I'm new to the forum and joined because I am considering a used F-150 as my next vehicle. Over the past few weeks I have made the following observations-
(1.) The price of a new F-150 with rebates is about $1k to $3k higher than the list price of a used low mileage (<30k miles) 2009-2010 unit with similar features. I think most buyers are easily convinced that spending $1k to $3k more is a no brainer.
(2.) If you are like me and hate the idea of taking a huge depreciation hit the instant you drive the vehicle off the lot, you start to ask questions about the used truck market. The first question is: "How much mark up is there in the used F-150 Market?".....Not an easy question to answer.
But I think I can estimated it. I'm considering a 2010 F150 Lariat (plus pkg & Navigation.) Based upon my own experience I know that most dealers will not offer KBB trade-in. I think most dealers are offering wholesale price for trade-in. You can get an idea of wholesale price from here: http://www.carquotes.com/tools_and_resources/
This site uses Black Book and will email you an estimate of the wholesale/trade in value. (When asked for your car information do not enter information about your current car. Enter information about the car you are interested in buying. Here is where things get a little muddled. The estimate that you receive from CarQuotes.com is not truly wholesale price. BlackBookUSA is a business typically only offered to those in the car industry. In fact if you try to buy a subscription to Black Book, the site will ask for your industry credentials. Your quote will be close to wholesale but not quite wholesale pricing level. Some sources indicate that the free quotes are about $1500-$2000 higher than true wholesale.
Based upon the email quote that I was mailed I used that value and determined that the asking price/free blackbook estimate = 1.4. At first I couldn't believe that the used car market was getting 40% Mark Up!!! It seemed way too high...however I googled these results and found other sources indicating that the used market might be as high as 40%
(3.) If we assume that the asking price really is 40% Mark up then there is certainly room to negotiate. How low a given dealership is willing to go cannot be determined exactly. However, there are some websites that kind of give you an idea. Try http://clearbook.truecar.com/....again be careful here. This site is powered by BlackBook...and if you read the small print you are going to discover that the pricing is really an average for all styles in the same model year.
I think most people should be able to get significant price reduction (20%?) from motivated dealers.
One more Gem.....If you want to determine what a given vehicle has for options it can be a little maddening trying to decipher the dealer's description. You can try this instead, if you know the VIN:
Good info. I think a 40% markup is a bit ambitious though in most cases for a used vehicle. I'm sure there are lots of cases where the dealer low-balls the trade and the customer goes for it because they don't want to deal with the hassle.
I'm finding the prices of used trucks ridiculous, quite frankly. If you run blue book (KBB, Edmunds, Nadaguides, etc.) on a one to two year old truck, you can often find the same truck brand new for the same price or only a little bit different. In some cases, the price of a brand new truck can even be less than you find on a used model.
About a month ago I walked on a 2010 F150 Lariat Supercrew 4X4 with 34k miles on it. It had center console, reverse camera, cooled seats, etc. Only option missing was navigation. The sticker said $32,500 and they offered to sell it to me for $30,585. I offered $28,000 because we had just priced a brand new 2012 model with essentially the same options at the same dealer and it was $39,000. I thought that the difference between new and used should be greater than $8,500, particularly given that they had that truck on the lot for about 2 months. They refused to come below a penny $30,585 and insisted that they were only making $500 on the deal and that Nadaguides shows $32k as the retail value. A few days after I walked, they sold it, so it appears that I was the one doing the low balling in this case. Had they offered it to me for $1,000 less, or more than the ridiculous $2500 number on my trade, I probably would have gone for it. Since that time I haven't really found anything that compares to that truck for the same price. I found one that was $1,000 more with half the miles, but it sold before I even got ahold of the dealership.
I'm surprised that the dealer walked on a $28k offer. I'm having difficulty believing that at $30,585 he is only making $500.00.
