ORLANDO, Fla. – If you’ve walked onto a dealership lot lately, you may have felt it instantly: sticker shock.
New car prices have surged, driven by inflation and a growing appetite for bigger, more expensive vehicles. With average prices now hovering around $50,000, many shoppers are experiencing anxiety over high prices before they ever turn the key.
We spoke with CBS News Business Analyst Jill Schlesinger about how buyers can navigate today’s costs, decide whether to buy or lease, and negotiate without overpaying.
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Here’s the transcript of our conversation:
WKMG News: If you’re in the market for a car or truck, buckle up. Prices have skyrocketed to around $50,000 because of inflation and the fact people are buying larger and more expensive vehicles. If you’re about to take the plunge, CBS News Business Analyst Jill Schlesinger is here with car buying tips.
Jill, we were actually talking about this in our newsroom. Someone’s buying a new car and they were shell-shocked with prices. How should you start the process?
Jill Schlesinger: Whew, it’s tough out there.
You’re gonna have to determine how much you can afford and it’s not just that sticker price. It is the cost of owning and operating the new vehicle, which AAA says is about $1,000 a month. So obviously, managing this expense, it’s gonna require some homework on your part.
Conduct that research. Even if you’ve been loyal to a particular brand or a dealership, please consider expanding your search to other options, maybe a broader geographic area. All this information can be found online.
WKMG News: And it seems, Jill, this always comes up, this idea of who should buy and who should lease.
Jill Schlesinger: Well, I think if you’re driving cars into the ground, you’re buying, you know, basically you buy it and you’re gonna keep it for 10 or 12 or 15 years – you are really best served by buying. Even if you borrow money to buy, once that loan is paid off, the annual cost of carrying the car, it’s dropping significantly.
But, you also may be the kind of person – just admit it – maybe you like those shiny new vehicles, the improved safety options, the latest tech. Then you might like that lease. The good news is a lease does require usually, a smaller down payment. It results in lower monthly payments. The problem is you’re never getting rid of that car payment.
WKMG News: All right, Jill, here’s the big one: negotiating. What are the tips on negotiating? Because we all hate to negotiate with car dealerships.
Jill Schlesinger: I mean the negotiation process has gotten better since there’s more information online so it’s not as contentious, but I will point out that you should avoid dealer markups which show up on that final invoice sometimes, so avoid that. Remove the expense of add-ons; you know, you don’t need some of this stuff – and of course the most important thing, the willingness to walk away. That is your best negotiating tool.
WKMG News: Awesome advice. Thank you, Jill.
You can see Jill regularly on CBS Mornings and the CBS Evening News. For more analysis, go to JillOnMoney.com.