Rant: Car Prices

[Jay_Gatsby]

Can someone please explain to me why a quality used car is so expensive? As my car is entering its final phase of life (I'm not putting another dime into it), I've been looking a getting a quality replacement (i.e. likely the same make and model). What I'm finding is that people want a rather inflated amount (e.g. 80% of new) for something that is already 2-3 years old and has 30k-40k miles on it.

I'm thinking of getting a bit more creative when it comes to buying. Maybe I'll buy a vehicle just about to come off of its lease, or make friends with a used car salesman and pay him $500 to get me the best deal possible from another dealership.

The bottom line is that I don't think I'll ever be able to educate myself sufficiently to get a "fair" deal on a quality used car, and I'm not interested in getting ripped off. As indicated in my other rant, I'm tired of that...

 

[wabmester]

It's whatever the market will bear. Stay away from dealers. Check KBB. And haggle like mad.

 

[education]

And be VERY CAREFUL, my friend. If you buy a car from an individual, you may get screwed royally since there are so many unscrupulous crooks who are selling flood ravaged cars that are worthless and will self destruct after you drive down the road. Stay way from those "curbside deals" that are too good to be true.

Professor

 

[yakers]

Actually there are some pretty good deals on new cars if you shop around or get a lower status car. I paid under $10K for a brand new 2005 Ford Focus in Nov 2004. Similar deals are around. But this is a basic car although a good stereo & AC. This also included oil changes every 5k mi until 100k mi and no services except oil required until 100k mi. This car is every bit as good as the two Honda Civics I have owned.
Just find a car that hasn't moved and you may find a great price. Oddly enough most car dealers make more on used cars than new although that can come from shafting the party they buy from.
Now I did look at the Civic & Prius hybreds and liked them but the prices were just too muchand no dealers willing to make deals.I believe Chevy sells a version of the Toyota Corrola which has no great market yet it is the same car.
So what are you looking for anyway?

 

[Craig]

Consider getting it inspected at the dealer before buying ... I've had more private individuals try to scr*w me on cars than dealers. You know ... "gee, I forgot my wife had that accident ...".

I'm a little surprised you're finding the market that strong. I would have thought summer employee-price discount programs would have hurt used car values. It is often tougher these days to get a deal on a slightly used car, because many come off of lease or otherwise through dealers, and are mainly available at dealer-only auctions. On the other hand, less depreciation of our used cars isn't bad.

As yakers notes, be sure to at least consider a new car. I know in the motorcycle world we are actually seeing some used sport bikes sell at retail for more than a new bike (hard to get models). Markets can be funny.

 

[Lakewood90712]

If you drive them till it's scrap metal time, new is more cost effective. The "One Only"
advertized special CAN be found , but takes a little work.

The last time I got one, I got the friday newspaper at 7 and hit the dealer when the doors opened at 9, ad and funds in hand.

Be ready for some really unhappy sales and finance people when you pass on the $800 "Paint Protective Package" , the $500 Scotchguard , The non-factory extended warranty , and all the other crap with 80% profit margins.

John.

 

[yakers]

If you drive them till it's scrap metal time, new is more cost effective. The "One Only"
advertized special CAN be found , but takes a little work.

The last time I got one, I got the friday newspaper at 7 and hit the dealer when the doors opened at 9, ad and funds in hand.

Be ready for some really unhappy sales and finance people when you pass on the $800 "Paint Protective Package" , the $500 Scotchguard , The non-factory extended warranty , and all the other crap with 80% profit margins.

John.

Hey, thats what I did. After testing cars in various places I saw the loss leader and went for it, MSRP $15,030 and sale price $9,788. Just said I'll take that one, thank you. I love to haggle but it was unnecessary, I had done my homework and this was a good price.
The salesman was quite pleased as it took so little of his time, made a sale and looked busy to other customers. The finance "closer" read me pretty well, no pitch for financing, paint coating, and other crap but he didn't look happy.

 

[SteveR]

I will use the "internet salesperson" at the dealership. I get them to give me a price and then I so see another dealer with the information and let them have a shot at doing better. Sometimes they do and I buy the car but doing it this way moves you in a different circle than the average Joe off the street. They usually make a token effort at selling the high priced hype stuff but tend to just rattle it off knowing you are not going for it. I have saved a lot doing it this way and when the time comes for the next one I will continue to go this route. I prefer to buy new and keep it for several years. I am 4 years into one car and 3 in another so I have a while before I will need another one. I really hate buying cars.

