When Is the Best Time To Buy a Car?

With inflation and supply-chain issues like the semiconductor chip shortage causing vehicle prices to skyrocket, timing your purchase is critical for maximum savings. According to Kelley Blue Book, the average new car sold for $48,528 in May 2023 — $1,393 beyond what it was last year.

The best time to buy a car is often at the end of the month, quarter or calendar year when dealerships are trying to meet sales targets. You may also consider certain holidays when dealerships are running sales promotions.

Knowing the right moment to make a car purchase can put extra money back in your pocket. Whether it's taking advantage of end-of-year sales or holiday promotions, your timing can be as crucial as the make and model you choose.

As the year winds down, car dealerships are keen to meet their annual sales targets and clear out their inventory for new models in the coming year. This urgency often translates into significant discounts and promotional offers for buyers.

One critical period is the week between Christmas and New Year's Eve. During this time, dealerships are particularly motivated to close deals and hit their year-end sales quotas. This can result in some of the year's biggest discounts, making it an excellent time for savvy shoppers to buy a car.

Moreover, car sales tend to slow in winter, especially around the holidays, when people are often more focused on holiday expenses. This decrease in demand can further motivate dealerships to offer great deals to attract potential buyers.

The "model year" in the auto industry refers to the year a manufacturer assigns to a particular car model, regardless of its actual production. New or next year's models typically arrive at dealerships in late summer or early fall. This period marks the end of the model year for the current models.

When these new models roll in, dealerships need to clear out their inventory of outgoing models to make room for the new ones. This can lead to significant discounts and incentives on the outgoing models, especially cars that haven't sold as well as expected or are due for a redesign.

Car dealerships often operate on monthly and quarterly sales cycles. These cycles are tied to specific sales targets that, if met, can trigger bonuses or incentives from car manufacturers. As the end of the month or quarter approaches, dealerships close to hitting these targets may be more willing to offer discounts to close a sale.

This pressure to meet targets is at more than just the dealership level. Individual salespeople often have their own monthly and quarterly sales goals. They might be more motivated to make a deal if they're near a target that triggers a commission bonus, which can work to a buyer's advantage.

However, it's important to remember that not all dealerships operate on these cycles, and some might not be under pressure to meet sales targets. The effectiveness of this strategy can vary, and it's not a guarantee of a better deal. But if your car purchase timing aligns with the end of a month or quarter, it could be an opportunity to negotiate a more favorable price.

Holidays are often a time of sales and promotions across various industries, and the auto industry is no exception. Dealerships often run sales promotions during major holidays, offering significant discounts or financing deals to attract customers.

Here are some specific holidays that often come with significant car sales:

• Memorial Day: This holiday kicks off the summer season, and dealerships often offer sales to draw in customers over the long weekend.

• Independence Day: The Fourth of July is another holiday where dealerships often have sales, taking advantage of the mid-summer holiday when people are often off work and can shop.

• Labor Day: As summer winds down, dealerships may offer Labor Day sales to clear out current model year inventory and make room for new models.

• Black Friday: The day after Thanksgiving, known for big sales across all retail sectors, can also be a great time to find a deal on a car.

• New Year's Eve: As dealerships try to reach year-end sales goals, New Year's Eve can be a time of significant discounts.

Dealerships take advantage of these times when potential buyers are off work and might be more inclined to make big purchases.

During weekends, dealerships are often busy with shoppers. When Monday rolls around, customer traffic slows down significantly. This slower pace can work to a buyer's advantage. With fewer customers to attend to, salespeople can give you more attention, which might lead to a more personalized buying experience.

Moreover, since the dealership is less crowded, salespeople might be more willing to negotiate to close a sale. This advantage could result in a better deal for the buyer.

While there are optimal times to buy a car, there are also times that might not be as advantageous. The following may not be the best for car shopping:

• Early in the model year: When a new model is just released, demand is often high, and dealerships are less likely to negotiate on price. If you're interested in a new model, waiting a few months for the initial hype to die down might be worthwhile.

• Early in the month: Dealerships often have monthly sales targets. At the beginning of the month, the pressure to meet these targets is less intense, so they might not be as willing to offer discounts.

• When you're in a rush: If you need a car immediately, you might need more time to do thorough research or wait for the best deal. Dealerships can often sense when a buyer is in a hurry and might be less willing to negotiate.

• When you're unprepared: If you still need to do your research on the car's market value, have yet to decide on the exact vehicle you want or don't know your budget, you're not ready to get the best deal.

Although waiting for a better time to purchase your new vehicle may be difficult, your patience may result in significant savings.

Timing is just one piece of the puzzle. Equally important is thorough planning and research. By combining the right timing with solid preparation, you can make a financially smart decision that aligns with your specific needs and budget.

When planning to buy a car, you may wonder about the best time to make your purchase. We answered some of your frequently asked questions below.