For the past year, buying a new car or truck has generally meant paying more than ever before. Between a growing economy and years of pent-up demand for new wheels, the average price for a new vehicle hit $30,832 in November, according to TrueCar. Yet within the past few days, several automakers have thrown extra cash, no-interest loans and other deals on their models in an unusually large push for buyers in December, already expected to be the biggest sales month of the year. If $13,000 off sticker price can't move a new Chevy Silverado, what will?
Those Silverado deals come due to a stumble by General Motors, which will reveal an all-new 2014 Silverado on Thursday, GM's single best-selling vehicle. Last month, Chevy didn't respond to better offers from Ford and Ram on their pickups -- with Ram offering up to $8,200 in discounts -- and GM's inventories swelled to more than twice the normal level, with dealers sitting on 245,853 trucks.
That forced GM to up its offers on Friday, adding rebates, sweeter loan deals and bonuses to dealers who hit sales targets. While the average Chevy truck rebate may have risen by $1,000 to $5,000, dealers can use their cash in creative ways. One Georgia Chevy dealer was offering $13,000 off a Silverado and $12,000 off the Chevy Avalanche until this story appeared; a more typical discount runs closer to $9,000, with a few dealers broaching $10,000 off.
But it's not just pickups getting extra money on the hood. GM raised its rebates on many models Friday, from the Chevy Cruze to the Traverse. Dodge, facing a similar inventory bloat and slower-than-expected sales of the new Dodge Dart, doubled its available rebates to as much as $1,500; Chrysler is also offering a $1,000 enticement to Volkswagen owners due to a spat between Chrysler/Fiat chief executive Sergio Marchionne and VW executives in Europe. Japanese brands have raised their enticements as well in recent months, with TrueCar estimating that Nissan spent as much on deals per vehicle in November as GM and Ford — about $2,800.
And it's not just mainstream models. BMW and Mercedes have been punching at each other all year for the title of best-selling luxury brand, throwing a combination of cheap lease deals and cash at their customers, forcing other luxury makes to follow along with thousands of dollars in discounts of their own.
Combined with tens of thousands of additional buyers who will be seeking new cars due to damage from hurricane Sandy, December may be one of the bigger sales months for new vehicles in the past few years. History shows that every December mini-boom triggers a hangover come January when the industry pulls back on its enticements, and carmakers have been explicit about favoring higher prices instead of chasing every last sale. Before the industry gets its dose of New Year's regret, car buyers should enjoy the party.