Holiday weekends like those surrounding Memorial Day, Fourth of July, and Labor Day are popular times to shop and score some great deals. But while many people plan to buy food, clothes, summer essentials and outdoor essentials, cars aren’t high on most shopping lists.
In fact, a recent GOBankingRates study found that only about 4% to 5% of Americans plan to buy a car during this three-day holiday weekend. This is surprisingly low considering the fact that many retailers also offer lower prices and other incentives at these times.
So why aren’t Americans buying cars right now like they once could? And perhaps most importantly, why is now actually a good time to buy?
Here are the words of automotive experts.
Check out: Buying a Used Car: Best Age and Mileage to Get Great Value
Next: How to get $340 a year in cash back from the gas and other things you already buy
Why don’t more Americans buy cars?
Several factors may prevent American consumers from spending their money on vehicles. A big one is simply economics, particularly its effect on vehicle prices and supply.
Since the pandemic, car prices have risen to unexpected heights. A lot of people sat on the sidelines waiting for prices to drop, and now, four years later, there’s no sign of that happening, said Mark Beneke, owner of Westland Auto Inc. [High] price has become the new norm and the thought of this scares most consumers as they are unsure if this will continue or continue to rise. Many are still waiting on the sidelines for prices to come down.
And then, of course, there’s the fact that inflation has also brought higher interest rates, something that has made car ownership more expensive than ever.
We’ve seen skyrocketing inflation over the past few years, and along with it, interest rates, Beneke said. If higher prices weren’t enough, rising interest rates lead to an even higher total cost after everything is finalized. People have not had time to come to terms with this, and it is meaningless to admit that it happened so quickly.
Another potential factor keeping people from buying cars is economic uncertainty, Beneke said. People don’t want an expensive car loan hanging over their heads if something like an unexpected layoff were to happen.
Then there is the limited supply of affordable and reliable cars in many areas of the country.
The supply chain issues we faced are ongoing and much of their impact is still being seen, Beneke said. This has continued to increase the cost of production, reduce the available supply and therefore increase the price for consumers. The consequences of this are likely to continue for some time, especially if consumers do not contribute to the flow of spending in the economy.
Right now, dealers aren’t offering as many incentives to buy as they used to.
Dealers also have scaled back the big deals and discounts they saw over the summer, said Jason Farrell, a certified master technician at Mechanics Diary. With fewer cars available and people still wanting to buy, they don’t need to work as hard to get the metal off the part. Less incentive for buyers to pull the trigger now.
See now: 10 car models getting massive price cuts in May 2024
But there are still plenty of reasons to buy a car now
Making the decision to buy a vehicle depends largely on your financial situation and your needs. That said, here are a few reasons why it’s worth picking up a car now or during those big holiday weekends when sales are at their peak.
Dealers are making room for new inventory
New models are often released around the beginning of fall, so now is the time when many car dealerships are starting to make room for new inventory. This can mean more incentives or lower prices if you know where to look.
Even though fewer people are buying cars this summer, it’s actually a really good time for buyers if you know how to work the system, said Todd Bialaszewski, a certified mechanic and founder of Junk Car Medics. Towards the end of the season, dealers are very keen to clear out last years models to make room for the next years. This desperation leads to some seriously good deals, financing offers and trade values waiting to happen.
Less competition can mean more bargaining power
Reduced competition can work in your favor as you have more leverage during negotiations, Beneke said.
That depends on where you live and what kind of car you’re buying, of course. But if you visit a dealership that isn’t too busy, you may also have a better chance to sit down and negotiate prices.
Prices may drop slightly
Summer often sees a drop in car prices, especially if you’re looking for a used vehicle.
As many people have already spent during tax time, prices slowly start to come down. By summer, they’re down a lot and can make it one of the best times to get a great price, Beneke said. This also means that many people have already traded in their vehicles to upgrade to newer models, which increases the available supply of used cars available to you.
But prices can also rise again
Although car prices may fall during the summer or around key sales periods, they are just as likely to rise in the coming months or years.
With automakers ramping up production, prices look set to rise going forward as demand outstrips supply, Farrell said. So locking in on what’s available today can save you money down the road versus waiting. Dealer subsidies may also be removed.
It’s a good time for a Test Drive
It might not be your biggest priority, but better weather could make now a good time to buy a car if you’re already in the market anyway.
No one wants to test drive in a storm! Warm summer days make for a more pleasant shopping experience, said John Lin, a mechanic and owner of JB Motor Works.
End of month sales are more common
When it comes to buying a car, time is of the essence. If you manage to catch a sale at the end of the month, you can get a lower price than expected.
As the month draws to a close, dealers may be a few cars short of a sales quota that would earn them a big bonus, said Lauren Fix, automotive expert at Car Coach Reports. Sellers will have more motivation to make a deal with a buyer and can make deep car discounts, offsetting any money lost with the bonus.
Just be aware that any sales team that has already met their quota for the month is less likely to negotiate as much.
More from GOBankingRates
This article originally appeared on GOBankingRates.com: Americans Aren’t Shopping for Cars Now: Maybe You Should Be
#Americans #Arent #Shopping #Cars
Image Source : www.aol.com