- Don't expect to find favorable financing at the dealer.
- Try these tactics instead.
The Hot-Selling Hyundai Palisade Just Got Harder to Buy
Sales plummeted due to low inventory but remain strong for the year
New-car shoppers interested in the 2021 Hyundai Palisade may come to a sobering realization: They won't get much help from the company's financing arm.
The popular three-row Palisade SUV already had one of the lowest discount rates for an SUV of its size, as we reported in May. That didn't stop the average Palisade from leaving dealer lots about twice as quickly as rivals. At surprisingly high prices, no less.
Now, though, Hyundai has seemingly put an end to all available offers on the Palisade across the country. In a search of more than a dozen major U.S. metropolitan areas, Hyundai did not even list the Palisade among vehicles eligible for finance offers.
"Generally, when an automaker pulls its incentives, it means the car is selling well," said Ron Montoya, senior consumer advice editor for Edmunds. "When something is flying off the lots like the Palisade, Hyundai doesn't need to offer any major discounts or promotional rates."
That means it will be harder for shoppers to find favorable terms at the dealer. But there are still ways to score a deal.
What's behind the move?
As Hyundai pulled away its offers this summer, sales of the Palisade also took a hit.
Hyundai reported sales of 5,965 Palisades in June 2021, which represents a 27% drop compared with sales of 8,169 Palisades in June 2020.
Even with the slow sales month, the Palisade is a big winner so far this year. In the second quarter of 2021, Hyundai reported a 15% increase in Palisade sales compared with the same period last year. Through the first six months of 2021, Hyundai has sold 19% more Palisades than it did in the same period of 2020.
The overall strength of Palisade sales indicates that its poor June showing was not due to a consumer demand problem.
Rather, the issue may be that there simply aren't enough Palisades to go around.
While its corporate sibling, the Kia Telluride, is built and shipped from West Point, Georgia, the Palisade is made in South Korea. Hyundai has seemingly been slow to fill U.S. dealerships with 2021 versions of the in-demand SUV.
For example, an inventory search on the company's public website revealed just 125 Palisades currently available within a 100-mile radius of the Los Angeles area. There are only 34 within 100 miles of Chicago, 24 in the Houston area and 11 in the Seattle area. A search for in-stock Palisades within 100 miles of Las Vegas revealed just two.
How to work around the problem
Without enticing offers on the table, and facing dwindling availability, Palisade shoppers have less bargaining power than in the past.
But there are still strategies you can use. If you're intent on buying a new Palisade in the near future, you can secure financing before arriving at the dealership, for instance.
"I recommend getting preapproved for a loan with your bank or credit union," Montoya said, "so that you have a basis to compare interest rates."
You might also choose to resort to other tactics, he said, such as searching in cities outside your usual range and being open to models with a different color or options than you'd prefer. When you do speak with the financing department, be sure to ask for the best terms being offered by its partner banks.
These might be less than ideal buying conditions. But if your heart is set on a Palisade, such tips can help you bring it home to your driveway with a deal that works for you.
In this case, low supply poses less of a problem for Hyundai than it does for Hyundai's customers. Until the industry gets a handle on its microchip shortage, we may see more automakers cut back on discounts and incentives to regain lost revenue. That means it may be harder to score a good deal on high-demand models like the Palisade for the foreseeable future.