Edmunds: Car shoppers face bigger discounts than usual this Memorial Day Weekend
As shelter-in-place orders are eased and dealerships across the country begin to reopen, experts say Memorial Day presents an opportunity for the auto industry to capture some deferred demand.
SANTA MONICA, Calif., May 20, 2020 /PRNewswire/ — Consumers in a position to purchase a new car can look forward to bigger bargains than usual this Memorial Day weekend, according to the car shopping experts at Edmunds.
Edmunds’ experts say that prior model year selldown efforts were severely affected by the coronavirus pandemic: Edmunds data shows that 1 out of 10 new vehicles on dealer lots in May were 2019 model year vehicles, which means that shoppers can find more clearance vehicles to choose from this holiday weekend compared to years past.
Car-buying platform Edmunds.com serves nearly 20 million visitors each month. With Edmunds.com Price Promise(R), shoppers can buy smarter with instant, upfront prices for cars and trucks currently for sale at over 10,000 dealer franchises across the U.S.
Edmunds analysts also note that since this is the first big holiday shopping event since the outbreak of coronavirus, and it’s happening as states begin to ease up on shelter-in-place restrictions, Memorial Day weekend presents a good opportunity for automakers and dealers to attract buyers after bleak sales numbers for the industry in April.
“We’re seeing far more generous incentives and deals out there than we typically would for Memorial Day weekend, and since more consumers might be looking at vehicles for summer road trips instead of airline travel, things might look up a bit for the industry,” said Jessica Caldwell, Edmunds’ executive director of insights. “We’re optimistic that sales could improve after the record lows we saw in April, but there’s still a layer of uncertainty around whether consumers will really show up en masse to shop given the severe effect that the pandemic has had on personal finances and the economy.”
Edmunds’ experts say that some of the best deals on new vehicles this holiday weekend will likely be found on trucks and SUVs. Edmunds data reveals that for 2019 model year vehicles sitting on dealer lots right now, full-size trucks are seeing an average discount of 17%, midsize SUVs are seeing an average discount of 14.4%, and subcompact SUVs an average discount of 16.3% compared to the manufacturer’s suggested retail price (MSRP). For 2020 model year vehicles currently on dealer lots, full-size truck list prices are seeing an average discount of 13.4%, midsize SUVs a discount of 11%, and subcompact SUVs a discount of 13.5% compared to the MSRP.
To help car shoppers who are looking to take advantage of Memorial Day sales, Edmunds experts created an insider guide on how to research and buy a car safely from home:
Do your research online: Edmunds’ car reviews and best-of lists can help you decide which model you want to buy.
Establish your budget and shop around for financing: If you’re planning on financing your vehicle, use a loan calculator to determine your monthly payment estimate and start shopping around to get preapproved for a car loan. Edmunds also has its own online car shopping solution for consumers to start their next purchase from home and determine their monthly payments before talking to dealers.
Get your trade-in appraisal: If you have a trade-in, get it appraised online so you have a trade-in amount for comparison when you start reaching out to dealerships.
Get price quotes from different dealerships: Review ads carefully and start talking with dealerships online to get a few different price quotes. Be sure to look at all aspects of the deal, including the interest rate, finance terms, any added fees and the “out-the-door price.”
Locate your car: Check out your local dealership’s inventory online to determine if they have your vehicle in stock. Due to the pandemic and shutdowns, some selections might be limited in terms of options and colors.
Request a contactless test drive: Call, text or email the dealership to ask if they’re offering contactless test drives. Many are willing to drive vehicles to local shoppers’ homes for test drives while following social distancing measures such as wearing masks and sanitizing the vehicle fully before and after test drives.
See what paperwork can be completed online, and whether home delivery is an option: The final step in the buying process is signing the paperwork and taking delivery of the vehicle. Many dealers allow both to be conducted from your home. Submitting paperwork in advance reduces the amount of time the salesperson needs to be at your house for final signatures, and an at-home vehicle delivery helps limit time spent at the dealership.
“If you know you’re in a financially stable enough position to purchase a new vehicle, and you aren’t super picky, now is a really good time to consider buying. Safety is obviously top of mind in the current situation, but the great news is that the entire car buying process can essentially be completed online and from the comfort of your own home,” said Ivan Drury, Edmunds’ senior manager of insights. “If you have your heart set on more specific vehicle features, options or colors, you might want to turn your attention to 2020 model year vehicles. The discounts won’t be as steep, but there will be far more of a selection to choose from.”
For more automotive research and insights, visit the Edmunds Industry Center here: https://www.edmunds.com/industry/insights/.
Edmunds guides car shoppers online from research to purchase. With in-depth reviews of every new vehicle, shopping tips from an in-house team of experts, plus a wealth of consumer and automotive market insights, Edmunds helps millions of shoppers each month select, price and buy a car with confidence. Regarded as one of America’s best workplaces by Fortune and Great Place to Work, Edmunds is based in Santa Monica, California, and has a satellite office in Detroit, Michigan. Follow us on Twitter, Facebook and Instagram.