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What's your car worth as a trade?  What's it worth retail? Find out below!

About trade value
About retail prices
To sell yourself or not to sell yourself
What to consider in figuring an appraisal value
Find trade-in value for your car
Find retail price for your car  
Why is my car not worth what I think it is?

ABOUT TRADE VALUE

1. Most people associate the term trade-in with rip-off.  And, let's be honest here, car dealers have a reputation for trying to be less than fair about paying you for your car.   But, let's also be honest about something else:  you want the most for your trade AND you want to pay the least for your new car.
2. Trade value can be determined in two ways:
   1. Trade allowance:  The traditional method of trade appraisal.  Often shown as the difference between the retail price of the car you are purchasing and the actual cash value for your car.  It can be very difficult for you to know exactly how much your car is worth if you only focus on the difference figure:  How much is discount from retail and how much is actually for your car? You know you are dealing with a difference figure when the value of your car is dependent on what vehicle you select.
   2. Actual Cash Value (ACV):  What your car is really worth on the wholesale market.  ACV is determined by several factors including:  general condition of the car, documented service history, body damage, past paint and/or body work, windshield damage, smoke odor, miles, treadware remaining on tires and general popularity of the car.  Both Edmunds and Kelley offer excellent step-by-step guidelines for determining the condition of your car.  When you  figure condition, be honest and you'll have a more realistic idea of what your car is worth.
3. Saturn uses the ACV process.  In other words, we'll buy your car from you for the price we quote you even if you do not buy a car from us.  
4. IMPORTANT:  When comparing a trade from a Saturn dealer with a value from another source you MUST confirm that the figure is ACV.  Ask the source (dealer, friend, etc.) if they are willing to buy the car from you even if you do not buy a vehicle from them.  Also, if the value of your trade is dependent on the vehicle you purchase, you are getting a difference price and you cannot compare the difference price with the Saturn ACV price.
5. For more on the Saturn Used Car Process, check out the main Saturn page.

WHOLESALE VS. RETAIL PRICE

Understanding the difference between a wholesale price and a retail price saves you a lot of grief if you consider trading your vehicle.

1. WHOLESALE VS RETAIL:
   1. Wholesale price is the price a vehicle sells for at an auction.       
   2. Retail price  is the price paid by a consumer for a vehicle from either a private owner or a dealer.
2. WHAT'S THE DIFFERENCE?
   1. Wholesale vehicles are usually sold AS IS with no warranty and no work done to the vehicle.
   2. Retail value usually means the vehicle has a warranty and/or has a documented repair record.  Someone, either a private owner or a dealer has put time and money into the vehicle and is standing behind the work and the vehicle for a period of time, usually 30 days.
   3. Wholesale vehicles incur many costs as they are prepared for sale:  
      • Transportation to and from auctions, dealer lots, service centers, etc.
      • Re-conditioning costs including thorough cleaning, waxing, paint work, dent removal and windshields.
      • Major repairs including brakes, transmission and checks of all major systems.
      • Tire replacement.
      • Complete oil, filter, transmission and other applicable services.
   4. Retail price from a dealer is almost always more than retail from a private owner. Why?  For most of the reasons just mentioned in the previous item.  The dealer pays to have the car fixed and must stand behind the car with a warranty.  Private owners do not (and, in my opinion, should not) get into the business of fixing broken items or offering a warranty (see more on this below).
   5. A wholesale purchase is made with the intent of reselling the vehicle, after appropriate repairs, for a profit.  A retail purchase is made with the intent to own. 
3. CAN A DEALER SELL A CAR TO ME WHOLESALE?
   1. Nope.   In Maryland, a dealer is required by law to put at least a 30 day/1500 mile powertrain warranty on all used vehicles.  So, we can't sell a car to the public "AS IS."
4. SUM UP, PLEASE:
   1. Okey-dokey.  
      1. If you trade your car, you will get wholesale value.
      2. If you sell your car on your own, you  can ask for retail value.
      3. The retail price you get on our own will be less than a dealer price.

So, do you trade or sell?  For help, go HERE.

