If you're looking for a new Chrysler, Dodge or Jeep, this just might be your weekend.
Chrysler dealers who will lose their right to sell new cars as early as Tuesday need to unload the remaining cars and trucks on their lot or face getting stuck with them.
Chrysler, which has filed for bankruptcy protection, has told 789 dealerships they'll no longer have a contract to sell new cars after next week.
Those with cars still on the lot will not be able to take advantage of manufacturers incentives like rebates, which will make selling them uncompetitive with other dealers.
Car dealers in that position expect a very busy weekend as customers seek deep discounts, knowing that the dealers are in a bind.
"We're obviously drastically discounting the vehicles," said Jerry Lande, new car sales manager for Des Moines Chrysler. "We have lots of inventory and we expect a big weekend."
Customers shouldn't expect ridiculous deals, though.
Some dealers have reported customers calling expecting half off or $10,000 off. Lande said he has had a few such calls.
"Clearly we get some of that, but that's not realistic," he said.
The dealership, which sells only Chrysler models will sell only used cars after next week.
It had 140 Chryslers still on the lot on Friday after selling 70 in 12 days, the result of a liquidation sale announced when Chrysler said it was one of the dealers to be cut.
So, if you're in the market for a Chrysler, what can you expect?
With the understanding that prices and incentives vary from market to market, here's an example of a realistic deal you might be able to negotiate this weekend.
Say you were interested in a $30,000 Chrysler Town and Country minivan, a popular family vehicle these days. Buyers may be able to negotiate as much as $6,000 off the price, said Jeremy Anwyl, chief executive of Edmunds.com, a Web site that provides detailed auto information for consumers.
A manufacturer's sticker price of around $30,000 would give you a minivan with a few nice options like a DVD player, running boards and flexible seats. It should be noted that you should rarely pay a manufacturer's suggested price unless it's a very popular or hard to get model.
In this example, the dealer invoice — the price the dealer pays the manufacturer for the car — would be about $28,000.
Incentives you could capture vary. Chrysler is offering buyers $1,500 cash back on the minivan.
Buyers can get another $1,000 if they currently own a Chrysler, a reward for brand loyalty. By financing through a credit union, you could get another $500 off and members of the military get another $500 credit.
The dealer also likely received as much as $2,000 cash from Chrysler to use in any way they want. You could reasonably expect the dealer to give you a fair share of that off the price as well.
Here are a few tips to keep in mind if you're thinking about Chrysler shopping this weekend:
- Find a dealer in your area that's on the discontinued list. The list is part of the bankruptcy filing available here.
- Call the dealer before you leave to make sure it has the models you're looking for. The selection is likely very limited for reasons I'll explain in a moment.
- Look up incentives for the models you're interested in on the Internet. Chrysler lists them on its Web site by ZIP code, the dealer's Web site likely does, too. So does Edmunds.com.
- If you're looking to trade in, make sure you know the car's value, which also is available on several Web sites. Many customers frequently think they're getting a good deal but don't get as much out of their trade as they should, Anwyl said.
Chrysler has been tracking the cars left at discontinued dealers. When the company announced it would shutter the dealerships, there were 42,000 cars on those lots. As of Friday, 26,000 remained.
If they are not sold, all but 1,981 will be transferred to other dealers, said spokeswoman Kathy Graham.
Some dealers say they would lose money if they transfer the cars under the Chrysler plan.
The bottom line is dealers have much more of a financial incentive to sell to a customer than to transfer it to another dealer. That means a good deal for you.
"There are opportunities for consumers out there, Graham said. "There's not going to be a fire sale or like a retail store's 70 percent off clothing thing because they don't have a big motivation to sell at a big loss."
Wade Walker, who owns Walker Motor Inc. in Montpelier, Vt., is mad at Chrysler and said he's tempted to throw a burlap bag over the Jeep sign that stands in front of his dealership. He wants nothing more to do with the company that he says hasn't been very helpful to the dealers it's terminating.
Walker sold the final seven Jeeps he had to another dealer and lost a couple of thousand dollars, he said.
He began selling off inventory in January when he it appeared to him that Chrysler might be in trouble.
Jeep made up about a quarter of his business.
"It hit hard," he said of Chrysler's decision to terminate his contract. "I'm just waiting anxiously for them to come and take their sign away."
Initially, dealers were given until Tuesday to sell the inventory but that may be delayed by a few days since the 2nd U.S. Circuit Court of Appeals is hearing a challenge to Chrysler's bankruptcy restructuring plan.
The Auburn Hills, Mich.-based company is planning on selling the bulk of its assets to a group led by Italy's Fiat and emerge from bankruptcy protection.
Late Tuesday, the appeals court halted the sale pending the appeal by a trio of Indiana state pension and construction funds, which say the deal unfairly favors the interests of the company's unsecured stakeholders ahead of those of secured debtholders such as themselves.
One last piece of advice if you look this weekend. If you go to one of these dealers don't assume you're getting a great deal. Be prepared to negotiate while remaining realistic about a fair price.
Anwyl, the Edmunds executive, said an odd phenomenon has developed since Chrysler announced it was filing for bankruptcy protection. The average price of their vehicles crept up slightly.
The reason is consumers are assuming they're getting a really good deal because of the bankruptcy when they actually could do better, he said.
"The temptation is to rush in and think 'oh my goodness this is a once-in-a-lifetime deal,' " he said. "In some cases it is, but that doesn't mean you're going to get it automatically."
His advice: do you homework before you leave the house.