Just like the rest of the economy, supply and demand also controls the automotive industry; when popular cars sell like hotcakes, everybody wants one.  The automotive industry is production driven and the manufacturer controls the inventory shipped to the dealer. 

To better understand this, Hilary offers up a few great examples:

1.} Let’s say you live in the Northeast and it’s the dead of winter.  The dealer has ten convertibles on his lot, and because it’s blustery cold and snowy, there aren’t any buyers for the convertible, so the purchase price will go down.  The reverse is also true if there are ten Sport Utility Vehicles on the lot and a snowstorm blows through, you can bet the dealer already knows at least ten people will come in and want to buy one.  The price is set at the list price, so there’s no need for a discount on the SUV; therefore the demand exceeds the supply.  On the other hand, if the SUV’s were at the dealership during the summer months without any buyers, the price would go down. 

2.} In September or October, which is the beginning of the calendar year for the automotive industry, the manufacturer takes this time to plan inventories, set goals for the coming year and determines the number of vehicles to sell in the States.  Those who manufacture import vehicles will consider what other countries are willing to distribute, and if the vehicles are selling well abroad, it could hamper inventory in the States by not being able to make available has many of that particular make or model. 

3.} Keep in mind that a dealer is going to attempt to sell as many cars as possible within a thirty day period, because the dealer doesn’t want to pay interest on the inventory on the lot since in most cases, a bank owns the vehicles and the dealer simply pays for the use of the money.  Also important to note is that the more inventory he moves off the lot or from within the dealership, the more money he earns from the manufacturer, or factory. This is what’s known as an “earn and turn system, and it’s just one of the ways a dealer grows his business.

Bottom Line: Inventory is supply and supply controls pricing.

Tags: Advice, General

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The other day while I was travelling down a busy road, the car in front of me blew a tire.  The sound was quite loud and immediately, the car began to swerve into the right lane of the 4 lane road we were on, but the driver gained control, put on his hazard lights and eased his car over to the shoulder. 

Changing a tire need not be a harrowing experience in fact, the worst part is probably coming up with the elbow grease it takes to get the lug nuts off, but I know you can do it and I’m going to walk you through it right now {feel free to print this page and tuck it in your glove compartment for future reference!}.

All set?  Let’s get started:

There are two kinds of flat tires a slow leak and a sudden blowout.  The slow leak is easy to detect since while driving, you’ll begin to notice your car will pull to one side, while the blowout is sudden and comes with a loud noise.  You’ll then feel your car swerve and hear a thumping  or thwacking noise – which is the flat tire whirling around on the rim.  While the sound may alarm you and the sudden jerk of the car may startle you, try not to panic; gain control of the steering wheel, flip your hazard lights on and ease your car onto the flat shoulder of the road.  If you’re on a city street, turn your wheels toward the curb. If you’re on a hill, you’ll want to turn your hazard lights on, coast to the bottom and then ease over onto the shoulder of the road.

Once you’ve eased over, put your car in park and set your emergency brake.  If you have passengers, move everyone out of the car, away from traffic and away from your vehicle.  Try to block the wheels if you can by using a brick, a bag of rock salt from your trunk, a piece of wood or anything you can find that seems handy and heavy.  You’ll want to wedge it against the wheels at the opposite end of the car.

Your jack and spare tire should be located in the trunk {never leave home without a spare tire, lug wrench and a jack}, probably underneath the carpet in a special area reserved for stowing your spare.  Remove the tire, jack and lug wrench from the trunk, place them alongside the tire to be changed and then position the jack under the car, touching either the car frame or the bar that supports the front or rear suspension - whichever is closest to the tire you’re changing.  

Using the flat end of the lug wrench, pry the hubcap off and then loosen the lug nuts that hold the wheel on – but don’t remove them just yet.  Loosening the lug nuts may take a little time and elbow grease, especially if they’ve been previously secured with a power tool.  Don’t be afraid to put your weight into it to loosen them up, standing on the lug wrench if you have to.  Once the lug nuts are loose, jack up the car slowly, stopping when there looks to be enough room to remove the wheel.   Now, remove the lug nuts and place them in the hubcap or in your pocket, so they don’t get lost.

