When Is The Best Time To Buy A New Car?
No matter how great your car is or how long you’ve had it, nearly every driver reaches a point where it’s time to start looking for something new. In 2013 alone consumers in the United States purchased more than 15 million new automobiles, meaning almost 5 percent of the population either replaced or supplemented their existing vehicles with new ones.
With so many sales, and the constant demand in the US for transportation, it can sometimes be tough to locate the best value you can on a new vehicle. Automobile retailers are often loathe to give too great of a discount on models, and are typically playing from an advantage with customers who really need a new car. Knowing all this, any savvy consumer can take steps to guarantee they receive the best possible deal they can when purchasing a new vehicle.
Step 1: Plan Ahead
The first and most obvious step in preparing to purchase a new vehicle is to plan ahead for what you want. Despite how simple this sounds, it is often one of the biggest mistakes a consumer will make when buying a new car.
First of all, never wait until the last minute to replace your current vehicle. Keep a watchful eye on your vehicle’s condition and your own feelings about how well you like or dislike it, and start planning to replace your vehicle weeks, if not months, before you believe you will actually do so.
Second, be sure to consider whether a new vehicle is the right choice for you. Purchasing pre-owned can often be significantly cheaper than purchasing a brand new vehicle, and has the advantage of having much less of a timing bias on price. The downside of purchasing pre-owned as opposed to new is that you will be buying a vehicle that will often times already have a significant amount of wear and tear. In addition, new vehicles come with manufacturer’s warranties and, many times, a supplementary dealer warranty on quality and reliability, both are harder to purchase on a used car. Here is a posting I wrote on the best used cars under $5000.
Next, research what it is you want in a new vehicle. This includes not just what model or models you are interested in, but also what features you would like to see in the unit you purchase. Knowing what features and model you want when going into a dealership gives you extra leverage when dealing with salespeople and can help you to prevent extra costs due to the inclusion of features you don’t need or don’t want.
Once you’ve decided what dealers you will shop, try to find what you can on other consumers’ experiences with them. Have several locations in mind to visit, and be prepared to go to every last one of them before settling on a location to purchase from. Many times presenting a competing offer from another dealership can help you negotiate a better price, giving you yet another advantage when negotiating with salespeople.
Now you can start planning the “when” of your shopping trip.
Step 2: Timing Is Everything
Here is where planning ahead proves its greatest worth: letting you choose the time when you go into the dealerships to negotiate price.
Prospective buyers should always keep more than just a dealership’s profits in mind when negotiating a price on a new vehicle. By picking the right time consumers can take advantage of sales quotas to help drive the price on their new vehicle down.
When considering when to purchase a new vehicle, consider the month and season. Shopping for a new vehicle early in the year is typically considered a bad move, since this is the time of year when dealerships are actually expecting consumers to arrive to purchase new models. With the current year’s models still fresh on the sales floor and the summer months all coming up, dealerships see a lot of sales during the first four to six months of the year, giving them a lot of leverage when dealing with customers to keep the price high. Tax returns are most often given out this time of year, a situation dealerships are familiar with. Dealers expect customers who come in during this time of the year to have a fairly high level of disposable income in comparison to the rest of the year, and will often negotiate their prices based on this expectation, making it harder for cash strapped or money-conscious buyers to get a great deal.
Instead, focus your search for a new vehicle during the last half or, even better, last quarter of the year. This period lends itself to an opposite effect for dealerships than the first half: instead of consumers having extra money to spend and gearing up for summertime, many people are instead settling in for the holiday season and harsher winter months. On top of that, if you have settled on a model from the current production year, new year models typically start becoming available in September, leaving many dealerships with a large amount of stock that is no longer the latest of its type, giving them an incentive to sell their older models to allow sales space for the newest ones.
