Year-End Discounts: Is It Worth Buying A Vehicle In December?

December is a good month for bargain hunters as car and bike manufacturers roll out hefty discounts.

Nissan and Datsun vehicles ready to be shipped at the company’s plant in Chennai.

Photo: The Quint

You would have heard people advising you to not buy vehicles in December and wait for the new year instead. And you would have also heard people telling you that it’s a great time to go bargain hunting in December.

It’s a fact that car and bike manufacturers roll out hefty discounts in December to boost their sales and clear inventory. What do you have to gain or lose from such deals? Here’s a look.

Pros Of Buying Vehicles in December

There are distinct advantages to going car or bike shopping in December because you can really drive a hard bargain.

Good Discount Deals

Most companies offer huge discounts to clear stock of their present year vehicles because buyers often want to wait for the new year to pick up a later model car or bike. If not straight cash discounts, they also throw in accessories or extended warranties. Nissan, for instance, is offering a five-year warranty on the Kicks. Mahindra is throwing in cash discounts of up to Rs 50,000 on select models. Ford is offering up to Rs 40,000 off on models like the EcoSport.

Beating Price Hikes

Often car companies dangle the bait of an impending price increase in the new year, which gets consumers to showrooms. That is true to a certain extent as most companies tend to revise prices in January. It’s a good time to save a few thousand rupees on a vehicle.

Better Exchange Deals

If you are looking to exchange an old car or bike for a new one, December is a good time to do that. One can avail of the existing discounts on offer and the dealer evaluates the old car or bike at the prices prevailing in the current year. If you go in for an exchange in January, the car or bike is treated as being a year older.

Cons of Buying Vehicles in December

If December is a great month to go bargain hunting, why is it that sales usually taper off and buyers shy away from picking up vehicles? Well, it turns out buyers are worried about the resale value of vehicles.

Impact on Resale Value

The issue is that vehicles bought in December of a particular year are seen as being significantly older to a vehicle bought in January, just because of the year change. So when an owner goes to sell a vehicle, the resale value drops significantly as the vehicle is seen as being a year older, even if it is just a month older to a vehicle bought in January.

One workaround to this is some dealers promising to register vehicles in January with a permanent registration plate, but offering a temporary plate for the month of December.

Model Year Changes

Often car companies make minor model changes to the refreshed model that is sold in the new year. This could be something as small as a sticker job or a new colour scheme. However, in the mind of the buyer it just seems like a much younger, newer vehicle. Buyers hold off purchases just so that they could get these minor improvements on their vehicles.