade-in price doesn't matter.