Why Buying a Car at the End of the Year Can Help You Save

Whether you’re looking for a new or used car, the end of the year can be a great time to get the best deal on a new vehicle. Before you start shopping, understand how the buying process works and why the end of the calendar year is the most cost-effective time to shop for a new ride.

Out With the Old, In With the New

New model years typically arrive at dealerships in the fall. That means that the dealership will often discount outgoing models to make room for new inventory. If you’re looking at purchasing a new vehicle toward the end of the year, buying last year’s model may net you the best price. If the manufacturer has made minimal changes to the model, you’ll likely see smaller discounts compared to models that have been completely redesigned, which often have steeper discounts and additional incentives to help move inventory.

Car manufacturers often support dealerships by providing attractive financing and cash-back deals toward the end of the calendar year. Manufacturers want the newest models on dealership lots so they’re more likely to offer deep discounts to consumers. Research has shown that December offers the steepest discounts from vehicle manufacturers – sometimes up to 6% off the manufacturer’s suggested retail price (MSRP). These savings, coupled with dealership incentives and negotiating power, can help you save big bucks on your next vehicle.

When shopping, understand that salespeople often have monthly, quarterly, or even yearly sales targets to hit, and achieving these goals often results in rewards or bonuses. As a buyer, you can use this information to help negotiate a better deal. Ultimately, by waiting to purchase a new vehicle until the end of the year, you’re giving the salesperson a chance to hit their goals before the year ends.

Despite the deals available, shopping at the end of the year may have some drawbacks. If you’re looking into last year’s models, you may have a limited selection to choose from due to low inventory. Dealerships typically offer better incentives to move older inventory off their lots, which may result in fewer options for you. If you’re looking at last year’s model to get the best deal but can’t find one with all the features you want, see if the dealership is willing to negotiate the price on a newer model with all the bells and whistles you want.

Tips for Maximizing Savings

So, how should you maximize your savings when shopping for a new vehicle? Check out these tips for getting the best deal.

• Do your research. Before you head to the dealership, be sure you know what you want in a vehicle and what you’re willing to compromise on. In addition, be sure you know what your current car is worth if you plan to trade it in. Use sites like Kelley Blue Book^® to determine your car’s value before you receive a trade-in offer from a dealer.
• Have your financing ready. With PSECU’s low-rate auto loans and quick approval times, you can head to the dealership with the financing you need. Knowing your financing is secure can give you an edge when negotiating the final price of your purchase. Having a preapproval will let you focus on the out-the-door price and not get caught up in securing dealership financing.
• Ask for additional discounts. When negotiating, don’t overlook the value of incentives offered by your dealership. Perks like free oil changes, car washes, or discounted maintenance can help you save money over time. If you don’t live near the dealership and aren’t able to take advantage of these perks, ask if their incentives can be offered in other ways, like discounts on the overall price of the vehicle.

Check Out Our Rates

While shopping for a new vehicle can be stressful, buying a car at the end of the year can help save you money on your purchase by maximizing dealership incentives and utilizing your negotiating power. Ready to start the auto buying process? Learn more about our low-rate auto loans.

Kelley Blue Book^® is a registered trademark of the Kelley Blue Book Co., Inc.