O.T.--Used Car Pricing--What Has Happened??

Jiles · May 31, 2011

I have bought a lot of vehicles in my 65 years. I have never bought new and I am a mechanic.
I have always thought that I got a better deal with a NEW Car Dealer then an individual, and I have checked with as many as 25 different dealers in my surrounding area.
I am shocked at the prices Individuals and Dealers are asking. I always consult NADA--Kellys--and Ecmunds to determine price and I have never paid Dealer Retail for a vehicle
In todays market, EVERY vehicle I have checked, is priced 1K to as much as 6K ABOVE any RETAIL appraisal I have checked.
Most of these prices are obtained from the internet sites and Negotiating starts from this price. Some are advertised a "No Haggle".
One dealer told me that most people don't care what the automobile price is--as long as they can make the monthly payment

RayP(MI) · May 31, 2011

Donno, but I always look for reasonable price on a vehicle before I even start. Price too high, they can keep it.

No namer · May 31, 2011

I bought a new Ford Escape and traded in my 2007 Cobalt. I got $6,800 for the Cobalt trade and they sold it within 10 days. I assume they got $8000 for it. (they orignally wanted to only give me $6500 for it but I twisted their arm) This car new 5 years ago was $15k.
I think it is a called inflation.

Ken Macfarlane · May 31, 2011

Used car dealers here follow this formula:
-Perfect gems in desirable models that are traded in, are kept
and sold for above book.
-Anything less goes to the auctions and sells for about 65% of
dealer used lot price.
-Smaller dealers buy at auction and put their mechanics and
body guys spare time to use fixing up these unloaded trade-ins.

Exceptions:
-Repos always go to auction no matter what it seems, even when
the dealer/finance company will lose big time.

Welding man · May 31, 2011

Good used cars in my area,especially pick-ups are hard to find. The new ones have gotten so expensive, that unless you have a very good job you can't afford the payments.$30,000 for someone making $10.00 and hour is out of reach. Cash for clunkers also took some good used cars out of the market.The dealers all know this. My local Ford store sells a lot more used than he does new, program cars,etc.All this contributes to inflated prices.

Anonymous-0 · May 31, 2011

Cash for Clunkers took a whole lot of good used vehicles off the road.Supply and demand.

Anonymous-0 · May 31, 2011

(quoted from post at 09:32:10 05/31/11) Cash for Clunkers took a whole lot of good used vehicles off the road.Supply and demand.

favorite car is a VW golf II (85-91). Almost impossible to find one now and used to pick them up for a couple hundred bucks.

Tony in Mass. · May 31, 2011

Yeah cash for clunkers was a scam, Chicago gangster politics at its best. No one is going anywhere, so everything is low milage nowdays. New car taxes are an extra sticker shock, some state add that to the sticker list, so yeah, there's another gee note. In Mass, the emmissions test computor only plugs into 1996 and newer, 'cause of the computor pigtail plugs becoming standard that year, so anything older will automaticly pass if there is no visible smoke. Kind of a bonus to hang onto an ol' creampuff. For people like me... we shall keep our pre 95's till the bitter end....

dej(Jed) · May 31, 2011

(quoted from post at 08:58:20 05/31/11) I have bought a lot of vehicles in my 65 years. I have never bought new and I am a mechanic.
I have always thought that I got a better deal with a NEW Car Dealer then an individual, and I have checked with as many as 25 different dealers in my surrounding area.
I am shocked at the prices Individuals and Dealers are asking. I always consult NADA--Kellys--and Ecmunds to determine price and I have never paid Dealer Retail for a vehicle
In todays market, EVERY vehicle I have checked, is priced 1K to as much as 6K ABOVE any RETAIL appraisal I have checked.
Most of these prices are obtained from the internet sites and Negotiating starts from this price. Some are advertised a "No Haggle".
One dealer told me that most people don't care what the automobile price is--as long as they can make the monthly payment

I think you must have an isolated case of high prices. Dealers have always been nuts on pricing. Prvate individuals are simply pricing like they always have. There are plenty of good deals. Just keep some phone numbers and call these high priced ones in about 2 weeks. Cars aren't selling when it comes to cash money.

dhermesc · May 31, 2011

Until 2006-2007 the US produced about 12-14 million cars/light trucks a year. Huge numbers of those went to the rental fleets.

