Why You Should Buy a New Car This Month
BOSTON (TheStreet) — If you're thinking about buying a new car in the near future, drop everything and do it now.
That's because an analysis of millions of U.S. auto purchases made over the past five years found that August is the best month for vehicle prices.
"August is an absolutely a great time to buy cars," says John Krafcik of TrueCar.com, a consumer auto-buying site that conducted the study.
TrueCar looked at more than 20 million new-car sale reported to state motor-vehicle departments between 2009 and last year and found that the average automobile went for $29,296 in August. That's $716 below the five-year period's $30,012 average — and $1,850 less than what the typical consumer paid in December, which TrueCar found was the worst month for deals.
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Krafcik says August is prime time for car buyers because dealers and manufacturers are phasing out the current model year's stock to make way for the upcoming year's offerings.
"The new model year for the most part starts in September or October, which essentially makes August the 12th month of the model year that's ending," he says. "That puts strong pressure on dealers and manufacturers to clear the old cars out."
The expert says consumers who buy 2014s this month will find some of the year's best prices, manufacturers' rebates and financing deals.
But Krafcik says prices will slowly rise between September and December as more and more 2015s reach dealer lots. For instance, TrueCar found that the typical vehicle sold during the past five years during September cost $30,389, or $1,093 more than August's average price.
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But fear not, procrastinators.
Krafcik says shoppers who miss out on this month's deals can still enjoy better and better prices on 2014s as the year wears on — if they manage to find any.
"Whether you can still get a 2014 [after August] will really depend on demand for a given vehicle," he says. "There are some 2014s that the industry is very heavy on right now, while others are already almost completely sold out."