If you've been waiting, it's time to start shopping.
After cutting back on incentives in May and watching sales sag, auto makers have resumed piling on the deals. How long the good times will last for shoppers is anyone's guess, but market watchers say incentive fever could last into fall.
While it does, buyers who do a little research and are willing to compromise on appointments such as exterior color or trim and equipment levels can find substantial savings as the 2002 model lines peter out.
"The average discount on a new car in the first half of June was $3,718," said Art Spinella, vice president of CNW Research, a Bandon, Ore., market research company that tracks auto industry incentive spending.
There's a little hitch, of course -- but there is little about buying a new car or truck that doesn't come with a hitch or two.
Although incentives are getting bigger, so are prices. The average manufacturer's suggested retail price, or MSRP, on new vehicles sold during the first half of June was $26,002 -- the highest MSRP ever, Spinella said. The average transaction price after negotiations and incentives was $22,284, also a record high, he said.
The incentives most consumers see are advertised deals -- consumer cash offers and discounted interest rates or lease terms. But auto makers also try to boost sales by giving their dealers incentives -- which dealers can keep for themselves or pass on to consumers as market conditions dictate.
Shoppers who know about dealer incentives can bargain even harder.
At General Motors Corp.'s Cadillac division, for example, a national promotion offers a cash rebate of $3,000 on the 2002 model Eldorado. GM also is offering its dealers $7,000 for each 2001 model Eldorado they move.
That means that a bargain-hungry shopper who doesn't see much difference between the two model years (and there isn't) could strike a better deal going after an unsold '01 model.
Sometimes, dealer cash and consumer cash can be combined: Hyundai is offering as much as $1,500 cash back to buyers of its 2002 model XG350 sedan. But dealers also are being offered $750 to $1,500 for each new XG350 they move. A buyer who knows this could persuade a hungry Hyundai retailer to pony up the dealer cash as well as the customer rebate, cutting the price by a nifty $3,000.
There are dozens of such deals to be made these days.
GM, which has been successful in slashing production and operating costs, is leading the incentive wars.
Brainerd Dispatch ©2013. All Rights Reserved.