I priced out a fully loaded (plus pkg, chrome pkg, bucket seats, 20" wheels and Nav) 2010 F150 Lariat with 37,000 miles using a couple of internet sites. BlackBookUSA gave me an estimate of $28,835 and Edmunds returned a value of $25,300. I'm fairly certain that the BlackBook estimate is not the true wholesale price, I think the true wholesale price is about $2,000 less. If you average Edmunds and BlackBook's trade-in Value you get $26,000.
Based upon what I have read so far it appears that most dealers are skiddish in this economy and are sticking to wholesale prices when it comes time to determine trade-in value. I think if you stick to your guns with the same price level at the next dealership you'll end up with the deal that you want.
I'm surprised that the dealer walked on a $28k offer. I'm having difficulty believing that at $30,585 he is only making $500.00.
I priced out a fully loaded (plus pkg, chrome pkg, bucket seats, 20" wheels and Nav) 2010 F150 Lariat with 37,000 miles using a couple of internet sites. BlackBookUSA gave me an estimate of $28,835 and Edmunds returned a value of $25,300. I'm fairly certain that the BlackBook estimate is not the true wholesale price, I think the true wholesale price is about $2,000 less. If you average Edmunds and BlackBook's trade-in Value you get $26,000.
Based upon what I have read so far it appears that most dealers are skiddish in this economy and are sticking to wholesale prices when it comes time to determine trade-in value. I think if you stick to your guns with the same price level at the next dealership you'll end up with the deal that you want.
Kevin
I was surprised as well that they didn't come down at all. They basically said, okay, we've had it for a few months, we'll sell it for $30,585. I said that's too high, I'll give you $28,000. They asked where I got that number and I told them Edmunds.com. He brought a printout from NadaGuides showing retail was $33k or something like that. He claimed that trade in was even $30,000. I flat out asked him, "If I bring this truck in right now, you mean to tell me that you'll give me $30k for it?" He sort of side-stepped the question and stated something about everybody wants the lowest price for the new vehicle and the highest price for their trade based on blue book.
At one point they even asked me "What can we do to get you to drive home in this?" and I told him to lower the price to $28,000. He said he couldn't lose $2,000, "you wouldn't want me to lose $2,000, do you?" I said, "well, better in my pocket than in yours." They were nice guys though, I'll give them that. Almost had me believing they were only going to make $500 for a split second.
I don't know what they sold it for, but they did call me back the next day and up my trade offer to $3500. I didn't hear from them after that, and that following Saturday they sold it. Not sure what they sold it for, but again, comparatively speaking, that wasn't a bad deal, but the difference just wasn't great enough for me between new and used. When I can buy a slightly less optioned (no center console or moonroof) brand new, 2012 for $5500 more, it just doesn't make a whole lot of sense to pay $30,500 for used in my opinion.
There is another one that is pretty much the same truck at one of their sister dealerships about 20 miles away, but it has 16k miles on it and they're asking $33,900, which is ridiculous. I guess that's why they've had it since early December and it's still sitting there.
Last edited by CaptainHook; 02-21-2012 at 06:06 PM.
Dealers love to confuse the consumers with the various pricing guides. I think if you do a little research you'll discover that KBB, Edmunds, and NADA all provide data showing retail pricing guidance. The issue with this information is that it is a compilation of "ASKING PRICE" not "SALE PRICE". The only website that I have found so far that gives some indication of Sale Price is Clear Book. Unfortunately, the data shown in Clear Book is somewhat confusing. (The small print indicates that they are showing data for vehicles with similar features of the same model year.) I think that means that the data is a mix of XLT's, Lariats, Fx4 etc with similar features.
When I find a vehicle that I'm interested in I'll politely ask the dealership to show me their wholesale pricing guides and prove to me that they paid the value that they are claiming.
In general I'm hoping that the rise in gas prices and the fact that it's income tax return season will be reason enough to get the dealerships to be a little more reasonable.
Dealerships these days have to use their used vehicle lot as a profit center - because there's very little profit in new vehicle sales with everyone beating them down to invoice pricing. Between that and the service/parts departments they have to make money somehow to stay in business.
