WHEN TO BUY A CAR: Consider these five times during the year for purchasing your new car. Image: iStock
Cape Town - For bargain hunters, this time of the year could be a great time to get a good deal on a new car.
But this is not the only time to buy a new car. New model roll-outs, automakers' redesign schedules and other events can uncover bargains for those who know how to read the tea leaves of the auto market.
Just picking an opportune purchasing time isn't enough. First, cover the basics: Arrange financing, check local dealer inventories, and research pricing guides for the current market value of your desired vehicle.
In South Africa, buyers have to wait a year or two for vehicles to arrive. Sometimes this means owning a vehicle that might be replaced soon after its local launch.
Consider these five potential opportunities to up your chances of snagging a bargain.
1. Model changeover
The big three US carmakers (Ford, GM, Chrysler), for example, launch their new models in August and September, while other carmakers sprinkle new-vehicle introductions across the calendar. Most buyers are drawn to the newest models, which pressures dealers to offer deeper discounts and incentives to clear their inventory of the previous year's models.
Jessica Caldwell, an analyst at car shopping site Edmunds.com, said: "We're at a critical time where dealers need to clear out 2016 inventory to make room for 2017's, and that's good news for shoppers who will see some great deals on outgoing models in the coming weeks."
That means consumers do not have to arm-wrestle or play the back-and-forth game to get a good price. Dealers are much more likely to cut to the bone more quickly - so it's less of a hassle.
READ: INFOGRAPHIC: How South Africans shop for cars in 2016!
Bargains are more likely to be available in the compact sedans and luxury vehicle segments, while bakkies and SUVs still are commanding higher prices.
Buyers shopping for newly redesigned or recently introduced models will pay dearly for wanting to be the "first on the block to own that car". Manufacturers "trickle out" a few vehicles for each dealer to drive up interest. Eager buyers will have to pay sticker price and sometimes a bit more.
2. End-of-month pressure
Of all the days of the month, traditionally the last five are when dealers have the greatest incentive to sell.
That's because some carmakers offer bonuses when dealers hit certain sales numbers. Dealers know they can take a loss on that vehicle because they know they'll get the bonus for hitting their quotas.
READ: They sold how many?! SA's best-selling luxury SUVs
These kinds of bargains are more common at high-volume domestic dealers. However, it's hard for the average consumer to know which dealers are facing the pressure to hit quotas. Shopping at the end of the month can help you better your odds - perhaps you're the lucky person who walks in at the end of the month and the dealer is missing the one sale he needs.
3. Year-end sales
The final week of the year brings with it some great deals, particularly from luxury automakers. It's when manufacturers are trying to eke out those last few sales and will forego money in order to get rid of inventory.
Keep in mind, however, that with dwindling inventories, you might not be able to get your first choice of color and options.
4. Model redesign
When manufacturers redesign models, dealers have both the outgoing and new models for sale at the same time. That leads them to offer incentives and discounts to get rid of older models.
Of course, the resale value of the vehicle would be lower. And sometimes, the new model may be better than the outgoing model.
5. Last year of a model's production
This tip is for serious penny-pinchers. When a car is being discontinued or "rebranded" as a different model, the outgoing model's prices drop even more dramatically.
READ: Vehicle finance - 5 things to know when buying a new car
When there is plenty of foot traffic on the car lot, the dealer will keep prices higher, believing there will be a better offer from another shopper. So weekend afternoons aren't optimal because besides higher pricing, the sales staff will be busy and test-drives will be rushed. Instead, shop mid-week, communicating with dealers via text or emails.