FACTORS TO HELP DETERMINE A TRADE VALUE      

1. I recommend starting with the appraisal features of Kelley Blue Book or Edmunds.
2. When we appraise a car, here are some of the things we consider:
   1. Exterior:  
      1. Paint Quality:  Glossy or dull.  Faded, cracked, peeling.  Do all panels match? Some chips and dents are normal (especially around here) but an excessive number results in a deduction.
      2. Tires:  Less than 50% treadware and Satun replaces the tires.  In fact, tires are one of the more expensive items we replace on used cars. Look for dry rot (tiny cracks in the sidewall of the tire) or cupping (run your hand around the inside rim of the tire and feel for scooped areas and then go wash your hands).  Tiny cracks indicate a car that has sat for long periods; cupped tires indicate alignment problems.
      3. Accident damage:  major dents, dings, scratches, bumpers that need replacing.  We'll use a paint meter that can tell if the paint is original.  We'll look for overspray (untaped areas around damaged or repaired areas).  
      4. Windshield:  Cracked, starred or leaking.  
   2. Interior:
      1. Cloth/Leather condition: burns, stains, rips, tears and all that other good stuff.
      2. Odor:  smoke and pets are the top two offenders.  People are less and less willing to pay for a used car that smells like cigarettes.
   3. Engine, Transmission and mechanics:
      1. Appearance:  if it looks bad, it probably is.
      2. Oil, transmission fluid (if applicable).
      3. Misses, hesitations.
      4. Transmission: does it shift OK?  How is the clutch? Any problems here are expensive.
      5. Steering rack, CV boots, wheel bearings.
      6. Leaking head gaskets, oil smoke, cracked engine blocks (ouch).
      7. Most major engine problems result in big deductions because of the expense.
   4. Power features:
      1. Do all the power windows, locks and mirrors work?
      2. Keyless entry?
      3. Seats, sun roofs and any other power features.
   5. Other Things:
      1. Overall look of the car.  Is it in good shape?
      2. Documented service history.  We know that someone who takes the trouble to change the oil on a regular basis, check the brakes, hoses and belts and rotate the tires is going to have a better car worth more money.

   Be honest about the condition of your car.  Ask yourself, "How much would I pay for this car?" Think with your head, not your heart.  Unfortunately, the appraised value of an ordinary car does NOT include all the emotional stuff that we associate with our cars.  My 1989 Audi meant a lot to me, but that didn't change the fact that it was a $1000 car.  And when I sold it at auction in January '01, I got about $900 after all was said and done.

Please take time to read the fine print when using appraisal services.  Consider the numbers guidelines subject to market fluctuations.  A used car is a market commodity and is variable just like the stock market.  What does that mean?  A number in a book may be too high for the actual auction values in a region of the country; likewise, a number may be too low depending on the market. 

Things to remember: 

• Be honest.  Deduct for mileage, broken parts and paint work and/or accident damage.
• If you do $2500 worth of repairs to a $1000 vehicle, it's still a $1000 vehicle.
• If you have receipts showing a consistent service history, your car will be worth more wholesale.
• A clean car brings more money that a dirty car.
• A car with cigarette odor brings less money than a nonsmoker car. 
• If the dealer sells your car to a wholesaler, the dealer will make little, or more likely, no profit on your car. Why?   Let's thing about it: You trade your 1993 90,000 mile Taurus.  The dealer's elects not to fix, sell and warranty your car so a wholesaler takes the car to auction.  First there are transport fees to the auction.  Second, reconditioning fees prior auction.  Third, auction fees including a percentage of the sale price. Finally, the buyer of the vehicle must pay for transportation away from the auction to another point of sale.  So, you can see that the costs can add up quickly.
• Dishonesty on the part of either the seller or the dealer can result in very expensive mistakes.  A dealer has a right to make a profit.  You have a right to a fair and honest trade appraisal. 