The Ford Taurus was Ford's best selling car for several years with a majority of the going to fleets along with the likes of the Impala and the Intrepid. After just a year or two of service those cars were dumped back on the market at extremely low prices driving down the entire used car market.

Then the financial crisis started in 2008 and annual car sales dropped into the 8-9 million range and has very slowly crept back to 10 million range. The market number guys say the US needs to produce 10-11 million cars a year just to replace those that quit and get crushed every year. The fleet cars are being kept longer and the entire market is much tighter than it was. If you notice new car prices are way up due to fewer incentives (MSRP hasn't jumped to much though). Prices are up because there are fewer good used cars to buy and the new car prices are sky high.

In 2005 I bought a 2004 Taurus with 18K on the clock for $9900. Those days are long gone, in fact that same 2004 Taurus with 60K or less is still worth $9000.

scottwv · May 31, 2011

Cash for clunkers drove used car prices up by taking away a bunch of saleable vehicles. Looked good on paper though!!

mkirsch · May 31, 2011

(quoted from post at 09:32:10 05/31/11) Cash for Clunkers took a whole lot of good used vehicles off the road.Supply and demand.

BALONEY.

Cash for clunkers took a mere fraction of 1% of the "good used vehicles" off the market. Not even a spit in the ocean, and TWO YEARS AGO.

Anybody trying to tell you otherwise is blowing smoke up your butt, and you're a fool to believe them.

The OP's assessment is the closest to the truth: People don't care what the vehicle costs these days. All they care is if they can make the payments.

supergrumpy · May 31, 2011

was looking hard at 2010 Cobalts this past weekend, 3 years ago you could find ex-rentals with roughly 20k miles on for decent discount off new

last month or so all I could find were 34k mile ex-rentals for bit below new prices, forget that, bot new instead and I can beat the car myself

those high used prices do not refelct the beating those rentals took

Old Roy · May 31, 2011

I think that was our old Ford Festivea juse as they started to introduce foreign cars into the American dealerships. using a different badge.
Untitled URL Link

tjdub · May 31, 2011

There are a lot less NEW car dealers around now. You can expect to find higher prices and less accommodation when the nearest competing dealerships are boarded up ones.

dhermesc · May 31, 2011

Actually it looked even worse on paper when you included the details.

White House blows a gasket on Clunkers critique

The Cash for Clunkers program gave car buyers rebates of up to $4,500 if they traded in less fuel-efficient vehicles for new vehicles that met certain fuel economy requirements. A total of $3 billion was allotted for those rebates.

The average rebate was $4,000. But the overwhelming majority of sales would have taken place anyway at some time in the last half of 2009, according to Edmunds.com. That means the government ended up spending about $24,000 each for those 125,000 additional vehicle sales.

dhermesc · May 31, 2011

Agreed.

The entire C4C program was a fart in the wind in terms of benefits for consumers - the car companies liked those tax dollars though.

JayinNY · May 31, 2011

No one can afford new so everyone is looking for used. I
bought 1 new truck the rest were all used, I will never buy a
new truck or car again.

MSD · May 31, 2011

I might not be to good at math but how does the govt. spending $4000 for a rebate cost them $24,000 for each car sold?

hd6g Tom · May 31, 2011

Jiles, here in Iowa at the auto auctions you see a lot of spanish speaking people buying up cars and trucks. They take them to Mexico City and retail them there. A few years age this was not happening. They spend a lot of CASH and will (most of the time) give more for a vehical than it would normally bring. This has driven up the price we have to pay.

Anonymous-0 · May 31, 2011

just supply and demand
a few rules....
asking ain't getting
you cannot get it if you do not ask
a sucker is born every minute
and car dealers are all liars

Dick W. · May 31, 2011

It didn't even look good on paper. Worst thing to ever happen in the car industry. All the GREEN talk was really about the payback for the bought votes.

F-350 · May 31, 2011

Good clean later model used vehicles are becoming scarce in
my area so the prices are going up..Not many new ones were
sold in 2008-2009 plus everyone is driving their current
vehicles longer and longer..A friend that runs a used car lot
is having trouble finding inventory.

