Does this car-buying strategy make sense?
September 23, 2024 7:40 PM Subscribe
Mr. Blah and I are both in the market for new cars. We tend to drive ours for a long time—our current cars each are over 13yo & have 160k+ miles. So, I think it makes sense for us to look for 2024 models that are going at a discount as the 2025 models arrive. We won't care that they'll immediately lose a bit more value than the usual drive-off-the-lot loss. Am I correct, or should I be thinking about this differently?
We will 100% buy new, not used.
We will 100% buy new, not used.
Also on the off chance either of you is considering an electric car, it seems pretty clear at this point that NACS (the Tesla charger standard) is absolutely going to replace CCS in the next few years. Most of the 2024 and earlier models from companies other than tesla will have the CCS socket, meaning that you'll be using an adaptor for the lifetime of the car. Just something to keep in mind.
posted by true at 8:03 PM on September 23, 2024 [3 favorites]
posted by true at 8:03 PM on September 23, 2024 [3 favorites]
Best answer: My dad is meticulous in record keeping in terms of insurance costs + repair costs, and from doing this over the course of his adulthood he's concluded that the cheapest option is to do what you're planning on doing - i.e. buying new, but when you can get a deal doing so.
posted by coffeecat at 8:44 PM on September 23, 2024 [4 favorites]
posted by coffeecat at 8:44 PM on September 23, 2024 [4 favorites]
I bought new last month of previous year model like you are thinking about. I also searched dealer inventory and looked for the make of vehicle I wanted that had been on their lot more than 2 months. The dealer has a "floor plan" or carrying cost or monthly financing to the car maker that the longer it sits the more it costs them. My salesperson was trying to negotiate hard, but when I told him the vehicle I wanted was on his lot for 6 months and I am the dealer's best chance at buying that rig, he started coming down price. I finally told him, "Either you give me a take it or leave it price or I will give you one, but I am done with this game of going back and forth and not really making progress." He chose for me to make the offer. I gave him what I looked up as his price from the manufacturer, less than the MSRP by a decent amount and told him he could keep the holdback. He said no and I started to walk out when he asked me for 2 minutes to talk to his manager. Within a minute they agreed.
My point is I think you are on the right path and you should research inventory and costs. Then go in confident and negotiate hard.
posted by JohnnyGunn at 8:56 PM on September 23, 2024 [17 favorites]
My point is I think you are on the right path and you should research inventory and costs. Then go in confident and negotiate hard.
posted by JohnnyGunn at 8:56 PM on September 23, 2024 [17 favorites]
Am I correct, or should I be thinking about this differently?
I don't disagree with your conclusion.
One minor thing to consider is gap coverage. If you happen to total the car immediately after buying it, any insurance you may be able to collect on (liability coverage if it's the other party's fault, collision/comprehensive if it's your fault) will only cover the value of the car at the time of totaling. That may be less than you owe on the vehicle, or less than the cost of a replacement new vehicle. There are insurance products for covering this difference. In my experience, they are overly expensive for the value you get. However, if you're in a position where you absolutely can't afford to live without a car, and you aren't able to pay for a replacement car easily, you may consider getting gap insurance to ensure you can replace the car should that happen.
posted by saeculorum at 11:03 PM on September 23, 2024 [2 favorites]
I don't disagree with your conclusion.
One minor thing to consider is gap coverage. If you happen to total the car immediately after buying it, any insurance you may be able to collect on (liability coverage if it's the other party's fault, collision/comprehensive if it's your fault) will only cover the value of the car at the time of totaling. That may be less than you owe on the vehicle, or less than the cost of a replacement new vehicle. There are insurance products for covering this difference. In my experience, they are overly expensive for the value you get. However, if you're in a position where you absolutely can't afford to live without a car, and you aren't able to pay for a replacement car easily, you may consider getting gap insurance to ensure you can replace the car should that happen.
posted by saeculorum at 11:03 PM on September 23, 2024 [2 favorites]
We also drive cars into the ground and then most recent one we bought was one year old, had been a fleet car for an insurance adjuster (or something?) Most importantly we got a several-year guarantee (we are not in the US, mind you) and the timing belt had been adjusted (the car had about 60K miles) and all the wrinkles of a 'new car' had already been seen to. Obviously it was also about 50% of the cost of a new car, which was also appealing.
posted by From Bklyn at 1:05 AM on September 24, 2024
posted by From Bklyn at 1:05 AM on September 24, 2024
I just bought a motorcycle that had 1200 miles on it and had had its first service done at a significant discount on the new price and with the first service over and done. I wouldn't rule out a car in a similar condition. The first year is the worst for depreciation, and buyer's remorse is your friend, if you can find something that suits.
