Rant about selling cars

[Pete Y]

t been trying to sell the wife's old car recently (2003 Honda Jazz, nothing exciting) and it's been a real pain in the a, for no other reason than the people responding to the ads either have no manners or decency or intellect.. Or indeed are deficient in all three.

I've rwc'd it, it's ready to go - cosmetically a few things but on the whole a good honest car for someone that runs on the smell of the proverbial oily rag. And yet..

1. Makes a time to come see via sms, doesn't show. I text an hr later, says he's not coming. Thanks for letting me know, idiot.
2. SMS - Would you consider a swap for my convertible volvo? (I'm presuming not a brand new c70).
3. SMS - offers 18% below asking.
4. SMS - wants to come see, but first offers 27% below asking, then cancels.
5. Email - are you negotiable. When I tell him what I'd accept I don't hear back.

The thing is, I would happily settle for 10% below asking price, and the asking price is already quite discounted as we have a new car and just want to be rid of it. I'm just surprised even as a Gen-Y that all correspondence has been by mistyped sms and just the rudeness of some.

So.. Anyone else experienced this? Should I have put a higher asking price and then the lowball figures might have been acceptable?

Certainly in buying and selling 9 classic or enthusiast cars in my life I have only ever dealt with good people - respectful, helpful and keen to do honest trade.

[Garibaldi]

What you are experiencing is what I go through every day as I sell cars for a living. There is no magic formula in selling a car you just have to grind it out until you find the right buyer. I don't know how some people get through life and you are right there is very little courtesy or respect shown these days. The older people are generally better to deal with as they grew up with these values drummed into them. I hate to think what people are going to be like in 50 years time.

[MD]

Slowly but surely the Oz population (who loves a "bargain" ) is insipidly moving towards a bartering pricing structure commonly used in the last place you had an overseas holiday at.

You know the deal. You want to buy that matchbox that has a picture of Mona Lisa painted on the front done by a Franciscan monk a few world wars ago. The vendor claims it is special. You think it is special. The asking price is a $1 000.

The haggling starts. The vendor knows it worth 37c. You are only willing to buy this gem for no more than 41c and the backwards and forwards evolution of this potential sale is on the way and about to fall until the vendor pulls the buyers shirt back to the bargaining table as the buyer is about go and let the sale go cold.....

Inch by inch this practice is getting more entrenched. It's in real estate, motor cars, all sorts of private buying and selling. The worst case I know of is in some retail where a massive price reduction on the ticketed price is promoted on a Monday fire sale. Over the prior week end the outlet is closed and every item is re-ticketed with a hugely inflated regular price crossed out and a sale price added suggesting a great bargain is to be had. In reality, the sale price is the regular price and sometimes even more than original price. As they say, believe it or not.

Another deceitful practise by at least on massive retailer I know was to sell quality brand named products much cheaper than their opposition. This was because the vendor was large enough to buy a production run from the manufacturer having negotiated a shitty quality for a shitty price but hey, it had the brand and customers were none the wiser thinking they scored a bargain!

Once this type of marketing stupidity is fully rolled in, you'll be bartering from shoe laces and door hinges ( much sought after items) to birthday cake for your mum. Fiddling with price certainty is everybody's nightmare. Enjoy the future.

Speaking of the future in 50 years, the defining term is anarchists.

[Nate Dog]

Selling cars second hand is a numbers game.
As far as i can see your biggest flaw is taking it personally.
None of the people whom have called you are intrinsically evil, nor do any of them mean you harm, outside of a zero sum game type harm.
27% bellow asking price doesn't sound like a mental place to start a negotiation. I've had people offer me less than half to start with.
If you get the impression they're going to waste your time, hang up. If you think they might be willing to negotiate, negotiate.
Learn to be upfront. Don't tell them you find their offer offensive, where will that get you? Tell them nope, i'll take X off but thats it otherwise we are too far apart.
Stick to it and eventually you'll get what you want.