There is one other reason to focus on buying a vehicle in the last quarter of the year as well, and that is year-end quotas. Many dealerships will purchase vehicles for their lots based on an expected number of sales over the course of a year, and as the year wanes many times you can grab deals from dealerships as they strive to reach their year-end quota as quickly as possible. Also of note is that many dealership salespeople receive bonuses at the end of the year based on sales, giving the staff of the dealership incentive to cut you a deal and move every vehicle they can as well. Many dealers will have year-end sales on the previous year’s models to try and move as much inventory as they can, giving buyers a great starting point from which to whittle down their price even further, though the number of customers who show up for such sales can adversely impact your ability to barter a discount as well.
In addition to focusing on the end of the year, it is also often suggested that buyers in search of a great deal on a new vehicle search near the end of the month for many of the same reasons. Though monthly incentives for dealerships and salespeople are much less than those for the whole year, they can still impact the end price of your dream vehicle, and when you are looking at units that can have prices in excess of 40 thousand dollars, a thousand here or there can make a massive difference in long-term costs when financing, or especially when buying outright.
Focusing your shopping near the end of the month and year is a simple enough task and likely to lend itself to the largest percentage of any savings you might find when shopping for your dream vehicle, but there are other environmental factors you can take into account as well that, while more minor, can still have an impact on your final price.
Like with the year- and month-end advantages, you can also get some bartering advantage by timing your purchase near the end of the week, or even the end of the business day. Rather than playing into the business’ bottom financial line, focusing on these periods will instead give you a psychological advantage against salespeople you encounter. By the end of business hours many employees will be tired and ready to finish their day. Aiming for this time period with your purchase can be tricky, since you will want to check for features you desire ahead of time, otherwise you will likely get on the bad side of a salesperson’s personality, which could hurt your discount. If you do know exactly what you are looking to get, however, there is always the possibility that your salesperson will be more inclined to cut you a better deal in order to ring up a sale.
This might also apply to the end of the week. As the weekend rolls around many salespeople will be gearing up for their own free time, and if you time your purchase close to their time off for the weekend they may offer you a better deal than normal simply to speed their way out the door.
Another way to steer a dealership’s sales staff toward offering you a better deal is to take advantage of sales slumps or even inclement weather. The less busy a dealership is when you stop in the more likely they will be to want to make a sale, and the same goes for purchasing during poor weather conditions: sales are unlikely during snowy or rainy weather, so if you can get out and make your purchase during such conditions you can potentially increase any savings you might have otherwise made.
Step 3: Watch For Exceptions
Careful watch of conditions can help to make sure you pick the absolute best time to buy a car. If you choose to wait for the end of the year to do your vehicle shopping you can often find yourself strapped for choice as dealers will have sold most of their stock, making it a bit of a gamble if there is a make or model you really want. Sales are a good alternative to watch out for in these cases, but the influx of customers that come with them can, in turn, hurt your ability to haggle for any discounts beyond those tied to the sale.
Likewise, shopping for a used vehicle, or even a “new” vehicle more than a model year or two old, can change the landscape when it comes to haggling down your price. Many dealerships that specialize in new vehicles will have a handful of models that fit these criteria on their lot and will often be more ready to cut a deal to sell you the car and bring in up-to-date stock, giving the savvy consumer a good foothold to argue down their price well below what would typically be paid. Finding such a deal is far from predictable, however, and it is unlikely that you will be able to shop for a particular make or model as efficiently by relying on them. Scouring used car dealerships can yield good results even for newer vehicles on occasion, but used vehicles have their own disadvantages one needs to watch out for.
In the end, shopping for a new vehicle will take a lot of planning of the when and where to shop for your next car, truck, or SUV, from time of year to how busy they are, even down to the weather, and they can all make a difference in your purchase price. It can be difficult and confusing to plan, but if you mind your Ps and Qs, you can locate and buy just the right car for just the right price.
One last step. Call your local, independent insurance agent Insurance Plus Agencies Inc. 740-992-6677 for their advice on makes and models that are costly to insure.
They also provide Lease & Loan GAP with your policy - that will save you a bunch.