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What Canadians needs to know about inflation when buying a car

Posted by on Aug 11, 2022 - Archived under Bad Credit Car Loan Tips

Canadians from coast to coast are constantly adding new words to their glossary; for the last couple of years, we had Covid-19 pandemic and mandates added to our glossary, but in 2022, the word of the year will be inflation.

Reports just released indicate that inflation in Canada hit a rate of 8.1%, which hasn’t been since the early 1980s, like before the first Nintendo Entertainment System (NES).

That is how long ago inflation was this high.

Inflation makes everything more expensive, and it is like a tax that no one agreed to, especially if your wages are not keeping pace with these increases, and let’s face it if you work for someone else, your wages aren’t keeping pace.

How inflation is impacting car buyers in Canada

The vehicles that are already available at your local dealership offer you the best possible value for your money; starting in the early fall of 2022, the vehicles that are coming off the production line will be exposed to the full brunt of the inflation hitting everyone.

Carmakers are susceptible to spikes in production costs; raw materials, fuel to transport vehicles, and manpower are all becoming more expensive, and the manufacturers must pass on these added costs to you, the consumer.

If you need a new vehicle and are willing to move fast, you can lock in a great deal, but timing is essential. It is not just a higher car price you need to contend with; you also need to be prepared to pay higher interest rates.

The Bank of Canada is increasing interest rates to battle inflation

The Bank of Canada is forced to battle inflation with the only weapon it has, interest rate adjustments.

Interest rates have been raised dramatically this year, and there is more pain to come. Even if your credit score is amazing, you will be required to pay a higher interest rate.

If your credit isn’t good, be prepared to pay even more if you continue to wait.

Finding the best car at the best possible price

You’ve seen websites advertising the “best car prices in Canada,” but these websites should be the last place to look for a good deal on a new car.

If you truly want a great deal, you need to visit your local car dealership and work with them.

These local car dealerships have a large inventory of cars you can choose from; this variety will provide you with the ability to test drive a car and drive it home today.

The same dealership also has a tremendous network of lenders throughout Canada; this means you will have access to the best deals in the country.

What you need to do is head over to the dealership right now and get things rolling; the Bank of Canada could raise interest rates at any time, forcing you to pay more for your new car than necessary.

For those of you who know that you have a challenging credit situation, please visit Dixie Auto Loans where we have a team of credit specialists ready to help you get approved for a car loan today!

Let’s get in touch! 

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