[Garibaldi]

I don't begrudge anyone for wanting to get the best price they can but it is becoming ridiculous at how little dealers are making on new cars. People are becoming almost mercenary in their quest for a deal. I have sold $70,000 & $80,000 vehicles with as little as $500 profit in them. By the time you factor in your overheads you are making a loss. Profit is not a dirty word, all businesses need to make a profit to survive. If it wasn't for their spare parts, service and finance departments most dealers would go broke very quickly. The manufacturers and distributors really don't care if the dealers don't make any money, all they are concerned about is new vehicle volume.

New car salespeople are earning about the same today as they were 15-20 years ago but the cost of living has increased substantially, so in real terms they are worse off. A lot of people I know, good experienced sales people are getting out of the industry because the income and stress just aren't worth it for the hours they work.

Some time in the not too distant future you are going to walk into a new car dealership and there will not be anyone there with much experience to assist you, and you know what, you caused it in your quest for the lowest price, all the good people have left the industry.

[kartone]

In 2002 in the US I purchased a new, top of the line Subaru online.
I viewed the inventory of dealers within 150 miles radius, selected the vehicle by VIN number showing all the included options using the manufacturer's code, dealt with the "Online Sales Manager" and started negotiation at Manufacturer's invoice to dealer plus USD500.-. Over two weekends visited finalists and eventually purchased vehicle with freebies (mat, free service for 3 years, free yearly government mandated inspection for 3 years and dealer workshop manuals) for manufacturer's invoice minus USD800.- (from the sale the dealer receive benefits such as rebates and better allocation hence the minus UDS800.-)     

[Garibaldi]

It's a real dilemma for dealers, pressure from the factory for new car sales and showroom upgrades, pressure from the public for sharp prices and pressure from their staff for decent pay. The return on investment for most dealers is very average, you would be better off putting your money in the bank.

[Craig_m67]

Lots of percentages in your post.. How have you calculated what is a good/fair price?

[Pete Y]

As far as i can see your biggest flaw is taking it personally.
None of the people whom have called you are intrinsically evil, nor do any of them mean you harm, outside of a zero sum game type harm.

Oh believe me I don't take it personally. I was just surprised, having come from selling classic/enthusiast cars where you set a reasonable price, people actually pick up the phone and CALL to chat and people generally don't waste your time. It's more about the lack of basic manners and people skills really.

Lots of percentages in your post.. How have you calculated what is a good/fair price?

That was more to give an indication of the 'low-ball' offers. I'm not tied to a particular percentage, but generally when I go shopping for a car I think 10% is a reasonable rule-of-thumb, because sellers build in some fat (partly due to inflated expectations, partly due to expecting to be haggled). I think more than that when the car is worth less than 8K is starting to get unreasonable. I also positioned the asking price lower because I was keen to sell quickly.

Some time in the not too distant future you are going to walk into a new car dealership and there will not be anyone there with much experience to assist you

To be honest, and not to downplay your profession, it sounds like you have a passion for it... But... Late last year I went to Alfa dealerships looking at Giulietta - I knew more about the cars than the dealers. One didn't even know there was going to be an update in 2014. I went to a VW dealer, no one got off their arse in the office to even talk to me. 

As for the "game" when buying a new car of trying to get a decent price - I dont think it serves anybody particularly well.

I wouldn't be that sad if we eventually moved to a "direct-selling" model for new cars, much like Tesla are now pioneering (although they have faced a lot of opposition from various levels of Govt to do so.)

[poohbah]

I don't begrudge you making a living Garibaldi, everyone has to eat, but personally I doubt I will never again buy a brand new car from a dealer.

Me and the missus purchased a brand new Subaru Forester 2 years ago - first time I have ever bought a brand new car (had about 15km on the clock from memory!). We got a reasonable deal on the purchase itself, but got screwed on the trade-in. Won't go into the details, but traded an '04 V6 Ford Escape with about 100k on the clock (really straight, nothing wrong with it and nothing owing).

Dealer sold it less than a week later for double the price  we got on the trade and all he did was wash it again. Yep, my fault - should have sold it privately, probably would have got at least 50% more than on the trade. With hindsight, I should never have sold the Escape - just kept it til it was clapped out, then bought another near-new car. And as sensible (reliable and boring) as the Subi is, I miss the oomph of that 3L V6 on the open road.

In comparison, I bought my 156 for about 10% of the original list price and its been brilliant - admittedly maintenance is more costly and regular than the Subi but boy does it make me smile!

