Just curious really.

Should a car be worth say 10k against a car that is worth 15k but also against a car that is worth 11k ??

What do you think.

Its an arbitary number given to make you feel like you won. Any one trading a car into a dealer has already lost the game- unless they have a very rare and in demand car.

The trade in will be priced to ensure the dealer has the same margin on either car.

As above, it’s about margin on the deal as a whole.

Is that a yes or no then.

I can’t see it being worth less just because the car it is going against is 11k instead of 15k especially at the same dealer.

It’s not that it’s worth less, it’s that they’re prepared to offer you a bigger or smaller discount on the purchase of different vehicles.

No brainer – why would it be worth more against one thing than another?

By that I mean the value of you car is unlikely to change so play them at their own game, take the higher value and get it set against the less discounted car.

Its a no.

The value of your car has very little to do with the deal unless its rare and desiarable and if its that big engine auto thing then its unlikely.

Working % theres more margin cash wise in the 15k car than there is in the 11k car…. So they are using this to make it look like your getting a good deal on your trade in ….. How ever they are not prepared to lose the same % on an 11k car as the profit margin is lower because its a % not a fixed number

Sk’s idea may work if they are desperate, how ever they are not going to give cars away……

What big engine auto thing ?

The smax of doom.

2.0 is hardly a big engine though is it.

2.0 is hardly a big engine though is it.

except, remind us why you want rid…

We want “rid” as you so eloquently put it as we are now doing lots more miles and it makes more sense financially to have a diesel car.

The only way you can win (well draw) is if their markup is equal to the difference between what you can get private and they can get retail – ie you are not losing out.

This normally isn’t the case.

If you have a car they can sell easily and you want one they are struggling to sell then you may be able to get a decent deal.

One good way to do it is they give you rock bottom trade in value and bump down the pre-vat price to a lower price accordingly. ie you haggle them down and they haggle you down. That way you end up paying less VAT on the new car price.

Any one trading a car into a dealer has already lost the game- unless they have a very rare and in demand car car that’s on its last legs and the dealer doesn’t check it out properly.

I’d be wary of buying diesel as a long term prospect. Taxation will begin to really penalise them in the near future.

It’s not rocket science.

Your car is worth X
Car A is £11k on the forecourt with a £1000 margin
Car B is £15k on the forecourt with £2000 margin

You don’t think every car on their forecourt has the same margin on it do you? What about being able to charge a premium for desirable stock? What about trying to get rid of old stock?

So you get offered X plus a little over allowance on car A. You get offered X plus more on car B

At the end of the day it means diddly squat as it’s the price to change that matters and any overallowance is just pandering to your ego about what your car is worth. If you didn’t have the trade in the same would apply to outright discount.

Can also be the other way around. Just because a car is more expensive on the lot doesn’t mean it has more margin

I don’t understand how a cars value can change though ?

Surely it’s worth a price and that’s it ??

All depends on the margin they are making from each individual car they show you.

The value hasnt changed. Its the same car, they are massaging numbers to get you into the more expensive car.

In your mind its worth x

To them its just a number. Number is variable to what they need it to be.

They know it wont be an easy car to shift so they wont throw away margin to put this thirsty beast on their forecourt.

Oh and if you dont like it, show it with your feet.

I would also suggest working out how much you will save with a diesel

ie Most cars have a 2-3k spread for profit / fund for fixing up to sell from the PX price to the retail price

Keeping the same car that 2-3k might be 20,000 miles of fuel or 40,000 miles of the incremental coast of fuel the diesel would save

The margin on a typical new car is about 2%. The dealers make all their money from manufacturer bonuses for hitting sales targets. When I say ‘make all their money’, they just about break even. No one would chose to become a car dealer in the UK if you knew how little money there is in it.

squirrelking – Member
……so play them at their own game, take the higher value and get it set against the less discounted car.

He he, yeah, like that’s going to work.

Any car dealer that would do that, wouldn’t be in business long enough to pay the first electric bill.

As above a dealer will value a part ex based on the deal they are looking to do – not against the value of the car. At the extreme end of this example think of £2k minimum part ex etc deals that you sometimes see – a £200 mot failure is still worth that 2k.

It does not matter based on the value of the car you are buying but the dealers position on that car – margin, how long they’ve had it, sales that week/month etc.

In short the value of your car is relatively fixed if you sell it to a person but a dealer is looking at a much broader range of things so the amount of money they offer you for the car on paper is not just based on it’s actual value.

It sucks a bit when they say it’s worth 10k against a 15k car but then it drops to 8k against a 11k car.

You should have asked about the cheaper one first and then you’d have got a pleasant surprise!

…when they say it’s worth…

They’re not saying what your car is actually worth. They’re combining what it’s worth (to them) with what discount they’re prepared to give you off the one you buy. And that discount varies depending on what you buy.

Any one trading a car into a dealer has already lost the game- unless they have a very rare and in demand car car that’s on its last legs and the dealer doesn’t check it out properly.

This!! The polo traded in was rusting at the arches (think it was a poor repair job prior to me owning it) and the engine was definitely I’ll. Got a grand for it and the price I did for the panda was fair in my eyes. Felt quite smug lol.

