SAN DIEGO (KGTV) - People looking to buy a new or used car may have to hurry if they want to take advantage of the Coronavirus Pandemic's best deals and discounts.
Recent studies from the California New Car Dealers Association show that sales of new cars in San Diego were down by 18.6% in the first quarter of 2020 compared to the same time of 2019. That's better than the state average of 21% but still worrisome for the industry.
President Paul Dyke says his dealership saw sales drop in the 10-15% range at El Cajon Ford. But he says the company did a great job of offering deals to bring people into the lots, such as low-interest financing, long term payment plans, and lower prices.
"Zero percent is always something that gets people moving," says Dyke. "Now for the first time in Ford's history, doing it at 84 months on quite a few of the models really kept things going."
The CNDCA says the Pandemic forced the industry to readjust its outlook for the year. They now predict new car sales to reach about 1.5 million in 2020, down from 2.1 million in 2019. If sales stay slow, it could be the worst year for new car sales since the Great Recession.
Meanwhile, used cars are flooding the market as rental companies upgrade their fleet.
Hertz recently filed for bankruptcy. The company iSeeCars.com did a study on their prices and found that Hertz was offering sales discounts in May that were 43% greater than the discounts they offered in April.
"There are still plenty of deals to be had," says Amada Lasik from iSeeCars.com. "That's especially true for cars that have been lingering on lots for a while, so we invite consumers to do as much research as they can."
Manheim, a company that does used car auctions across the country, says used cars have been staying on lots for longer than usual. According to their data, almost 64% of used cars sold within 30 days back in February. By March, that number had dropped to 53%. The longer a car stays on the lot, the more likely a dealer will offer it at a lower price.
Manheim also found that used car sales were down 34% in April compared to 2019, while wholesale used car prices dropped more than 11%.
All that being said, experts believe these numbers will bounce back over the summer as restrictions ease.
Dyke says his most significant concern for the industry is inventory. Since factories were closed for several months during the Pandemic, dealerships won't have as many cars to sell in July and August.
Dyke says the companies will raise prices and eliminate the deals as demand increases while supply dwindles.