I would imagine that car dealers sometimes have “leftovers”: what happens if a new car hangs around, unsold, for a model year or two? They don’t just destroy it, do they? Does it go back to a giant warehouse somewhere? Is it possible to walk into a dealership and ask for a new car that is a model year or two behind (i.e., does anyone still have brand new '02/'03 cars lying around)?
(This feels like a question whose answer will make me go :smack:, but it popped in my head yesterday and now I gotta know!)
Like everything else, if you make something valuable cheap enough it will sell. Sooner or later a new car will be discounted enough to make it sell. End of problem.
Rental car fleets and deeply discounted bargins for the most part. You can get some great deals on last years models in December, but it will usally be a base/stripped down model.
Some end up going south of the border as well, but not as much as they used to.
A car dealer can sell to anybody as long as the manufactuer gets there invoice price (which isn’t set in stone) and they are free to take a lost. But I can’t imagine this happening (parting out) with a major manufactuer. Parts dealers can buy warrentied parts from the OEM all day long cheaper and easier than taking them off a vehicle.
But if memory serves me I believe that you could buy new Yugos for a couple of years after they went out of business. I can recall some people buying two so that they would have a parts car.
My car (a '91 Mazda Miata) wasn’t originally purchased until late 1992. Given that new model years come out the year before, it was two years out of date at that point. I assume that the original buyer got a good deal because of it.
Funny thing about the auto business, every new car that gets built gets sold. Watch the ads starting in about Juneish here in the states. You will hear about model year clearance sales. By November if these ads are still running (they will only run if there are still last years cars left over) they are offering some very atractive deals.
You have to understand that a car dealer usually does not own the cars on his lot, the bank does. The bank charges intrest on the money borrowed to keep these cars there (called flooring). If a dealer were to keep new cars around for a year or more, they are losing their ass on the flooring charges.
The last time I saw any cars left over for more than just a few months after the new year was when Yugo went out of business here in the US.
It’s still early enough in the year that if you take a close look at the weekend auto dealer ads in any major city newspaper, you’ll find a few '04 model closeout deals still available. In fact, I even heard one dealer locally (Atlanta) running a radio ad in the last couple of weeks that mentioned extremely steep discounts on remaining '04 models in stock (whether they actually had any '04 models remaining in stock is, of course, another issue). I have actually seen at least one car that was two model years old still sitting on a dealer lot, but that’s a pretty rare sight.
A few years ago, when I was shopping for a new car, I saw a Plymouth Sebring sitting in a Chrysler dealer’s lot. (This was after the Plymouth name had been discontinued.) It was a couple of years old, but was being sold as new for less than $10,000. I figured that it had to be a lemon.
I eventually ended up buying a Saturn, in case anybody was wondering.
A family member of mine bought a 1999 7 series BMW new in 2001. It was an unpopular color and just sat there for 2 years. There was a very steep discount on it.
I’ve seen this a lot with motorcycle dealers. Right now it’s not uncommon to see an '05 on the floor next to an '04. If you ask, they sometimes trot out an '03 from the back room. Eventually they will drop the price to just get rid of the damn thing.
If you have never seen that sort of promotional ad, the rest of us envy you!
For those few cars that are not moved even in that way, plus demo. cars and a few other groups of technically-new-but-not-really cars, they are often sold off to higher-end used-car operations, sometimes as part of a single corporate dealership with the new-car franchise.
But what are these ‘Urine Clearance Sales’ they keep talking about?
I bought my 2003 Yamaha YZF-R1 in July or August 2004. Same bike as the 2004s, but $500 less than the already-discounted prices on the 2004s. Now, I wouldn’t have cared about $500 at the time (I had a good job), and I would have bought a 2004 if I was ‘in the market’. But the 2004s were only offered in blue or silver. The 2003 was red.
Hey, it’s not my fault I bought a new bike! They’re the ones who put the red R1 in the showroom! They’re the ones who put a good price tag on it! I only went there to get new tyres for my Seca II.
