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This year has been quite the doozy when it comes to buying cars. It’s no secret that the global chip shortage and resulting inventory shortages have made buying a new or used car tougher than ever. But one workaround is buying a demo car from a dealership, which can possibly save you a lot of money.

What is a demo car?

New cars ring a secondary lot concealing empty spaces at Toyota of Orange in Orange, CA, on Thursday, November 11, 2021.
New cars ring a secondary lot concealing empty spaces at Toyota of Orange in Orange, CA, on Thursday, November 11, 2021. | Jeff Gritchen/MediaNews Group/Orange County Register via Getty Images

A demo car is a car that’s used by a car dealership for test drives whenever popular cars are in short supply, notes Edmunds, which is why it’s also called a “demonstration car.” These cars are also sometimes driven by the dealership’s managers for commuting and are not typically registered, so they are still considered new. This means that a demo car can be sold as a new car despite the fact that it has some miles on the odometer (typically 1,000 to 3,000).

There are some advantages to buying a demo car

A brand new Volkswagen Beetle is displayed in the showroom at Serramonte Volkswagen on July 09, 2019, in Colma, California. | Justin Sullivan/Getty Images

If you happen to be offered to purchase a demo car at a dealership, then there are some advantages to doing so:

  • New car incentives: Since demo cars are considered new they can still qualify for incentive from the dealer or manufacturer.
  • Lower price: Demo cars are often priced at a discounted rate due to the miles that they have incurred.
  • Additional accessories: Some demo cars may even have additional factory accessories on them, which can add value to their discounted prices.
  • Good condition: Fortunately, since demo cars are typically driven by the dealership managers and/or staff, they are treated better than rental cars.
  • Warranty: Since the demo car is considered new, the new car warranty from the manufacturer would still apply.

There are some disadvantages to buying a demo car too

a new car sits outside a dealership
A new car is showcased at a car dealership in Brooklyn on October 05, 2021, in New York City. | Spencer Platt/Getty Images

As we can see, purchasing a demo car can be a pretty sweet deal. You can get a new car with a warranty and accessories at a discounted rate. However, for every positive, there’s a negative. As such, here are some of the disadvantages of purchasing a demo car.

  • Some of the warranty is used: Since the car will have some miles on it, those miles will eat into the car’s warranty.
  • Mileage: As stated before, there will be some miles on the car.
  • History: While the car’s mileage may be low, you never know who drove the car and to what extent.

What should you look for in a demo car?

If you plan on purchasing a demo car, then you may want to look out for a few things. According to Find The Best Car Price, you may want to check on the car’s pricing. While demo cars are typically discounted, some are not, so it’s important to pay attention to the market and see if the demo car is worth its price.

Find out how much of a warranty is left on the demo car so that you’ll know how long it will be protected. Also, make sure to get a vehicle history report to check if there are any accidents or other issues that you to need to know about. Lastly, ask the salesperson about any incentives that can apply to price for even more of a discount.

Ultimately, a demo car can be a good way to get into a new car if you don’t mind the mileage on the odometer. But just remember to check it out thoroughly to make sure that you’re getting the best deal possible. Otherwise, it could be better to buy a new car instead.  


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