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Are customers who buy the 2023 Subaru Crosstrek, Outback, Forester, and other all-wheel-drive models savvier than Hyundai Santa Fe, Audi Q5, and Volkswagen Golf buyers? A new report from Automotive News (by subscription) says yes. They make the most informed new vehicle buying decisions today.
In the new car buying environment, shoppers must be savvy to get the best car value and deal. Interest rates are up, and many buyers are pairing their lengthy vehicle retention with longer-term loans, such as the 84-month terms that now appear in about a fifth of financed new-vehicle sales, says a recent report from Automotive News.
photo credit: Patrick Subaru
Jeff Williams, Vice President at Williams Auto World, which owns a Subaru store, a Hyundai store, and Audi and Volkswagen stores, can compare its customers across the four car brands. Williams says Subaru customers are by far the savviest shoppers today.
The average new-vehicle loan carried a 5.2 percent interest rate during the third quarter, up from 4.1 percent a year earlier, according to Experian. As the interest rates go up, Subaru customers put more money down.
photo credit: Patrick Subaru
Williams said that Subaru retailers are seeing more cash purchases and larger down payments on new and used Subaru vehicle transactions. He said his Subaru dealership has seen more cash buyers than he'd encountered in "quite some time" and described receiving many "big down payments" in the $20,000-$25,000 range.
Williams said Subaru customers are savvier than his Hyundai, Audi, and Volkswagen car buyers. "They buy a Subaru because of the value and the quality," he said, adding buyers typically keep their vehicle a long time. They're also educated and thoughtful about their money, he said.
Hyundai, Audi, and Volkswagen customers are pairing their new car purchase with longer-term loans, such as the 84-month terms that now appear in about a fifth of financed new-vehicle sales, says Williams.
He said that Subaru consumers would buy a vehicle and finance it over three to five years. But Subaru customers aren't pairing their new car purchase with longer-term loans. "We're not seeing a large increase in long-term financing," he said.
What does it mean for Subaru buyers?
Buyers who get shorter-term loans will avoid getting into trouble when they trade in their Subaru vehicle. It's easy to get "upside down" with 72-84 month loans. You'll owe more for the car than it's worth when it's time to get a new vehicle.
In a recent interview, President and CEO of Subaru of America Tom Doll explains why they don't offer 72 months or even 84-month financing as other automakers do. Doll says they look out for the customer now because they will see them in 4 or 5 years when they return to trade the all-wheel-drive vehicle.
Subaru customers who buy the 2023 Subaru Crosstrek, Outback, Forester, and other all-wheel-drive models are savvier than Hyundai Santa Fe, Audi Q5, and Volkswagen Golf buyers. They aren't paying higher interest rates, they don't get financing over 48-60 months, and they won't regret buying a Subaru.
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Denis Flierl has invested over 30 years in the automotive industry in a consulting role working with every major car brand. He is an accredited member of the Rocky Mountain Automotive Press. Check out Subaru Report, where he covers all of the Japanese automaker's models. More stories can be found on the Torque News Subaru page. Follow Denis on Facebook, Twitter, and Instagram.
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