Negotiating Price of Used Vehicle - Suggested Approach/Tips

[Voodooman]

If anyone wanted an interesting listen on the ins and outs of a car dealership, listen to this recent episode of This American Life. The reporters spent a month with a dealership in Long Island, and the result was entertaining, informative, and a little bit sad at the same time.

http://www.thisamericanlife.org/radio-archives/episode/513/129-cars


The biggest takeaway...go in on the last day of the month. Most dealerships are so desperate to make quota, they'll take any deal, even at a loss. This applies more to new than used, but I still think the last day is the best chance for a deal.

From my own experience, if your dealership is stupid enough to leave their sales board visible, you may gain some valuable insight into who to talk to. A number of years ago, CMP had their board in plain sight. I picked out the salesguy with the lowest number for the month, and dealt only with him. I believe I got a better deal due to his desperation, although I freely admit that my perception could be totally false.

[Table 5]

Originally Posted by Boblobla

I sold my truck pretty painlessly on Kijiji for $6000 more than the dealer was willing to give me.

I don't understand why people trade in cars or try to sell to dealers...they always get terrible value. Even if you price it low, you'll pretty much always get more for a car in a private sale than what a dealer will give you.

It's like people trying to sell something on Pawn Stars. That dealer is in the business of making money...so he's not going to buy something unless there's a way to make money off of it on some level. Even if he turns around and gives you a supposed better deal on a new car, you've give him all your lost profits on the used one.

I guess it's a lot more convenient to sell to the dealer, but people are walking away from thousands of dollars for that convenience.

[habernac]

Originally Posted by Table 5

I don't understand why people trade in cars or try to sell to dealers...they always get terrible value. Even if you price it low, you'll pretty much always get more for a car in a private sale than what a dealer will give you.

It's like people trying to sell something on Pawn Stars. That dealer is in the business of making money...so he's not going to buy something unless there's a way to make money off of it on some level. Even if he turns around and gives you a supposed better deal on a new car, you've give him all your lost profits on the used one.

I guess it's a lot more convenient to sell to the dealer, but people are walking away from thousands of dollars for that convenience.

I always laugh at the dummies on Pawnstars that get all bent out of shape. "But you heard the guy, it's worth $1000, why won't you give me $1000 for it?" Because they're in the business of making money, donkey.

[Table 5]

I just listened to that TAL episode the other day...it was pretty great stuff (and as you said, a little sad too).

I've always known that going on the last day of the month is a good idea, but that episode really hammers home just how important it is to the dealer.

[Regular_John]

Originally Posted by Table 5

I don't understand why people trade in cars or try to sell to dealers...they always get terrible value. Even if you price it low, you'll pretty much always get more for a car in a private sale than what a dealer will give you.

Ever tried selling a vehicle (or anything really) through Kijiji? You're almost forced to mark it up 50% what you really want just to account for the low ballers.

I had a 98' grand am with two sets of tires listed for $1,500ish and I was getting calls/emails like "would you take $250 and deliver it to me in Airdrie?".

When it comes time for a new car I'll take whatever the dealer is offering on my current bucket just to avoid the hassle of fielding calls/emails from tire kickers.

[Table 5]

Originally Posted by jaydorn

I had a 98' grand am with two sets of tires listed for $1,500ish and I was getting calls/emails like "would you take $250 and deliver it to me in Airdrie?".

Well at $1500 you're not exactly dealing with the 1%. It's mostly going to be kids and people who are on a tighter budget, so I'm sure you'll get more than your fair share of low-ballers trying to eke out money.

When it comes time for a new car I'll take whatever the dealer is offering on my current bucket just to avoid the hassle of fielding calls/emails from tire kickers.

It's definitely an extra hassle. But when you're talking thousands of dollars, personally I think it's worth it to ignore a few emails and meet with a couple of lowballs (you can usually tell who these guys are right off the bat though, and filter them out as needed).

[Regular_John]

Originally Posted by Table 5

Well at $1500 you're not exactly dealing with the 1%. It's mostly going to be kids and people who are on a tighter budget, so I'm sure you'll get more than your fair share of low-ballers trying to eke out money.



It's definitely an extra hassle. But when you're talking thousands of dollars, personally I think it's worth it to ignore a few emails and meet with a couple of lowballs (you can usually tell who these guys are right off the bat though, and filter them out as needed).

Yeah I suppose it depends on the age/condition of the vehicle you're trading/selling. I've stuck with rust buckets the last few years, so it's all under $5k, probably skews my experience.

[Table 5]

Originally Posted by jaydorn

Yeah I suppose it depends on the age/condition of the vehicle you're trading/selling. I've stuck with rust buckets the last few years, so it's all under $5k, probably skews my experience.

