Edmunds: Hunt for ‘deals’ will be tough for car shoppers this Labor Day weekend
Despite rising inventories, many automakers aren't promoting discounts en masse for the long holiday weekend. But Edmunds experts say bargains can be found if shoppers know where to look.
SANTA MONICA, Calif., Aug. 28, 2019 /PRNewswire/ — Shoppers seeking Labor Day deals on new cars will likely need to do some extra research before heading to the dealership this holiday weekend.
According to the car shopping experts at Edmunds, the average advertised discount for 2019 model year vehicles hit 6.4% this July and isn’t expected to climb much higher in August or September.
Edmunds analysts say that automakers are pulling back on major advertising and incentives for the holiday weekend because they’ve grown more comfortable with letting vehicles linger on dealership lots through the end of the year.
In December 2014, just 24% of new vehicles sold were 2014 model year, whereas in December 2018, 2018 model year inventory made up 44% of sales.
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.
“Automakers no longer have that ‘everything must go’ mentality that they used to when it comes to clearing out prior model year vehicles,” said Ivan Drury, Edmunds’ senior manager of insights. “Labor Day weekend historically served as a key moment in time for automakers to pile on the deals to clear out as much old inventory as possible and make room for the new, but we’ve seen a major shift over the last few years. Elevated interest rates are making promotional offers a lot more expensive for automakers, and they’re simply not in the same rush.”
But Edmunds analysts also say that just because automakers aren’t advertising blowout sales, it doesn’t mean bargains aren’t out there.
“The fact is inventories are high and automakers are motivated to move these cars. Shoppers just need to be a bit more strategic in their approach. It’s not going to be as easy as walking in and saying, ‘Give me that low price I saw advertised everywhere on TV,'” said Matt Jones, Edmunds’ senior manager of retail insights.
Edmunds experts put together a quick insider guide to help shoppers find these hidden bargains:
Make sure to look for deals on your local dealership website. Automakers might not be advertising big deals on TV or on their national websites, but your local dealer website will be highlighting specific promotions for your area.
When you’re doing your research online, keep an eye out for large numbers of the same car sitting at the dealership: If there are large quantities of a certain type of vehicle available at your local dealership, chances are you’re going to find some pretty good discounts because dealers are motivated to clear them out.
When you’re at the dealership, check to see how long a car has been sitting on the dealership lot. Check the sticker on the inside of the vehicle’s door jamb. Generally speaking, if a car has been sitting on the lot for at least 70-90 days, you might be able to negotiate the price down further.
If you’re looking to buy a used car, make sure to check out its vehicle history report online. A vehicle history report will tell you when the car was traded in at the dealership. If it was traded in months ago and has been sitting on the lot, you’re also going to be able to negotiate a better deal on the vehicle.
Get preapproved for an auto loan if you’re thinking of financing. A preapproved auto loan starts you on the right foot: You can get an idea of how much you can afford, and you’ll have an interest rate that you can then compare to the dealership’s financing. While you might not get 0% finance offers, the dealership might have an annual percentage rate closest to 0%.
More insight into recent auto industry trends can be found in the Edmunds Industry Center at https://www.edmunds.com/industry/insights.html.
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.