The Joplin,MO area probably had 8-10,000 vehicles
destroyed during the recent tornado....Lots of these will be
replaced with used if they can find them..

Spook · May 31, 2011

(quoted from post at 11:14:35 05/31/11) Until 2006-2007 the US produced about 12-14 million cars/light trucks a year. Huge numbers of those went to the rental fleets.

The Ford Taurus was Ford's best selling car for several years with a majority of the going to fleets along with the likes of the Impala and the Intrepid. After just a year or two of service those cars were dumped back on the market at extremely low prices driving down the entire used car market.

Then the financial crisis started in 2008 and annual car sales dropped into the 8-9 million range and has very slowly crept back to 10 million range. The market number guys say the US needs to produce 10-11 million cars a year just to replace those that quit and get crushed every year. The fleet cars are being kept longer and the entire market is much tighter than it was. If you notice new car prices are way up due to fewer incentives (MSRP hasn't jumped to much though). Prices are up because there are fewer good used cars to buy and the new car prices are sky high.

In 2005 I bought a 2004 Taurus with 18K on the clock for $9900. Those days are long gone, in fact that same 2004 Taurus with 60K or less is still worth $9000.

I agree with your conclusions, but I think the production numbers were actually quite a bit higher - US car & light truck sales were 15 to 19 million units 2000 - 2007. The drop in supply was about 50%.

Ken Macfarlane · May 31, 2011

Anyone have the same fun of fighting with the salesperson for a
cash price? You tell them over and over, I don't give a hoot about
the payment, tell me the cash price, then tell me using the cash
price as a base, what the actual interest rate to go financed is.

They bs you with oh its 3%, yeah, but you remove a 4000$ discount
as a fee to finance and its 9% financing which I can beat even on an
unsecured loan! Worse when its a business vehicle, you lose a
current interest expense to get a bit more depreciation expense.

730d se · May 31, 2011

Part of it is supply and demand. Tight economy causes several factors. People are keeping cars longer so there are less per cycle coming back in to the circle to be sold as used.
The one that is almost hard to believe is the lies that dealers continue to use and get by with. One of them is low percent or "even 0%" interest. It should be illegal to state that as it is never true. No one (including the car makers) is going to lead anyone else money for no interest. They are front or back loading the numbers.
They actually admit this in the ads if you are listening (or reading). You can get EITHER a "low" or "0%" interest rate OR money off, but not both.
It is amazing that the general public cannot out smart most car dealers.
The other thing driving the higher prices is people have little or no cash so dealers know they are looking for a "payment". That is the worst way to buy anything, whether you have cash or not.

MarkWV · May 31, 2011

got a fax from NADA mid april for modifying used prices until new guide came out, something about the tsunami in Japan affected most prices since most cars had various parts from Japan, listed makes and models affected. Something about fewer new cars, more demand for used, .........

Brian Jasper co. Ia · May 31, 2011

Cow Cookies. The vehicles we blew up were the 'bread and butter' SUV's and trucks that make up most of the front row on used car lots. Most of those are what new dealers sent to 'the auction'.

RandyB(MI) · May 31, 2011

Your last sentence hit it right on the head!! Legal "loan-sharking".It aint just the car dealers , its ALL retail! They deserve to have them all back in their lap after a year. Young credit challenged people don't stand a chance of ever getting ahead. Did you ever think in a thousand years that an all volunteer military would ever fly?? Guess who's in it and why! Guess who's just as broke and credit challenged after serving their country for 2-3 yrs or more and can't even get a paying job or credit when they get out? The greed of this country is raping everyone under 40 and creating just what government wants...a bunch of "slaves" or "sheeple" as it were. The wheels will come off and when they do it won't be pretty. The rich or "wright-off" population are what keeps the new prices high. They pass it on through their bussiness and those same "slaves" end up paying for their "new" vehicles too. Get rid of all the poor and old...there in our way. Don't laugh , other countrys have done it and ours is on the brink.

JerryS · May 31, 2011

The only good thing that this program produced was that it got about 85 percent of the "Elect external_link" bumper stickers off the streets.

bison · May 31, 2011

I don't care what the veh new price is.
i always buy fixer uppers ,as long as the body is good and they're diesels.

And i never ever bought/buy from a dealer "period'

O.T.--Used Car Pricing--What Has Happened??

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