It’s the end of the year and a brilliant time for buying a car. Whether you’re looking to buy new or used, it’s the period in the year when car dealers are under the most pressure to make sales. Which is great news for buyers. Here’s why, if you’re considering a car purchase, December is the best time to head down to the dealership.
Why is Christmas such a good time to buy a car?
Think about it. Buying a car is probably the last thing you want to do. You’ve got presents to buy, holiday to take, don’t forget forking out for the other half’s Christmas present, and then there’s paying to feed the 5000 on the big day itself. You’re not alone. Frequently at this time of year, the inside of a car dealership can feel like someone’s forgotten to unlock the door. If you go in willing to do business, any half-awake sales exec will snatch your hand off.
Why dealerships are under pressure
The car industry’s sales figures are calculated according to the calendar year, rather than the tax year. As the year draws to a close, car manufacturers will be desperate to get one over their rivals for 2015. At street level this translates into pressure on dealerships and their staff to meet the year’s sales targets.
Why is December in particular so good?
For the most part the car industry operates around bonuses. The sales execs get bonuses for selling cars. Their bosses get a reward for hitting certain sales targets. And the dealerships themselves are rewarded by the car manufacturers for every car they sell. These are frequently paid on a quarterly basis. The reason December is such a crucial month is that it is both the end of the fourth quarter and the end of the year so there are plenty of bonuses resting on whether you buy that new car or not.
What does this mean for buyers?
The combination of all the above means that sales execs will be in the mood to deal. And that means discounts. The reason they can do this is that the bonus they get from the manufacturer for hitting their targets will offset any discount they might make on the car. So you get a cheaper car, the dealer is frequently better off financially, and the car maker adds another unit to their annual total. Everyone’s a winner. Julian Lobb, who works for trainer Impact Prospecting Solutions, said “If you go to the showroom at the end of the quarter when dealers and manufacturers probably still have targets to hit you should get a cracking deal.”
Research is still vital
Although car sales execs might be keen to do deals, they’re not stupid. What’s more, they’re highly trained sales professionals. In comparison, many regular drivers are mere amateurs. So it’s still important that you do your research. Find out everything about the car you’re interested in. For example, which trim level and engine do you want? And how popular are these? Look on internet sales sites to find this out: the bigger discount they’re offering, the more likely you are to get a good price from a dealer. Then look on the manufacturer website. What kind of deals are they offering? Frequently, any discount is split between manufacturer and dealer. So although the manufacturer might be offering a cash discount and decent finance terms, the dealer should still have some room to give more money off. And if you’re not comfortable doing this, try a new-car broker. They will haggle on your behalf and are more switched on to how prices are moving.