Lower Vehicle Prices One Good Effect of Down Economy

Sep 03, 2009
The auto industry has been hit hard by the economic downturn of the last year, but the need for a rebound in sales has led to a new incentive for consumers: lower sticker prices on new cars.  Automakers have been cutting prices for the 2010 model years with such zeal that the new versions of some vehicles actually cost less than their predecessors.

has cut the price of its E350 sedan by $3,300 to $49,475.  Nissan is introducing price cuts to the Sentra sedan of between $130 and $1080 depending on the version.  And Chrysler is going the furthest with its cuts, lowering the MSRP on almost all of its models.  For example, the 2010 Town & Country minivan is down $1,030 from 2009 to $29,215.

The lower “manufacturers suggested retail price” isn’t the lowest customers can expect to pay, either.  The final deal is worked out between the dealer and the customer, which could work greatly in favor of buyers who are interested in low-demand vehicles the dealers are trying to unload.

The main reason for the price cuts is simple competition.  The demand for new cars is the lowest it has been in decades, and lowering the price of newer models can serve to increase the visibility of the product on the road and move slow sellers off of dealer lots.

Before you rush out to acquire one of these cheaper new cars, be advised: not all of the price cuts are strictly competitive.  The 2010 Chevrolet Equinox has gotten a price cut but has also lost its six-cylinder engine in favor of a smaller four-cylinder. The 2010 Cadillac SRX is also much smaller than its predecessor in exchange for a price cut.

Photo courtesy of rutlo under the Creative Commons License.