Grab the flat tire on both sides, pulling it towards you until it slides off.  Put the spare on and replace the lug nuts, getting them as tight as you possibly can.  Lower the car, replace the hubcap {if it doesn’t fit the spare, that’s okay}, put everything back in the trunk – and you’re done!

Remember that the spare is just that a spare and it isn’t intended to be driven for long periods, so you’ll want to replace it with a new tire as soon as possible.

Tags: Advice, General, Guides

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With Memorial Day just around the corner, high school and college grads looking towards the open road and vacation season upon us, I thought now would be the perfect time to offer up a handy list of items you should never leave home without – especially on long trips.  Some  items on the list are obvious, like your drivers license and insurance cards, but I don’t know how many times I’ve left the house, believing my credit card was in my pocket when it fact, it was at home on the kitchen table.

Other items, like a small notebook, toilet paper or duct tape, may not be things we think about keeping in the trunk, but it never hurts to be prepared – in fact, it’s usually when we’re ill-prepared that the worst seems to happen. 

1. Drivers License, Vehicle Registration and Insurance Card
2. Debit/Credit Card/Cash {don’t leave cash in your car – keep cash, debit and credit cards on you and never leave your purse in the car – you can lock it in your trunk, but make certain you have your keys}
3. Phone Numbers/Cell Phone
4. Army Knife
5. Spare Tire, Jack and Lug Wrench
6. Triple A Card {if you have one}
7. Sunglasses
8. Baseball Cap or Hat
9. Two or Three Bottles of Water {replace every month or so}
10. Duct Tape {to repair cracked hoses, secure a bumper, etc. }
11. First Aid Kit
12. Jumper Cables
13. Two Cans of Extra Oil
14. Map {especially if your GPS stops working}
15. Emergency Road Kit {blanket, flashlight and batteries, non perishable foods items, flares, toilet paper or tissue, rock salt, kitty litter or small bag of sand, small shovel, socks and extra clothing, gloves, pen, notebook, at least one gallon of water in a plastic jug, matches or disposable lighter and Call Police sign}.

If you can’t purchase the items you need all at once, try to pick up one or two from the list on grocery days, adding to your inventory as you go. By the time you’ve collected everything on the list, you’ll be well on your way to happy travels ahead.

Is your list different?  What do you keep in your car in case of an emergency?

Tags: Advice, General

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Just like children, pets and prized collections, our cars need love, too.  We’ve all heard the saying, “An ounce of prevention is worth a pound of cure,” and it’s the same with vehicles we own – a little maintenence now can help prevent costly repairs later.  Below are a few things you can do to keep your car running smoothly:

Routinely Check Your Oil {and all fluids}: 

If you own a car, checking your oil is one of the easiest and most important things you will ever do, and since it only takes a minute, I strongly advise checking the oil at least once every two weeks.  If you’ve gone a month or more without checking your oil, it’s been too long.  The oil keeps the engine running and without the proper amount of oil, your engine is placed in severe risk of seizing up – and should that happen, the repair/replacement costs can be enormous.  Nip it in the bud by getting into the habit of checkig your oil – before the oil light comes on.

While you’ve got the hood open, also check the coolant, brake fluid, power steering fluid, automatic transmission fluid and if your vehicle is a stick, check the hydraulic clutch fluid. 

Check Belts:

Open your hood, run your hands along all the belts and inspect for rough or worn edges.  Belts should be smooth or if they have grooves, they should be firm – never worn or frayed. If you come across a belt that seems cracked, worn or frayed, it’s time to have it replaced. You’ll want to do it now as opposed to hearing a high pitched shrieking sound coming from under the hood on your way to work. 

Check Hoses:

Like belts, hoses should feel smooth or have solid grooves.  Again, check for cracks, frays and small holes, especially around the radiator.  If you find hoses are old, worn, cracked or frayed, it’s time for replacements. Radiator leaks cause the engine to overheat and mean costly repairs for you. 

