Mar 11th 2009 11:03AM Luxury Deal Alert! - The state of the economy has some benefits, and that is in New Cars. New Car sales are down, and companies are slashing prices. Used Car sales are more competetive, and prices are going up. That is good news for new car buyers because their car will not depreciate as much. There is a downside, though: financing is hard to come by.
Here are some examples:
This self-proclaimed "Luxury" site, which apparently specializes in pre-owned Lexus's, is advertising lease specials, but the fine print reads "tier 3 plus" approval!
This dealership just put up a sales coupon that undercuts the price on all models by an "additional" $5,000 (it doesn't mention financing). It used to be that dealerships favoured financing customers because the store would get a cut of the bank's profit. Now it is difficult for dealerships to find financing for their customers, and fewer banks are offering leases.
Lastly, look at this Honda site trying to describe itself as a luxury car dealership: http://southhillshonda.com/about-us-frame.aspx - if that's not clutching at straws, I don't know what is!
Mar 10th 2009 5:25PM Wow, this article is a great read one year later! It is funny to look back and see what has happened since, and how things are the same and different now. A year ago you could still get a lease or finance through a bank.
SUV prices sunk so low, but then went back up, but consumers did win by getting good value on these cars. Today, however, used car prices at wholesale are up considerably, and that coupled with new car incentives blurs the line between new and used. New cars are beginnng to seem a good value, but then again it is very difficult to get financing if required.
Dealerships are having a tough time of it, of course, as new car sales are down. I am sure you've heard of the dealerships offering a free "cheap" car with the purchase of one of their expensive models, but I am including here some more typical "dealer specials" trends that are popping up, mostly targeting special financing in order to find customers:
This one is a Honda dealership near Pittsburgh (a simple Google seach will find you more, all brands): http://southhillshonda.com/finance-frame.aspx -- as you can see, they are actively trying to make the customer think about financing their purchase.
It's not just mainstream cars, either. Look at this Lexus dealer in New Jersey: http://www.lexusofenglewood.com/ -- click on their Featured Lease Specials, and the fine print reads "subject to Tier 1 plus credit approval" -- when have you seen "plus"?!
I was searching Lexus, so I found this other store (I don't drive a Lexus, honest, in fact I drive a Subaru - best car on the road, and one of the few manufacturers that's doing okay so far), here's the link: http://www.preferredluxury.com/leasespecials.asp -- it has the same leases, clearly saying "Tier 1 plus" AND they have a credit link, but seriously, can they really get financing for someone without Tier 1 plus?
I think it's a buyers market for new cars right now, but only if you can get financing and pay cash. New car prices are down, and used car prices are up, meaning that your new car will not depreciate as much and as quickly.