Also in your favour is if you aren't hooked on a specific car. The wider your search, the more you might find at a price you like.
posted by How much is that froggie in the window at 1:06 AM on September 24, 2024
Also in your favour is if you aren't hooked on a specific car. The wider your search, the more you might find at a price you like.
posted by How much is that froggie in the window at 1:06 AM on September 24, 2024
After you pay this car off, start saving for your next car. Then you can pay cash for the next one. This way, you'll save on interest on your next purchase.
posted by SPrintF at 8:18 AM on September 24, 2024 [1 favorite]
posted by SPrintF at 8:18 AM on September 24, 2024 [1 favorite]
Your idea makes some sense, but a few thoughts:
-For in-demand vehicles, it may already be too late to find a 2024 model
-Expect that the discount will be pretty small for a 2024 vs. a 2025 in most cases, likely to be swamped by other cost factors
-Because you keep your cars for so long, you should be looking for the exact make and model with the exact features that you want, rather than the 'best' deal, because you have plenty of time over the lifespan of the vehicle to amortize any additional upfront cost.
So I guess I would say that your 2024 idea could be a component of an overall buying strategy, but it would be a misstep to make it the central idea of your plan.
posted by Kwine at 8:19 AM on September 24, 2024 [3 favorites]
-For in-demand vehicles, it may already be too late to find a 2024 model
-Expect that the discount will be pretty small for a 2024 vs. a 2025 in most cases, likely to be swamped by other cost factors
-Because you keep your cars for so long, you should be looking for the exact make and model with the exact features that you want, rather than the 'best' deal, because you have plenty of time over the lifespan of the vehicle to amortize any additional upfront cost.
So I guess I would say that your 2024 idea could be a component of an overall buying strategy, but it would be a misstep to make it the central idea of your plan.
posted by Kwine at 8:19 AM on September 24, 2024 [3 favorites]
I'm old enough to have purchased three technically new, last year's model "demonstrators" over the years, and don't regret any of those purchases. Having the full warranty has always paid off, and by the time the cars have been out of warranty I've had to do very little maintenance other than the basics.
One day one of these decade+ old cars I own will have an actual problem and I'll be able to buy a "new" last year's model again.
posted by eschatfische at 9:40 AM on September 24, 2024
One day one of these decade+ old cars I own will have an actual problem and I'll be able to buy a "new" last year's model again.
posted by eschatfische at 9:40 AM on September 24, 2024
Years ago here on the green, I saw a link to this guide about negotiating a new car purchase. We followed the advice in 2016 and got a new 2016 subaru forester (with 3 miles on it when we test drove) for $1000 less than a 2015 with 10k miles on it. During the third round of emails, a couple of the dealers could not believe the price we got and said something like "If that car exists and that is actually the price you've been quoted, take that offer because I don't know how they can offer that price."
Follow the instructions to the letter. Pretend you don't have a phone. Don't set foot into a dealership until you've gotten a negotiated deal are just there to see that exact car and sign the paperwork. (We did actually go in to three dealerships to test the three separate vehicles we were considering; but that was a completely separate process from the buying process)
posted by msbrauer at 9:50 AM on September 24, 2024 [11 favorites]
Follow the instructions to the letter. Pretend you don't have a phone. Don't set foot into a dealership until you've gotten a negotiated deal are just there to see that exact car and sign the paperwork. (We did actually go in to three dealerships to test the three separate vehicles we were considering; but that was a completely separate process from the buying process)
posted by msbrauer at 9:50 AM on September 24, 2024 [11 favorites]
Yes, this is a good strategy. The base/net/MSRP/dealer/holdback costs get renamed and thus more opaque every year, but overall, that's the right idea.