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2003 F150XL 4.2 short cab/bed 4x2 5 speed manual 3.55 LS
I always laugh when you bring in a lower "blue book" printout than they show and they say, "Well, that's just a suggestion..." I understand that they have to make money or they wouldn't be able to stay in business, but at the same time, I want to pay the lowest price possible, just as they want me to pay the highest price possible.
There are so many variations in blue book values and each one of them is quite different. Edmunds seems low, KBB seems high and NadaGuides is sort of hit or miss high/low. I also don't understand some of them; you click the trim level, for example, Lariat and then it gives you options for leather and heated seats. Well, Lariat already includes leather and heated seats, so aren't I doubling up on the options? Doesn't make a whole lot of sense to me because Lariat isn't even available without leather.
I made my first attempt today to buy a 2010 Lariat....what a disaster!! A local dealership has had a 2010 Lariat on their lot for about 2 months. I went in test drove the vehicle and liked it. After the test drive we started talking price. Instead of negotiating sale price THEN negotiating Trade-in, I agreed to negotiate a delta price (the amount needing to be financed).........classic rookie mistake....sadly I'm too old to be a rookie. As we were negotiating this price I thought the dealer was lowering his asking price. (Looking back on it I now know that it was way too good to be true.)
What the dealer was doing was rolling my payoff amount into the new auto loan. Instead owing the bank $20k.....I was going to owe the bank about $24k. (The $4k is what I owe to pay off my current vehicle.) At the end of the day, the dealer hadn't budged from his asking price. I will not repeat this mistake again. Hopefully others will learn from my mistake as well.
I've always negotiate my trade-in after negotiating the sales price of the new vehicle. This results in two things; first, the dealer can't play the "numbers game" and confuse you with it. Second, this usually results in a lower trade-in number, or at least the "real" trade in value that they are making with you.
Typically I go into a dealer transaction knowing that I'm most likely not going to trade, but it is nice to have the option and I can certainly see the appeal after having tried to sell my last vehicle for about 4 months. I eventually ended up trading it for an ATV.
I tried this tactic on the 2010 Lariat I referenced above, only to be offered about half of what I thought my trade in was worth.
I made my first attempt today to buy a 2010 Lariat....what a disaster!! A local dealership has had a 2010 Lariat on their lot for about 2 months. I went in test drove the vehicle and liked it. After the test drive we started talking price. Instead of negotiating sale price THEN negotiating Trade-in, I agreed to negotiate a delta price (the amount needing to be financed).........classic rookie mistake....sadly I'm too old to be a rookie. As we were negotiating this price I thought the dealer was lowering his asking price. (Looking back on it I now know that it was way too good to be true.)
What the dealer was doing was rolling my payoff amount into the new auto loan. Instead owing the bank $20k.....I was going to owe the bank about $24k. (The $4k is what I owe to pay off my current vehicle.) At the end of the day, the dealer hadn't budged from his asking price. I will not repeat this mistake again. Hopefully others will learn from my mistake as well.
With gas prices running up (and up, and up...) I'm wondering what will happen with the prices of trucks, particularly used trucks. The residual value seems to be a pretty high percentage of actual prices [not M.S.R.P.] of new trucks. I think the prices of used vehicles generally will be up with high gas prices, but the prices of used trucks are already up, so I'm not sure what will happen.
I think at this point I'm going to wait on the sidelines to see how it plays out.
I think the prices of used vehicles generally will be up with high gas prices,
Only vehicles that get high gas mileage, such as a Honda Civic. You will almost be able to steal a used F-150. That's exactly what happened last time gas went to 4 bucks a gallon. Book value on mine right now is higher than it was in 2008, and I only have a V-6!
Expect values of used trucks to start dropping any time now.
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2003 F150XL 4.2 short cab/bed 4x2 5 speed manual 3.55 LS
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