Are you in the market for a car? If that’s the case, you are in luck as the ‘best week to buy a car’ is nearly here. Auto market experts have identified December as a great month to buy, and here’s why the week between Christmas and New Year’s is prime time.
Above all, the deals offered by car companies may make it an enticing time to buy. Still, a few other market considerations make this December even more opportune.
The impact of Trump’s tariffs on car prices
Buyers must consider the international labor and manufacturing that goes into most cars sold in the US. Even American car companies like Ford have plants in other countries on which they rely. One of those countries is Mexico, and with Donald Trump’s return to the White House set for January 20, these foreign parts could become pricier due to his tariffs. The cost of these import taxes could be passed along to the consumer, leading car dealerships to increase prices in 2025. If you plan to purchase a car within the next year, the threat of tariffs might be reason enough to push up your buying plan.
Over the last two years, car prices on new and used vehicles have decreased by 2.1 percent. While these trends are promising, prices remain 26 percent higher than their position in late 2019, reports the Bureau of Labor Statistics (BLS). These high prices have made many reconsider buying a car because of the higher interest rate associated with their auto loan should they not be able to buy the vehicle outright. In the first quarter of 2024, auto debt reached a record $1.6 trillion, more than credit card debt. Delinquency
The deals of the season
In general, thanks to special holiday offers put on by car companies, December is considered the best time to buy. The deals offered often provide the biggest discount on the MSPR (the ticket price). In addition to enticing shoppers during the holiday season, car companies are also preparing to release updated models, and the sales can help clear the inventory of earlier ones.
Is December really the best month to buy?
If the President-elect follows through on his plan to enact tariffs at the scale that has been proposed, December is likely your best bet to save on your new car.
However, consumer price data from the BLS do not show December as the month when prices are the lowest for new and used cars. Over the last ten years, the best deals were offered three times in September, followed by December and January, each of which made the list twice.
Just looking at used cars, December has offered customers the best prices three times—more than any other month. For new cars, January is unequivocally the month where customers will find the best deal during the year.
The EV market broke records in 2024
According to data from the US Energy Information Administration (EIA), the percentage of electric and hybrid vehicles purchased, as a portion of all cars bought, continued to increase this year. Towards the beginning of the year, the percentage of EVs and hybrids sold made up 19.1 percent of new light-duty vehicles sold, and a few months later, in the third quarter of the year, that figure surpassed 20 percent, climbing to 21.2 percent.
That means that today, slightly over a fifth of new cars being purchased are not fully gasoline or diesel-powered. The demand for EVs has grown substantially through new tax incentives offered by the federal government that grant a $7,500 credit towards the purchase of certain EVs.
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