auto

Beware bogus advertising slogans

Huge end-of-year sale/must make room for new models: Dealers love to say it's the biggest chance of the year to save the most money on a new car (it may be new, but it's last year's model). In some ways, they might be close to telling the truth. It might be true if you keep the soon-to-be-year-old car for seven years or more -- long enough to drive it into the ground -- and don't figure on getting much for it when you sell it. However, if you usually sell or trade in your car every two or three years, buying a year-old model could cost you big-time.

Buy this car at below-invoice price: Don't let the dealer convince you he's selling that car at no profit just because it is at invoice or below. The invoice price does not necessarily mean that's what the dealer paid for it. He may be getting a rebate, and he is definitely getting a dealer holdback fee from the manufacturer. This is a percentage of the price held back by the manufacturer when the dealer buys the car and paid to him when he sells it. Depending on the car, it usually ranges between 2 percent and 3 percent of the manufacturer's suggested retail price. So make sure you are getting the real invoice price. How? Again, both Kelley Blue Book and Edmunds are excellent resources.

Automotive advertising (factory and dealer associations)
Jan-June '05
($ mil)
% of
budget
% change
vs. '04
Network TV$1,535.222.86.5
Cable TV$921.313.724.1
Syndicated TV$ 58.80.9-6.6
Spot TV: 210 DMAs$2,617.838.9-0.2
Spanish-language
network/cable TV
$141.92.122.3
National magazine$780.711.64.1
Local magazine$4.10.1-8.4
National Sunday
supplement
$7.90.13.5
National newspaper$82.11.212.3
Local newspaper$317.14.79.7
Local Sunday supplement$0.10.08.0
Network radio$15.10.2-26.3
Spot radio$165.82.5N/A
Outdoor$77.11.1-3.6
Total$6,725.11007.4
Source: Nielson Monitor-Plus
Note: Time period comparisons are not available for spot radio due to methodology changes.

 

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