But the differences you're talking about are hundreds to small thousands. Minimizing interest paid over a loan is much more important, so pay even closer attention to the financial arrangements.
posted by Dashy at 10:55 AM on September 24, 2024
But the differences you're talking about are hundreds to small thousands. Minimizing interest paid over a loan is much more important, so pay even closer attention to the financial arrangements.
posted by Dashy at 10:55 AM on September 24, 2024
Response by poster: Thanks for the answer so far. And yeah, one of my motivations is seeing financing for the 24s drop to around 1.7 as opposed to 5+ for the 25s.
posted by BlahLaLa at 11:18 AM on September 24, 2024
posted by BlahLaLa at 11:18 AM on September 24, 2024
My and my wife's cars were both bought as 'demo' vehicles - cars the dealers had on hand to use for test drives. In both cases (different dealers) the price was many thousands below new, because they had newer model demo cars in and needed to get rid of the old ones (and the finance cost of holding them). These came with 100% of the new car warranty even though my wife's car was three years old (with less than 1,000 km) and mine was almost a year old (with 12km on it, as it spent its whole life on display in the showroom).
I've been looking around at possible replacements for my car and there are still very good deals to be had with demos although, of course, you don't get much choice in colours/models etc. I think these are the best of both worlds - you get a new car at a used price. But you have to be quick, because lots of people look out for them.
I hadn't seen the advice linked by msbrauer, but I did follow a similar path. I spent a lot of time researching what I wanted and settled on the specific model I was going to buy, then set about finding the best deal for that car. It's easy to get bamboozled by dealers if you just walk in with a vague idea of what you want. I did test-drive a couple of models early in the process, but was clear that I wasn't buying that day (and didn't end up buying either of the models I drove for cost reasons). Once I was ready, I used the 'I'm buying a car today, so give me your absolute best price now or I'll buy from someone else' line. I found this quite effective - most salespeople can't resist a quick sale and will respond well to someone who is clearly in the market to buy right now.
I also didn't try to trade my previous car in, because it was not particularly desirable at the time and not something the dealer could make a quick sale on, so I found it was better to just negotiate a straight sale and sold my old car privately later. If you want to trade a car in, you might be better to take your car in and have the dealer offer you their 'changeover' price, because they may be willing to juggle the trade-in price up so they can include a higher sale price of the new car in their sales records. Once you have that number, though, you can then do the reverse auction thing, where the price you are comparing is the exact $ you have to give the dealer to take your car and have you drive off in a new one. This does require more contact with car salespeople than you might like, but being clear and direct pays off.
posted by dg at 10:52 PM on September 25, 2024
I've been looking around at possible replacements for my car and there are still very good deals to be had with demos although, of course, you don't get much choice in colours/models etc. I think these are the best of both worlds - you get a new car at a used price. But you have to be quick, because lots of people look out for them.
I hadn't seen the advice linked by msbrauer, but I did follow a similar path. I spent a lot of time researching what I wanted and settled on the specific model I was going to buy, then set about finding the best deal for that car. It's easy to get bamboozled by dealers if you just walk in with a vague idea of what you want. I did test-drive a couple of models early in the process, but was clear that I wasn't buying that day (and didn't end up buying either of the models I drove for cost reasons). Once I was ready, I used the 'I'm buying a car today, so give me your absolute best price now or I'll buy from someone else' line. I found this quite effective - most salespeople can't resist a quick sale and will respond well to someone who is clearly in the market to buy right now.
I also didn't try to trade my previous car in, because it was not particularly desirable at the time and not something the dealer could make a quick sale on, so I found it was better to just negotiate a straight sale and sold my old car privately later. If you want to trade a car in, you might be better to take your car in and have the dealer offer you their 'changeover' price, because they may be willing to juggle the trade-in price up so they can include a higher sale price of the new car in their sales records. Once you have that number, though, you can then do the reverse auction thing, where the price you are comparing is the exact $ you have to give the dealer to take your car and have you drive off in a new one. This does require more contact with car salespeople than you might like, but being clear and direct pays off.
posted by dg at 10:52 PM on September 25, 2024
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posted by Fiasco da Gama at 7:47 PM on September 23, 2024 [2 favorites]