How That Can Help You Get a Great Deal


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If you’re thinking about buying a new car, you might just be in luck. Many car dealers across the U.S. currently have too much inventory — which means you may be able to get a great deal on some makes and models.

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Here’s what you should know about why this is happening and how it can benefit you if you’re in the market for a new ride.

Do Dealerships Have Too Much Stock?

Car dealerships measure their sales using a metric called “market days’ supply.” This is an estimate of how many days it would take the dealership to sell the cars that are currently in its possession. This metric is a good way to measure the retail demand for cars, and it’s used by dealers to set prices.

Market days’ supply is calculated by taking the current inventory at a dealership and dividing it by the average sales per day from the past 45 days. If cars are currently selling at a slower pace than they used to, the market days’ supply goes up.

Dealerships don’t usually own most of the cars on their lots. Instead, they make payments on each of them through something called a floor-plan loan. This means that the longer a car sits unsold, the more it costs the dealership. Dealerships want to keep their inventory moving to avoid this, so if their vehicles have a high market days’ supply, they may lower their prices to improve their sales.

Normally, car dealerships aim at a target of about 60 days’ worth of cars on the lot. As of the latest numbers, the current national average is 76 days, though many brands, such as Volvo, Lincoln and Dodge, currently have more than 120 days’ supply.

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Which Cars Might Be Cheaper Soon?

The higher the market days’ supply for a brand of cars, the more likely you are to get a good deal. To help move cars faster, dealers and carmakers may offer incentives for models that are selling at a slower pace. These include special deals like cash back, lower interest rates on loans and other bonuses that make buying the car cheaper for you.

Right now, most of the oversupply appears to be on the more expensive end of the market, with dealers having more than 90 days’ supply of cars over $50,000. Some more affordable brands, such as Toyota and Honda, actually have increased in demand, with only 30 and 45 market days’ supply, respectively.

However, if you’re in the market for a car from any of the following brands, you may be able to get a better deal:

  • Ford: 100 market days’ supply

  • Mazda: 105 market days’ supply

  • MINI: 108 market days’ supply

  • Nissan: 112 market days’ supply

  • Genesis: 115 market days’ supply

  • Mitsubishi: 115 market days’ supply

  • Volvo: 121 market days’ supply

  • Infiniti: 127 market days’ supply

  • Chrysler: 143 market days’ supply

  • Lincoln: 144 market days’ supply

  • Dodge: 151 market days’ supply

  • Jeep: 152+ market days’ supply

  • RAM: 152+ market days’ supply

  • Jaguar: 152+ market days’ supply

  • Alfa Romeo: 152+ market days’ supply.

If you decide now is the right time to buy a car, here are a few tips to remember:

  • Do your research: Know what kind of car you want and what it usually costs. Check out the current supply and demand for the brand you’re looking at so you know whether you’ll be able to negotiate for a better deal.

  • Shop around: Check out different dealerships to see which one offers the best prices and incentives.

  • Negotiate: Always try to negotiate a better price. Dealers may be more willing to lower their prices when they need to get rid of cars quickly.

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This article originally appeared on GOBankingRates.com: Car Dealers Want To Get Rid of Stock: How That Can Help You Get a Great Deal

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