New Car Deals Remain Strong

New Car Deals Remain Strong
  • Opening Intro -

    Like many consumers, you may think that the best deals on new cars are offered at the end of the calendar year.

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After all, ads touting big discounts through various “winter sales events,” “December to Remember” deals and “Hyundai Holiday” sales extravaganzas urge you to do your new car shopping before everyone sings, “Auld Lang Syne.” The truth is this: these sales do not offer discounts you won’t be able to find at other times of the year.

New car deals are not limited to Christmas.

Indeed, data compiled by Edmunds – an important automotive portal – reveals that for January 2011 new car incentives remained flat compared to December 2010, demonstrating that the push to get customers to showrooms is not exclusive to the year coming to an end. What these Christmas time ads do suggest is that each manufacturer wants to increase its market share, making it seem to consumers that the best time to buy a car is just before the new year dawns.

January Incentives

For January 2011, new car incentives averaged $2,530 per vehicle sold, down just $8 from December 2010, according to Edmunds.[1] The biggest incentives appear to be offered by the domestic manufacturers with GM averaging $3,762 per sale. Indeed, the average Cadillac sold in January was discounted by $5,641, reflected in the brand’s monthly sales which shot up by 49 percent over January 2010.[2]

Toyota, Honda and Nissan are also discounting their vehicles or offering low-rate financing. Nissan averaged $2,231 per vehicle sold, the highest among the Japanese big three. Toyota, which has battled perceptions of quality problems over the past year or more, has been discounting too. Come President’s Day weekend, Toyota will be stepping up its incentives, by offering zero percent financing for 60 months on most Toyota brand models reports Ward’s Auto.[3] For America’s perennial sales leader, the Toyota Camry, additional down payment assistance and loyalty discounts will be made available, deals expected to be extended to some other models.

Discount Sampler

Some of the deals offered as February 2011 include $4,000 discounts on the 2011 Buick Lucerne with an additional $1,000 customer loyalty cash. Chrysler is offering zero percent financing for 72 months on all 2010 models. Ford is offering discounts or low-rate financing on most 2010 models with discounts available on select 2011 models.

Foreign manufacturers are also offering discounts with Saab taking $7,000 off of the sticker price for the 2011 9-3 convertible. Saab discounting is the most generous, with the Swedish automaker averaging $8,124 for vehicles sold in January 2011.

Financing or Rebate

For consumers looking to save money, paying cash will give you the best leverage. Since most of us cannot plunk down $25,000 or more for a new car, the next best option is to put down at least 20 percent or more toward that purchase.[4]

Another way to save money is to arrange your own financing, now averaging 6.21 percent, and taking the manufacturer’s cash. Clearly, this is where you’ll want to break out the calculator to determine if the low rate offered by your credit union paired with the manufacturer’s cash is better than zero percent or other discounted financing offered by your dealer. Hundreds of dollars in financing costs may be at stake here, so make sure you compare the numbers to find the deal that is best for you. Our partner site, SayLending.com, offers various auto loan calculators and a shopping sheet to help you choose what is best for you.

References

[1] Edmunds: Edmunds.com Reports True Cost of IncentivesSM: Car Bargains Didn’t End in December

[2] GM: Cadillac U.S. sales surge 49 percent in January

[3] Ward’s Auto: Toyota Launching Q1 Incentive, Ad Campaign

[4] USA Today: Bankrate: Avg. Car Loan Rate of 6.21% Lowest in Decades

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Categories: Autos Express