The Best New Car Incentives
But the market for new vehicles has been upended this spring because of disruptions caused by the March 11 earthquake in Japan. Parts shortages have forced many automakers to temporarily stop production, causing a ripple effect that means lower dealer inventories on many popular models and, in many cases, higher prices. The average price of a new car is up $350 since the earthquake, according to Edmunds.com.
MORE AT Forbes.COM
You could put off your purchase until later in the year, when production should be back to normal and car dealers are likely to have better deals. If your lease is set to expire this summer, ask whether you can extend it for a few months. Or maybe you can take over the last few payments on someone else's lease until car showrooms are better stocked.
LeaseTrader.com can match you up with someone looking for what it calls a "bridge-the-gap" lease, and you don't need a down payment. "Taking over an eight-month lease with low monthly payments would allow a person to delay their car shopping until the beginning of 2012, when inventories are expected back at normal levels," said Sergio Stiberman, the web site's founder and CEO.
A used car isn't really a good alternative right now, either--their prices are at near record highs.The combination of higher demand for new cars and lower inventories means carmakers and dealers don't have to spend as heavily on discounts. Edmunds.com reported that the average "true cost of incentives"--a sales-weighted average of everything from cash rebates to subvented interest rates and lease programs--was $2,118 per vehicle in April, down $250 or 10.6% from March, and down $515, or 19.6%, from April of last year. It's the lowest incentive spending since October 2005."This is the clearest indication yet that automakers are gearing up for inventory shortages," said Jessica Caldwell, director of industry analysis for Edmunds.com. "Demand for new cars has been growing as the economic recovery has strengthened, but now the industry may experience a hiccup if consumers decide to wait for the next deal to come around, which may not be until the autumn."
If you need to buy a car right now, there are still some good deals out there, if you know where to look. Websites like Edmunds.com, Truecar.com and Kelley Blue Book typically have a "deals of the week" feature on their home page, but you can dig a little deeper into those sites and find out the discounts and incentives on virtually any car. Incentives usually last for a month or more, but it's always best to check to see whether published deals are good in your area.
A lot of carmakers offer cash rebates for military veterans, college students or recent graduates, and will give you an extra discount if you're trading in a car of the same brand. Great financing rates are also available if you get your loan through the carmaker's captive finance company.
Hobbies can also get you a good deal: Ford Motor Company, for instance, is offering a $500 discount on the Escape compact SUV if you're a member of the American Quarter Horse Association.
Automakers are offering the lowest incentives since October 2005, but there still are deals out there. Here's a sampling of this week's best incentives.
2011 Ford Fusion
One of the best-rated mid-sized cars, the Fusion SEL has a sticker price of $25,110, but right now you can get up to a $1,500 cash rebate, or 0% financing on a three-year loan. Mercury lease owners can terminate their contracts up to six months early if they buy a Fusion.
2011 Kia Forte
The Forte holds its own against better-selling compacts like the Toyota Corolla or Honda Civic, and it's a great deal. The MSRP for the mid-line EX sedan is $17,395, but Kia is currently offering a $1,000 rebate, plus another $1,500 if you finance through Kia. If you lease, you can get an $1,800 discount.
Known for its fun-to-drive personality, the Mazda3 is a lot of car for the money. While cheaper versions are available, the 3i Touring model, starting at $18,100, comes with a lot of nice extras. Currently, Mazda is offering a $500 loyalty cash bonus to current Mazda owners who buy the Mazda3, plus 0% financing on a 5-year loan and up to $750 in additional cash rebates for all buyers.
2011 Nissan Altima
The mid-sized Altima 2.5 has a sticker price of $20,270, but Nissan is currently offering a $1,250 rebate or 0% financing for up to five years. There's an extra $500 bonus for financing through Nissan, and $500 for college grads.
2011 Mitsubishi Endeavor
The underrated Endeavor is available with a $4,500 discount or 0% financing. Military personnel get an even better deal by applying the incentives to the dealer invoice price.