Unless you’re the sort of person who finishes up their holiday shopping even before the first Black Friday ads show up on television, you’re likely racing around trying to figure out what to get for your loved ones. Maybe for yourself.
Perhaps a new car is on somebody’s wish list but you’re wondering whether it makes sense to buy one this time of year. Well, if you can swing the down payment it just might be. Historical data – and recent comments by industry executives – suggest that December is traditionally a good time to buy and this year may yield some especially attractive deals.
“This will be the highest discount period,” contends Jesse Toprak, chief auto analyst for the data tracking firm TrueCar.com.
Spring is generally the strongest selling season of the year, buyers often deciding to trade in after watching the old jalopy cough and sputter through the cold. Autumn brings the traditional start of the new model-year, many buyers racing to showrooms to get the newest and hottest products.
There are, however, a number of reasons why December is a great month for those who can swing a deal on top of the rest of their Christmas and Chanukah shopping. For one thing, most shoppers are focused on other matters, whether a necktie for dad, some perfume for mom, or toys for the tots. Showrooms can be downright lonely places this time of year but dealers still have their own bills to meet – and gifts to buy – so they’re often in a mood to do what it takes to get you to buy.
This past year has been a good one for the auto industry. “The U.S. is one of the few places where the industry is making money,” notes Steve Cannon, the CEO of Mercedes-Benz U.S. After years of recession, the industry sharply cut back production capacity and with demand rebounding faster than expected there’s been less pressure to offer incentives than has historically been the case following a deep recession.
Overall, rebates and other givebacks have been falling in recent months, though that can vary, model-by-model.
Like your local dealer, manufacturers have bills to pay and factories to keep running, so they’re often in a mood to make potential buyers happy when demand might otherwise be low.
Watch TV and you’ll be barraged with ads for the various holiday specials. Regional marketing managers just might be hoping to meet their quotas. Brands might be locked into a race to see who can declare the biggest sales or market share.
You’ll find some particularly sweet deals on pickup trucks right now, General Motors President Mark Reuss admitting the maker “missed” market trends in November and wound up with a surfeit of unsold Chevrolet Silverado and GMC Sierra pickups that it wants to clear out before the New Year.
And it’s not alone. In some cases, an automaker will advertise more aggressive incentives and there are plenty ways to check those out online. In other instances, however, a company like GM or Toyota will set quotas and encourage dealers to meet them by dangling an extra $500 or $1,000 per vehicle. The dealer can pocket that money or use a little to sweeten and close more deals.
Some data indicate the best days to buy are December 10, 24, 27, 28, 29, 30 and 31st, at least according to TrueCar’s analysis of past trends – seven of the 10 best days of the year, it says, measured in terms of the money you’ll save compared to list price.
But smart shoppers can improve their odds just about any day in December. There are numerous websites, such as TrueCar and KellyBlueBook, that provide pricing information. Don’t be surprised if seemingly fixed numbers, even MSRP, or the Manufacturer’s Suggested Retail Price, don’t always agree. And take so-called “invoice” prices with the proverbial grain of salt. What the deal actually pays is usually a fair bit less, says TrueCar CEO Scott Painter, because of so-called “holdbacks” and other discounts.
You’re likely to get your best deals on discontinued and leftover models, as well as vehicles such as those GM pickups that haven’t been selling as well as expected and are in over-supply.
Some experts have suggested buyers get their best deals when they’re grumpy, perhaps because sales people think the customer is more likely to walk if they don’t come up with a good deal. It certainly helps not to be overly enthusiastic and signal you’re ready to buy no matter what.
TrueCar’s Painter also stresses that while you always want to get a good price, demanding the rock-bottom number isn’t always the best deal in the long-run. A smart shopper may be willing to pay a bit more for a dealer they can trust, one that has a good reputation, the right hours, perhaps a loaner program for when your car is in the shop.
But do your homework and December just might land the car of your dreams under the tree.