We want “rid” as you so eloquently put it as we are now doing lots more miles and it makes more sense financially to have a diesel car.

I’d put money on it that it doesn’t.
Work depreciation in. Once you see how much money you’ll loose changing car against keeping your current on for another 3 years or more, and work out how much of the difference in fuel that’ll pay for, you’ll probably work out that it’s a waste of money.
For instance, we bought a £6k Focus 6 years ago. A few years back we got a PX value of around £2.5k. A diesel car might do 10mpg more, accounting for the difference in fuel prices (using £1.20 petrol, £1.25 diesel) will save £228 every 10,000 miles. So that £3,500 we’d have had to fork out for a newer £6k car would pay for around 153,000 miles worth of fuel consumption difference.
And that’s on a cheap car. That difference goes up and up the more money you pay.
Also, the petrol car is cheaper to service, uses tyres around 1/3 slower (lighter, less torque) and has less, and cheaper, stuff to go wrong in the engine bay.
Buy a new car if you like, but don’t imangine for an instant that I’ll save you money. 🙂

It’s not only the fuel though pp. Tax is 265 per year against 105 for the diesel we are looking at.

Food for thought though. Will have to do some sums.

A rule of thumb:

When a dealer is selling a car its full book.

When a dealer is taking a PX they’ll say its the wrong colour combination, doesn’t have the right pipping, has one wheel too many etc etc.

Arnold Clark moaned and whinged about a MX5 I PX’d saying they were offering me too good a deal and wont make a penny on it. A year later I was talking to the woman who bought it from them….at 2k more than they gave me for it.

If its got good history, doesn’t need much prepping they’ll have a book of eager indie dealers who will be around within the week to collect it.

Do the sums again. Fully.

e.g. We looked at getting newish car – with the economy bells and whistles – but once we worked out our miles per year, even allowing for the VED, it was definitely cheaper to get an older, less efficient model.

FWIW we’ve gone from a decently powered 2.0l petrol hatch to a 1.4TSI and can’t really notice diff in power, economy is good bit better. Improvements in engine tech a large factor, as old car was pretty well looked after in the engine dept at least, always ticked over nicely – just a bit heavy on fuel compared to modern cars.

I’d be wary of buying diesel as a long term prospect. Taxation will begin to really penalise them in the near future.

This.

“A year later I was talking to the woman who bought it from them….at 2k more than they gave me for it.”

– and how much of that was profit – its still possible they didnt make a penny on it…..

They gave me trade in book and sold it for 2k more. There were tiny dents that were still there from when I owned it and they hadn’t even taken the small raceface sticker off the boot lid! From the timescales they’d turned it around in a week/sold it. She still owns it now- 4years on and I see her driving around my area in it/beeps and waves. weird when you occassionally see the cars you sold (I see three regularly 8) )

OP see it as figures like the dealer does….

10k against 15k … your car is “worth” 66.6% of the new purchase price.

8k against 11k … your car is “worth” 72.7% of the new purchase price.

So it’s actually “worth” more at the lower price.

OP – the key to this whole discussion is that you have fundamentally misunderstood what is being offered. As others have stated what the dealer is doing is offering you a trade-in or PX value for your car. That is not a statement of the value of your car. As a seller in this type of transaction you have to separate yourself from your vested interest in your car and what you think it is worth (most people over value their own cars) and look at the bottom line. How much are you prepared to pay to change your car? If your budget is, say, £3000 then what you are aiming to do is arrive at a deal were you get the best car you can that meets your needs and costs you no more than your £3k budget. As part of that deal you are also looking at the car you are considering buying and assess whether you feel the asking price is a fair one for the age, condition and mileage.

If you are not happy with the p/x offer from the dealer and you think your car is worth more than that then put your money where your mouth is and go sell it privately. I would say that unless your car is relatively new and highly desirable then most dealers are not really desperately keen to take a p/x in as it means additional stock that they have to move on. Older cars will either go to a local “low end” dealer or will be pushed out to auction. In the case of the former the low end dealer will also be needing to make sure he gets a profit out of the deal. In the case of the latter it costs the dealer money to send it there plus they may well get a lower price on it than they had expected.

Which means, at the end of all that, what they are doing is playing a numbers game. They have a car which has x profit in it. They want to make as much profit as they can while at the same time selling you the car. Your car just becomes another variable in the equation which they have to factor in and work out how much they are likely to get for it. In many cases they will not get anywhere near what they are offering you so that difference comes out of the profit of the car they are selling. Wrap it all up and out pops the figure you have to pay to change vehicles. If you like the number then do the deal. If you don’t then walk away. Unless you really, really want the car they are selling then it’s down to haggling and compromise.

Dealers don’t care what the car is worth. They care what it’s worth to them, and that depends on what car you want to buy from them!

A PX offer has bog all to do with the ‘value’ of a car it’s a measure of what the dealer is willing to give you for it and that will depend on:

How much you’re spending on top.
How easily he thinks he will be able to sell your car.
How easily he thinks he will be able to sell the car you’re looking at to someone else if you don’t buy it.
Whether he’s had a good month to date.
Where the family want him to take them on holiday next year.
etc
etc
etc