 

[Texas Proud]

Why do car prices keep their value?

It actually might be that cars are now built better and have a lot longer life to give... also, a cars value has a 'bottom'. Unless it is wrecked or trashed out it will see for this price no matter how old or many miles.. a 15 year old Lexus LS with 180,000 miles still sells for $3300 for private party..

 

[Michael Moore]

My father had pretty good luck buying a new pickup by sending letters to several dealers in smaller rural towns. He told them what he wanted and asked them for their best deal. It would be a sale they'd normally not see, and though they may not get the volume discounts of a big-city dealer, they might figure a couple hundred bucks in the pocket was better than having something sitting on the lot.

A friend of mine is the service/parts manager at a big Honda dealership. He said that a good time to go and bargain is at the end of the month, as you might catch them when they are running a bit short of their sales goals so they are a little more desparate. Also, at that time A/C was always a dealer-installed option on Hondas (this may no longer be the case) and he said to see what the salesman wants, and then go around to the service department and see what their price was. Sales and service are usually separate sections, and sometimes there's a bit of rivalry and the service guys might like cutting the price a bit and "stealing" the sale from the sales droid.

If you contact the dealerships via email some of them will go straight to their bottom-line no-haggle "Internet price", which keeps you from having to beat the price down from the full retail sticker level. When I bought my ZX3 Focus in 2000 the "Internet Sales Manager" told me that anyone that contacted him was presumed to have done their research and found out what the going price was, so there was no sense in trying to jerk them around. Here's the price, take it or leave it.

I took it. I've now got just under 70K on the car and I still like it. 30mpg freeway is pretty standard with or without A/C. It is pretty much ready for new dampers, but that's no big surprise.

cheers,
Michael

 

[justin]

Bought a new honda in 2000. I waited till the 2001's were on the lot, and told the dealer I'd help him get rid of the old 2000 inventory that was collecting dust next to the new 2001's. They also re-did the 2001 model of the car I bought, so the 2000 looked extra old. To add to this, I happened to find a dealership that had just been started, and the owner told me he was cutting me a deal so he could up his sales volume and get more "allocation" from the corporate offices for the following year. Got the car at invoice (hard to do for a honda at the time), low APR financing package, and factory extended warranty at cost (about half of MSRP). Worked for me.

 

[BigMoneyJim]

I saw a commercial during football tonight: Chevy (I think) red tag sale: you won't pay a penny over the tag. Small print: tax, title, dealer fees and options extra.

So I'm curious: where is it that people pay more than the sticker price? The commercial seemed to think this was a great deal. Maybe it's because the tags are red? Is that it?

 

[73ss454]

BMJ,

Sometimes people will pay over sticker price.

Range Rover is charging up to 5K over sticker right now on some models.

When certain cars are hot and hard to get dealers will charge what ever the customers will pay. Mustangs in the northeast are still going for over sticker price on GT manual shift cars because they are very hard to get.

JOE

 

[sgeeeee]

I've never talked to anyone who thought they made a bad deal on a car. . . Think about that.

Car dealers spend every day of their lives figuring out how to make people spend their money while thinking they got a good deal. The car buying public faces the car dealers every several years (at most) but always seems to think they got the best of the dealer.

Like any other negotiation, there are some things you can do to help yourself. You can arm yourself with as many facts as you can. Use the internet to research the car you want to buy and any car you want to trade-in or sell. Learn all you can about your local market. You can try to control your emotions. You can be prepared to walk away.

I've looked at the data about new cars, resale value, trade-ins, etc. If you trade cars every few years, then re-sale value has a significant impact on the cost effectiveness of your car purchase. But the longer you keep a car, the less important trade-in value becomes and the more important purchase price and maintenance becomes.

Driving habits also impact car purchase decisions. For example, I drive off-road to get to archaeology sites deep in the desert on a regular basis. I need a high clearance, 4x4 vehicle. But if I read the typical reviews of 4x4's, I find out what vehicle is a good parent's bus in inclimate whether conditions. That doesn't work for me.