Car Buying In A Slowing Economy

CONSUMER REPORTS OFFERS SHOPPERS CAR-BUYING TIPS IN A SLOWING ECONOMY

CR Auto Price Services urges buyers to keep a sharp eye on the bottom line

Yonkers, NY - With the economy slowing, consumers in the market for a new car should hone their negotiating skills, hunt for models offering substantial incentives or rebates, and possibly consider downsizing to a smaller and more economical vehicle, according to Consumer Reports' Director of Auto Price Services, Paige Amidon. "Car buyers place too much emphasis on the monthly payment for their new car without evaluating all the numbers and determining what the true cost will be," Ms. Amidon says. "Consumers should do some research before they head out to see what's on the dealer's lot-and leave their checkbook at home until they really know what they want." Auto buying surveys done by Consumer Reports have shown that too many buyers visit just one or two dealerships and don't spend enough time considering different makes and models. That's especially true for buyers who tend to go back to the same dealer time and again. Consumers should take the time to visit at least three or four different dealerships, research vehicle reviews and pricing information on the Internet or the local library, and be prepared to walk out of a dealership if they're not willing to give you their best price. A good place to start your research is Consumer Reports Online, at www.ConsumerReports.org., where you can read car reviews and obtain detailed pricing reports. Many manufacturers are currently offering rebates and incentives-discounts given by the manufacturer to either the customer or the dealer to increase the sales of a particular model. Unfortunately, some buyers assume that there's no room left to negotiate on the purchase price if the dealer is offering a rebate. But Ms. Amidon says consumers should still be sure to negotiate-even if they are being offered a rebate. "The rebate is a signal that there's a lot of room to negotiate because the manufacturer and dealer (more)

- 2 - are trying to move those cars," she says. In this economy, shoppers may also want to think about downsizing-buying a vehicle that's smaller, and more economical to run. Rather than buying a big, gas-gulping SUV, they may want to consider a smaller SUV, or maybe even a minivan. Leasing a new car is also an option. But leasing doesn't make sense for everyone-especially those who drive a lot, or who load their trunk or roof rack with paint-gouging flea-market treasures. That's because you'll be assessed for what the leasing company determines to be excess wear and tear to the vehicle when you return it at lease-end. You'll also be charged anywhere from 10 to 20 cents for every mile you drive beyond what your lease allows. Try the free interactive quiz on Consumer Reports.org to help determine if leasing is for you. The Consumer Reports' New Car Price Service provides the Consumer Reports Wholesale Price, which gives the closest available approximation of the dealer's real cost. The Consumer Reports Wholesale Price takes the dealer's invoice price and figures in the rebates, holdbacks, and incentives being offered at the time. Car buyers who have used our New Car Price Service have saved an average of $2,200 off the original quote given by the dealer on the model they purchased. The $12 price reports also include buying and leasing advice, Consumer Reports' recommendations on options and equipment for a car, a list of alternate recommended models, and Consumer Reports' trusted safety and reliability ratings. For information about purchasing a New Car Price Report, call 800-395-4400 or visit Consumer Reports Online at www.ConsumerReports.org. You'll also find reviews of cars, SUVs and light trucks, general buying advice, and information on special publications from Consumer Reports including the New Car Preview 2001. You can also find car reviews, reliability data, and buying advice in the Annual April Auto Issue of Consumer Reports, which goes on sale everywhere magazines are sold on March 20. Consumer Reports is the trusted source for information and advice on consumer products and services. Its editors have decades of experience in driving, testing, and reporting on cars. Their work is based on the testing and expertise of the Consumer Reports Auto Test Division, which has evaluated autos on the test track and on public roads for more than 50 years, and on the analysis of reliability data by Consumer Reports Survey Research Division, which gathers auto repair information from hundreds of thousands of Consumer Reports subscribers each year. - 30 -

The material above is intended for legitimate news entities only; it may not be used for commercial or promotional purposes. Consumer Reports® is published by Consumers Union, an independent, nonprofit testing and information-gathering organization, serving only the consumer. We are a comprehensive source of unbiased advice about products and services, personal finance, health, nutrition, and other consumer concerns. Since 1936, our mission has been to test products, inform the public, and protect consumers. OPI:DPL:3/22/01