Buying a car is a major financial decision where timing can make a difference. Jump too soon, and you may miss out on deals. Wait too long, and inflation may hit your wallet.
In today's market, car buyers are grappling with tough questions. Should I buy a new car now or wait? Will new car prices drop? What time of year do car prices go down?
If you're like other car buyers, one burning question probably weighs on your mind as the year-end approaches: Do I make the leap and buy in 2023 or hold off until 2024?
Discover tips for navigating the ideal time for your car purchase. As we walk through the ins and outs of what may be the best time to buy a vehicle as well as other factors to consider, in this uncertain environment, you'll be ready to hit the road with your next car.
Be A Smarter Buyer When Buying A Car
Regardless of the timing of your purchase, it's important to note that experienced salespeople often apply sales tactics to create a sense of urgency for potential buyers. The aim? To convince you to buy on the spot or risk losing out on a purported once-in-a-lifetime opportunity.
But here's what to consider: it may pay off to stand your ground, resist the fear of missing out, and do what savvy shoppers tend to do.
Car buyers taking a smarter approach are intentional when it comes to timing their shopping. Rather than rushing into an impulsive decision, they time purchases for when car dealerships are more inclined to offer better deals.
Armed with this insight, let’s explore how timing may help score a more favorable deal.
For starters, understand that sales professionals work on commissions and have quotas to meet each sales cycle.
What follows is a deeper dive into how this knowledge helps shoppers like you land a deal.
When Is The Best Time Of Year To Buy A Car?
Every month, quarter, and year, salespeople kick into full gear, rushing to meet sales targets. As these cycles draw to a close, they become extra motivated to offer some sweet deals, creating a great chance for you to snag a bargain.
Still, not all end-of-cycle days are created equal. Some are a good buying opportunity, while others can be more significant.
New Year's Eve and New Year's Day are often seen as times when buying a car might be a good idea. That's because dealerships are triple-motivated: it's the end of the month, the end of the quarter, and the end of the year all at the same time. That means they have plenty of sales targets to meet. Which explains why there are so many special end-of-year sales events.
What can sweeten the offer even more is that this is the time when car manufacturers usually roll out those special financing options, potentially filling your pocket with extra savings.
Still, remember that you most likely won't be the only one privy to this knowledge. Dealerships are typically packed at this time of year, so it's wise to hit the lot prepared.
Perform your research in advance, pick your desired car model, and have your financing ready. So, when the big day arrives, you can simply head to the dealership and finalize the purchase.
What Is The Best Month To Buy A Car If I Missed End-Of-Year Sales?
If you missed the December sales, don't despair. Many dealerships continue to offer attractive sales well into January and sometimes even beyond (think February's President's Day events). During these periods, they're keen to clear inventory off their lots to make room for new arrivals.
As you look further into the calendar year, the end of each quarter stands out as another promising opportunity to secure a fantastic deal. During these times, dealerships have quarterly quotas to reach, so sales professionals might be motivated to offer promotions in order to meet their sales targets.
If you wonder what month is likely to be a less expensive time to buy a car, mark your calendar with these end-of-quarter dates. These are months when car prices typically go down:
- March 31 (End of Q1)
- June 30 (End of Q2)
- September 30 (End of Q3)
- December 31 (End of Q4)
What Time Of The Week Is Best To Buy A Car?
When it comes to car shopping, Monday seems to be a top pick. It's also one of the slower days of the week for foot traffic, providing a more relaxed shopping experience.
On quieter days, you will likely get more attention from a salesperson and might even land a nice deal as they look to invigorate this traditionally sluggish start to the week.
What Time Of Day Is Best For Buying A Car?
Although the timing of your arrival at the dealership may not directly impact the purchase price, it can enhance your overall buying experience. A good rule to follow is to avoid times around lunch hours and the final hour before closing.
Other Opportunities To Get A Good Deal
Three-day holiday weekends are traditionally one of the best times to get a deal on a vehicle.
For example, Labor Day is one of the busiest days for car sales, and Memorial Day sales events often offer enticing opportunities.
Plus, Black Friday shopping frenzy isn't just reserved for snagging brand-new TVs. With some strategic planning, you could lock in a bargain on a car.
