KEY POINTS:
New and used car prices are about to increase sharply, so prospective buyers should act now, motoring industry leaders say.
Motor Industry Association chief executive Perry Kerr says the industry is looking at a potential 40 per cent price increase driven by the falling dollar.
Another price-driver is
the introduction of emissions standards, which limit imports to later-model, more-expensive vehicles.
If you can buy a car that's been in stock in New Zealand bought at a better exchange rate, then you may never buy that car cheaper, the Automobile Association's Jack Biddle says.
Figures for new and used car sales have fallen and Kerr says it is a good time to bargain with dealers, most of whose margins are about 10 per cent.
A dealer pays the finance cost of a car while it is on the floor, so will be keen to move stock. Biddle says salespeople will "do their utmost" to sell a car - and that may mean a discount or other incentive, such as fitting a tow bar or giving the best possible price on a trade-in. "You can never offend a salesman," says Biddle. "Ask them if this is the best deal they can do for you."
Giltrap Toyota in Auckland is throwing in warranties, service plans, AA road service and on-road costs worth at least $2500 on new models other than limited editions. The Winger Hyundai dealership in Greenlane favours giving price concessions over giveaways.
Globally, the car industry is suffering, with sales down 45 per cent in some parts of the United States.
Turners Car Auctions' chief executive Graham Roberts says his company sold more than twice as many repossessed cars last year compared to 2007 and he's expecting the number to keep rising.
"People are feeling the pinch and defaulting on their loans where a large percentage of the car's value was financed when it was very easy to access money," he says.
Turners' finance company has seen a surge in applications to its highest level as other finance companies have collapsed. Cars are also being auctioned by owners as their insurance or registration comes up for renewal.
"They've made a decision to go from a two-car family to one," Roberts says, marking a shift from New Zealand's earlier position in the top three countries for car ownership per capita worldwide.
"You're not going to get any change from $2000 for annual running costs on even a low-end car when you take insurance and other costs excluding fuel into account. It goes up from there, depending on whether you've borrowed and the type of car."
A SHARP DEAL
* Don't get caught up in "cash backs" - ensure you understand the deal.
* Shop around - the same make and model of car can differ in price between dealerships.
* If you have a car to trade in, see if you could get more by selling it privately.
