Edmunds says that US car shoppers will find some of the best deals in years on new vehicles this Black Friday (November 24).
“Incentives reached near-record levels in October, so we expect automakers to continue to sweeten savings as the year winds down,” said Jessica Caldwell, director of industry analysis at Edmunds.
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“With slower sales of 2017 model year vehicles, automakers and dealers are more likely to leverage fully the Black Friday holiday as an opportunity to thin bloated inventories to make room for 2018 models.”
Edmunds research shows that Black Friday is one of the biggest car shopping holidays of the year, accounting for 15 percent of total November car sales and dealership traffic roughly doubles during big holiday sales weekends.
Despite strong demand for trucks and SUVs in the US, automakers are struggling to move lagging 2017 inventory off dealer lots. In October, 72 percent of new vehicles sold were 2017 model year, while last October, 60 percent of new vehicles sold were 2016 model year. Five years ago, only 46 percent of the new vehicles sold in October were from the 2012 model year. Incentives last month remained at a near-record high of US$3,472 per vehicle; however, Edmunds analysts say automakers are going to have to be even more aggressive if they want to move inventory.
“Clearing out old inventory is expensive, especially when automakers are forced to deeply discount passenger cars, which already have thin profit margins,” Caldwell said. “With less than two months left in the year and this much inventory remaining, we expect to see some very creative year-end sales events to entice car shoppers.”
