Tuesday 26 November 2019

Should You Buy a Car Over The Holidays? Will You Save Money?

  • Should you buy a car over the holidays? We wanted to see what the data said.
  • Black Friday and other holiday deals are common among both new and used cars.
  • Here are some of the best deals plus a few points of advice before you start shopping.

Buying a new vehicle is one of the most expensive decisions we can make. According to Cox Automotive, the average payment on a new vehicle exceeded $530 last year, or about 10 percent of the median household income. In May, Kelley Blue Book noted the average transaction price for a new vehicle was $37,185, up four percent from May 2018. These figures may not necessarily be surprising, as everything from health insurance to smartphones are increasing in price today.

Should You Buy a Car Over The Holidays? Truth Versus Hype

This time of year, we see advertisements about big factory rebates and incentives, and how we can save hundreds, perhaps even thousands. Yet, is there any truth to this? Do we really get a better deal over the holidays?

“The months of November and December are historically a popular time to purchase a new vehicle due to available cash and financing incentives,” explained David Sloan, General Manager of the Chicago Auto Show. “Automakers offer some of their best lease deals and financing incentives around the holiday months.”

“Historical evidence from the likes of J.D. Power and Motor Intelligence indicate that holiday months and, in some cases, holiday weeks, see higher incentives on average,” added Kelsey Mays, Senior Consumer Affairs Editor, Cars.com. “With Thanksgiving hitting later in the month this year, car shoppers are well positioned to get a great deal on a new car.”

Should you buy a car over the holidays?
Should you buy a car over the holidays? We examine the data to find out.

Best Black Friday Car Deals

Based on data from Cars.com:

  • Chevrolet is offering nearly 20% off the list price for many 2019 models, including the Bolt EV, Cruze, Impala, Malibu, and Silverado 1500 double cab. Qualified buyers can get 0% financing for 72 months plus up to $3,250 off, depending on the vehicle.
  • Hyundai is advertising $2,750 in cash discounts for select 2019 Sonata trims. Qualified buyers can choose 0% financing for 60 months. The 2019 Tucson has rebates as high as $2,750 for certain trims. Shoppers who skip the cash discount can get $500 plus 0% financing for 72 months.
  • Jeep is offering up to $5,300 off on select trims of the 2019 Compass depending on a shopper’s location. Qualified buyers can choose 0% financing for 36 months and receive up to $3,500 off. The 2019 Renegade comes with up to $6,200 in savings, depending on the trim level and region. Qualified buyers can get 0% financing for 36 months plus up to $3,500 off select trims of the Renegade, again depending on the region.
  • Kia is advertising the 2019 Sorento with discounts up to $6,000 for specially-tagged models and trim levels. Qualified buyers can take 0% financing for 66 months in lieu of the cash discount.
  • Nissan is offering discounts of up to $3,500 on the 2019 Rogue Sport, depending on the region. Qualified buyers can get 0% financing for 60 months and an additional $1000 off.

“Factory-advertised incentives are available to all dealers, so consumers should arm themselves with such information and shop several dealers to secure competitive offers,” Mays said. “For consumers, so much of the search involves finding the car that actually qualifies for the advertised incentive.”

Should you buy a car over the holidays?
2019 Kia Sorento. Photo: Kia Motors America. 

Best Black Friday Car Deals

Based on data from U.S. News & World Report:

  • 2019 Chevy Bolt: 20% below MSRP.
  • 2019 Chevy Camaro: 0% financing for 60 months plus $750 cash back.
  • 2019 Honda Civic: $189 per month lease for 36 months ($2,199 due at signing).
  • 2020 Hyundai Elantra: 0% financing for 72 months.
  • 2019 Hyundai Ioniq EV: $109 per month lease for 36 months ($2,500 due at signing).
  • 2019 Kia Stinger: 0% financing for 66 months and up to $2,000 cash back.
  • 2019 Subaru Outback: 0% financing (limited term).
  • 2019 Toyota Camry: 0% financing for 60 months.

“Black Friday deals aren’t just at big box stores,” said Jamie Page Deaton, Executive Editor of U.S. News Best Cars. “Automakers are rolling out some major discounts to power the final sales push toward the end of the year, and shoppers can save big.”

What About Used Vehicles?

Car search engine iSeeCars.com finds November and December are good times to buy a pre-owned vehicle. After analyzing over 40 million used car sales, iSeeCars.com compared months of the year and days of the week to determine whether consumers would find more or fewer deals. In their methodology, iSeeCars.com defines a deal as a savings of five percent or more.

“October through November is the height of new car buying season, which means there is a high volume of trade-ins and off-lease vehicles entering the used car marketplace,” explained Phong Ly, CEO of iSeeCars.com. “Used car deals can be found year-round if consumers are patient and if they do their research. However, deals tend to be more abundant late in the year during the holiday season.”

