Labor Day Car Sales Could Be Hard to Come By

Alex Healey
· 4 min read
Labor Day has long been associated with retail sales and discounts, and car dealerships are a big part of it. In fact, Labor Day Weekend normally sees more car sales than any other three day period in the calendar year.
Unfortunately for anyone interested in
buying a car
, things are going to be a little different this September. Primarily due to the semiconductor chip shortage, automakers are struggling to meet demand and car prices have spiked.
As a result, good deals on
new cars
are hard to come by. Whether you like car shopping in person or at
an online dealership
, you’re unlikely to receive a big rebate.
Read on to learn more about the issues impacting car sales this Labor Day, and find out when things are expected to go back to normal.
Labor Day car sales are typically a great time to find a deal.

Why are Labor Day car deals so hard to find this year?

To say the auto industry is currently a seller’s market is a massive understatement. With inventory at an all time low, car prices have shot up to meet demand, and rebates have become increasingly rare.
The main reason car manufacturers are failing to meet demand is the global semiconductor chip shortage. These tiny computer chips are essential for the many electrical components that are found in modern cars.
When the pandemic began, automakers slowed operations, and semiconductor chip manufacturers redirected sales to other industries, like consumer electronics, which were in hot demand due to everyone being stuck at home.
When automakers tried to ramp up again, they found there were no longer enough chips to go around, and as a result, manufacturing output has been severely limited.
The only surprising part of
Toyota’s recent announcement
that it is cutting global production by 40% is that it took this long. Every other major car maker has already been forced to slow operations, delaying the release of new models, and driving up the cost of existing ones.
The problem is exacerbated by pent up demand for cars, with some states reporting a
30% increase in car sales
when compared to pre-pandemic levels. It has also had a knock-on effect on
used car prices
, which reached an all-time high earlier this year.
It doesn’t take an economist to understand why car manufacturers and dealerships will be reluctant to cut prices during this time.
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Are there any new car deals available this Labor Day?

has reviewed sales data from
Kelley Blue Book
, and found that automakers are offering barely half the level of incentive discounts that they were in 2019.
Manufacturer to dealer incentives have completely disappeared, and dealers have responded by stopping most rebates available to customers.
However, there are still some deals to be found, especially if you are willing to sign a lease or submit to an in-house financing agreement.
U.S. News & World Report
highlights Labor Day leasing deals for the 2021 Kia Forte and 2021 Hyundai Venue, which are available for less than $200 a month.
Additionally, no-cost financing deals are available for the 2021 Honda HR-V and Nissan Murano, with the latter offering up to $4,000 cash back.
You’ll still have to find a dealer with available inventory though, and a bad credit score will prohibit you from getting financing for a new car.
All in all, 2021 has been a year to forget when it comes to finding a good deal on a new car. If you can afford to wait then you probably should, as most experts think the chip shortage will be over by early 2022.
Our advice? Spend your Labor Day at the mall instead of a car dealership. There are still some great deals on back-to-school supplies!

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