Your Mechanic Can Be a Valuable Asset When Purchasing A Used Car
Your Mechanic Can Be a Valuable Asset When Purchasing A Used Car
Car dealers are not particularly well liked, and knowing as many of them as I do, I can understand why that might be the case. I run an import shop in Florida that specializes in late model luxury imports. I’ve been in business for quite some time, and I have heard plenty of horror stories from customers regarding other dealerships. In my opinion, I think the majority of car dealerships one will encounter are reputable, by and large. I say “by and large” because some dealers I know use nickel and dime methods to maximize their profits, which I disagree with. Personally, I would rather give the customer a quality auto at a fair price and consequently gain a lifetime customer, but that’s a topic for another article. One of the more recent horror stories I heard involved someone who had purchased a vehicle that was leaking oil. For those of you that know anything about cars, you know that this is nothing to be taken lightly. The customer was assured by the dealership that this older, yet low mileage used car was in pristine condition. Here’s where it gets interesting… Before the sale, the customer asked if she could have the car inspected by her mechanic. The dealership did everything they possibly could to keep that from happening, and succeeded. They told her that they would have their own mechanics do a “twenty point inspection” which would save her the time and expense of having her mechanic take a look. Unbelievable! Since the customer parked her car on a busy street where there were already several oil spots, she never noticed the leaking until after her ridiculously short thirty day warranty was up. Her mechanic would have spotted an oil leak the minute he had the car up on the rack. As disheartening as this story is, there is a valuable lesson to be learned here. Car buyers, unless they are dealing with a dealer they are familiar with and whom they trust, should seriously consider having a mechanic check out any used car they are interested in (preferrably the local certified manufacturer dealer of the automobile make they are considering). I have had several first time customers ask me if they can have the car independently inspected and I am always happy to oblige. Take my word for it, the only dealers who would frown upon independent inspections are those who have something to hide. To learn more visit Spanos Imports of Daytona Florida visit http://www.spanosimports.com/
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Trade'r in? Yup! Nope! Whaaat?
When trading a vehicle there are four categories that will clearly affect the value of your vehicle; (1) Current market value. This is an adjustment amount to the book value that is made by the vehicle appraiser and occurs when there are real time changes in the market that are not readily reflected in current book values. One powerful example is the energy crisis that came along in the fall of 1973. Many consumers panicked (mildly) and began trading their gas hogs for fuel efficient smaller vehicles. As the extent of the crisis and its duration were unknown, and there were no real predictions as to the short and long term effects, most dealers looked on the gas hogs with an eye of concern, specifically in relation to their dollar value. I counseled many buyers during that time, encouraging them to be patient and wait it out. Most of them, nearly all, traded anyway. They received as little as 50% of the book value for their gas hogs and paid over retail in many cases to purchase a fuel efficient vehicle. Many of those people returned to the market within a short period of time and traded their fuel sippers for gas hogs. Again, values were adjusted to allow for the glut of small vehicles on the dealers lot. There are always current market value adjustments whether just at a dealership, in a city, an area, a state, a region, or across the country. These adjustments may be as simple as a dealership being overstocked with used vehicles due to some internal problem; therefore the dealer has to pay less for vehicles currently being traded in. An area may be affected by an economical crisis that overall affects the consumers ability or willingness to spend money. Wars and rumors of war have a strong negative effect on vehicle values, as does the price of fuel. One major factor that affects the value of trade-ins are the deals being offered on new vehicles. The greater the deal on new, the less is paid for the trade. Why? Used vehicle buyers will step up to new vehicles and pass on the late model used vehicles. In many cases payments on a new vehicle may be roughly the same as a one year old used. Additionally, consumers may determine that they are better off trading their current vehicle sooner than intended, taking advantage of the factory incentives, and driving off in a new vehicle with payments close to where they were, and offsetting maintenance expenditures in the process. (2) Dealership attitude. Vehicle values may be affected simply by some issue within a dealership. An inexperienced Used Vehicle Department manager, a poor cash flow in the dealership, a weak sales force not selling vehicles, and other situations. One thing learned when purchasing at an auction, talking with a wholesaler, or shopping a trade-in to another dealership is that prices vary widely across the board. Realistically I have witnessed value swings by as much as $2000.00. (3) Dealership wants. In some circumstances a dealer may not want your trade. You might have a very expensive trade, the dealer does not want to tie up money in a slow seller and the dealer cannot find a home for it with another dealer. Therefore to make a deal he will hit the trade low expecting to find a home for it at the auction, with another dealer, or attempt to cheap sell it on his own lot. Regardless, the vehicle may bring several thousand dollars below book, your loss. (4) Dealership need. The dealership may not need “another one of those”. Some vehicles are a glut on the market. An example would be the dumping of a rental car fleet at the auction, everyone buys them, everyone has one, and no one needs another one. Dealership want and dealership need may also swing in your favor. There were many times that I paid over book (more than $1200.00) to own a vehicle, knowing that if I did not, someone else would, and I would miss the sale on three vehicles; (1) my vehicle, (2) the trade-in, and (3) the trade-in on that one. Instead of missing business, I would make three profits. It should be clear that; (1) you must know the value of your vehicle to do business with it; (2) the book value is affected by other circumstances, some of which are beyond your control. However, because you know the value of your vehicle you have an idea of where you should be, and by shopping more than one dealership (if you don’t get the value up front) there is a very good chance you will get your money. It is absolute that you use a professional source to determine the value of your vehicle prior to shopping for your next vehicle. If you had a wad of $10.00 bills in your pocket, a big wad, and you wanted to trade them for $50.00 bills, and if you had never counted them, how would you possibly know how many $50.00 bills to get in return for your 10’s? Would you just throw them out there and take back whatever 50’s were offered? Or would you count them ahead of time, separate them in $50.00 packets, band all the packets together, and put in writing the total amount of all the packets, put that slip of paper with your packet, and put one in your pocket? Would you then watch as the other party counted your 10’s, and as the 50’s were counted out for you? Wise folks count their money first, record the amount, and observe while others handle their money! Chuck Norlin is a 41 year veteran of negotiating, a Cal U and General Motors University graduate, and 30 year career expert in the retail vehicle business.
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