What You Need to Know Before You Buy an American Car

As Chrysler heads toward Chapter 11 bankruptcy and General Motors tries to avoid it by slashing jobs and killing brands (first to go, Pontiac), potential car buyers are wondering how the tumult in the industry can effect their decision to buy American.

According to Phil Reed of Edmunds.com, there are three major things you must know before deciding to buy an American car:

1. Your warranty will be honored. If you are buying a Pontiac, the warranty will be honored by its sister brands, such as Cadillac, Buick and Chevy. Even if GM goes away completely, the Obama Administration has announced it will honor all warranties through a special program. There is no reason to panic, Reed says.

2. The resale value of your car will go down when the specter of bankruptcy arises. The resale values of most American cars has been bad for some time, but it stands to get worse if the industry continues to struggle.

3. With all that said, there are great incentives out there on many American brands. One such bargain is the 2009 Pontiac G6 convertible, which Reed says is being offered with $3000 cash back. With an MSRP around $22,000, you could stand to get it for under $20,000 and make use of low-interest financing. To stand to get a convertible heading into the summer months at that price is almost unheard of.