Our Terms of Service and Privacy Policy have changed.

By continuing to use this site, you are agreeing to the new Privacy Policy and Terms of Service.

Shopping for a car? Buy now before prices jump

Expect car prices to rise as the effects of Japan's earthquake and violence in Libya begin to be felt. In this image, cars that had been ready for export are piled up in a Japanese port.Expect car prices to rise as the effects of Japan's earthquake and violence in Libya begin to be felt. In this image, cars that had been ready for export are piled up in a Japanese port. By Peter Valdes-Dapena, senior writer


NEW YORK (CNNMoney) -- If you're in the market for a new car, but especially if you're looking at a fuel-efficient Japanese model, experts say you're better off buying now because prices will only get higher in coming weeks as the effects of the earthquake in Japan and the unrest in Libya and the Middle East start to be felt.

Up to now, Japan's earthquake has had little effect on prices of Japanese cars here. For the most part, dealers already had cars on their lots with more coming on ships and trucks.

Besides, most "Japanese" cars sold in the U.S. are made in North America.

But in the coming weeks, factory shut-downs and other disruptions in Japan could make it difficult to find some Japanese-built cars. The problems could even affect inventories of American cars, since some components may be produced in Japan.

General Motors already had to shut down a Louisiana factory producing mid-size pick-up trucks due to a shortage of unspecified Japanese parts.

"We haven't seen the biggest climb [in prices] yet for most cars," said Jesse Toprak, an auto sales analyst for the auto pricing Web site Truecar.com.

Price increases will begin later this week, he predicted, and continue through April.

Aaron Bragman, a senior analyst for industry consultants IHS Global Insight thought it might take a little longer before the real impact is known.

"We're still a couple of weeks away from getting the big picture of who's really going to be affected by this," he said.

Since prices for cars are set on a case-by-case basis through individual negotiations, actual car prices can fluctuate greatly depending on market forces, as opposed to the commonly advertised manufacturer's suggested retail price, or MSRP.

Then there is simple supply-and-demand. Prices for well-regarded new domestic or Korean compact models will likely also rise as more customers turn to them in lieu of hard-to-find Japanese competitors, Bragman said.

Factory disruptions caused by the earthquake came on top of rising gasoline prices that had already started pushing up prices for the fuel-efficient cars Japanese automakers are especially known for.

With the U.S. and other nations now involved in fighting in Libya, there are worries that gas prices will rise more. Those fears, even if fuel prices remain relatively stable, can put even more pressure on the price of more fuel-efficient cars.

"It's volatility that really drives people to smaller cars," said Bragman. To top of page

Find Your Next Car
Index Last Change % Change
Dow 16,058.35 -469.68 -2.84%
Nasdaq 4,636.11 -140.40 -2.94%
S&P 500 1,913.85 -58.33 -2.96%
Treasuries 2.17 -0.03 -1.27%
Data as of 4:47am ET
Company Price Change % Change
Bank of America Corp... 15.53 0.05 0.32%
Apple Inc 107.72 -5.04 -4.47%
General Electric Co 23.88 -0.94 -3.79%
Ford Motor Co 13.72 -0.15 -1.08%
Microsoft Corp 41.82 -1.70 -3.91%
Data as of Sep 1
Sponsors

Sections

McDonald's has been testing an all-day breakfast menu in several markets for months. Now it has said when the change will go nationwide: October 6. More

Iran could be pumping more than four million barrels of oil a day by the end of 2016, the country's oil minister tells CNN in an exclusive interview. More

The Moto X Pure Edition is not just the best giant Android smartphone or the best Android phone for the money. It is the best Android phone ... period. More

How do you run a successful crowdfunding campaign? Indiegogo's CEO Slava Rubin offers his top tips and mistakes to avoid. More

Here's what you need to earn to afford a home in the 27 biggest metro areas in the country, according to HSH.com. More