2023 on-the-lot inventory Interest Rates

[Je1279]

I just noticed that the interest rate for most on lot 2023 F150 models is 4.9% for 60 months. It had been 2.9% for 60 months for 2022 models for the past few months. Unsure if this was intended to reduce the 2022 inventory or a function of the rising interest rates (or a combination of both).

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[Henfield]

A year ago, Ford had 60 month interest free credit on 21s. I know, that's what I got when I bought mine.

 

[Je1279]

I haven't seen the official 2023 financing incentives for Chevy and Ram yet so it will be interesting to see how they compare.

 

[Buyer2021]

I just noticed that the interest rate for most on lot 2023 F150 models is 4.9% for 60 months. It had been 2.9% for 60 months for 2022 models for the past few months. Unsure if this was intended to reduce the 2022 inventory or a function of the rising interest rates (or a combination of both).

There should be no surprise in any of this, there's clearly a strategy in-play to move holdover 2022 inventory and incentivize 2023 sales (the 4.9% on current model year is still quite competitive against most 3rd party financing at the moment).

Lookback at many past years shows there's nothing new under the sun about this 2-pronged strategy with different interest rates coinciding with the period when there's both previous and current model-year inventory on dealer lots.

 

[Je1279]

@Buyer2021 I guess I am interested to see if the manufacturers all take the same approach or opt for different approaches. There has to be a tipping point where a combination of pricing and interest rates eventually price enough people out of the new car market where manufacturers will need to adjust one, the other or both downward to generate sales.

 

[Buyer2021]

@Buyer2021 I guess I am interested to see if the manufacturers all take the same approach or opt for different approaches. There has to be a tipping point where a combination of pricing and interest rates eventually price enough people out of the new car market where manufacturers will need to adjust one, the other or both downward to generate sales.

Of course, all of that's part of the ongoing challenge vehicle manufacturers have faced for decades (again nothing new).

What is new are evolving manufacturer strategies for achieving a better balance between produciton, inventory, and consumer demand. We'll see if Ford's strategies in that regard (they've made public statements about revised dealer-ordering procedures and allocations for stock inventory and a push for more 'custom-order' sales, for example) affect the market at large. IF those strategies are successful in the goal of reducing on-lot inventories as a continuing measure, that could affect the need for certain types of financing incentives.

All of that may be difficult for even observant consumers to detect, and certainly difficult for consumers to forecast.

IMO the biggest observable effect, and it's tied more to the general economic / employment / interest situation than anything manufacturer's do, is that consumers in general are already tending to keep perfectly serviceable vehicles longer. But all of that is 'complicated' by fuel prices and the (inevitable?) shift from ICE to EV ownership.

I guess it's all "interesting" to observe; I'm not sure if or how that plays into individual micro-decisions about 'when to buy' (got your crystal ball?).

It all certainly reinforces me being very glad I'm not in the vehicle-buying market at this time and especially glad I'm not working in the automotive business at all!

 

[dhrandy]

Interest rates are on the rise across all things. I’m one of the lucky ones that got 6 year 0% interest in 2021.

 

[fordhouston]

for my region its 2.9% 60 months for 2022 and 3.9% 60 months for 2023.

 

[Je1279]

@Buyer2021 You make a number of good points and I agree with your assessments. I guess for what it's worth to others, if I purchased the same vehicle off the lot today that I ordered less than two months ago (3.9% for 60 months locked), it would cost me ~$1,000 more over the life of the loan. That is assuming you finance half of the total cost. If you are financing a larger portion, the difference would be even greater.

 

[Fordphanatic]

Interest rates are on the rise across all things. I’m one of the lucky ones that got 6 year 0% interest in 2021.

That makes 2 of us. 0% for 72 months! That was in October 2021

 

[powerboatr]

for my region its 2.9% 60 months for 2022 and 3.9% 60 months for 2023.

here as well
the FMC rates appear to be driving the reduction of 22 models
its not just trucks. i looked at an edge and it is the 2.9 plus 3k cash back for 22s
problem is 22 inventory is not that great and upper trims are missing things we pay extra for in the upper trims, multi contour seats, etc

 

[wayfarer556]

Not to get into politics, but there is a broader economic situation at play here. Essentially, cheap or free guaranteed money is now gone. That makes giving loans and mortgages riskier. So the interest rates climb.

 

[powerboatr]

Not to get into politics, but there is a broader economic situation at play here. Essentially, cheap or free guaranteed money is now gone. That makes giving loans and mortgages riskier. So the interest rates climb.

funny this came in today
we just got a notice from our credit union that credit card rates for lowest tier are going up to 14.99 i jan due to increased fraud costs, and other visa related costs
we carry zero balance but thats still nearly 3% over last year

i wonder how many others are seeing a projected rate increase on visa or other credit cards

i got an ad form ford visa and get 31k pass points if i applied..but their rate was over 20%. not that i carry a balance but dammmm
may take it to get the points when i buy an oil change than pay it off and not use it

 

[dhrandy]

That makes 2 of us. 0% for 72 months! That was in October 2021

That was exactly when I got mine. The deal literally ran out the Monday after I picked mine up. In November it was 5 years for 0%.

 

[redline]

In Canada right now is 1.49% on 2022 and 3.99% on 2023. GMC is 3.99 on 2023 no idea on 2022

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