Chrysler/GM Car Glut: Savings Opp Or Nightmare?

To add insult to injury, Chrysler and GM will NOT be buying back vehicle inventory from dealerships that recently received closing notices. Maybe we have two new candidates for Worst Company in America next year! On the other hand, maybe this is good news for consumers. Large inventories + need for quick cash = SALE!

And not only a small, save-a-bit sort of sale, but potentially a huge, save-thousands-of-dollars sale. Of course there are no guarantees that the savings will be gigantic (Circuit City didn’t really show us the price love, now did they?), but all the elements are in place. Throw in the tax incentives for buying a new vehicle we could be in car-buying bonanza land. And there’s no need to worry about buying such a car, since the warranty from the company will still be valid.

Hold on a minute. There’s one thing that’s nagging us a bit: buying a car from a company that’s on the verge of going out of business. Sure, they’ll give you a warranty on the car now, but what happens in two years when the companies potentially no longer exist? Thinking about it that way makes a great deal a bit more risky and maybe no as much of a “value”.

Of course it’s a balance between savings and risk. If the discounts become really steep, it may be worth the risk to get a new GM or Chrysler. But if the savings are only a few hundred dollars, or even a couple thousand, we’ll pass this time around.

Dealership Closings: Bad for Them, Good for You [MainStreet]

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