In Auto News, CNN reported that new car sales are at the lowest point in 25 years. OK, well what are we going to do about that problem? Here is a snippert from CNN.com
“From 1999 through 2006, U.S auto sales averaged 16.9 million vehicles a year. Before that period, there was only one year when annual sales even hit 16 million.
These strong years came at a time when the number of licensed drivers was posting a modest 1.1% annual gain, suggesting that the sales increases were way ahead of fundamentals. In other words, people bought new cars or trucks because they could, not because they necessarily needed to.
We had above- trend years, some of which we caused by an incredible growth in household net wealth that later we found wasn’t real,” sad George PIpas, director of sales analysis and reporting from Ford Motor.
Pipas added that, “slaves were artificially high in other years due to a higher and higher level of incentive spending.”
“Now when we look back, we see elements of a bubble,” he said.
“Does that present a problem today? Of course.”
Now here is the problem America, just because you have the credit to purchase a new car in 2006, does not mean your credit will stay the same or your budget may not allow you to pay for a lease on a vehicle. It makes more economic sense to buy a used vehicle and save money? The payments will always be cheaper, and your insurance will always be lower. I mean, in my book, if you earn less than $250,000 per year, why not buy a used car and save the extra cash. Look at this scenario- you have $20,000 to spend on a vehicle and you are looking to purchase a vehicle or you start shopping. Lets say you go used… Here are few options:
1. You can make make a large down payment on the vehicle and have low monthly payments, which will always save your credit score.
2. If you purchase the vehicle, and it’s yours,’ it may become a liquid asset in a few years, which can put money back into your pocket.
One of the only ways that this country will ever survive this recession, is to adapt. We Americans have been spoiled rotten by this thing called credit. If you were looking to buy a car, buy it used instead of new. I know it all comes down to personal preference, but to save money you have to put aside your old habits. This goes for the BigThree as well as they seek for a plan that looks decent minus the private jets.
There have been many stigmatisms about used cars, and the quality with anything you purchase. You have to do your homework. Here are some tips to help.
1. Do more homework on the used dealership.
2. Make sure you are armed with a CARFAX and don’t be afraid to ask for a VIN number.
3. Do some research on the vehicle itself.
4. Don’t be afraid to harass the dealer, it takes three visits to make your decision then make the extra trips.
5. If you know a mechanic you might want to bring him/her with you for a test drive.
Wake up America, its not about new cars any more- if we want to get the economy back on track, we must not be spoiled; but smart. We must not be afraid of innovation and new ways of getting the auto industry and the economy back on track, The ones ar the top are trying or so they say; so we have to do our part, no standing waiting.
If you own a business in the auto industry:
1. Make wise budget cuts.
2. Don’t be afraid to cut great deals that is what people are looking for in hard times like these.
3. Free is always a good thing: when money is exchanged that is when you really loose out.
4. Always remember, you are giving a sevice, so treat people kindly.