So when I eventually have to replace the current family hauler, I will be going back to my usual policy of buying second hand where the original owner has taken the hit on the depreciation.  Will Just have to convince the missus that instead of sensible japan, we need a second Italian  in the garage...

[Darryl]

All this internet car trading transparency (mostly - it is still hard to see what a car *actually sold for*) allows a motivated buyer and seller to pair up and make a deal - and some level of motivation imbalance will shift that deal either way. Maybe the Gen-Y zero attention span approach of  SMS a lowball offer and run grates but you can still extract some grumpy old person quiet enjoyment from the thought that whatever that buyer obtained was a POS (unless he got  lucky in finding a seller who had to leave ther country the next day) . Don't give up....

Being in the market for a used car at the moment, and having been there before on both sides of the transaction, I have a few observations for your enjoyment or edification (or maybe just ridicule).

Cars have sold that I thought were overpriced and didn't even look at. Maybe they were one of Mike's retailer mates and the headline price was just to make the buyer think they were getting a bargain when they closed the deal for 30% below the asking price?

I advertised a car with asking price I was 100% sure (confidence is great isn't it?) was fair only to end up dropping the price by, in aggregate 25% to get a sale. However, in that case the bloke who did buy it (first to do any more than call and fail to show up) phoned, requested that the car be ready to go with docs in order and petrol in the tank (I was a bit worried it might have been about to be stolen!) and turned up the next day, paid the asking price and drove off all without doing more than glancing at it as he got in to drive it to a destination about 500km away.

I had another car on the market at a "fair price" and not so much as 1 caller for months (this wasn't an unusual/exotic car, I was pretty confident I had the price right - plenty of sales to compare) only to have the first person to come and look at it buy it - with no more than a half hearted attempt at a sub 10% haggle because clearly (from the reaction on first seeing the car), my "overpriced" (I presume that is why the lack of callers) car was in so much better condition (or for the cynics, perhaps merely better presented) than the $#%t she had been looking at for a few $ less.

Some sellers are clearly "out there" with their pricing - waiting like a speculative trader for the "right buyer" or some strange shift in the market. There are cars I have seen listed for several years (no exaggeration)....

Some sellers (and good on them - why should anyone have to be an expert on used car values or risk giving it away?) use the Carsales stats and the feedback from interest to run a Dutch auction of sorts - it is only a question of whether they start at a a Graysonline exclusive special limited edition watch original recommended retail price or not.... they still eventually end up at a point where they get a buyer (and/or they get a low ball bid early and take it I guess - see above). Looked at a car recently where the price dropped from over 30k to mid 20s in a few weeks. Nice car too - and I think the end price was very fair (no I didn't buy it, decided it wasn't quite what I was looking for).

Never mind whoever is on the other side of the transaction - the first challenge will come as no surprise to some: The CFO and I can't agree on car buying criteria. I'm a big believer in condition/condition/condition. She is a big believer in "low km" which means we spend a lot of time looking at and refusing to buy low km mobile ashtrays/livestock transport vehicles And that's before we even get to the colour...

[AndrewR]

I don't begrudge anyone for wanting to get the best price they can but it is becoming ridiculous at how little dealers are making on new cars. People are becoming almost mercenary in their quest for a deal. I have sold $70,000 & $80,000 vehicles with as little as $500 profit in them. By the time you factor in your overheads you are making a loss. Profit is not a dirty word, all businesses need to make a profit to survive. If it wasn't for their spare parts, service and finance departments most dealers would go broke very quickly. The manufacturers and distributors really don't care if the dealers don't make any money, all they are concerned about is new vehicle volume.

New car salespeople are earning about the same today as they were 15-20 years ago but the cost of living has increased substantially, so in real terms they are worse off. A lot of people I know, good experienced sales people are getting out of the industry because the income and stress just aren't worth it for the hours they work.

Some time in the not too distant future you are going to walk into a new car dealership and there will not be anyone there with much experience to assist you, and you know what, you caused it in your quest for the lowest price, all the good people have left the industry.

Here, Here. I left in March after 36 years!

[Garibaldi]

Good on you, you got out. I wish you all the best for the future.