In this economy, everyone’s looking for the best deal possible. Haggling on price is an essential part of purchasing a new car. Car buyers spend their time comparison shpping to get the best possible deal. To save money on a new car purchase, however, it’s important to learn how to get great deals. New car buyers can still save money on a new car with litte bit of kniwledge on car sales. One of piece of that knwledge on how to save money on a car, which doesn’t involve saving money on the car loan or the car loan interest rate is to buy a new car at the end of the month.
At new car dealerships, the sales staff often operates on a quota system. The salesmen receive a “spiff”, or bonus as they hit each sales goal for the month. This means that if a staff member is only slightly short of their sales goal and the end of the month is coming up, they’re far more likely to work with consumers on price. Their goal is to sell a certain number of cars, and dropping the price may be well worth their while.
Car salesmen often receive bonuses for hitting thier sales goals. This means that they may be receiving money from the dealer, manufacturer, or both in exchange for their sale. These goals grow and change with the needs of the individual dealerships, but almost always focus on the end of the month. This makes month’s end a perfect time to purchase a new car. These bonuses supplement the salesmen’s income, and are often a large portion of their salary, so they’re willing to work hard for them - including negotiating on price with customers.
Car dealers are losing money, overall, in this economy. Consumers are becoming more educated about purchasing cars. This means that they have better ideas of what cars should cost, and are therefore better equipped to negotiate on price. Already, more car buyers are researching and obtaining their car loans directly and bypassing the dealership financing. Saving money on the car loan with lower interest rates saves more money since this is often a profitable transaction for the dealer. In general, car salesmen are making less money than ever before. They work on commission, and are more willing to make deals than ever before. These salesmen are relying on their bonuses as an important part of their income, and are willing to negotiate to earn this money.
Dealerships also have quotas to meet, allocated by the manufacturers. If they hit these sales goals, the manufacturers are far more likely to send more cars to the dealership the next month. More vehicle equals more inventory, and better selection for customers. If goals are not met, manufacturers may allocate fewer cars and trucks to the dealership the next month. Therefore, it’s in the dealership’s best interest to sell as many cars as possible, and their focus is often on sales volume, not individual prices. The dealership may encourage salesmen to cut prices near the end of the month for this reason.
In fact, many dealers are selling cars below cost, due to the current economy. When you combine end of the month discounts, rebates, and other incentives, the price of your new car may be an even better deal than you expected! Use the dealers need to sell the cars with financing provided directly from a bank or finance company, and the deal becomes sweetened with a low interest rate loan as well. It’s a better time than ever to buy a new car.
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