Frugal Shopper: Incentives Making Toyota, Honda Vehicles A Bargain

October 8, 2010
2011 Toyota Camry LE

2011 Toyota Camry LE

2010 Honda Pilot

2010 Honda Pilot

For decades, Toyota and Honda have been the brands that you simply can't expect to get a good deal on. Much as with an Apple Computer or high-end bedding, in some cases you had to swallow your smart-shopping pride and pay close to MSRP.

But lately, with Honda and Toyota it's been quite the opposite. Domestic brands are reducing incentives spending—as they're finally on top of the supply-demand relationship and no longer producing more vehicles than they can sell. Meanwhile, those two brands are increasing incentive spending.

And that highlights an interesting trend: In looking at incentive spending and sales, from January 2010 through September 2010, compared to the same period in 2009, TrueCar notes that a few domestic brands, namely Buick and Cadillac, are seeing sales spike while sales of Toyota and Honda remain quite flat.

Subaru was also a winner; it saw sales rise more than 22 percent while average incentive spending fell nearly 30 percent. Dodge also did well, with a 13.7-percent rise in sales, versus a 23.2-percent drop in average incentive spending, as did Jeep, and GMC. Kia and Hyundai also saw large sales gains with lower per-vehicle incentives spending.

Honda sales were up just 1.1 percent versus last year—with 36.4-percent more incentive spending per vehicle. And Toyota spent nearly 31 percent more on incentives, per car, but sales gains were tepid at 1.4 percent. Scion boosted average incentives by 214 percent, but sales actually went down nearly 30 percent.

Industry-wide, there are some signs that it's getting better in general: Incentive spending per vehicle has fallen 1.4 percent, while sales are up 10.4 percent.

But back to the main point, if you've ever really wanted a Honda (or Toyota) for the look and feel of the vehicle, the reliability, or the resale value, now is the time.

According to TrueCar, Toyota is discounting its 2011-model vehicles more than any other make right now—ten percent below MSRP, on average. Honda is discounting them eight percent on average. The 2011 Toyota Camry (11 percent), 2011 Toyota Avalon (10%), 2011 Honda Pilot (8 percent), and just-redesigned 2011 Toyota Sienna (8%) lead among models.


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