jamesrg

I guess the same could be said for interest fees if you finance the car?

85Gold

I'm sure the buyer of my 2021 GT4 which I sold for ~5% over MSRP had to factor shipping from FL to CA in his calculations for his total cost. Look at BAT fee as their version of ADM to the buyer costs.

Peter

TXshaggy

Whut? Thought everyone paid cash…

TheBucketOfTruth

I don't think it's a stretch to consider the price paid for an item to be the the "value" on a given day for said item. This includes the fee. When I was shopping for a car and thinking of using a broker, the broker fee 100% factored in to my calculations on the ultimate price I was going to pay for the car. I don't think what the seller netted from the sale is relevant. Just like whatever your dealer gives you as trade in value probably isn't representative of the retail value.

If a home gets sold do people look at the selling price as the total price the seller netted after paying their realtor's commission? No of course not. I don't think this should be looked at any differently. And let's not involve taxes as that is a separate category. And in many places that would be a constant regardless of how you purchased the car whereas auction fees, broker fees, consignment fees, etc. are not universal. And some are paid on one end vs. the other. What people care about is the total price paid for the item. And no not financing charges (though interest rates may factor in to ultimate pricing of the market), not shipping charges, etc.

lilbza

That is your budget though, that is not the value of the car. Also comparing the sale of a property is completely different. The seller pays the fee in that instance, not the buyer.

So if you purchased a car on BAT for $100k, plus $5k BAT fee, you think the car is now worth $105k? What if you tried to sell it the very next day on BAT, would you'd want $105K? I suppose the next buyer would then value the car at $110k after adding their $5k buyers fee? That makes absolutely no sense.

PTSFX

It’s worth $105k to the person that bought it (or at least it should be if that’s what they were willing to pay for it). Purchase price, value, worth, etc. may or may not be the same. Everyone is “right” here to a degree…

hf1

Archimedes is right. Transaction costs (brokerage fees, commissions, taxes, etc.) do not factor in the market price. Market prices of stocks, bonds, commodities, and currencies are quoted on the screens as the transactions occur regardless of the transaction costs (commissions, etc.) paid by buyer or seller which could vary widely.

lilbza

Yep, I think some people are confusing value/worth with cost. They are not the same... blame covid for that. It used to be your car lost value as soon as you drove it off the lot, now we live in the upside down world.

RedCarrot

What the car is worth does not have to be a single data point. It's worth to the seller what the car is sold for; it's also worth to the buyer what the car is sold for plus fee.

I do agree buyers factor in the fee in what they are willing to bid on a car. As a general observation, it appears the CXX models seem to do better than expectation on these sites while the regular ones are worse off than selling privately.

mrclam

Restaurants don't quote you prices of food inclusive of tax and tip but they should absolutely be factored into your decision to eat or not eat there. Arguing about value for most of these types of purchases is pointless because value is perceived by both the buyer and the seller, and it doesn't need to be the same. If you were trying to re-purchase your first car, and someone had happened to restore it to exactly the condition it was in when you last had it, would it have more value to you than to any other purchaser? If you had a pang of nostalgia and wanted to re-live that experience, it absolutely would be worth more to you than anyone else.

Even in the case of a dealership considering purchasing a a vehicle on BaT for resale will consider all of the transaction costs when trying to work out whether or not there is margin to be made. If the dealer sees a spyder they think they can sell for 110k, but it would take a 105k bid + 5k transaction fee, they would not tell themselves that the car is worth 105, they paid 105, and therefore they can execute this transaction at a profit.

I don't think that anybody is arguing that paying a transaction fee adds value to property, but it sure as heck needs to be factored in to whatever price you decide that property is worth to you.

In a perfectly rational market, if a car is "worth" 105k, then when listed on the private market, you should be able to find a buyer for 105k, and if you list it on BaT, you should only be able to find a buyer willing to win a bid at 100k.

hf1

According to this logic, no rational seller would post a car on BaT because he is guaranteed to get $5k (or 5%) less than his car is ‘really worth’. And yet BaT’s business keeps growing. The world must be full of irrational people.

mrclam

when are markets rational? Hardly ever :-)

PTSFX

The type of seller that doesn’t want to deal with fielding low ball offers, scheduling test drives, etc would, because that hassle isn’t worth the extra $5k to them. They are willing to not extract the full value of the car to know that it will be sold in seven days without dealing with either of those two things. Same as someone that trades it in is wiling to take even less in exchange for not taking pictures, answering questions, etc.

All three types of sellers are rational, they just assign different value to their time and factor in things like stress, aggravation, general annoyance of dealing with the public and opportunity cost to the deal.

hf1

That's exactly my point. All those can be aggregated as transaction costs and the market price does not and should not factor them in. Brokers (middle men) for all traded assets come at all levels of service and corresponding transaction (brokerage) costs. Apparently both BaT buyers and sellers find the 5%/5k transaction fee acceptable for the level of service they are receiving in the transaction. Regardless of who actually pays the fee, the buyer AND the seller end up 'splitting it'.

In short: The market price is the BaT hammer price.

Archimedes

Those of you who think that all the BAT fees should be added in, what about the cost of the buyers Internet service? The heating and lighting cost in the room he watched the auction on his computer? The value of his time spent bidding? For that last one, probably just assume that he’s married to a super hot lingerie model, so his free time is really valuable…