Avoid surprises:  Why your car is sometimes not worth what you think it is:

One of the things I dislike about this business is telling good folks bad news.  Cars that have been dependable, reliable transportation are worth much more to the owner than to me as a dealer.  Why?  Remind yourself of the info above.   Take this real example:  a 1989 Olds Calais S level sedan with 79,000 miles. Automatic transmission with the (in)famous Quad-4 engine option.  Paint is faded, scared with dirt and debris and just generally worn out.  Transmission shifts OK but steering rack is binding in turns and will need to be replaced.  Inside, A/C works OK.  Driver seat needs to be replaced:  hole in fabric and little support (just worn out).  Remainder of interior passable.  How much would you pay? The owner wanted somewhere around $1,000.00.  The actual value?  About $100.00.  Needless to say, the customer chose to go elsewhere.  Keep in mind the issues of  reconditioning (the paint, interior) and auction/transport fees plus any monies needed to make the car safe to drive.  Can you see how a $100.00 is probably about right?   The emotional attachment, the memories add value for the owner, but not for us.  For those of you who know me, I experienced the same thing with my 1989 Audi.  The car was worth a bunch to me, but the $850.00 is brought at auction was the actual, real value for the car.  

The bottom line?  You want to pay a fair, retail  price for the new car so you should expect a fair wholesale value for your trade car. 

Kelley Blue Book

Edmunds True Market Value

ABOUT RETAIL PRICING OF USED CARS

1. Retail:  Retail price is the cost of the vehicle from the dealer to the consumer.
2. Factors that determine retail price:
   1. Market Area:  Some cars are worth more in one part of the country than another. Trucks are generally worth more in the west and southwest than in the east.  Regional differences also affect price.  Acura prices are usually higher in the DC area than in the surrounding area.  
   2. Fleet and leasing.  Some auto makers allot high numbers of cars for fleet, leasing and rental programs.  As the cars come out of service (off lease, out of fleet use) they get sent to auctions.  Large numbers of the same car drive prices down.  For instance, Ford puts many Tauruses into Fleet use (to help sales figures); when all those cars come out of service the prices at the auctions drop and stay down.  The result is a lower price for all Tauruses.
   3. General quality and safety.  Cars with a reputation for reliability and safety retain more of their original value (less depreciation).  For example, Dodge Neons and most Hyundai and Kia models lose a great deal of value due to quality and safety concerns.  Cars like Saturn, Honda and Toyota have better reputations and histories and retain more value.  As a result, a 1995 4-door automatic Dodge Neon can sell for $5995; the same Honda or Saturn might be at least $2,000 more. 
   4. Time of year:  Convertible prices are highest in the Spring and 4x4 prices are generally higher in the Winter months.  

TO SELL THYSELF OR NOT SELL THYSELF:  DECIDING TO TRADE OR SELL YOUR VEHICLE ON YOUR OWN

Here- in no specific order -  are some things to consider when deciding whether or not to trade your car or sell it yourself:

1. You will usually get more cash for your car if you sell it yourself.
   1. A dealer will always give you wholesale value for your car.   Selling it yourself allows you to get retail value.  Retail is usually $1000 - $1500 more than wholesale.
2. How much is your time worth?  
   1. Selling on your own can be time intensive.
   2. Prior to the sale, you must place the ad(s), clean the car, pay for state inspection and fix any minor problems that you think might lower the value.
   3. You will need to make appointments with prospective buyers.  And, trust me here, as surprising as it may seem, people do NOT always keep appointments and they DO NOT always call and cancel.  
   4. Playing a waiting game, Part I:  How long do you wait before you place your ad in different places? A week?  Two weeks?  Do you have the time to let  your car advertise for several weeks?  Remember, those ad costs lower your overall profit.
   5. Playing a waiting game, Part II:  Suppose you get an offer, how long do you let the person "think it over."
3. Do you mind strangers having your phone number and address? 
4. Are you comfortable with strangers coming to your home and test driving your vehicle?
   1. There are literally thousands of horror stories and test drive nightmares.  
5. How good are your at negotiating?
   1. Consider this.  Everyone expects you to lower your price.  So, you'll have to negotiate the transaction on your vehicle.  If you aren't careful, you can find yourself losing money on the whole deal.
6. How long can you be without a vehicle?
   1. When you sell your vehicle, the new owner will probably expect to take possession right away.  How quickly can you get your new vehicle?
7. Will you provide a warranty?  Sell your car as is?  What if the car breaks down 3 days after you sell it?
   1. Private owners should always sell a vehicle AS IS.  The only warranty should be "3 feet or thirty seconds" :) Why?  Do you really want to be in the business of fixing every last imperfection in your old vehicle?  
   2. What if your vehicle blows a gasket the day after you sell it?  Are you going to deal with the consequence   s?

So, here's what I think:

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