Cars are cheaper in recession

Mmutle Molepo would like to know how the law of supply and demand affects car prices.

Mmutle Molepo would like to know how the law of supply and demand affects car prices.

Supply and demand affects the automotive industry becausedealerships sell more of the popular types of cars than those that are less in demand. In winter, dealers will find it hard to sell convertibles, for example, but sports utility vehicles (SUVs) will be more in favour, especially in a climate where there are icy roads. Most car dealerships have a set price, so the SUVs will be sold at the full, listed price because the dealer will know that they "will almost sell themselves". But the dealer will probably have a "special" on convertibles. In the economic climate where sales have plummeted, dealers offer better deals than when things are going well. - industry.bnet.com; carsforgirls.com

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