Buying a New Car?
Wednesday, June 17th, 2009The global automotive industry is in a tailspin, with a double digit sales drop being felt in the United States, select European markets and elsewhere. Some analysts are predicting that depressed sales will continue through 2009 with only a modest recovery happening by late 2010.
Of course, the flip side of the news is that consumers are still buying new cars. This means that as automakers work frantically to reduce production and cut back on capacity, some excellent deals await the savvy shopper.
Are you planning to buy a new car this year? If so, let’s take a look at some things to consider before you buy:
Research Thoroughly - Thanks to the internet, everything and anything you want to learn about new models is available online. You can compare similar models, read reviews, learn fuel mileage estimates, check out consumer ratings, simulate outfitting your car, arrange a test drive, obtain price quotes and more. Truly, before you set foot in the dealership you can have all of the information you need to ensure that you get the right car at the right price.
Not the Sticker Price - As recently as 2007, most consumers paid at or just below the sticker price for their new cars. No more. Today, a sticker price is simply a guide, but you can pay closer to what the dealer paid for the car when you uncover that information while researching your particular car. These days, most new cars can be had for just a few hundred dollars above dealer invoice, even for lower amounts when manufacturer incentives are included.
Cash or Credit? — If you are paying cash for a new vehicle, then good for you! You have much more leverage than the person who is relying upon credit, a negotiating position that few consumers have. However, even if you are needing to finance your purchase, you can still come away with a great find. Before you get started, obtain a copy of your credit report and credit score to ensure that there are no mistakes on your report and that your score is high enough to get low interest rate financing. In many cases you’d do better obtaining your own financing and taking the cash rebate, but in some cases you can find both through your dealer.
Warranties and Guarantees - How long is your car warranted for and what does that warranty cover? Standard powertrain warranties of 5 years or 60,000 miles may be enough for you but what if you plan on keeping your car for the long haul? Consider an extended warranty purchased through your dealer to cover those parts not covered in the warranty beyond the customary warranty period.
Extra, Extra - Certain popular or high end models won’t necessarily be discounted, but that doesn’t mean you will have to leave the showroom without a deal. Why not ask the dealership to include oil changes with your purchase or some sort of concierge service? Maybe having access to a loaner car while your vehicle is being maintained is all that you need; even the most basic car manufacturers typically offer this service these days.
Finally, when ready to negotiate, be prepared to walk out of a showroom if the deal doesn’t meet your needs. In a given metropolitan area, several dealerships selling the same brand cars can offer different incentives; shop around to find the best deal that is right for you.