Automobile Dealers are Singing a Different Tune
Authors Preface:
[Automobile dealers are singing a different tune all right. Enjoy the music, even hold hands and sing along, but keep an eye out for the wounded Tiger behind the pot plant. They may appear wounded, but they can still put up a good fight. You will need a whip and a chair.]
On the heels of the automotive industry debacle and the subsequent payout of $350 billion of taxpayer money to keep them in business, the fallout has traveled quickly down the line. To date, the only winners in this deal seemed to be the corporate executives. The auto manufacturer line workers still fear losing their jobs, through reorganization and downsizing, while automobile dealers around the country have been put on hold, waiting to see when they might be reimbursed for promotional rebates and such from the auto manufacturers. The automobile dealers have been squeezed, between the proverbial rock and hard place.
Everywhere you look, in newspapers and TV ads, you now see automobile dealers offering clearance sales, with huge discounts, low down payments and interest rates you haven’t seen in many moons. Many automobile dealers have simply closed down, unable to weather the auto-unfriendly economy. Consumers have put the brakes on their spending and news reports indicate that potential buyers are unwilling to purchase a vehicle from an auto maker who might be bankrupt in a matter of months.
The truth is that the automobile dealers who have so far managed to hang in there, are holding huge inventories of 2008 models, which threaten to become an albatross, come March, when taxes must be paid on inventory. So they have more than enough incentive to sell these vehicles, quickly.
You may never know your best deal or how low they will go. You can bet their first offer, though chock full of discounts and throw-away add-ons like undercoating, fabric seal and paint sealant, will not be their best. Negotiating a car deal is no different than it ever was. Don’t let your expectations or the heat of the moment think that your are about to kill this wounded Tiger. How to deal for a new car is covered in the page on “Tips on Buying a New Car and How to Negotiate with the New Car Dealership”.
Just a few short months ago, TV ads for automobiles and trucks weren’t offering the average consumer much of a reason to buy. Prices were only nominally discounted, with the ads mainly extolling the virtues of a slick body style, GPS and other add-on gadgetry which could be yours for upwards of $20,000. All of the ads carried the usual fine print disclaimers, which couldn’t be read with your reading glasses in a single viewing. O.A.C. (on approved credit) was what did catch your eye. With the bank credit situation already in play, everyone knew that unless they had perfect credit, they didn’t stand a chance of getting a loan.
Presumably, this line of ads didn’t produce results for the automobile dealers. Which is why we’re now hearing a different tune. Now, prices are being slashed dramatically, with rebates offered on top of the low-as-you-can-go pricing. As for financing, the automobile dealers must have worked something out with the banks, because the current crop of ads include ‘financing available at low rates’ right in the narrative. You still can’t read the fine print, but buying a car does seem to be a bit more doable and attractive.
Could it be that we’re getting closer to the right time to buy? Is your old clunker driving you crazy? Or should you hold out just a little bit longer and see if some yet better deals are in the pipeline?
Buying a new car is a weighty decision these days. No matter how the automobile dealer packages his deal, until the economy shows signs of stability and individual consumers have a more solid take on their personal financial situations, the auto market remains a buyer’s market.
Is it time to grab a potentially good deal now? How low can they go? I’d say, “Now is the Time”. I think they will start to come back real soon.