Every dealership tells you to go to Carmax when negotiating a trade-in, now I think I know the reason why.


As some people on this board know (thanks to my spamming threads) I have been in the market for a car in the IS-F's class and I have been getting quoted for my S5 as a trade in from multiple dealers. Well today I found out that when Carmax appraises your car and the figure comes in low (which is in most of the cases) every dealership you go to after that will know what Carmax offered you and will base their offer from there.

For example in my case I was first getting quotes in the 42-46k range from multiple dealers before I visited Carmax to appraise my car. I went to Carmax the other day and those retards appraised my car at 34k! Ever since then all the dealerships have been offering me much less at 38-42k. Well today I found out when I visited a Lexus dealership that they can see what others (ie Carmax) appraised your car at. They use that as a basis to start negotiations for the trade in. Funny how I was quoted 42k as a starting point (could have went up to 45-46k easily) at Beverly Hills Lexus (which should be where its harder to get a better deal since its a affluent neighborhood least impacted by this recession) and suddenly now dealerships in the suburbs are using 38-40k as a starting point RIGHT AFTER I got my car appraised at Carmax.

I don't know if there are some kind of deal between dealerships, wholesalers and/or Carmax where Carmax intentionally quotes a very low figure so that dealerships can then use that to their advantage when negotiating a trade-in, but this certainly took me out of the market. Funny how so many dealerships tell you to go to Carmax to get the car appraised when they fully know that Carmax will offer a **** price for the car.

 

The exact opposite happened for me. Carmax appraised my last trade-in $2,500 higher than the dealer was offering. They matched it; I was happy.

If Carmax low-***** your trade-in estimate, just don't show the paperwork to anybody. You're under no obligation to share information like that, just like the dealer isn't obligated to match a higher price than they're willing to pay.

 

I doubt if Carmax has any type of collusion or agreement with local new-car dealers. That would probably be illegal, and perhaps (?) a form of price-fixing. People would complain, and dealerships could be shut down by the State Attorney General's office.

In fact, here in the Washington-Baltimore area, some Carmax outlets actually deal in new cars themselves, not just used ones. The one in Laurel/Columbia, MD, for example, also includes a Mitsubishi franchise.

 

That sounds very illegal. Price fixing as mmarshall said

 

I had similar experience to Iceman. Carmax gave me a great buy bid. Dealers offered lower, and then were willing to at least match Carmax.

 

Just sold our benz for good price. No complaint here.

 

Never seen a Carmax out west. But I guess I should seek one out and take a look.

 

I really cannot believe this theory. The dealership actually told you that they can see what Car Max offers you for your car? How? Talk about illegal!

 

I can't imagine there is a local appraiser database. More likely, they all are basing the appraisal on the auction price. When I went to buy my car, when I got my trade appraised, every dealer told me, straight up, the price they would get from Manheim--my trade was 7 years old, and they were not going to sell it on their lot. Sure--maybe they shaved some $$ off the auction price, but they all had access to THAT pricing.

 

If you like I can find out if the databases are linked

 

I'm an employee of Carmax and they gave me about $1,700 less than blue book. It all depends on who is appraising your car at the time.

 

I have brought 2 vehicles to CarMax and both times were horribly low-balled by them. I will NEVER do business with them again. I think if you do research on KBB and NADA plus Manheim, you can get a general idea on your own. Then stick to the figure in your head. But don't be unreasonable. Markets everywhere are down. I sold my GS for retail to a Cadillac dealership. They have it on their lot as being on the higher side of market value. But hey, good for me! But I knew what I wanted for my car and realistically what it was worth.

 

I highly doubt that there is a national database linking carmax to all the dealers. A one year old car should not trade in for wholesale price, just stick to the KBB value. Theyc an offer you anything they want and you can ask for anything thing you want for the trade in, but there is a realistic price range for your S5, and you should know what that is.

 

I've gotten a great price once, and so insulted ($50?, really?) that I stormed out once.

 

why dont you just sell it private party on autotrader or ebay ... i imagine someone would pick up your car pretty quickly