Yahoo Finance Thinking of Gifting a Holiday Car This Christmas? Here’s Why It’s Not a Good Idea This Year
When it comes to holiday excitement, few things can top unwrapping a small box on Christmas morning to find a car key inside, then sprinting to the driveway to see a shiny new car all wrapped up in a bow.
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Normally, gifting a car in December can be a smart move (if you can afford it) because many dealers reduce prices to clear old inventory off the lot. But these are not normal times in the auto industry, and gifting a car this year could be a mistake.
December car sales “tend to be higher” than the monthly average for the rest of the year, according to U.S. Bureau of Economic Analysis (BEA) data cited by the Automoblog website. Between 2005 and 2021, December auto sales were 8.28% higher than the average monthly sales for the corresponding year.
Separate research from the U.S. Bureau of Labor Statistics (BLS) found that new car prices in December also were lower than the yearly average in six out of the 12 years from 2010 to 2021, Automoblog reported.
But while buying a new car as a holiday gift might sound like a good idea, it can be problematic — especially in 2023, with car prices near record highs and rising interest rates pushing monthly car payments even higher. For these reasons, “now is just not a great time” to buy a car unless you have to, according to Automoblog.
That hasn’t stopped a lot of people from dreaming about being gifted a car this holiday season. A recent survey of 1,004 U.S. adults conducted by Extreme Terrain found that more than four in 10 Americans (44%) “wish” for a car gift this year. Among the other key takeaways:
Fifty percent of those wanting a gifted car prefer an electric vehicle (EV), signaling a “strong eco-conscious shift.”
Americans planning to buy a car this holiday season are eyeing Toyotas the most (43%).
Only one-third of people in relationships would trust a partner to buy a car for them as a surprise gift.
Thirty-four percent of survey respondents have bought a car during the holiday season, with nearly 1 in 10 feeling buyer’s remorse.
That last part — buyer’s remorse — is also a recurrent theme when it comes to gifting someone a car over the holidays. No matter how good your intentions when gifting a car, people tend to have very specific ideas about what they want in one.
“Buying a car is a process and a personal thing, so it’s usually best to leave it to the person,” Carter Seuthe, CEO of Credit Summit Consolidation, told Automoblog. “There’s a good chance you’ll get it wrong and the person you’re buying for won’t have the kind of vehicle they really want.”
The best move is to consult with someone first before buying them a car. This might spoil the surprise, but you’ll improve your chances of getting the right vehicle.
“Before purchasing a car as a Christmas gift, be sure you know what the person wants in a car,” Seuthe said. “Find out what features and styles that the giftee prefers so that you’re spending money on something they actually will appreciate.”
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This article originally appeared on GOBankingRates.com: Thinking of Gifting a Holiday Car This Christmas? Here’s Why It’s Not a Good Idea This Year
