How to Win a Presidents Day Car Sale

DETROIT (TheStreet) -- Presidents Day weekend is only enjoyable if retailers and car dealers don't take too many of those green presidential portraits away from you.

That's going to be a much tougher task this year, as IBISWorld predicts Presidents Day spending will increase to $9.7 million this year. That's still down from $10.3 million in 2008, pre-recession holiday spending, but 7.2% more than the $9 million spent last year and almost 15% more than the $8.6 million spent in 2009.

If you're shopping for a car this Presidents Day weekend, you should walk onto the lot prepared with the knowledge that can separate the real deals from the standard dealer "discount."

While IBISWorld forecasts spending increases for travel (7.4%), clothing (3.5%) and electronics (4%) this holiday weekend -- with the latter's revenue set to eclipse pre-recession spending -- car sales are slated for the biggest boost. After dropping from $5.2 million on Presidents Day 2008 to less than $4 million in 2009, auto sales are slated to hit more than $4.6 million this year, up 9.5% from last year. That's great for the automakers, but not necessarily for buyers.

"We're starting to see the inventories build up a little bit and some automakers -- some -- are starting to make deals," says Charlie Vogelhem, executive editor of Intellichoice. "However, they're not as generous as they've been in recent years."

Ford(F), Toyota(TM) and Nissan's(NSANY) per-car incentives to customers last month all dropped significantly from January 2010, according to Edmunds.com, while European, Japanese and Korean automakers all cut incentives to start off the year. This doesn't mean there aren't deals to be had, however, as a post-IPO General Motors(GM) increased incentives from $2,900 last January to nearly $3,800 last month. GM's continued that trend this month, according to TrueCar's TrueTrends report, as the automaker is offering $7,000 in dealer cash to anyone buying a 2011 Cadillac DTS and $5,000 to those willing to drive away in a Chevrolet Impala.

Yet consumers still have to do a little digging if they want to separate the real deals from the standard dealer "discount." For example, according to TrueCar, anything below a 5.6% discount on the manufacturer's suggested retail price isn't a "deal," but the standard price of that automobile that the dealer can easily make up by coaxing a customer into questionable ancillary purchases such as "fabric protection" and "paint protection film."

"The consumers have way more information available to them than they ever had," Vogelheim says. "They really can become well-educated in a particular car, and it doesn't need to be a surprise for them when they get to the dealership and wonder 'Wow, how much does that cost?'"