Money Talks, So Should You

Why people buys cars at the end of the year

Clint Williams
by Clint Williams, Dimespring Contributor

Ah, the holidays. TV specials. Eggnog. Christmas carols. Holiday parties. And shopping. Lots and lots of shopping. It is the time of year when the malls are crowded and the automobile dealership lots are quiet as the night before Christmas.

December, for a number of reasons, is a great time to buy a new car for those who are atop the nice list.

That's because dealerships are desperate to lure shoppers more focused on spending all their extra cash on Christmas gifts, says Davis Speight, president of Starwood Motors, which sells high-end used cars in Dallas.

The weeks leading up to Christmas are also a good time to buy a new car because dealerships are trying to hit their annual sales quotas and related bonuses, Speight says. Dealerships have both month-end and year-end targets, so December can bring big discounts.

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Also, the close of the year means dealers want 2012 models gone before 2013, says Jessica Caldwell, a senior analyst at, the online automotive buying guide. Something about the flipping of the calendar makes a car just a few months from the assembly line seem dated.

Dealers have another incentive to make a deal  to avoid paying taxes. Dealerships in most states have to pay taxes on inventory they have at the end of the year, explains Speight. A dealer is willing to shave his margins to avoid paying taxes, which can mean you save thousands, Speight says.

If you want to make a deal, go before Christmas, Caldwell says. Dealerships traditionally see a spike in business the week between Christmas and New Year’s Eve.

The best deals may be among luxury brands Mercedes Benz and BMW, Caldwell says, as the German auto giants battle for bragging rights and market share.

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Some tips for buying a new car no matter the season:

  • Get your loan first. Having a pre-approved car loan from a bank or credit union when you walk onto the lot makes negotiations much simpler.
  • Know your worth. It’s easy as click-click-click to find out how much your car is worth as a trade-in. Go to the online pricing guides found at websites such as Kelley Blue Book and the National Automobile Dealers Association. Be honest about the condition of your vehicle and focus on the wholesale or trade-in value.
  • Focus on price. Don’t let the sales staff throw too many variables into the mix. Firmly set the price before going on to other points of negotiation, such as financing.
  • Know a good price. The True Market Value established by the numbers crunchers at should be your target. Edmunds analysts look at the market, examine past sales, consider the popularity of the car within your region and set the TMV price. It is usually less than sticker price but more than invoice price.
  • Don’t be a sucker. Just say no to extras of dubious value such as paint sealant, fabric protection and window etching of the vehicle ID number.


Clint Williams is an Arizona-based freelancer for DImespring. He has written for the Arizona Republic and the Atlanta Journal-Constitution.