Well, Q4 is upon us. This is what I consider to be the best time of year to purchase a car.
As you probably already know, dealerships have goals and quotas to meet. Included in this would be end-of-year goals. Making a car purchase at the end of the year could increase your chances of getting a better deal. According to iseecars.com, the months of November and December offer 26.9% and 23.5% more deals than average, respectively. If I were in the market for a new car, I would begin my search now, in October. There are deals to be had in October, and it gives more time research and compare prices. Pick 3-5 vehicles that you are interested in and compare pricing, options, rebates, promotions, etc…
In addition to quotas, another prompt for dealers to discount cars is due to overstock. The new models begin to roll out late summer and fall, and the dealer has to make room for these new cars. For instance right now, you may begin to see better deals on the 2019 models as the 2020 models are beginning to fill up the dealer lots. Pay attention if a vehicle has been redesigned for the new model, you may begin to see significant discounts on the current model, because they can appear to be less desirable. On the flip side of this, if you are in the market to lease a vehicle, you may see better lease deals on the newer model compared to the current model. Tip: Ask the dealer to show you a side by side comparison of 2019 and 2020 model lease rates. The newer model will likely have better rates due to residual value. Residual value on a lease refers to the estimated value of the lease vehicle at the end of the scheduled lease term.
If you are in the market for a preowned vehicle, there are deals to be had, they just may not be as heavily discounted compared to new vehicles. Larger dealers will begin to receive an influx of people who want to trade in their cars for the latest models and lease terms will be coming to an end. This will present an opportunity to purchase a nice preowned vehicle.
When doing your research and preparing for your car purchase, there a few things to keep in mind.
If the vehicle you want is a strong seller and in high demand, there may not be much of an incentive for a dealer to discount the price.
This may be a similar case for smaller independent used car dealers. Their profit margins may not be as large and they may not have the overstocked inventory problem to contend with to warrant heavy discounts.
The end of the year is not the only time there are good deals offered. Take advantage of holiday sales events and promotions. Christmas and New Year’s, but also Memorial Day, 4th of July, and Labor Day sales can have good discounts.
Most importantly, exercise patience. When negotiating a car purchase, be willing to walk away if you do not feel good about the deal and if isn’t right for you. Wait for the deal that you want (if it is within reason). Chances are you will not likely get a $20,000 car for $12,000. Do your research so that you know what your ideal car is selling for. Truecar.com and Cargurus.com are great resources for price comparisons.
Good luck on your car purchase journey!