S7E25: The 3 Biggest Car-Buying Mistakes—and One Simple Fix
About this episode
Ray Shevska of Car Edge breaks down why buying a car in the U.S. is so often confusing and costly, blaming opaque dealer practices, lobbying groups, and state-by-state enforcement. The conversation centers on three common mistakes: buying wants instead of needs, focusing only on monthly payments instead of total cost, and ignoring expert guidance that could prevent bad choices. They also discuss transparency trends like Amazon-style pricing, Costco programs, and Car Edge’s AI negotiating agents that generate a dealer transparency index.
In this episode, we sit down with Ray Shefska, co-founder of CarEdge, who brings decades of industry experience and deep data insights to the car-buying process. He breaks down the three most common mistakes consumers make when purchasing a new car—and shares a simple, practical solution to avoid them. We also explore how platforms like Amazon Autos are changing the game with transparent, no-haggle pricing, and what that means for today’s car buyers looking for the best deal.
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Car Edge
"[14.3s] with Ray Shevska from Car Edge. He's the co-founder. How are you, Ray?"
Car Edge is a service/company that helps people buy cars more intelligently. The host is bringing in Ray because he deals with how people should shop and what goes wrong in the process.
Car Edge is a company that helps shoppers with the car-buying process, typically focusing on pricing transparency and guidance. In this episode, Ray Shevska’s background at Car Edge sets up the discussion about common buying mistakes.
paying insurance
"[61.3s] ...I just sold it because it was just [67.2s] like here in that driveway and like taking space, paying insurance and all that kind of thing."
Insurance is a recurring cost of vehicle ownership, and it can be a reason someone chooses to sell a car they aren’t using. The host mentions paying insurance while the car sits unused, tying ownership costs to buying decisions.
using other people's money
"[78.0s] Well, I, you know, there's two things in life that I've learned that are very important, [82.9s] using other people's money and apparently driving other people's cars."
This phrase is basically saying: when you’re not using your own money, the decision can feel different. In car buying, it often connects to financing and how the deal is structured.
“Using other people's money” is a mindset about financing or leveraging someone else’s capital rather than paying fully out of pocket. In car buying, this often relates to how financing terms can change the effective cost and the buyer’s leverage during negotiations.
convertible
"[115.7s] how much is that car? It was a BMW 318i, the convertible."
A convertible is a car where you can open the roof. Mentioning “convertible” helps describe the exact version of the BMW being discussed.
A convertible is a car with a roof that can be lowered or removed. In this context, it’s part of the description of the BMW 318i the host bought, which can affect pricing, desirability, and maintenance considerations.
BMW 318i
"[110.7s] ...I went to the dealership and said, [115.7s] how much is that car? It was a BMW 318i, the convertible."
A BMW 318i is a smaller BMW model. Here it’s mentioned as the specific car the buyer bought, and it’s used to illustrate how dealership negotiations can play out.
The BMW 318i is a compact 3 Series–based model (the “i” indicates a gasoline engine). In the segment, it’s used as an example of how the buyer negotiated quickly at a dealership by offering immediate payment.
write you a check
"[123.3s] like 43 or something. And I said, what about if I write you a check right now? [128.5s] okay, 38, 500. Okay, here's the check."
Writing a check means paying right away with money from your account. The host is using it to show that the purchase went quickly because payment was immediate.
Paying by check is an example of immediate, straightforward payment that can speed up a purchase. The host uses it to show how the dealership process can be faster when the buyer offers quick payment.
car-buying process
"[146.7s] Unfortunately, buying cars [146.7s] in this country is probably one of the most troubling and broken processes that we have."
This is the whole routine of buying a car, from figuring out the price to signing paperwork. The point here is that the system often favors the dealer because they have more information than the customer.
The “car-buying process” includes how pricing, availability, and vehicle details are communicated between dealers and customers. The speaker frames it as broken because it relies on asymmetric information—dealers often know more than buyers.
franchise system
"So they went with a franchise system. And when they did that, they seated control over what the dealers could actually sell the vehicles for."
A franchise system means the car company uses local dealerships to sell its cars. The dealership can sell the cars, but the manufacturer usually sets some ground rules.
A franchise system is how many automakers sell cars through independent dealerships. The automaker grants the dealer the right to sell the brand, but typically keeps control over key rules like pricing structure and sales practices.
MSRP
"And a lot of people don't even know what that so-called MSRP is, right? Manufacturers suggested retail price."
MSRP is the sticker price the manufacturer recommends. Your final price can be higher or lower depending on the market and the dealer.
MSRP stands for Manufacturer’s Suggested Retail Price. It’s a marketing baseline, not a guarantee of what you’ll actually pay—especially when supply is tight or demand is high.
short supply
"or it could be incredibly low when when something's in short supply and there's a high demand for it."
Short supply means there aren’t many cars available. When that happens, prices tend to go up because people are fighting to buy what’s available.
Short supply refers to low inventory relative to demand, which often leads to higher prices. When a popular model is hard to find, dealers may charge above MSRP because buyers compete for limited availability.
NADA
"And do we want to revise a little bit about the NADA, the National Association Deal? No, National Automobile Dealers Association."
