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You’re in the market for a new car or truck, but when is the best time to lease or make that big purchase? Does timing really make a difference? The simple answer is, yes, timing is important, and buying a new car or truck at the right time can save hundreds or literally thousands of dollars.
Equally important is knowing in advance as much as possible about the desired vehicle, from the sticker price, standard equipment level, options, colors, trims, to rebates, transportation costs, financing and more. Many websites such as KBB.com tell you what the dealer pays for that vehicle. An educated consumer will get a better deal than a shopper who merely scanned the slick, glossy vehicle brochure.
Here’s a few timing tips to help secure a good deal for a new car or truck:
Year-end sales events
Dealers generally do their best wheeling and dealing at the end of the calendar year. Automakers usually have big incentives to move the metal during the Christmas season because some dads and moms make the new car purchase their family’s holiday gift. For some dealers, December is one of their biggest sales months.
Read: Buying a car is more expensive than ever — here’s why
There’s another reason for all the Christmas-themed car advertising flooding the airwaves in December. Automakers and dealers want to move unsold inventory off their lots before the end of the calendar year. It all about accounting: They want to carry as little inventory as possible into the new year. Dealers will do whatever it takes, sometimes lose money on a deal, to meet calendar or December sales objectives. The best days for shopping? The last week of December, preferably Dec. 30 and 31.
A case in point is one young Tampa, Fla., woman who spent the last two days of the year shopping for a lease on a new Honda HMC, +2.21% Civic. She got reasonably good deals from three dealers, but later, on the phone, pitted one dealer against the other. Finally, at 8 p.m. New Year’s Eve one dealer caved, giving her the deal she wanted. The dealer wanted to close the doors and head to a party.
End of the month
Of course, everyone can’t wait until the end of the year to buy or lease a new vehicle. Automakers and dealers generally have monthly sales targets, sometimes with handsome bonuses for a sales manager and sales person. Once you have selected a model, at the beginning of the month check the incentives on that vehicle. It’s easy: Pull up the automaker’s website to determine how much is offered. Also, if the website is asking for your ZIP Code, add it because many times an automaker is offering an additional regional incentive.
Price the vehicle online, determine the sticker price before incentive, after the incentive, then go shopping. Head to the dealership between the 16th and 20th of the month. Don’t lock in the deal just yet. Instead, wait until the last two or three days of the month to negotiate.
Cars and old bread have one thing in common: Prices are discounted when the new, fresh stuff appears. Buying a new vehicle from the previous model year, for example, can save thousands versus purchasing a comparable vehicle from the current model year. It’s possible only a handful of insignificant changes were made between the two model years such as new exterior and interior colors. Generally speaking, the new models arrive in September and October.
Read more: Expect good deals on any of these discontinued cars
Hefty incentives are likely if the vehicle has been a slow-selling model, possibly because the public knew the redesigned model was arriving soon. A redesign generally includes restyled exterior sheet metal, new features, maybe even a new engine and transmission that improves fuel economy.
Go online and check the dealer’s inventory for last year’s new models. That dealer will be very anxious to sell those vehicles to make room for this year’s model. The downside is that the new features or color you desire might only offered on the redesigned model. And remember, you are getting a year older vehicle, so expect your resale value to take a hit versus the new model. However, many buyers are very happy to take last year’s model to save thousands of dollars.
Shop online, but test drive and close in person
These car-buying tips also apply to shopping online. These days you can do everything online from picking out the model, equipment and color, to financing the car, knowing the trade-in value and the monthly payments. The same is true for a lease: You can determine the down payment, term and monthly payments before walking into a dealership. However, it is important to drive the car desired to see if it meets your needs before committing to a vehicle online or at the dealership. You can negotiate online and then try for a better deal when you enter the dealership for the first time.
Related: Virtual used car dealers may be the future of auto shopping
Holiday sales events
Finally, another good time to buy is at the holiday sales events automakers create to move the metal throughout the year. Usually these events are tied to significant rebates and special financing. Besides the Christmas season, the weekends around Memorial Day, July 4 and Labor Day are promoted heavily on radio, television and the internet. Dealers stuck with an oversupply of certain models are likely to add additional discounts.
In summary, no one is going to offer the best car deal even if you follow the timing tips listed above unless you do your homework, know as much as possible about the car and pricing, and then work for the best deal. As Ray Koch says in the movie “The Founder” about the obstacles he overcame to create the McDonald’s MCD, -1.29% restaurant chain, it is all about “persistence.” It applies here, too, if you want the best deal, persist.
This story originally ran on KBB.com.