Check Engine for Leaks:

Keep your eye on gages and pay close attention to “low level” warnings. If you begin to notice stains or fluid puddles on your driveway or anywhere you normally park, it’s time for further investigation. This isn’t the same thing has occasional drippage from the car’s air conditioning, which is normal and happens when you’ve been driving for long periods with the air conditioning on.  What I’m referring to are pools of oil, transmission fluid, etc.  If you notice fluids are leaking, or you see pools of fluid underneath your car,  it’s time to take your vehicle to the nearest mechanic as soon as possible. 

It’s also a good idea to keep tabs on the stuff we sometimes forget or take for granted, such as tires and the horn.  You’ll want to perform routine checks on the following at least once a month:

• Battery posts {look for corrosion}
• Tail lights, head lights, reverse lights, turn signals, and your horn.
• Windshield wipers {look for wear}
• Tires and tire pressure.   

By performing these simple tasks routinely, you’ll help prevent costly repairs down the road.

Tags: Advice, General

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When it’s time to purchase a new vehicle, we usually take a few things into consideration, such as price, style, size and urgency of need.  Once we have a good idea what we want and need we’re off to the dealership to see what’s offered and what we can afford.  In order to help us better, a salesman at the dealership will ask us a series of questions in order to pin-point exactly what we’re looking for and to hopefully assist us in qualifying for a loan. 

Has Hilary points out, there are only two objections in the car business; the value of the car and our ability to afford it.  If we’ve found the car of our dreams, then determining how much money we’re willing to spend becomes the primary factor in the sale, and discovering what kind of buyer we are helps to determine the magic button, – the point where vehicle and cash come together beautifully, the point where the customer says, Yes! 

Hilary gives a great example: 

Let’s say you’ve got your heart set on a BMW that comes in at $550.00/month, but it’s a little over your monthly budget, so you’re ready to settle for that nice and comfy Volvo because it’s $70.00 less and priced right at $480.00/month. What you may fail to realize is simply that if you really want the BMW, the value of the car may actually be worth spending the extra cash. Perhaps if you could get your payments closer to $500.00, you would be in a much better position to actually purchase the BMV, rather than the Volvo. This is a good time to tell the salesman or financial office that if they could get your financing closer to $500.00/month, you’re a buyer for the BMW.  This way, they’re also in a much better position to try to make the BMW more affordable for you, and at the same time, create more value for their product. 

Generally, there are four types of buyers or any combination of the following:  

• Trade Buyer:  This buyer has researched the trade value of her car and will focus on what the dealer will give her in trade value.
• Discount Buyer: This buyer is looking for a good deal and deep discounts; make and model generally aren’t a factor.
• Payment Buyer: This buyer is looking for a good, dependable vehicle which will easily fit into her monthly budget.
• Difference Buyer:  This buyer is concerned with the difference between their trade and the new vehicle.

A Trade Buyer concentrates on the trade and the trade-in value: How much will you give me for a trade-in? I know the Kelley Blue Book value is…

A Discount Buyer is seeking out the best deal for her money.  She wants a good discount, maybe a rebate and other incentives.

A Payment Buyer is looking for a vehicle that fits her monthly financial budget.  She may not care how much the car costs, but she wants to make absolutely certain it fits her monthly terms.  She’s a stickler and usually won’t go over her monthly payment allotment.

A Difference Buyer concentrates on the difference between their trade and the new car.  They know exactly how much they want to spend and exactly what they want to buy.  They may say, Your selling price is $25,000.00, so I’ll give you my car and $8,000.00.  Do we have a deal?  Chances are they may miss the mark by more than a few thousand dollars, but they’re willing to give it a good try. 

I’m a combination of payment buyer, discount buyer and a trade buyer; I want something that falls into my monthly payment range quite nicely, however I’m never one to miss scooping out a good deal and getting the most for my money. If I can come close to making the BMW fit into my budget has described in Hilary’s example above, I’m willing to spend the extra money to make it work.  I also know I’ll probably get good trade-in value later on down the line.

What kind of buyer are you?

Tags: Advice, General

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