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Car Incentives Are Terrible Right Now

Incentives on vehicles sold in April hit their lowest level since 2005, according to Edmunds.com, which estimates the average incentive paid by automakers was $2,118 per vehicle sold last month.

The reason incentives are so low right now is due to supply and demand issues.

Inventories of new vehicles are lower due to brisker consumer demand thanks to a strengthening economy, and shortages resulting from the recent Japan disaster.

As a result, automakers don’t need to offer rich incentives.

The decrease in incentive spending runs across the board by manufacturers regardless of country of origin, with the exception of Korean automakers Hyundai and Kia - least affected by the Japan disasters and clearly trying to capitalize on the situation.

Domestic automakers showed the largest decline in incentives from March, averaging $2,683 per vehicle sold in April, down $398 from March.

Japanese automakers had the second largest decline with $1,696 per vehicle, down $236 from March.

So what can you do as a car buyer? Should you wait a few months in hopes of getting a better deal? Not necessarily - these supply and demand issues are predicted to last until at least the end of summer and possibly until the end of the year.

We just have to get used to the fact that car deals are not as good as they used to be. However, that doesn't mean it's impossible to get a great deal - make sure to use our car buying formula when you're ready to start negotiations and you'll do fine.






3 Steps Every Car Buyer Needs to Take to Save Maximum Money

The key to getting the best deal is to gather price or lease bids from as many local dealers as possible. Then shop that best price around until no one can beat it. Here are the steps:

Step 1 Get Prices From My Trusted Network

Select the vehicle you're interested in to see if there are local dealers in my network who will provide you with their best upfront price. You will get direct access to an internet sales manager who you can further negotiate with online (no need to visit dealership).
Select Vehicle to Get Local Pricing

Step 2 Get Prices From TrueCar / CarsDirect

TrueCar, and CarsDirect are my top 2 online price quote recommendations. These services show you pre-negotiated prices from dealers closest to you - and the deals are usually pretty decent. But remember, you can still negotiate further.

Step 3 Complete my Checklist

Follow this up with my checklist to make sure you squeeze out every last bit of savings.
- Gregg Fidan

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About The Author

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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