Here's a list of holidays that are typically a good time to explore car deals:
- Presidents Day (3rd Monday of February)
- Memorial Day (Last Monday of May)
- Independence Day (July 4)
- Labor Day (Beginning of September)
- Black Friday (Friday after Thanksgiving)
If you're not dead set on owning the latest car model, another possibility to explore is to wait until the end of the model year to buy a car. Cars for new model years usually have their debut in the fall, but do your research to see if your top picks might follow a different schedule.
Similarly, you can opt for a car model that's undergone a redesign. As this happens, both manufacturers and dealerships are eager to clear their inventories of the old model and make room for the shiny new editions.
Should I Buy A New Car Now or Wait?
These tactics typically serve as reliable guidelines for car purchases in an ordinary buying environment. However, today's auto market appears to be anything but.
Car sales hit rock bottom in 2022, with fewer vehicles sold than in any year since 2011[1]. Normally, this would lead to steep discounts and generous financing terms. However, this time, such car deals were harder to come by because the problem was on the supply side.
Car buyers now face a challenging choice, torn between buying in the current climate or holding out for more favorable conditions.
There's no single answer to what car buyers should do, as their specific circumstances differ, and the nature of this unusual market environment makes it difficult to predict what will happen next.
While smart tactics are still valuable, they alone may not be enough.
Before tactical nuances come into play, you need strategic guidelines to gauge whether a market correction is on the horizon. Of course, this task lacks the luxury of a crystal ball for definitive answers, but consider some factors driving the market and use that knowledge when strategizing the timing to purchase a car.
Factors To Consider When Deciding When To Buy A Car
Car prices can fluctuate for various reasons, but they all usually fall into two broad categories: direct and indirect factors related to demand and supply.
Direct Factors To Watch Out Before You Buy A Car
Dealer inventory reflects the immediate supply of cars available at their lots. When this inventory decreases, even as demand remains the same or rises, prices tend to rise—a scenario that unfolded in the wake of the pandemic.
Although this indicator is recovering, some manufacturers still face parts shortages and can't fulfill car orders due to a lack of inventory[2]. An immediate price drop is less likely for such vehicles, particularly if they are in high demand.
These high-demand vehicles are also less likely to offer rebates or dealer discounts.
Indirect Factors From The Broader Economic Environment
What sets smart car buyers apart is an understanding of fundamental economics, namely the impact of interest rates and inflation on supply and demand.
Without going into the technical nitty-gritty, let's equip you with the knowledge that can help you pick the time for a car purchase.
Interest Rates
Since March 2022, we've seen a complete turnaround from record-low interest rates to today’s elevated levels[3]. Higher interest rates mean less favorable auto loans, causing many buyers to reconsider car purchases. Buyers who explore financing options may discover options to make their vehicle more affordable.
Ultimately, reduced demand usually leads to lower car prices, but the exact timing of this adjustment is difficult to pinpoint.
Inflation
Inflation brings about price increases across the board, and cars are no exception. As prices climb, consumers find it harder to set aside enough money to buy a new car. Again, this usually leads to a decrease in car sales, but the timeframe for when this reduced demand will translate into lower prices is also hard to predict.
Car Buying Experience To Remember
Few experiences can match the thrill of driving off the lot in your new car. Buying a car is an exciting event and a major milestone, especially if you are a first-time car buyer. With these tips in mind, you should be able to ensure that your next car buying experience is nothing short of great.
Timing Your Car Purchase: A Buyer's Checklist
In summary here is a short list of things you might like to consider as you strategize the timing of your car purchase.
- End of the month, quarter, or year: Dealerships often have sales quotas to meet, so buying a car before these days might lead to better deals.
- Holidays: Look for sales events and special promotions during major holidays like Black Friday, Labor Day, or Memorial Day.
- Weekdays: Visiting a dealership on a weekday might result in a better buying experience and more attention from sales staff.
- End of the model year or when new models are released: As the model year comes to a close or new models hit the market, you may potentially score a deal if you time your purchase around these days.
- Economic factors: Keep an eye on economic driving forces that tend to impact car prices, like interest rate dynamics, inflation trends, and the ongoing UAW strike negotiations.
Whether it comes to the timing of hitting the dealership or considering the economics of financing your vehicle, remember to do your research so that as an informed consumer, you can make the decision that best meets your needs.
To learn how PNC can help you on your vehicle-buying journey, visit our auto lending page