NADA is a group that represents car dealerships. They advocate for rules that help dealerships keep their franchise business model.
NADA is the National Automobile Dealers Association, an industry group representing franchised car dealerships. In the transcript, it’s described as working to protect dealer franchise rights and limit automakers’ ability to sell directly to consumers.
Lucid
"like Rivian does or Lucid does or Tesla does."
Lucid is a car brand mentioned as an example of selling directly to buyers. The discussion is about how that can conflict with the traditional dealership system.
Lucid is an automaker referenced here as another example of direct-to-consumer sales. The point is that manufacturers using this model can face resistance from dealer-focused organizations.
Tesla
"like Rivian does or Lucid does or Tesla does."
Tesla is mentioned because it sells cars directly to customers. That’s different from the usual dealership setup and affects how buying works.
Tesla is cited as a direct-to-consumer seller, meaning it sells cars without the traditional franchised dealer network in many places. This is central to the debate about pricing, negotiation, and dealer franchise protections.
Rivian
"they will fight tooth and nail to keep manufacturers from selling direct to consumers like Rivian does or Lucid does or Tesla does."
Rivian is a newer automaker. In this discussion, it’s mentioned because it sells cars directly to customers instead of relying on the usual dealership model.
Rivian is an automaker known for selling vehicles through a direct-to-consumer approach in many markets. The transcript uses Rivian as an example of a manufacturer that bypasses traditional dealer sales.
won some battles in some states
"apparently they have already won some battles in some states, I believe Colorado, maybe."
Different states have different rules for how car companies can sell. The transcript says some places have allowed direct sales, which changes what dealers can do.
This refers to state-level legal or regulatory outcomes that can allow or restrict direct-to-consumer sales. Because franchise laws vary by state, automakers may win in some places and still face barriers elsewhere.
dealer groups
"...the FTC's letter a few weeks ago to 97 dealer groups suggesting that perhaps they were in violation of some of the regulations, and it's time to clean it up."
Dealer groups are organizations that speak for car dealers as a group. Here, they’re mentioned because regulators sent them a warning about possible rule violations.
Dealer groups are industry organizations that represent dealerships and advocate for rules that affect how car sales are conducted. The segment describes an FTC letter to dealer groups as a signal that regulators believe some practices may violate rules.
50 countries
"Yeah, the other thing in this country, we have basically 50 countries, because every state has its own laws..."
The U.S. is made up of 50 states, and each state can have its own rules. So car-buying protections and enforcement can vary depending on where you live.
The speaker is using a rhetorical shorthand to describe the U.S. as having 50 separate sets of state laws. For car buyers, this matters because dealership advertising and consumer-protection enforcement can differ by state.
state attorney general
"...every state attorney general can determine how their office is going to work when it comes to consumer protection."
Every state has a top lawyer (the attorney general) who can help enforce consumer rules. That’s why what protects you in one state may be different in another.
Each U.S. state has its own attorney general, who can enforce consumer-protection laws and decide how their office handles complaints. The segment uses this to explain why consumer protections can vary widely from state to state.
Lindsay Auto Group
"the FTC just recently entered into an agreement with the Lindsay Auto Group, to pay up to $75 million in restitution for, well, corrupt advertising."
“Lindsay Auto Group” is referenced in connection with a legal settlement involving the FTC. The context suggests the company was accused of misleading or corrupt advertising, which is relevant to listeners because it highlights how dealer marketing can cross ethical or legal lines.
separate what they need from what they want
"the first mistake they make... consumers need to separate what they need from what they want... What they want tends to tends to really inflate the price of the vehicle."
This is a core car-buying strategy: distinguish “needs” (must-haves) from “wants” (nice-to-haves) before shopping. The speaker argues that focusing on needs typically lowers the final price, while wants can push you toward higher trims, add-ons, and more expensive options that inflate cost.
inflate the price of the vehicle
"What they want tends to tends to really inflate the price of the vehicle."
It means your total cost goes up when you add things you don’t really need. Dealers can also push upgrades or extras that make the final price higher than you expected.
“Inflate the price” refers to how adding wants—like higher trims, extra features, or optional packages—raises the transaction price. In practice, this often happens through upsells, add-ons, and dealer-installed extras that increase the out-the-door cost.
payment buyers
"And and when I say that most people in this country are payment buyers. So they're they're just interested in what their monthly payments going to be."
Some people shop by what they pay each month. That can make the car seem cheaper than it really is, because the total price and loan details matter too.
The term “payment buyers” describes shoppers who focus primarily on the monthly payment rather than the car’s total price. This can hide the real cost because dealerships can manipulate loan terms to keep the payment looking acceptable.
10% of your gross monthly earnings
"there's a rule, right, about like, what is it, 10% of your monthly income should not. That's the way we look at it. Our our suggestion is that you should you should put no more than 10% of your gross monthly earnings towards your car."
They’re suggesting a simple budget rule: don’t let car costs take up more than about 10% of your monthly income. And that includes insurance, gas, and upkeep—not just the payment.
