By Aaron Crowe
The conventional wisdom is that the end of the year is a smart time to buy a new car because car dealers are looking to move inventory before new models arrive.
But is that always the case? Is December the best month to shop for a new car?
Some deals can be found throughout the year, especially at the end of the month when a dealer is looking to meet monthly quotas.
If you’re looking for cars for the upcoming model year, December sales may not be the best time to buy if you’re picky about colors or features. Cars from the current year, however, can be discounted, though it may require shopping a few months earlier to get the best deal.
Jason Weberman, a relationship coach, says that in October 2012 he bought a 2012 Rav4 for exactly what the dealership paid. There were plenty of choices of colors and models, Weberman says.
September to late October is particularly best because it’s when “dealerships need to clear space on their lots for the upcoming new models,” he says. “They are anxious to get rid of the previous year’s models.”
Finding deals on current year models doesn’t just happen in the fall, says LeeAnn Shattuck, who calls herself The Car Chick and helps women buy cars. Holiday shoppers are enticed with “holiday” incentives on the previous model year vehicles, though sometimes current or “new” model year cars have smaller incentives as well such as lease deals or low APRs for car loans, Shattuck says.
Such incentives can help dealers clear out inventory and “make numbers” by the end of their next fiscal year, she says, allowing them to gain marketing dollars and allocations in the next year from the manufacturer.
“But, holiday car shoppers should be careful to not get caught up in the holiday shopping frenzy and be content to pay the ‘sale price,’” she says.
“Customers who simply pay the price listed on the pretty red tag may be leaving money on the table,” says Shattuck, who recommends that they still do their homework and shop around to get the best deal.
The end of every month could be a good time to deal because auto dealership managers have quotas at the end of every month, says Mike Rabkin, president of From Car to Finish, which helps negotiate new car prices. Auto manufacturers have incentives such as rebates and special financing that expire around the turn of each month, resulting in many “sales” at the end of the month, Rabkin says.
“In recent years, new model year introductions for vehicles are increasingly taking place at any time of the calendar year, as opposed to the traditional fall season that people tend to think is the norm,” he says. “Therefore, many consumers may be surprised to find out there may be no old model year vehicles to buy in December for a ‘deal.’”
New models can be introduced at any time of the year, giving dealers incentive to push the old model out and to be aggressive in offering deals, Rabkin says.
“If the old model year is already gone, December may not be any better a time to buy a vehicle than at other times of the year,” he says.
Go to your local dealer’s website and click on the new vehicle inventory menu option, Rabkin recommends. That should give an idea if the old model year is already over, or if the dealer has plenty of inventory to get rid of while also having the new model vehicle in stock. “That’s when they really want to move the old model year’s inventory,” Rabkin says.
Another place to look is on manufacturers’ websites, which have a dealer lookup tool based on your zip code. The manufacturer will also list current model year cars for sale, indicating which cars are now “old” and may soon be on sale.
All that being said, Rabkin says auto dealers have one final incentive to move more cars in December than any other time of the year: annual quotas. They could get year-end bonuses for meeting annual goals, giving them something that even Santa Claus might not be able to give them — a year-end bonus.
Another reason to look for a car deal in December — if you live in the right area — could be lousy weather. Rainy or snowy days could keep customers home, leaving lonely car sales people without shoppers to attend to. If you catch a dealer at a slow time, they might be more likely to give you a deal.
If you do find a deal on a car in December, you might as well splurge on a huge car bow that you see in the Christmas car commercials. If you’re nice enough to give someone a car for Christmas, you’ve got to include the big bow.