What Happens to All Unsold New Cars?

When a car manufacturer introduces new vehicle models each year, the previous model year vehicles still unsold on a dealer's lot become "leftover" vehicles. These vehicles are still considered to be "new" vehicles until they are purchased and driven off the lot.

Background

Fall is traditionally the time of year that manufacturers begin shipping new model year vehicles to dealers. For example, automakers would send out their 2011 model vehicles in the fall of 2010. At that point, all of the 2010 vehicles become leftovers.

Incentives

Manufacturers are typically under increasing pressure to reduce older vehicle inventory during the fall, which means that manufacturers will be willing to offer special financing and rebates for leftover vehicles to sell them more quickly.

Advantages

One advantage of purchasing a leftover vehicle is that typically they will be available at a reduced priced compared to the newer models. Also, according to Consumer Reports, leftover vehicles that have been on a dealer's lot for a year or more tend to have fewer problems than new models.

Depreciation

Once a leftover vehicle is purchased, registered and leaves the dealer's lot, it is considered a "used" vehicle. This means that the vehicle will depreciate more quickly than a newer model, especially if the new vehicle model has been redesigned with new safety features and equipment.