This is a budgeting guideline: keep car-related spending to no more than about 10% of your gross monthly income. The key point is that it includes more than just the loan payment—insurance, fuel, and maintenance also count.
monthly payment instead of actually discussing the selling price
"The third mistake that the customers tend to make is they only discuss monthly payment instead of actually discussing the selling price of the car, or working a discount on the car, they get fixated on a payment."
The mistake is negotiating based on the monthly payment. It’s better to negotiate the car’s price because that’s the part you can compare directly between offers.
This is the core “mistake” being discussed: negotiating around the payment rather than the vehicle’s price. Payment-based negotiation can obscure the true cost because financing structure can be adjusted to hit a target payment.
Koreans
"So when I tell them, like, look at this brand, look at that brand. Oh, no, no, no. I, for example, I say, like, look at the Koreans,"
“Koreans” is shorthand for Korean automakers (commonly brands like Hyundai and Kia) when discussing which car to buy. The transcript uses it as an example of how recommendations can vary based on brand preferences and needs.
Hyundai
"they're like really good deals, Kia Hyundai Genesis. Oh, no, no, no, I want to know they want [865.9s] that."
Hyundai is a common car brand that often has sales or discounts. Here it’s mentioned as part of the group of brands people associate with good deals.
Hyundai is a major automaker that frequently competes on price and incentives. The episode brings it up in the context of shoppers chasing “good deals” and how dealers should communicate pricing clearly.
Genesis
"they're like really good deals, Kia Hyundai Genesis. Oh, no, no, no, I want to know they want [865.9s] that."
Genesis is a luxury car brand. The speaker is grouping it with other brands as examples of cars people think are “good deals.”
Genesis is Hyundai Motor Group’s luxury brand, positioned above Hyundai in price and features. It’s referenced as one of the brands shoppers might consider when looking for deals.
Kia
"they're like really good deals, Kia Hyundai Genesis. Oh, no, no, no, I want to know they want [865.9s] that."
Kia is a car brand that often has good promotions. The speaker is using it as an example of brands people think are offering deals.
Kia is a mainstream automaker known for offering value-focused trims and often aggressive incentives. In the context of car buying, it’s mentioned alongside other brands as an example of “good deals.”
Mazda
"Some brands Hyundai and Mazda had announced that they are going to start working [918.8s] with Amazon so you can quote unquote buy your car there."
Mazda is a car brand. In this segment, it’s mentioned because Mazda is exploring a way to sell cars with more upfront, online-style pricing.
Mazda is a mainstream automaker that, per the discussion, is among the brands exploring online car purchasing partnerships. It’s mentioned specifically in relation to Amazon-style listings and pricing transparency.
transparent price
"forcing the dealers at least through the listings on Amazon to quote a clear transparent price [950.8s] including all fees. And it's not necessarily the lowest price... But the beauty of it is, it's a [966.5s] transparent price."
A transparent price means you can see what the car costs and what fees are included before you buy. The goal is fewer surprises and less pressure at the dealership.
A transparent price means the buyer can see the selling price and itemized fees clearly before committing. The speaker argues this reduces dealer games and pressure, even if it isn’t always the absolute lowest number.
out-the-door price
"quote a clear transparent price [950.8s] including all fees... You know exactly what they're selling the car for, you know exactly what all [971.5s] their fees are."
An out-the-door price is the total you’ll pay to get the car, not just the sticker price. The speaker is saying buyers should be able to see that total up front.
An out-the-door price is the total amount you pay to drive the car home, typically including taxes, registration, and dealer fees. The segment’s emphasis on “exactly what all their fees are” is essentially the out-the-door concept.
Costco
"Yeah. And actually there's other options. I believe Costco has a pretty good program. [1010.1s] And actually the dealership that work with Costco, if they don't respect the price, they drop from [1015.8s] that program."
Costco is mentioned as having a car-buying program where the price is handled more fairly. The idea is that participating dealers have to follow the pricing rules, or they get removed.
Costco is referenced as offering a car-buying program that can provide pre-negotiated pricing through participating dealerships. The speaker claims that if a dealer doesn’t respect the agreed price, it can lose the program—creating an incentive for transparency.
price is only good if you finance through us
"Or that price is only good if you finance through us. Or that price is only good if you have a trade in."
Sometimes the “deal” price only applies if you finance the car through the dealer. If you use your own bank, the price might be higher.
This refers to conditional pricing where the advertised or quoted price applies only if you use the dealer’s financing. It’s a common tactic that can change the effective out-the-door cost depending on loan terms.
trade in
"Or that price is only good if you have a trade in. The idea behind the advertising should be the price is the price."
A trade-in is your current car being used as part of the payment for the new car. The warning here is that some “good prices” only work if you trade your car in.
A trade-in is when you apply the value of your current vehicle toward the purchase of a new one. The segment notes that some dealers make pricing conditional on having a trade-in, which can obscure the true deal.
pre-purchase homework
"So people, I mean, there's resources, do your homework, or actually no, just follow this website and they'll do the homework for you"
“Do your homework” refers to researching pricing and deal terms before buying. In this segment, it’s framed as using tools and data (like the website mentioned) to reduce the need for buyers to manually investigate every detail.
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