New Car Deals for March 2010

       Iguida.com highlights the best new car deals of the month in 11 vehicle categories, including Hybrids, compact cars, midsize cars, and SUVS. These top deals are based on the automakers’ current sales incentives.

Generally, three types of incentives apply:

• CONSUMER CASH REBATES: Our top consideration is always given to consumer cash rebates. This is cash paid by the manufacturer to you. You can accept the rebate in the form of a check after the sale, but most people treat it as a part of the negotiating process. For example, Hyundai is offering a $2,000 cash incentive on its 2009 Elantra compact car. As you negotiate the price of the new car, you can apply the $2,000 directly to your down payment to reduce the amount you’re financing. Or you can tell the dealer to deduct it from the vehicle’s transaction price in a cash sale. Note that when we list consumer rebates as being “up to” a certain amount, this represents a combination of offers the manufacturer may be putting on the table. And be aware that we don’t include group-specific incentives, such as rebates for military personnel or recent college graduates, and we don’t include customer-loyalty incentives.

• MARKETING SUPPORT: Our second consideration is direct-to-dealer marketing support from the manufacturer. These are sometimes called “dealer support” or “secret rebates” because they’re rarely publicized and the dealer doesn’t always pass the rebate on to an uninformed car buyer. For example, Mercedes-Benz is offering $14,000 marketing support on its 2009 S550 sedan. Indeed, these incentives are often used by luxury automakers to help their dealers move slow-selling models without “cheapening” the brand by advertising a rebate or cutting the retail price. There’s no guarantee the entire amount of the incentive will be passed along to a consumer. But knowing such an incentive is in effect can give you an advantage when you negotiate the transaction price on a given model.

• LOW-RATE FINANCING: Our third consideration is low-rate financing offered to buyers by an automaker’s so-called captive-financing divisions. These incentives can be as low as zero percent interest on a loan and can include loans as long as 72 months. On its 2009 Cobalt compact car, for example, Chevrolet is cash offering up to $1,500 cash and 1.9%-4.9% financing to 72 months. While they can save you thousands of dollars over the term of the loan -- particularly if you’re buying an expensive car -- the lowest interest rates typically are limited to buyers with spotless credit records. And you should always check with other lenders – banks, your credit union -- to see how their rates compare with the automaker’s low-rate financing. Finally, note that the incentive may also involve a cash rebate in lieu of discounted financing. In the 2009 Cobalt example, Chevy is also offering the alternative of a customer-cash rebate of up to $3,000. Be sure to run the numbers both ways to see which will ultimately result in the better deal for you.