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September May Not be a Good Time to Buy a Car

September 10, 2009

Low InventoryNow that the "Cash for Clunkers" program has ended, analysts are predicting September sales will fall off a cliff. We will most likely see the lowest sales figures of the year.

Normally when sales are this bad, dealers are desperate and willing to negotiate deals. Not so in this case. The "Cash for Clunkers" program ended up depleting dealership inventory at a time when manufacturers had already scaled back production.

The result? There are now less than 1.5 million new cars available for sale in the entire United States. This is by far the lowest figure ever recorded since stats were first compiled 18 years ago.

The good news, from a car buyer's perspective, is that dealers are reporting very low foot traffic in their showrooms. In addition, car manufacturers have been ramping up production in order to replenish depleted inventory.

The problem is, it's going to take at least a month before inventory piles back up at dealer lots. For now, most dealers are ok with the fact that there are very few buyers. They simply don't have many cars to sell, so from their prospective, they're not losing any money.

Wait just a couple of months and we're pretty sure dealers will begin getting desperate again as their inventory starts piling up.

Note however, that not all cars are low in inventory. Cars that didn't qualify for the "Cash for Clunkers" program can still be found in large quantities. It's mostly the fuel efficient cars you want to stay away from at the moment.

My Recommendation for Car Shoppers

TrueCar, Edmunds, and 1-800 Car Show are the quickest way to see the lowest car prices in your area. These sites show you no-haggle prices from dealers closest to you - and the deals are usually really good. This should be the first step you take when negotiating your car price. Follow this up with my checklist to make sure you squeeze out every last bit of savings.

California Residents - Important:

There is a new online car buying service called Roadster, available only to California residents, which I highly recommend you try - especially if you hate the stress of haggling with a car salesman. They provide an expert concierge who negotiates the price of the car and delivers it to your home with zero hassle - you never have to interact with a dealership. Here is my in-depth review of Roadster and why I recommend it.

- Gregg Fidan

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Gregg Fidan

About: Gregg Fidan

Gregg Fidan + is the founder of RealCarTips. After being ripped off on his first car purchase, he devoted several years to figuring out the best ways to avoid scams and negotiate the best car deals. He has written hundreds of articles on the subject of car buying and taught thousands of car shoppers how to get the best deals.

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