Best Car Deals for January

The automotive industry, battered by a brutal 2008 that saw sales fall to lows not seen in a quarter of a century, enters 2009 on very shaky ground. Consumer confidence fell to an all-time low in December. Even mighty Toyota posted its first yearly loss in seven decades.

In December, automakers responded to the grim news with heavy incentives and discounts.

We've seen dealers go to extreme lengths to move cars off of their lots, including buy-one-get-one-free Dodge Rams in Florida, a Texas Subaru dealer offer those who lease a Legacy at full price a second lease - on an Impreza - for 50 cents a year, and an Illinois Chrysler dealer offer Pacifica buyers a second car - a PT Cruiser - for just $1.

You may not see such publicity-raising moves in your own town - but as dealerships face unprecedented hard times, you might. Even if you don't, you will see worried dealers working to move cars off their lots at any cost just to remain in business.

As for the carmakers' national incentive programs, some of December's aggressive deals have been pulled for the new year. But other great deals have remained and new ones have emerged in January.

Most notably, Ford's "Employee Pricing Plus" program continues into mid January - and you'll spot a number of Ford deals below because of it. Car makers are even turning to seemingly recession-proof deals: Those who buy a new 2009 Hyundai, for instance, can now return the car and walk away from the payments if they lose their jobs in the first year they own the vehicle.

But more than any national incentive program, what will save you money in January is that car dealers are desperate, and looking to negotiate.

Dealers don't own the cars on their lots outright. They make payments on them -- and the way their loans are structured, a car gets more expensive for the dealership the longer it sits unsold.

Along with desperate dealers, government investment in financial firms and car makers has started to loosen credit standards. At the beginning of December, GM's lending arm would only loan money to new buyers with credit scores of 700 or above. But now, after a new influx of cash from federal bailout funds, the company is willing to lend to buyers with credit scores as low as 621.

As always, the best way to get the best deal is to shop around. Take a look at some of the top advertised deals below, but also be sure to get price quotes from multiple deals - your best negotiating tool in any market.

The Best Deals we found in January are listed below:

2009 Kia Rio

0% APR for 36 mos+$200 cash back or $1,500 cash back

When we performed the calculations for our annual Best Cars for the Money Awards, we weren't at all surprised that the Best Subcompact Car for the Money turned out to be the Honda Fit. Most of our editors had predicted that. But none of us correctly predicted the runner-up: Kia's smallest offering. Considering the car's low up-front cost, low cost of ownership (particularly its thrifty 27/32 mpg fuel economy rating) and its increasing quality, the Rio proved to be the second best choice a subcompact shopper could make. In January, with interest-free financing or cash-back offers available, it's an even better one.

MSRP: $11,495-$14,875

Invoice: $11,045-$14,120

MPG: 27 City/32 Hwy

2009 Ford Fusion

Employee Pricing+up to $2,500 cash back or 0% APR

The deal makes our list for the second straight month. The Fusion is every bit the equal of the Honda Accord or Toyota Camry, with more cornering agility and a higher safety score than either one. Incredibly, it's available now for the cost of a smaller Toyota Corolla or Honda Civic. If you were to max out Ford's current Employee Pricing Plus deal, bringing in outside financing so that you could take advantage of $2,500 cash back, you could pay just $15,492 for one of our highest-ranked midsize cars - about what you would expect to pay for its smaller Focus sibling in an ordinary year. Six months ago, $15,500 would have bought you a nice small car. Today, it will buy you a nice midsize car.

MSRP: $14,995-$17,970

Invoice: $14,091-$16,648

MPG: 24 City/35 Hwy

2009 Jaguar XF

0% APR for 60 Months

The new Jaguar XF is an experience like nothing else on the road. Enter the car, and you hear a subtle heartbeat sound as the start button pulses. Push it, and a polished nickel shift dial rises out of the console into your hand, hidden vents in the dash open in front of you, and a vicious V8 more powerful than what BMW and Mercedes have to offer rumbles to life. In January, it's available interest-free. But this isn't the typical 36-month 0% loan - this is a five-year loan, keeping payments relatively reasonable, and putting all that power within reach of more buyers.

MSRP: $49,200-$63,700

Invoice: $44,772-$57,967

MPG: 16 City/25 Hwy

2009 Ford Escape

Employee Pricing Discount over $2,000+0% APR

In a market filled with softer-looking "crossover" SUVs, the square-shouldered Escape is starting to look like a throwback. But with improved handling and braking for 2009, surprisingly good fuel economy (22/28 mpg with the four-cylinder engine), top safety scores and an the available SYNC infotainment system that even reads aloud text messages received by your Bluetooth phone, the Escape doesn't feel like an outdated ride. Ford has extended its Employee Pricing Plus deal, making a well-equipped Escape less expensive than most of its rivals for a short time. Discounts, however, don't apply to the Escape Hybrid.

MSRP: $20,100-$27,330

Invoice: $18,937-$25,315

MPG: 22 City/28 Hwy

2009 Mazda CX-7

0% APR for 36 Months+$500 Cash Back

The CX-7 drives like a sporty midsize car, particularly on winding roads. Its sleek looks also belie its SUV size and capabilities. It's surprisingly upscale inside, though its rear seat is a bit small for adults. And while most manufacturers are dialing back interest-free loans this month, Mazda isn't. The CX-7 is available interest-free until Feb. 2.

MSRP:$23,900-$28,400

Invoice:$22,365-$26,561

MPG: 17 City/23 Hwy

2008 Toyota Sequoia

0% APR for 60 Months or $3,000 Cash Back

Since General Motors and Chrysler have dialed back its incentives this month, we aren't seeing the same huge cash-back offers that dominated this list at the end of 2008. That leaves Toyota's no-interest offer to rise to the top - with a 60-month loan term, it keeps payments reasonable. There are still plenty of 2008 Sequoias on dealer lots, so Toyota is offering this incentive to move them. For those in need of seating for eight and the towing power of a large truck, the Sequoia is a nice choice. It's tuned for a softer ride than Chevy and Ford's biggest SUVs, but every bit as capable, and with Toyota's legendary build quality, it should last as long as you need it to.

MSRP:$34,150-$55,600

Invoice:$30,393-49,484

MPG: 14 City/17 Hwy

2009 Ford F-150

0% APR for 36 months or $2,000 cash back

The days of buyers seeking out luxurious pickups as family vehicles may be behind us. Trucks are tools again. The newly redesigned Ford F-150 is one of the best of them, joining the Chevy Silverado at the top of our rankings. With a best-in-class tow rating, payload capacity and rigidity, it's more capable of hard work than most of its peers. In SFE trim, it also offers best-in-class fuel economy. And with the available Work Solutions in-dash computer system, it does more than just the hard physical work. It used to be rare to see incentives on a brand-new vehicle, but in this market, even the all new F-150 is offered at a discount.

MSRP: $21,095-$43,885

Invoice: $19,633-$39,380

MPG: 14 City/19 Hwy