Should you buy a car over the holidays?
“October through November is the height of new car buying season, which means there is a high volume of trade-ins and off-lease vehicles entering the used car marketplace,” explained Phong Ly, CEO of iSeeCars.com.

When Is a Good Time To Buy An Used Car?

Based on data from iSeeCars.com:

  1. Black Friday: 33.1% more deals.
  2. Veterans Day: 32.5% more deals.
  3. Columbus Day: 30.5% more deals.
  4. Martin Luther King Day: 29.4% more deals.
  5. Christmas Eve: 28.7% more deals.
  6. Month of November: 26.9% more deals.
  7. Month of December: 23.5% more deals.
  8. Christmas Eve: 21.3% more deals.

Corresponding data from iSeeCars.com finds the first day of the month and the end of the month are the best times to buy. Consumers average 8.5 percent better on the first, and only slightly lower (5.6 percent) at the end of the month. “The dealership’s sales month usually ends a few days into the beginning of the next calendar month,” Ly said. “So sales made on the first of the month, for example, get tallied into the previous month’s sales.”

Shopping Locally Has Advantages

Local dealerships may be running their own sales and promotions in addition to what an automaker is advertising. According to Cars.com, as of November 12th, nearly half of all new vehicles listed on their site were from the outgoing model year, three percentage points higher than a year ago. “Inventory levels are relatively normal, but dealers are sitting on a bit more supply of the outgoing model year than usual,” Mays said.

The extra inventory may work to a buyer’s advantage over the holidays. Sloan says dealers are competing for consumer dollars and shoppers could walk away with a win, regardless of what vehicle they are looking for. “Local dealers offer a wide selection of vehicles within a huge price spectrum,” he explained. “This ensures consumers will be able to not only find a vehicle that fits their needs, but also one that fits their budget.”

Should you buy a car over the holidays?

Advice For Buying a Car

Always: Consider The Whole Deal

One common mistake is getting too preoccupied with either the price of the vehicle, or what is offered for the trade-in. The best way, especially when shopping between dealers, is to compare the trade difference. That is, the price of the new vehicle with tax, title, license, and fees, minus any applicable rebates and incentives and the value of the trade-in.

“Regardless of the incentive, consumers should fixate on the prospective car’s out-the-door price, including all taxes and fees. There’s a temptation to shop by monthly payment instead of vehicle price, but such amounts can be manipulated considerably by loan terms,” Mays said. “Consumers should secure third-party financing beforehand to ensure the dealer offers competitive terms, then focus negotiations with the dealer on the out-the-door price.”

Never: Fall In Love

Even if it’s a dream car and everything looks perfect, remain calm and collected. Never show too much excitement and be willing to walk. “There are some deals that might be too good to be true,” Ly said. “And when purchasing something used, you should get the vehicle’s history and have it inspected by a trusted mechanic.”

Always: Ask Lots of Questions

At reputable dealerships, the staff members are an immense resource. Some employees are even master certified by manufacturer, meaning they have successfully completed classes and tests that cover the automaker’s product line, customer service, and general vehicle knowledge.

“New cars are computers on wheels with all kinds of technology to make them safer, cleaner, and perform better,” Sloan said. “Dealership salespeople play an integral role making sure their customers know how to use the technology before they leave.”

Not sure about a particular dealership? Cars.com offers this dealership and salespeople review tool.

Never: Be Afraid To Wait

Ask for the final price in writing after all negotiations are finished and take 24 hours to think it over. At the end of that 24 hours, if for whatever reason, it’s just not the right time don’t feel bad. There will always be another good deal somewhere down the road, and new factory incentives will show up again in the future.

Not In The Market Yet? Attend An Auto Show

Consider attending a nearby auto show before you make a final decision on a new car. In addition to researching online, auto shows are a great place to learn about new vehicles. Larger events like the Chicago Auto Show feature nearly 1,000 different new vehicles with manufacturer-sponsored test drive opportunities. The test drives let attendees get behind the wheel of a multitude of new vehicles for no obligation. Automakers like FCA, Ford, GM, and Kia even set up ride-and-drive events at smaller regional auto shows. Those waiting a little longer to buy a new car will find auto shows are a great place to do more research.

“Many attendees report appreciating the low-pressure environment where they can gather information at their leisure from trained automotive product specialists with no strings attached,” Sloan explained. “Plus, by visiting the various displays, shoppers can learn about which vehicles will have rebates, new-car incentives, and ‘auto show bonus cash’ deals immediately following the show.”

The Automoblog staff covers automotive industry news, trends, and technology along with new vehicle releases. Automoblog is owned and operated by Gearhead Media LLC., based in Detroit, Michigan and Berlin, Germany. 



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