Best Car Deals: May 2011

While April was a strong sales month for car companies, May could end up being a rough time to be a new car shopper.  Sales are up and discounts are down. "Despite high gas prices causing near record-level purchases of fuel-efficient vehicles, we saw the highest industry average transaction price ever recorded in April,” said Jesse Toprak, VP of Industry Trends and Insights for TrueCar.com. “The increase in transaction price was due to the dramatic reduction in incentives, lower dealer discounts, and consumer preference for better-equipped vehicles.”

In April, car makers spent 10.6 percent less on incentives and discounts than they did in March.  Analysts expect the trend to continue. "This is the clearest indication yet that automakers are gearing up for inventory shortages," said Jessica Caldwell, director of industry analysis for Edmunds.com. "Demand for

new cars has been growing as economic recovery has strengthened, but now the industry may experience a hiccup if consumers decide to wait for the next deal to come around, which may not be until the autumn."

In collecting and analyzing the best car deals for May, we’ve found that compared to the past few months, the deals aren’t as widely available and simply aren’t as good. That’s because car makers are starting to feel the pinch in their inventories from the earthquake and tsunami in Japan. Honda says that production won’t be back at normal levels until the end of the year, and Toyota is aiming to resume full production in November.  With fewer cars to sell, and high consumer demand for fuel-efficient cars, car companies are using higher prices to manage their inventories.

While there are a few deals available this month, most analysts agree that prices will be lower and deals will be better this fall.  If you can wait to buy, you should.  If you just can’t wait, look for low- and no-interest financing, as well as some limited cash-back offers. You can also get a better deal by changing the kind of car you’re looking for.  While fuel-efficient small cars are in short supply, you can get cash back on many large trucks and SUVs. With gas prices edging up, however, you could end up paying more at the pump than you save at the dealership.

While we strive to keep this list of the best car deals up-to-date, they can change without warning. In many cases, the deals available to you depend on where you live. The best way to find out if you can take advantage of these deals is to contact a dealer near you. You can use the form next to the car you’re interested in below to contact local dealers for more information on the best new car deals. If these deals don't work for you, we’ve got the best deals for Toyota, Nissan, Ford, Honda, Chevrolet, Lexus, Infiniti, Jeep, and Chrysler. There’s a great deal out there for you, and we’ve done the research to help you find it.

The best deals we found for May 2011 are below:

• MSRP: $13,320 - $17,120
• Invoice: $12,886 - $16,458
• MPG: 28 City / 37 Hwy

2011 Ford Fiesta

Purchase Deal

Deal: $500 cash back OR 1.9% financing for up to 36 months

Deals on small cars are some of the hardest to come by this month.  With the top-ranked Ford Fiesta, you can choose between $500 cash back or 1.9 percent financing for up to 36 months. The Fiesta gets up to 40 mpg on the highway, so while this deal may not save you much money, you also won’t be paying too much to fill up the Fiesta.

Expires: 05/31/11

• MSRP: $28,045 - $40,395
• Invoice: $25,417 - $36,577
• MPG: 17 City / 23 Hwy

2011 Honda Pilot

Purchase Deal

Deal: 1.9% APR for up to 36 months

Good luck getting your hands on one of Honda's popular small cars, but if you need something larger, the Honda Pilot is tough to beat.  With seating for seven and three LATCH connectors in the second row, the Pilot is great for families with lots of little kids.  This month, you can get the Pilot with 1.9% financing for up to 36 months.

Expires: 05/31/11

• MSRP: $32,940 - $36,100
• Invoice: $31,622 - $34,656
• MPG: 21 City / 31 Hwy

2011 Volkswagen Eos

Purchase Deal

Deal: 0% APR for up to 72 months

Let’s face it: it’s a scary world out there right now, with natural disasters, war and unrest. The best way to take your mind off of all that is to hop in a convertible and enjoy the spring weather.  With the current offer of zero-percent financing on the VW Eos you can forget the world’s troubles without troubling your wallet.

Expires: 05/31/11

• MSRP: $21,975 - $27,015
• Invoice: $20,876 - $25,664
• MPG: 22 City / 33 Hwy

2011 Chevrolet Malibu

Purchase Deal

Deal: $2,500 cash back OR 0% APR for 60 months

With competitors like the Hyundai Sonata stealing the limelight, the Chevrolet Malibu may not get much attention in the midsize car class. Overlooking the Malibu would be a mistake, however.  Reviewers say it’s comfortable for most families and conservatively stylish.  It was even North American Car of the Year in 2008.  Ahead of a complete redesigned, you can get the 2011 Chevrolet Malibu in May with zero percent financing for up to 60 months or $2,500 cash back.

Expires: 05/31/11

• MSRP: $15,995 - $23,895
• Invoice: $15,850 - $23,276
• MPG: 23 City / 29 Hwy

2011 Jeep Patriot

Purchase Deal

Deal: $1,000 cash back or zero percent financing for up to 36 months

The Jeep Patriot tries to split the difference between being a comfortable on-road cruiser and a rugged off-road SUV.  And while reviewers say it’s not a class leader in either area, for people who need a car that can do both, the Patriot is a smart choice. This month, you can get the Patriot with $1,000 cash back or zero-percent financing for up to 36 months in some areas.

Expires: 05/31/11