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Is 2020 the best time to buy a car?

Until things turn around, right now may be a very good time to buy a car. Australia’s car industry has suffered 24 consecutive months of falling sales. Only during the GFC in March 2009 were new car sales lower than in March 2020. We even saw the end of that Aussie brand, Holden.

Buy a top four brand

Some brands are still doing well. In March 2020, the top four were Toyota Hi-Lux, Ford Ranger, Toyota RAV4 (thanks to the hybrid) and Toyota Corolla. Clearly Toyota is doing something right. In fact, Toyota’s market share of new sales rose from 18.5% as at March 2019 to 21.5% as at March 2020. Second and third market leaders, Mazda and Mitsubishi, both lost share during that year.

Mazda was the second most popular brand but with sales only 40% of Toyota’s. Meanwhile Kia’s sales in fourth place eclipsed its parent, Hyundai, for the first time. Three other brands had a good month, including MG, Ram Trucks with right-hand-drive, and Chinese marque, Haval.

Buy a used car

Of course, you may not want to buy a brand new car. Carsales says used car sales are usually 2.5 to 3 times higher than new car sales. They also depend on consumer confidence and unemployment rates. Car auction house Manheim claims:

  • 1% fall in consumer confidence means used car prices fall 3%
  • 1% increase in unemployment means used car prices fall 3.5%.

If you prefer a used car, there may not be a better time to buy.

The question now is how to buy. Do you visit a dealership or do you buy online?

Buy a car online

Two years ago, Budget Direct found three quarters of Australians prefer to buy cars in person. Only a third of men, compared to a fifth of women, were willing to buy online. That was a long time ago in the car world. More and more car brands are selling online and, thanks to coronavirus, more people want to buy online.

There are signs digital comes first while the showroom takes a back seat:

  • Hyundai’s new online system, Click to buy, allows you to select a vehicle and accessories to get the estimated driveaway price. You can still negotiate with the selling dealer.
  • Volkswagen buyers can now get the entire car range online. You pay $500 deposit on a model, then the designated dealership contacts you within 2 days to complete the process
  • BMW is developing a fully online purchasing system
  • Toyota already sells and finances cars online and takes about 50 online financial quotes a day.

For those who don’t mind paying 1.5% commission for convenience, there is http://carconnect.com.au. You say exactly what kind of vehicle you want, dealers submit their prices, and the winning dealer delivers the car to your door.

We have previously written that many people prefer the human touch, but that may change. Dealerships are open, but you can increasingly do your car shopping from home. Remember all new cars come fully registered with a current greenslip but a used car may have little registration left or none.

Corrina Baird

Writer and expert greenslips.com.au

Corrina used to lend her car to her kids and discovered first hand what Ls, Ps and demerits mean for greenslips. After 20 years of writing and research in financial services, she’s an expert in the NSW CTP scheme. Read more about Corrina

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