SUVs can tackle just about anything on the road. But they have one big drawback: they’re very expensive. And though everyone wants one, not everyone can afford today’s newest SUVs.
If you’re thinking about buying a new SUV, now is the time to act. Because right now, you can save thousands and drive away in the SUV you’ve always wanted.
Here’s what you need to know – and why automakers and dealerships are starting to slash prices on their SUV lineups.
Dealerships Are Seeing an Influx of SUVs
There’s one big factor affecting the price of new SUVs right now, and it’s supply.
Visit your local auto dealership, and you’ll likely find row after row of shiny new SUVs sitting on the lot. But here’s something you won’t see: the fact that every auto dealership has more cars than they can sell.
Right now, there are 3.95 million vehicles sitting on dealership lots. And that’s way more cars than dealerships can handle – in fact, it’s way more cars than dealerships can sell.
New models are arriving from automakers every month for dealerships to sell. On top of that, dealerships are preparing for the arrival of the next model year.
Making matters even worse is a huge, unexpected influx of off-lease SUVs. Leasing became a popular choice for drivers looking for an affordable way to get behind the wheel of a brand-new SUV. And in 2019, 2020, and the years that will follow, thousands of SUVs will be returned to dealerships. These off-lease SUVs will be like new, have low mileage, and will increase the amount of cars dealers need to sell.
And in addition to these factors, dealerships are already struggling to sell their usual inventory. While the U.S. auto industry sold over 17.55 million vehicles in 2018, things aren’t looking good today. Dealerships are expected to sell less than 17 million in 2019, with sales dipping even further after that.
If dealerships want to make a profit, they need to make a lot of sales very quickly. Otherwise, they run the risk of not meeting their quotas – and that could cost them a ton of money. For every car that sits on a dealership lot, the dealer must pay interest, storage expenses, and take a loss on any wear and tear.
Automakers Have to Compete to Earn Customers’ Sales
All of the above – new SUVs and off-lease SUVs and increasing cars sitting unsold – happening on dealership lots is making it increasingly important for dealers to sell vehicles. But there’s another problem that’s making it tough for dealers to sell SUVs.
Every automaker is trying to sell SUVs. This means that each dealership is in competition for your business. The marketplace is incredibly crowded – with auto companies releasing new SUVs, new crossovers, and new versions of beloved old SUVs, every single brand wants you to buy one of their SUVs.
And unfortunately, buyers are being more selective. This is putting pressure on automakers. They need to catch your attention in order to earn your money. As automakers compete to sell you an SUV, they’re going to have to entice you.
That’s where price drops will start appearing. According to the Detroit Free Press, experts expect that automakers will begin slashing prices, increasing incentives, and offering discounts on great SUVs to win your business.
Because SUVs are commonly big moneymakers for dealerships, there’s a lot of wiggle room in price. And this means that dealerships can take thousands of dollars off an SUV’s price tag without missing out. As sales dwindle, you’ll see the discounts get increasingly better.
Incentives and Sales Are Easy to Find
If you’re considering buying a new SUV, you need to know all of these things are happening – and right at your local dealership. Thanks to an excess of inventory, dealerships are willing to offer big deals and large incentives. But in order to get them, you need to know what to look for.
Automakers are beginning to offer discounts regularly on SUVs in order to move models. Look for special promotions at your local dealerships. GM has been spending increasingly more each month to discount its SUVs, even running month-long incentive events. Nissan has been offering incentives worth thousands of dollars in cashback on certain makes and models.
You should also search for SUV price cuts and discounts at certain times of the month. The Morning Call reports that auto companies will typically start offering big incentives once a vehicle sits unsold for 75 days. You should look for models that aren’t selling – and that you can easily do online.
You’ll also want to make sure you compare pricing, offers, and incentives at different dealerships. Don’t limit yourself to just one dealership. All the dealerships in your area will likely have different sales, different discounts, and different incentives. Make sure to compare their offers and see where you can get the biggest discount on a new SUV.