Trade in values - sigh
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    Fellow Frogger!
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    Default Trade in values - sigh



    I really did think that this time I might get a reasonable offer. I was looking at a new car from Renault and had a dealer serviced 3 yr old Megane diesel with 85k on it. Bought new for about $31k in 2012. I had figured the worst they would offer might be half that, but nooooooo.....

    $7-9k. That is over 67% in 3 years. I won't be able to buy new from them at that price, so we will keep the car.

    How do they do it? Why do they do it?

    Erik

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    Contented Peugeot Driver addo's Avatar
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    Rhetorical question; has to be.

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    I'd guess it will depreciate about $4K more in the next three years and still be under 200,000 km. Wow, you knock up the miles!

    There's a nice newish BMW for sale on the road near us for $7K. Our Peugeot 306 is still worth $2K after 21 years.

    I've come to the conclusion that most cars are like fridges now. It looks as if 1-4 years is not the time to trade up! So, a new buy should be thought of as an 8-10 year car unless you are rolling in dough! Bit of an "ouch" I agree.
    JohnW

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    COL
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    Quote Originally Posted by Erikbm View Post


    I really did think that this time I might get a reasonable offer. I was looking at a new car from Renault and had a dealer serviced 3 yr old Megane diesel with 85k on it. Bought new for about $31k in 2012. I had figured the worst they would offer might be half that, but nooooooo.....

    $7-9k. That is over 67% in 3 years. I won't be able to buy new from them at that price, so we will keep the car.

    How do they do it? Why do they do it?

    Erik
    Ouch but just a fact of buying a new car and trading up to a new car every 3 to 4 years
    Regards Col

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    Contented Peugeot Driver addo's Avatar
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    $7500/yr to rent your preferred car, that's $21/day.

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    Fellow Frogger!
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    I don't buy a new car every 3 years, but at 0% finance it was a chance to try out the idea. It also meant we had one car that I didn't need to worry about. The other cars in the fleet are all 20-30 years old.

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    VIP Sponsor David Cavanagh's Avatar
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    Fact of life I'm afraid. Not just Renault but everything is worth nothing second hand. German stuff is worse, Audi are the worst. 2-3 year old cars are flooded on the market so it's a buyers choice.
    David Cavanagh

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    Contented Peugeot Driver addo's Avatar
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    Maybe it's because the clever buyers of new cars know that a three year old European designed car is an unreliable death-trap bound to suffer terminal mechanical failure at any moment, with concomitant loss of life.

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    Quote Originally Posted by addo View Post
    Maybe it's because the clever buyers of new cars know that a three year old European designed car is an unreliable death-trap bound to suffer terminal mechanical failure at any moment, with concomitant loss of life.
    There not all Peugeot drivers.
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    Quote Originally Posted by addo View Post
    Maybe it's because the clever buyers of new cars know that a three year old European designed car is an unreliable death-trap bound to suffer terminal mechanical failure at any moment, with concomitant loss of life.
    Or maybe they need to make a Quid on trade in to cover the Salespeople wages and their infrastructure.

    They are required to make the vehicle roadworthy and reliable enough to to last out the stat warranty. And it's not good business sense to price a 3 year old vehicle similarly to a new car.

    A Megane has no intrinsic value other than transport to all but an enthusiast.

    Maybe the OP should put that car on Carsales, and wear the costs of preparation and RWC and check out the market.

    Used cars are like leprosy to most dealers and all but the low K (< 40k) pristine examples often get passed on to to the trade auctions.

    Sad but true.

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    You do have several good points there. To cover the warranty, any dealer needs a fair margin, summarising. And, in fairness to dealers, you can get a pretty neglected car detailed before trade in and not all folk trading in are scrupulously honest.
    JohnW

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    Quote Originally Posted by JohnW View Post
    You do have several good points there. To cover the warranty, any dealer needs a fair margin, summarising. And, in fairness to dealers, you can get a pretty neglected car detailed before trade in and not all folk trading in are scrupulously honest.
    John are you saying the public isn't entirely honest? Thank god the motor trade is.
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    Quote Originally Posted by David Cavanagh View Post
    John are you saying the public isn't entirely honest? Thank god the motor trade is.
    There is a common saying in the motor trade: "Buyers are liars". Commonly people will tell any bullshit to a car sales person...it seems to be an accepted thing to tell "white lies" when doing a deal.

    Anyway, the one thing the public need to understand is the difference between retail and wholesale values. If you sell to a dealer, even if it is as a trade in, you will only get wholesale value less any costs involved in detailing, repairing, etc. If ever a dealer offers you anything better than a terrible price be very suspicious as the extra "value" will be added to the change over cost. Often a dealer will simply sell on your trade in through the trade so there will be two sets of markups to be considered.

