Why CarMax Makes More Money on Used Cars Than Anyone Else • Hacker News Board

Re: Why CarMax Makes More Money on Used Cars Than Anyone Else

#111

Post by sjg007 » Mon, Jun 04, 2018, 8:20 PM UTC

bonestamp2 wrote: post #42

sjg007 wrote: post #7

Earlier quoted context omitted.

You pay that warranty on top. And it is good deal for a car that you know will require service. You can find good deals at CarMax. I found a car at CarMax $2k under the dealer. Now maybe I could’ve gotten it cheaper otherwise but I doubt much more.. also you have to realize that used cars are in demand vs new. Today it is often cheaper to buy new.

If you see a used car at the dealer, definitely negotiate it there too. Look the car up on CarFax and see if they acquired it at auction, then look up the average auction price for that year/model/trim and you'll have a good idea how much room they have to work with. Most dealerships make more money selling a used car than a new car so there's usually a healthy margin for you to take a piece of. Source: my dad runs a…

Where is a good source of average auction prices?

Re: Why CarMax Makes More Money on Used Cars Than Anyone Else

#112

Post by hunter2_ » Tue, Jun 05, 2018, 2:20 PM UTC

closeparen wrote: post #106

hunter2_ wrote: post #84

Earlier quoted context omitted.

It's true: with haggling, the buyer is at a disadvantage if they don't have the time to gather information. But isn't that like with supermarkets, where the buyer is at a disadvantage if they don't have the time to clip coupons? In both cases, the point is to let people who have more money but less time subsidize people who have more time but less money, so that everyone can obtain the goods even if they don't quite…

Dealers really don't like to give you give you an offer good for more than a few minutes, let alone in writing. Coupon prices are published in a separate venue, but still published.

Couponing for groceries is a pain in the ass, so enough people don't bother to do it, and that makes for a stable balance of people paying too much and people paying too little. With something as high value and infrequently purchased as a vehicle, finding a coupon in a separate venue is something almost everyone would do if they knew about it, and so it wouldn't achieve the necessary balance. Whatever the tactic is (haggling, couponing, who knows what they'll think of next) it has to be a sufficient pain in the ass for this concept (letting people with extra money and no extra time subsidize the opposite) to work. Not everyone agrees with this concept (stealing from the rich to give to the poor, welfare, however you want to think of it) but at the end of the day it makes for more people being able to purchase.

Re: Why CarMax Makes More Money on Used Cars Than Anyone Else

#113

Post by rconti » Tue, Jun 05, 2018, 3:11 PM UTC

2almalki wrote: post #108

rconti wrote: post #82

Earlier quoted context omitted.

I've got a car for sale right now for $31k. It's not listed widely (just an enthusiast forum) and I've had a couple nibbles after about a month, one guy test drove it and seems really interested. I also just changed the oil and am considering changing the differential fluid. I've already put multiple hours into listing, uploading pictures, meeting the guy to test drive, responding to texts, phone calls, etc. Because…

If you don't mind me asking, what car are you trying to sell for 31k?

Golf R

Re: Why CarMax Makes More Money on Used Cars Than Anyone Else

#114

Post by closeparen » Tue, Jun 05, 2018, 3:47 PM UTC

hunter2_ wrote: post #112

closeparen wrote: post #106

Earlier quoted context omitted.

Dealers really don't like to give you give you an offer good for more than a few minutes, let alone in writing. Coupon prices are published in a separate venue, but still published.

Couponing for groceries is a pain in the ass, so enough people don't bother to do it, and that makes for a stable balance of people paying too much and people paying too little. With something as high value and infrequently purchased as a vehicle, finding a coupon in a separate venue is something almost everyone would do if they knew about it, and so it wouldn't achieve the necessary balance. Whatever the tactic is (…

Shopping for outside financing and declining the prepaid maintenance contract are also things everyone would do if they knew. They are well documented in any kind of “how to buy a car” article, yet most people don’t seem to know.

Re: Why CarMax Makes More Money on Used Cars Than Anyone Else

#115

Post by fma » Wed, Jun 06, 2018, 2:17 AM UTC

argonaut wrote: post #103

larsiusprime wrote: post #45

Earlier quoted context omitted.

This is just anecdata. We bought a used car at Carmax and they gave us way, way, way above bluebook value for our trade-in (and all other offers, too -- and we were pretty aggressive in researching trade-in offers at other places and were prepared to be underballed by Carmax). My anecdata is no more useful than yours. Unless someone provides some actual reliable data points to produce a real, known trend, there's no…

A trade-in is not the same as an actual sale for cash. If you indeed got a great deal on the trade-in it just meant you got less of a great deal on the other components of the sale.

As far as I know, CarMax doesn't negotiate on the price. The price they list is the out the door price. So it's not like OP walked in and they added document fews and headlight fluid fees. He knew the price he was going to pay for the CarMax car, and was pleasantly surprised with the trade in value of his old car.