Take a look at the automotive market today. New car inventory is still low, and customers paying over MSRP has become the norm. Buyers are looking for any trick they can use to score a competitive price. Among the classic tips floating around is the idea that there’s a certain time on the calendar when car dealers will be hungry to bargain. Sadly, that advice is totally outdated and irrelevant in today’s market. In 2022, the “best” time to buy a new car has less to do with the calendar and more to do with your own timing and flexibility.
This U.S. News article from 2020 has been making the rounds, promising to alert buyers to the best moment to make an offer on various types of vehicles throughout the year. The article makes four key claims:
- Avoid buying cars in the spring — that’s when most folks want a new car for the summer.
- August is the best time to buy a non-luxury “leftover” model.
- December is the time to buy a luxury vehicle.
- The week between Christmas and New Year’s is the time for great deals.
Back in 2020, when inventory was plentiful and dealers were more apt to compete against each other to earn a sale, those tips were helpful. But in the current market, the assumptions behind some of these “hacks” no longer hold water. Let’s explain why, one by one.
Outdated Tip #1: Avoid Buying Cars in the Spring
The running theme that connects these tips has to do with supply and demand — and how those forces worked in a previous, more normal version of the new-car market. The reasoning behind Tip #1 is the idea that, in springtime, sales are high, and dealers are less “desperate” to move inventory, and therefore won’t be likely to budge on pricing.
In the thousands of deals I’ve done, I have not found shopping in the spring to be noticeably more expensive.
That being said, almost everything is more expensive in this market. But that doesn’t mean buyers can expect to save money by shopping at the end of summer or in the depths of winter.
Outdated Tip #2: Buy a “Leftover” Model in August
The classic argument for late summer and early fall shopping had to do with scoring a deal on a “leftover” model. In 2020 and before, dealers often had a healthy stock of current-model-year cars on the lot as new-model-year inventory started arriving. A savvy dealer would want to clear out the old stock to make room for the new.
As you can imagine, this advice doesn’t apply in 2022. Today, dealers struggle to get their usual inventory numbers, and a car is often sold before it even lands on the lot. There aren’t any “leftovers” to clear out.
Outdated Tip #3: Shop in December for a Luxury Deal / Outdated Tip #4: Shop During the Winter Holidays
The advice for finding “deals” at the end of the month/quarter/year is based on how dealers are rewarded for hitting sales goals. Before the COVID pandemic disrupted the car market, new-car dealers were expected to hit certain sales goals set by the manufacturers. Shops that met or exceeded these goals were rewarded.
Prior to the inventory mess, if you were shopping for a certain car in December and a dealer was close to hitting its goal for the month and/or year, the sales staff might be willing to take a loss on the individual transaction in order to nab the automaker’s end-of-year bonus. Yes, the bonuses can be that big.
You see the problem today. The factories are sending smaller numbers of cars to dealers, and in many cases, the automakers haven’t adjusted their bonus goals to reflect this. If a dealer needs to sell 100 cars a month to get the automaker’s bonus money, but the factory is only sending them 40 cars a month right now, the showroom has no way of getting that bonus.
So it doesn’t matter if you hit them up on the last day of the month, quarter or year. The store needs to rely on the profit from each individual unit; they’re not likely to take a loss on your transaction. Furthermore, if that dealer only gets 40 cars this month, but still has nearly 100 customers hungry to buy, there’s not much motivation for them to cut you a deal.
Buyers need to reframe this idea of “timing” a car purchase. In today’s new-car market, finding a fair price is less about the calendar and more about planning ahead. As I’ve said before, the best time to buy is when you’re ready, but you can wait if you need to. If you’re thinking about an upgrade, but your current car is still running fine, keep up with the maintenance on your current vehicle — you probably won’t be able to replace your ride with the snap of your fingers if it breaks down on you.
I have encountered a number of dealers willing to sell cars at competitive prices, but in most cases, it’s a process that requires a lot of patience: You could wait for months before the car you want becomes available. This whole concept of hitting the dealer at the “right time” isn’t really applicable today, when dealers have little motivation to bargain and the likelihood of them having the car you really want could be low.
Tom McParland is a contributing writer for Jalopnik and runs AutomatchConsulting.com. He takes the hassle out of buying or leasing a car. Got a car buying question? Send it to Tom@AutomatchConsulting.com
#Time #Buy #Car #Longer #Exists