Is Now The Time To Buy A Car?

Consumer Reports Editor Says Buyers May Get A Steal At The Dealership, As Car Companies Fail

(CBS)  General Motors is in bankruptcy and Chrysler is trying to climb out. Could now be the time to get the best deal on a new car?

Jon Linkov, managing editor of autos for Consumer Reports advised viewers Tuesday on The Early Show that buying now isn't a bad idea.

Though price wars between companies probably aren't going to be as common as you might think, buyer breaks from dealerships hoping to unload their inventory may be, Linkov said.

"Chrysler's really dumped maybe 50 percent of their inventory so far since the beginning of the announcement, General Motors is going to have a lot of inventory they want to dump," he said, "so this is a good opportunity to go and buy."

But he added buyers may want to wait a couple of weeks and do their research. A lack of product is not going to be the case, Linkov said, and we don't know if new incentive programs may be rolled out.

Linkov suggested even calling or sending an e-mail to dealerships in your area, asking them what they can offer.

The Early Show co-anchor Harry Smith asked Linkov if you should buy cars from dealerships that are going out of business.

Linkov said you aren't going to be able to bring your car to the same dealership, and remember that your warranty may be affected by the switch.

He said in the case of Chrysler dealers closing down, your car warranty may even be considered differently by other dealerships - or not even honored.

"After they've closed, and they're no longer a Chrysler dealer," Linkov said, "that's not necessarily a new car -- that's a used car -- different warranty."

He recommended buyers check out their warranty, plan out service and think about restrictions on the purchase.

Linkov said if your dealership is still open, you should get any issues addressed as soon as possible.

But for car owners who are already having problems getting their car serviced as dealerships die, Linkov said you should go through your warranty terms first and call customer service and ask -- without waiting to be called back or being put on hold -- where you can go.

Smith asked if one should jump at the chance of buying a vehicle if you find a great deal.

Linkov said you should get a reliable car, and know the resale value, but realize that if it is an unreliable car, the resale value is going to plummet.

"Don't just jump on price, there's a reason some cars are really, really cheap," he said.

He added buyers should drive cars from closing companies into the ground.

"Own it for life," he said, adding that it's important to make sure everything is safe on the vehicle. "...When Oldsmobile died, those cars had a far lower resale value than the equivalent General Motors product. Same thing with a Pontiac."

And now, that's the story of General Motors.

"Just keep it," Linkov said, "give it to your kids..."