Whether it’s to help get a new driver on the road or a fun gift to yourself, a new vehicle is one of the more important purchases you can make in any given year. With the average price tag of a new vehicle crossing the $40,000 mark, a car purchase should come with significant research and consideration attached. And while things like make, model, cost, and paint color are important criteria for any motorist to consider, you should keep in mind one other factor before visiting a dealership: when you’ll pull the trigger on a new car.
- Dealerships want to keep cars moving off their lot, especially when certain models fall out of favor for one reason or another.
- If possible, you can save some money by waiting for certain holidays or events to make a purchase.
- Just as there are good times to buy a car, there are some times you should avoid.
Best Times to Buy a Car
So you’ve done your research, secured a down payment or a car loan, and are counting down the days until you’re breathing in that new car smell. It may seem like the perfect time to buy, but your calendar could be telling you otherwise. Though motor vehicle manufacturers constantly advertise their latest models all year long, it’s important to note that the best deals only happen on or around specific dates.
Just as there are better days to buy consumer electronics and fitness products, there are optimal times to buy a vehicle. What it really boils down to is how badly dealerships want to move their existing stock. Cars that sit on a lot represent a considerable amount of revenue loss for a dealership and can cause problems once the new models start coming in. Couple that with quarterly sales quotas and you can start mapping out the prime times to buy a new vehicle.
- End of the month/quarter. One of the most important things to keep in mind when shopping for a new vehicle is the fact that nearly every salesperson on the show floor is operating under monthly or quarterly sales goals. Those goals may come with added incentives for the sales team if met, but this also means that they may be more willing to negotiate on a vehicle’s price to secure a sale.
- End of the year. Holidays like Christmas and New Year’s Eve provide the perfect excuse to hold special year-end sales events, making it a good time to hunt for a deal. Buyers get an added leg up since December culminates with the trifecta of year-end, quarterly, and monthly sales goals. Consumers in the past have been known to land sweetheart financing options, cash-back deals, or price reductions by waiting until just before the ball drops.
- Beginning of the year for used cars. While dealerships try to end their year with a boom in new car sales, they try to do the same at the start the year with used cars. That’s largely because January and February tend to see a huge intake of used cars as buyers trade in their old rides for a new one. According to data from iSeeCars.com, the top three months with the highest percentage of used car deals are January (28.7%), February (22.1%), and December (13%).
- Major holidays and long weekends. Christmas and New Year’s aren’t the only two holidays that help dealerships move cars. Labor Day, Memorial Day, and Black Friday, other days when lots of people are off work, are used by car dealers to draw customers into showrooms. The same goes for three-day weekends when a holiday falls on a Friday or Monday.
- Early in the week. It’s important to have a salesperson’s undivided attention if you intend on negotiating. During the weekend, when dealerships tend to be busy, that may not happen. Shopping on a Monday or Tuesday gives you a good opportunity to be the only person asking questions, going on test drives, and negotiating a final price. It’s also an added bonus that since financial institutions are open during business hours, applying for a loan may be easier.
- End of a model’s life cycle or design cycle. Like most consumer goods, vehicles have an expected life cycle. Over time, manufacturers stop producing a certain model or redesign it. Once that happens, dealers are going to want to clear their inventory of the older models to make room for new ones. Sure, you won’t be getting behind the newest vehicle on the road, but you may get a good deal.
- During a model changeover. New models typically reach showrooms in early fall. At that point, dealers want to clear out as much of their inventory of the previous year’s model to make room for the new model. If you’re OK with going with the previous model, you may save money on a purchase. Depending on how well the car has sold, you might try negotiating a steep price cut.
- When the dealership is offering additional perks. Sometimes, the best time to get a car is when a dealer is offering a great promotion. Deals like cash back, leases with low monthly payments, and low or zero-cost deposits are usually offered by the manufacturers themselves.
Worst Times to Buy a Car
Just as there are great days to negotiate a deal, there are other days when you should avoid car shopping. If you can wait a while before making your purchase, the following times may be best to avoid:
- Early in a model year. If you have your eye on a brand new car before it’s even on a dealership lot, consider tempering your expectation for a deal. Dealers have less incentive to try to get freshly minted cars off the lot compared with their older inventory. Conversely, early in a new model’s year is the best time to negotiate for a leftover model, since dealers want to make room for the new vehicles arriving.
- Immediately following a new model’s launch. Manufacturers spend fortunes marketing their newest models, and that’s intended to spark demand. Deal making is unlikely, so wait or check out a prior model.
- At the start of a new month. If the end of a month is one of the best times to shop for a car, then the opposite is true about the start of the month. The beginning of the month resets a salesperson’s monthly sales goals, and they’re less likely to push their managers for leeway on a deal. You might still negotiate a better deal, but be prepared to put in work ahead of time to prove how serious you are about making a purchase.
How the Global Microchip Shortage Affects Car Sales
As the world deals with an ongoing shortage of semiconductors that may last through 2022, numerous industries are left cutting production. Since modern vehicles depend on semiconductor chips, car inventories have shrunk.
If you’re seeking a deal on a new car, the unfortunate truth is that you’re entering a market where simple supply and demand economics are working against you. Lower stock levels, mixed with higher demand, has caused a 50% increase in buyers paying more than the sticker price. The average new vehicle price in June 2021 rose 8.6% from the previous year to $42,331.
Used car prices are soaring even more, and dealerships are less inclined to cut prices. The average used vehicle price in June 2021 gained 27% to $26,457 over the previous year.
If you absolutely must shop for a new or used vehicle during this shortage, accept that you’re in a seller’s market. Dealers aren’t in a mood to bargain. You also should be leery of any dealer markups you see that raise a vehicle’s price above the manufacturer’s suggested retail price (MSRP).
If you can’t find a good deal on the car that you want, you may ultimately need to settle for a different make, different color, or different kind of vehicle entirely. You can also try to soften the blow of a higher price tag by trading in an older vehicle. Leasing can also be a great way to get behind the wheel of a new car without having to commit to the car in question. Leases tend to last two or three years, so by the time that agreement is over, this shortage may be over and you can return to hunting for the right deal.
Can you negotiate better prices during favorable buying periods?
As a consumer, it’s your prerogative to hunt down the best possible deal. When you walk into a car dealership during one of their more pressing sales periods, you have more leverage than any other time of year. If you’re comfortable with haggling a little bit and negotiating the finer details of a deal, you can likely get an even better price than originally expected.
Is there a specific time of day when you should head to the dealership?
When hunting down a new vehicle, it’s usually best to get to the dealership as early in the day as you can—and preferably during a weekday. The reason for that is twofold:
- Salespeople are generally more rested and less stressed in the morning, having not yet dealt with the rigors of face-to-face sales.
- The dealership will likely be empty, since most buyers will be at work. This can often result in a faster buying process and more direct interaction with sales.
Can your lease ever be used in a deal?
If you have a leased vehicle and you’ve been getting calls from the dealership, chances are they want to reintroduce your vehicle to their inventory as a used option for other buyers instead of waiting for your lease to end. This is called a “pull-ahead” program, which ends a lease early, adds the car to the dealership’s pre-owned inventory, and brings the consumer back into the leasing cycle.
The Bottom Line
When it comes to buying a new vehicle, do everything you can to remain in the driver’s seat. By educating yourself about the car you want and picking the best time to hunt down a deal, you put yourself in the best position to secure a great deal.