Edmunds.com Unveils Information To Help Consumers Time Their Vehicle Purchases
June 08, 2007

The question car shoppers ask after "What should I buy?" and "How much should I pay?" is "When do I buy?"

Edmunds.com already helps with what to buy and what to pay. Now, Edmunds.com is adding a feature to help consumers time their vehicle purchases to take advantage of the best pricing and richest incentives.

In a presentation to the Society of Automotive Analysts in Detroit this week, Edmunds CEO Jeremy Anwyl told the gathering that Edmunds.com analysts study consumer intent, which indicates the demand or lack of demand for a vehicle, to predict a month or so in advance whether an auto manufacturer will add incentives or if dealers will be discounting.

Conversely, Edmunds.com can predict what vehicle is hot, based on consumer intent, and subsequently won’t require incentives or discounting in the near future, making now a better time to buy than later.

The Edmunds.com will add the buy/wait designation later this year, Anwyl told the SAA.

Watching Over the Consumer’s Shoulder

Edmunds.com's premise is based on the simple economic principle of supply and demand. Demand decreases, supplies rise and prices soften or, in the auto industry, incentives are added. Demand increases, supplies stay in balance, and prices hold firm.

What's new is the fact that Edmunds.com can accurately track demand based on the roughly 10 million consumers who visit the site to shop for and configure the car they will buy in the next 30 to 90 days.

“We can see demand by sitting on the consumer’s shoulder,” notes Anwyl. He adds that watching what a consumer actually does online is a far better indicator of demand than asking what they might do in a survey.

Opportunities for Consumers and Manufacturers

“This is of huge value to consumers,” Anwyl notes. But he acknowledges auto manufacturers’ initial reaction to the concept will likely be negative, much as it was to Edmunds.com posting invoice prices years ago.

But, Anwyl points out, advance notice of the supply and demand being out of balance creates not only an opportunity for consumers but also for vehicle manufacturers.

“Car companies often miss the signals of a softening market,” he says. “We can provide clear signals of demand that allow the car companies to create more demand by increasing advertising or adjusting pricing.”

A manufacturer could also prevent costly inventory buildup by trimming production of an anticipated slow-selling model.

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