I sold my Protege5 last year for around 3k, so I've gone through it myself. Took about 5-6 people to come see it in person before a college kid took it home. It was about a 4 on the annoyance scale (mostly with people who act really into the car and then don't bother to get back to you after they say they will).

I'm pretty sure a dealer would've offered me $500-$1000 bucks, and sent it straight off to the wrecking yard. Atleast this way I maximized the value, and some one gets to keep enjoying the car. I hate to see good little cars go to waste (I was really not a fan of Cash for Clunkers in the US...way too many great cars were destroyed).

[bizaro86]

Would it be legal to offer financing on selling your own used car? Obviously, that has the potential to be a PITA, but it seems like that's the biggest advantage a dealer has over someone selling privately.

[Table 5]

Originally Posted by bizaro86

Would it be legal to offer financing on selling your own used car? Obviously, that has the potential to be a PITA, but it seems like that's the biggest advantage a dealer has over someone selling privately.

There's nothing stoping someone from going to the bank and getting a loan for a used car.

When it comes down to it, the thing that a dealer offers is convenience. Convenience in transaction, convenience with speed, and convenience with payment. It all depends on what that convenience is worth to you. For me, if I can save a few grand, I'll definitely do it myself.

[cral12]

Originally Posted by cral12

Selling/trading in:
- 2002 Jeep Liberty Sport
- good condition; regularly maintained; no accidents
- 135,000 km (not a mistype!)

Prefer not to have hassle of selling privately, but maybe should reconsider then.

1 owner only

My Jeep:

http://www.vmrcanada.com/value_menus.../02jelity.html
(similar to Blackbook)
Low: $4925; High: $6900

Anyone care to take a stab at a reasonable asking price for me to sell it?

[Voodooman]

Depends on some other factors to some extent. How are the tires, brakes, windshield and other maintenance items? What's the repair history of the vehicle, any major issues?

Best guess, list for $6,500, take $6,000. I'd bet a dealership would only give you $5,000 at best, and they'll adjust the purchase of your replacement vehicle accordingly to make up any shortfall on your trade. Best to sell privately and go in with cash for the new one.

There's a 2002 Liberty with 175K for $8k at one of the places in Inglewood. $8k really means they'll take $6,500ish, and are likely into it for $5,000 to $6,000. So $6,000 for yours on private sale is reasonable.

[Table 5]

I would start at the higher end for the first week. You'll know right away where you stand by the reaction. If you get no replies, you're too high...if you get swamped, your probably too low. But if you start too low you have no where to move, so I always start high.

Work your way down a few hundred dollars every week (or more if you have the patience to wait). Just remember to always leave a little wiggle room for negotiation....if you're bottom price is 5k, don't list it at 5k.

[Locke]

Calm down fotze, you are not allowed to buy their home and burn it down in front of their children while cackling maniacally.

If you could swing that though that would be the ultimate negotiating tactic.

[Table 5]

Originally Posted by fotze

I'll give you $2000, CASH.

I always love that little sweetener by people as if it means something.

Dealers never want you to pay cash, and private-sellers will accept nothing but cash or certified check.

[Sliver]

Originally Posted by Table 5

I always love that little sweetener by people as if it means something.

Dealers never want you to pay cash, and private-sellers will accept nothing but cash or certified check.

Meh, I like 'cash' guys. I think it's more of a 'I have the money, don't have to screw around with financing, and don't need to sell anything of my own before buying this.' Basically they're saying if we can agree on price we can make this happen in the next five minutes.

[Table 5]

Originally Posted by Sliver

Meh, I like 'cash' guys. I think it's more of a 'I have the money, don't have to screw around with financing, and don't need to sell anything of my own before buying this.' Basically they're saying if we can agree on price we can make this happen in the next five minutes.

Sure you want the transaction to be as quick as possible, but I'm still not going to sell something for 2k if its value is 5k just because the guy can give me money right now as opposed to slightly later from now. It takes what, an hour max, to go to the bank and get your cash/check...it's not like it's some month long mortage-approval process.

And its not like guys who do the low-ball cash email are billionaires in top hats. It's usually some shady dude looking for a sucker.

[Sliver]

Speaking of low ballers on kijiji...always put in your ads something along the lines of 'low ballers will be ignored.' Then you can just delete their emails and not worry about them. Takes a lot of the stress out.

[cral12]

Thanks all - Kijijii is the best bet then, I'm guessing?

[Table 5]

Originally Posted by cral12

Thanks all - Kijijii is the best bet then, I'm guessing?

I would also put it up on Autotrader.ca. It's free, and pretty popular as well (and the audience is perhaps a bit of a step up from Kijiji). Although it takes a little longer to get your ad up...it took me about 2 days for it to be approved for some reason.