Should You Buy a Leftover Model Car From Last Year?
What is a Leftover Model?
Leftover models are the remaining stock of last year’s model year for a specific car. Once the new model year arrives on the lot, dealers and manufacturers want to get rid of the remaining previous year models as quickly as possible to make room for the new model year, as well as to prevent taking demand away from the new models. Because dealerships are eager to sell these leftover cars, it is possible to get a great deal on a new car once the new model year cars arrive. Deep discounts for previous year new cars of up to $10,000 off are not unheard of.
For example, in fall of 2018, many car manufactures are already releasing their 2019 lineup. You can now find 2018, and even remaining 2017 model year cars for steep discounts if you shop around.
I just purchased a brand new 2017 Chevy Cruze LT hatchback, sticker price of about $24,000, for $14,000. Because I shopped around, I got about $10,000 off MSRP. Other dealerships in my area were selling similar used cars for about the same price that I bought mine for brand new.
While this was an excellent deal for me, there are several things to consider when deciding if purchasing a leftover model is right for you. Before you jump at a too-good-to-be-true deal, consider the pros and cons of purchasing a leftover model vs. a new current year model.
Pros of Purchasing a New Leftover Car
The most obvious pro of purchasing a leftover is the cost. Once the new model year cars arrive on the lot, the older models will be discounted. How much of a discount you can expect depends on several factors including the make and model, how long the car has been on the dealer’s lot, and how much has been changed in the new model year.
By buying a leftover, you get a brand-new car with the full manufacturer’s warranty, but for a much lower price. In my case, I got my 2017 Cruze for about the same price new as other places were asking for used versions of the same car. In this case, going with the new, but year old, version of the car was a no-brainer.
• Potentially save thousands of dollars off MSRP
• Full warranty
Cons of Purchasing a New Leftover Model
While an excellent deal on a leftover might seem like a no-brainer, there are some potential drawbacks to purchasing a leftover model to consider. The biggest drawback to purchasing a leftover model is depreciation. New cars begin to lose value as soon as they are driven off the lot, and a leftover is already a year old when it is purchased. If you are someone who doesn’t plan to keep your new car for very long before trading it in for something new, you will take a huge hit in depreciation, especially if you didn’t get a super amazing deal when you first purchased the car.
Another con to purchasing leftovers after the new model years are released is that your choices are more limited. You are limited to whatever the dealership has in stock, so it might be difficult to find a car with the features you want and in the color you want. With mine, I got lucky and just happened to find a Cruze LT hatchback in Orange Burst Metallic with all of the features I was looking for, and more. If you are looking for something specific, you might have to settle for what you can find. While the longer you wait, the better deal you can potentially get, you will also be left with fewer options to choose from.
It goes without saying, but leftover models are a year older than the latest releases. The new model year may have upgrades and new features that the previous year didn’t have, including new safety features. If having the very latest features in a new car is important to you, a leftover model might not be the best choice for you.
• Limited choices
• Forgo latest features
Who Should Consider A Leftover Model?
If you plan on keeping your new car for many years (or “until the wheels fall off”), buying a leftover model might make financial sense for you. You still get the benefits of new car ownership, for a fraction of the price of the latest model year. If you aren’t concerned with having the very latest features, or if the car you are interested in hasn’t changed much between model years, it makes a lot of sense to consider purchasing a leftover.
How to Find Good Deals on Leftovers
The best place to start searching for deals on leftover models is online. Car buying websites such as AutoTrader.com and CarGurus.com allow you to search for new (or used) cars by year, make, and model to help you to narrow down your search. If you are specifically looking for a deal on a leftover model, search for “new” cars of the year, make, and model you are interested in. Be sure to filter by “price, low to high.” You may also be able to haggle a listed price down while visiting a local dealership, even if it is already listed at a deep discount.
A Final Word
Buying a leftover is a great way to get a new car while saving money. Be sure to do your research on different car models and dealerships, compare prices, and shop around while car shopping. Take the time to test drive several different cars before making a commitment and making sure the car you choose is the best fit for your lifestyle, as well as for your wallet. Even at a deep discount, a new car is still a major purchase.
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© 2018 Jennifer Wilber