to move a vehicle, ask the following questions: When will a new body style be introduced? Are you offering special incentives to clear out inventory on any particular models?
“Shopping against the season is also a great time to buy,” states Philip Reed, consumer advice editor for Edmunds.com. For instance, in the winter months in the Northeast, a dealer may be willing to significantly discount convertibles from several hundred to several thousand dollars due to a decreased demand for the vehicle.
“Anytime an automaker is offering a rebate on a vehicle, this probably means the vehicle is not selling quickly or the dealers are probably overstocked,” says Reed. Events that affect the economy, such as 9-11 or a hurricane, can also affect the automotive industry. “Shortly after Hurricane Katrina, gas prices rose and demand for full-sized SUVs declined,” says Libby.
As gas prices rose, so did the average incentive on trucks and SUVs: from $3,126 and $2,628, respectively, in October 2005 to $3,567 and $3,050 in November 2005. If you can afford to fill up the tank of a large SUV or full-sized truck, you may want to consider taking advantage of the deals many automakers will offer as long as gas prices are hovering around $3 a gallon. Some automakers and dealers may also offer free gas cards to help offset the high gas prices.
TIMING IS EVERYTHING
The end of the month or the end of year can be a great time to maximize savings. Waiting for the right time of the month paid off for Malvene Townsend, a 73-year-old retired public school teacher for Milwaukee Public Schools, who decided to buy a new Honda Accord LX in February and donate her 1995 Buick Skylark to a local agency that helps troubled teens. After shopping around and consulting with a close family friend in the auto industry, she decided to wait until the end of the month before making her move.
Initially, Townsend wavered between buying the newly redesigned Honda Civic or the Honda Accord. Because of the popularity and limited supply of Civics in Milwaukee, dealers were only willing to discount the vehicle $500. The dealers in the area had a greater supply of Accords, and therefore, were willing to offer her $2,000 off of the sticker price. (Note: It’s rare that Honda offers rebates on its vehicles since the discount structures on many of its cars are significantly less than some of the other automakers. Instead, Honda dealers may offer special financing or other incentives to remain competitive.)
If an automaker is running below its targeted sales goal, incentives such as low-interest financing, special lease rates, free gas, and deferred payments may be offered to stimulate sales. According to Darryl Ford, owner and general manager of Stone Mountain Chrysler-Jeep-Dodge in Stone Mountain, Georgia, “Manufacturer-imposed quotas and urgent advertising themes help to drive traffic at the end of the month. If I am a couple of cars away from meeting my objective, I’ll make some great deals.” In addition, Honda and