3 Lessons Car Shoppers Can Learn From the News

Photo (cc) by Joe Thomissen

Last month’s car sales were weaker than expected, MSNBC reports. The experts blamed everything from a weak economy to warm weather to falling gas prices.

But weaker than expected doesn’t necessarily mean bad, especially compared to where automakers were a year ago. Since then, sales have improved for almost all the major brands…

  • General Motors – up 11 percent
  • Ford – 13 percent
  • Nissan – 21 percent
  • Chrysler – 30 percent
  • Toyota – 87 percent

Why? Partly the economic recovery, however gradual and below expectations it may be. Another reason: People can’t put off the purchase any longer. Americans have an “increasing need to replace their aging cars and trucks, which are now a record 10.8 years old on average,” MSNBC says.

If you’re starting to think about replacing your vehicle but haven’t been paying attention to the market, here are some insights to keep in mind from recent headlines…

1. Higher prices might not last

GM and Ford are striving to boost their stock price by keeping prices firm and limiting incentives. “If all goes well, the companies will continue to strengthen their pricing and maintain profits to offset the economic crisis in Europe,” USA Today says.

That probably means fewer deals this summer – Chevy’s new Sonic is $1,000 more expensive than its competitors right now – but the worse things look, the more Ford and GM “face temptation to jack up rebates and offer discounted financing.”

So if you’re interested in these brands, watch for more weaker than expected headlines to see if Ford and GM change their minds – especially around the end of July, when second-quarter results come out.

2. Fuel efficiency doesn’t necessarily mean savings

A new Consumer Reports study cautions that fuel-economy versions of some popular sedans aren’t really worth the extra expense.

Testing the Chevrolet Cruze Eco, Ford Focus SFE, and Honda Civic HF, the study found they cost $500 to $800 extra but improve mileage only by 3 MPG or less. That could save owners less than $20 a year over the regular model – meaning you might not save any money unless you drive it for three or four decades.

As the study also points out, many regular models of competing sedans get comparable mileage to those special editions, so do a little math – don’t just assume green is good. Want some ideas? CNN’s got a list of 9 great road trip cars, including the Chevy Sonic, Mazda CX-5, and some pricier (and prettier) picks.

3. Popular doesn’t always mean safe

Cars.com’s report on May’s top-selling vehicles leads with Ford’s F-Series and the Toyota Camry, but also includes the Dodge Ram pickup.

All three vehicles also make safety lists – the F-150 and Camry are on the Insurance Institute for Highway Safety’s Top Safety Picks for 2012.

But the Ram 1500? It tops a list 24/7 Wall St. calls The Most Dangerous Cars in America, which is based on data from IIHS, Consumer Reports, the U.S. National Highway Transportation and Safety Administration, and JD Power.

Here’s part of what the article says about the Ram…

From 1998 through 2001, the truck received failing marks from IIHS in frontal offset tests, and was rated “poor” in protecting heads and left legs, as well as in restraining the crash test dummy. Though frontal offset ratings have since received “good” ratings from the IIHS, the vehicle’s side-impact and rollover ratings remain substandard. Curiously, it was the opposite in the National Highway Traffic Safety Administration tests. The agency found fault with the Ram’s performance on frontal impact tests but not with side impact tests.

There’s nothing wrong with popularity as a purchasing factor. Just make sure safety is one too.

If money’s the major concern in your auto purchases, check out Should You Buy or Lease Your Next Car? and 8 Tips for Buying a $5,000 Car.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

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