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New cars now more affordable than ever

New cars now more affordable than ever

May 12, 2011

Australians purchased more new cars in the year to March 2011 than the previous year, bucking the trend at a time when spending slowed overall.

New car sales grew 7 percent more than the year to March 2010 figures, resulting in a spike in enquiries for new car loans. Sales don’t appear to be slowing any time soon either. The Australian Bureau of Statistics’ latest figures for March sales reached 87,141 vehicles (seasonally adjusted), up 3.4 percent on February 2011.

It’s a significant increase considering that most other spending dropped away in the same period, including retail spending, which grew overall by just 3 percent.

New car market gets a shake up
Competition in the domestic new car market heated up as a slew of low-priced cars arrived from Asia. China’s Chery Motors and Great Wall Motors were among the new arrivals nabbing consumer attention with prices lower than previously seen on the domestic market.

This week Chery Motor’s small car, the Chery J1, was advertised as just $10,990 after a $1000 cash-back deal was introduced. Suzuki’s Alto was priced from $12,490 drive away. Meanwhile Great Wall Motors advertised its single cab ute priced from $17,990 including on road costs.

By comparison, Holden advertised its working cars priced from $28,490 drive away. So there are plenty of savings to be had if you’re prepared to look beyond your favourite make and model.

Save up to $645 by selecting a better loan
The strong Australian dollar is set to further impact car sales in coming months as some manufacturers pass on discounts to Australian consumers. Affordability is expected to increase further as new budget vehicles arrive on our shores.

So if you’re in the market for a new car and are seeking finance to buy, then now may be a good time to consider your options.

By comparing car loans online, you’ll likely find savings north of $500. For instance, the average $20,000 new car loan with a five-year term available through RateCity has an interest rate of 10 percent. By comparison, one of the top loans on the site, IMB‘s Car Loan (new) has a rate of 8.9 percent for the same loan size and term.

By opting for the IMB loan over another loan at the market average rate, you could potentially save around $645 over five years.

So not only does it pay to shop around for a great deal on a new car, but shopping around for your car loan quote can really pay too.

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