New year, new car?
Once upon a time – although not too long ago – most Australian car owners held onto their vehicles for at least a decade. They’d pay a new car off over about five years, then keep it for another five. But it seems that times are changing. Smartgroup's Group Procurement Manager Mark Biggart says people are upgrading more often now - every three to four years on average.
But with the New Year comes the temptation of a schmick new car that will let you endure the daily commute in style. Apart from comfort, there are plenty of other reasons to consider upgrading now. Here are the top four.
The value proposition
According to Biggart, there has actually never been a better time to buy a new car in Australia. It’s commonly believed that consumers in Australia pay more for their cars than those in other countries, but this is a misconception, he says.
“It may be true for luxury cars, but our bestselling cars do pretty well from a competition perspective internationally in terms of prices,” he says.
“Even the base model Volkswagen Golf is significantly cheaper here than in the UK.”
Car manufacturers all competing for market share has been responsible for keeping prices low. The quality of cars is high though, he says, with technology in particular improving all the time. “When you look at the cost of many cars – such as the Golf – today versus five years ago, largely the cost of the vehicle has either stayed the same or it’s got cheaper, especially when you factor in the seasonal adjustment.”
One of the best times of year to buy a new car is at the end or beginning of the calendar year, as dealers look to get rid of stock to make way for newer models.
Even if you miss the very beginning of the year, there are still times when bigger discounts can be found, including the end of the financial year and even the end of each month, when dealers chasing sales targets may offer significant price reductions.
Smartleasing customers also have the benefit of getting substantial discounts all through the year, over and above the affordability already in the market, due to the company’s buying power.
For those looking to finance or lease a car purchase, affordability is further enhanced by low interest rates. The cash rate – set by the Reserve Bank of Australia – has been falling since November 2011. It has been more than seven years since it was raised and competition is firm between lenders. “Low vehicle prices combined with the low cost of money is a pretty strong value proposition, making it a good time to buy a car,” says Mark.
With lots of manufacturers competing for a slice of the new car pie, there has never been a bigger choice of vehicles to choose from in Australia, says Mark. He adds that most of the top 10 bestselling cars in Australia this year had an update in some form – whether it be features, functionality or price points – over the past 12 months, which means there are some great vehicles on the market. There will also be some new cars coming onto the market in the new year, which Mark believes will be popular choices for consumers looking for something different.
Getting the best price: if you do it yourself, you’ll pay too much
With a network of 850 dealers across Australia, Smartleasing’s buying power can save you hundreds – and most often, thousands – on the price of your new car. We can even organise your test drives within our trusted dealer network, so your car buying experience is all service and no sales pitch.