If you’ve recently looked at buying a new or used car, you may have experienced a bit of a shock.
Compared to even a year ago, prices have skyrocketed. Records are being set almost daily. Prices of both brand new vehicles and previously owned vehicles have never been higher.
What Happened?
There are various theories as to exactly how we arrived at this disturbing situation in the consumer automotive marketplace but it’s clear that a combination of factors are to blame – the “perfect storm.”
The major factor, of course, was the worldwide health pandemic, which triggered other problems, which triggered others, creating a “domino effect.” These effects weren’t apparent immediately but, instead, took time to grow and mature. So now, we find ourselves in a situation that took roots over a year ago.
Car companies slowed or stopped production during the health crisis. Workers became sick or infected and couldn’t/wouldn’t come to work. Same for the companies who supply parts, especially electronic parts that modern vehicles depend upon. Customers were in lockdown and unable to come out to buy goods. Even after restrictions eased, many potential car buyers were uneasy and didn’t venture out.
Businesses closed and business travel slowed, which impacted airlines, restaurants, and car rental companies, who sold off a significant portion of their rental inventory.
As a result, there is a serious shortage of both new cars and used cars in the face of growing demand now that the pandemic is waning. Buyers who delayed buying new transportation during the pandemic are now coming out, ready to purchase again–but finding a brick wall in front of them. Manufacturers are facing supply chain problems. Selections of vehicles are limited in many cases, and prices are noticeably higher.
What to Do?
Getting a good fair deal on a vehicle purchase or lease has always been important, but it’s even more important now. With higher prices and limited supplies comes the challenge of getting just the right vehicle for your wants and needs, and finding one that fits your budget.
Online search tools such as our LeaseGuide Car Pricing Tool are one of the most valuable and useful automobile shopping aids that you have at your disposal. Such a tool allows you to find just the car you want and get the best deals before you ever set foot in a dealer’s showroom. It allows you to easily and discretely compare different deals from different dealers. It’s the smart way to shop for cars these days.
What About Leasing?
If you’ve spent any time on our LeaseGuide web site, you’ve no doubt run across the many instances in which we’ve explained that price is the most important factor in determining monthly payment. This fact might seem obvious to some, but many consumers mistakenly believe that leases are all based on MSRP sticker price – and dealer salespeople do nothing to correct that thinking. In fact, even a small difference in purchase price has a much more dramatic effect in a lease deal than if buying with a loan. Even a small discount goes a long way in leasing.
Since we explain all about leasing, its benefits, and its pitfalls throughout the LeaseGuide web site, we won’t repeat it here. But suffice to know that most people are attracted to car leasing because it offers significantly lower monthly payments than a car loan of the same amount, same term. Assuming that you are a good candidate for leasing (as explained elsewhere on this site), it often allows you to drive a car you couldn’t otherwise afford, or to simply be able to afford the car you need.
As previously mentioned, the lowest monthly lease payment results from the lowest purchase price. Even though you aren’t actually purchasing your vehicle, the lease deal is based on the price you and the dealer negotiate, along with other factors.
Getting Prices the Easy Way
Many people these days hate the process of haggling and playing games with dealer sales people. It’s stressful and often accomplishes little, especially if you are not skilled at it. That’s why the Internet has become one of the most valuable and useful resources for automotive consumers. Whether you are leasing or buying, it creates a level playing field for everyone. And it allows you to avoid the devil-tongued sales people until you’ve accepted a deal and are ready to go pick up your car.
You can do all your research online before ever visiting a dealer for a look and test drive. When you know what you want, simply fill out a form specifying the vehicle you want and have dealers in your area compete for your business. You are under no obligation to go with any of them. Furthermore, you shouldn’t assume that the prices you are quoted are the best the dealer has to offer, assuming you are willing to do a little further negotiating.
Get Your Best Prices Now