What’s the Deal with Vehicle Rebates?

Vehicle rebates give a buyer a fixed amount of cash when a new vehicle is purchased. A rebate can come from the manufacturer, the dealer, or the government. Regardless of who is offering the rebate, they usually work the same way; you get cash back when you agree to purchase the vehicle.

Car manufacturers periodically offer rebates to motivate consumers to buy a particular vehicle, within a certain time frame, and under certain conditions. This set amount of money is taken off the price of the vehicle at the time of purchase and does not originate with the dealership. The manufacturer passes along the money to the dealer, which is then passed on to the customer. By law, the dealership can not hold the rebate back or keep any amount of it.

For example, if Honda is offering a rebate of $5,000, an individual dealership can not change that amount and keep the rest as profit. If a rebate is not passed onto the consumer, the dealership risks losing their franchise or possible jail time. Sometimes dealerships offer their own rebates and have their own rules that apply. This is not the same as a manufacturer's rebate.

Rebates from a car manufacturer are typically offered to stimulate sales, move last year's inventory, or to provide an incentive to certain members of the population. Repeat customers, first-time buyers, recent college graduates, and members of the military are often offered incentives.

Government rebates are given to consumers when they purchase certain low-emission or high-efficiency vehicles. This could be in the form of a cash offer or tax credit. The government does this to encourage people to buy hybrid or alternative fuel cars so drivers will use less gasoline and therefore will create less air pollution.

When you purchase a new car through AAA Auto Buying, you get a personalized car buying experience. Our auto experts can help find you a new car and any rebates that are currently being offered. If you're not sure what you're looking for, we can help you find the perfect fit at a price that works with your budget. Call 1-866-710-6226 to learn about our service and any rebates that are available.