    To get a reasonable price for your used car the only option is to do the detailing etc yourself, advertise, negotiate and sell privately. Then you can take your cash to the dealer and negotiate the best deal you can on what you want to buy. Just be open with the salesperson and don't bullshit, keep the dealing simple and painless and you will be rewarded with a fair deal.
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    At the risk of boring you, dear friends, I reiterate my theory on used car values: Modern cars have a commercial life of six years. After that they are technically and fashionably obsolete and worth very little, and pass into the student/P-plate/migrant/backpacker market, or get shredded. That means that for every year of age you lose one-sixth of the value. That was proved correct just recently when I traded my lovely four year old Koleos that cost $32K and was offered just $12K, both on a new one as well as a good used one. I opted for the good two year old used one (new price $36K) and saved $12K. It works both ways! I am just sorry that I bought the first one new and suffered the painful write-down on the new price. I now conclude if you only buy 'good used' every time, you break even. Expensive lesson learnt. But then, I love that 'new car smell'!

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    Quote Originally Posted by Breitie View Post
    But then, I love that 'new car smell'!
    Mmmmmm... VOCs... Compound Interest - The Chemicals Behind the ?New Car Smell?

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    Quote Originally Posted by David Cavanagh View Post
    John are you saying the public isn't entirely honest? Thank god the motor trade is.
    I'm actually not joking. The car trade we deal with are usually teriffic people, it's the private people that give us greif.
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    1000+ Posts robmac's Avatar
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    Quote Originally Posted by David Cavanagh View Post
    I'm actually not joking. The car trade we deal with are usually teriffic people, it's the private people that give us greif.
    Possibly because the "trade" have realistic expectations and accept the concept of "making a quid", a concept lacking in some others.

    I recently Sold a vehicle on Car Sales.com.au and fielded calls from a large number of Gumby's some of whom verbally offered 50% of the advertised price. Without even looking at the vehicle.

    I ended up Selling, close to advertised price, to would you believe a "Chinese gentleman" with the deal transacted on the spot.

    Genuine seller meets genuine buyer.
    Last edited by robmac; 19th November 2015 at 05:23 PM.

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    VIP Sponsor David Cavanagh's Avatar
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    Quote Originally Posted by robmac View Post
    Possibly because the "trade" have realistic expectations and accept the concept of "making a quid", a concept lacking in some others.
    Probably, they also understand that time is money and having a dead car sitting there waiting for cheap parts from OS will only cost them money and annoy the customer.
    David Cavanagh

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    Fellow Frogger!
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    That is all fair information. My issue is that if I could find a dealer serviced 3 yr old car with 2 yrs still to run on the warranty at 1/3rd the new price, why would I have bought a new vehicle???

    You don't need to spend any money on roadworthying these, as they have all been maintained as new by the dealer!

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    1000+ Posts driven's Avatar
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    Now the taxi industry is picking up Mercedes vehicles. Just like they do in Germany.
    So much for a prestige marque

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    Quote Originally Posted by driven View Post
    Now the taxi industry is picking up Mercedes vehicles. Just like they do in Germany.
    So much for a prestige marque
    Not in Sydney they aren't.

    Camrys all the way and crazily, they are starting to get one headlight syndrome.

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    Quote Originally Posted by David Cavanagh View Post
    I'm actually not joking. The car trade we deal with are usually teriffic people, it's the private people that give us greif.
    Actually that is exactly my point. I remember an excellent article on the dishonesty of some private sellers/traders.
    JohnW

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    Too many posts! JohnW's Avatar
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    Quote Originally Posted by Breitie View Post
    At the risk of boring you, dear friends, I reiterate my theory on used car values: Modern cars have a commercial life of six years. After that they are technically and fashionably obsolete and worth very little, and pass into the student/P-plate/migrant/backpacker market, or get shredded. That means that for every year of age you lose one-sixth of the value. That was proved correct just recently when I traded my lovely four year old Koleos that cost $32K and was offered just $12K, both on a new one as well as a good used one. I opted for the good two year old used one (new price $36K) and saved $12K. It works both ways! I am just sorry that I bought the first one new and suffered the painful write-down on the new price. I now conclude if you only buy 'good used' every time, you break even. Expensive lesson learnt. But then, I love that 'new car smell'!
    Good used is the way - always has been unless you are confident you can keep the car for at least 10-12 years IMHO. Our ten-year old Scenic is brilliant.
    JohnW

    Renault 4CV 1950 (R1062)
    Renault R8 1965 (R1130)
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    Too many posts! JohnW's Avatar
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    Quote Originally Posted by Erikbm View Post
    That is all fair information. My issue is that if I could find a dealer serviced 3 yr old car with 2 yrs still to run on the warranty at 1/3rd the new price, why would I have bought a new vehicle??? You don't need to spend any money on roadworthying these, as they have all been maintained as new by the dealer!
    That is precisely the point. Buy new for a decadal plan but not for 3-4 year ownership. Otherwise, wait for the right secondhand vehicle of your choice. But wait for the right one....
    JohnW

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  25. #25
    Veni Vidi Posti 68 404's Avatar
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    Second hand values?

    How about a Megane CC with just 59,000km for $5000?

    Carizma Motors
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