Eric - Plug Guy

If you're buying from a Porsche dealer, they can offer a CPO warranty as well, so negotiate like hell once you nail things down.

Jay H

The typical mark up on used cars is $2,500 to $3,000 if a person is a good negotiator and the dealer needs a sale. I would assume the higher the price of the car, the more margin there is.

I traded in a '02 Boxster at a Porsche dealership a couple years ago. They gave me $17,500 and put it up for sale for a quick sale at $19,500 (asking price). The sales manager wanted the sale (on a new Boxster), paid me more than he wanted to, but told me he'd take a $1500 profit to move it quick. The car was extra clean and didn't need anything as far as maintenance. It lasted less than a week on the lot.

I sold my '08 Boxster this fall. The dealership added a CPO warranty and marked it up $4k over what they gave me. I would bet someone negotiated that price a bit lower, so I suppose they were left with maybe $2k in profit (after they paid their cost of the CPO warranty).

Dealers will start with massive margins when you walk in and negotiate on a car. If you can walk away and be patient, I bet the margins are closer to $2500 to $3,000 on these cars. Also, dealerships are very different in what pricing they will do. Some work on volume (low margins, but lots of units sold), some work on large margins (not many sales, but each sale could be massive margins).

I've always (without fail) been able to get at least KBB's "good" value on everything that I've traded (Porsche and non Porsche deals). The dealers will tell you that KBB is not a valid source anymore, but in the end, those are the numbers that typically work out on my deals...

Macster

No rule I know of.

There are exceptions but generally the dealer will allow the trade-in owner something like 'low book' or 'back of the book'. These are based on auction prices that the dealer has access to and which the public does not have access to.

The dealer will then offer the car at the retail price.

The markup can be huge. My father-in-law sold used cars and made more money selling used cars than he did new ones. (He made even more money selling RVs, used and new.)

Anyhow, dealers cherry pick cars. They seek out the best cars ones that require little if any work (besides detailing) to bring the car up to snuff.

Let's see... When I bought my 08 Cayman S, I traded in an 06 GTO with around 40K miles. The car was in very good condition.

The dealer agreed the car was in good condition and offered me around $15K trade in allowance (and I also got the Cayman S at $12K off its $62.6K sticker).

This $15K number was a bit above the trade in values listed at the various sites, like www.kbb.com.

Afterwards, knowing the Porsche dealer owns a GM/Chevy dealership I visited the used car lot off and on over the next couple of weeks and I found the GTO on the used car lot with a $18999 sticker and a sign that the car had been *marked down* from IIRC $21999.

Of course not even the $18999 number was anywhere near what the dealer had allowed me for the car's trade-in. Also, you have to consider the odds are the dealer would finance the car and make a bundle on that too.

Sincerely,

Macster.

Jay H

Do you know what the average commission is on these used cars?

I agree. I have found that if the dealer wants to wholesale my trade in, the deal isn't going to happen because they offer less for a car they don't want for their lot.

A good example. I bet one could have purchased the GTO for maybe $17,500 plus tax and fees (during the last day of the month and with good negotiating skills).

Macster

I do not know the sales commission now but I know from August of 1972 my father-in-law made in one month on sales commissions $3000 which worked out to about $100/car he sold. He sold roughly a car a day. The dealer of course made much more than that and there were other salesmen too.

If one knows his market the price he offers a dealer for a car is often below the point at which the salesman makes any commission, at least on the paper.

In some cases the sales manager will accept an offer for the car that means the selling price is below the point the salesman makes a commission. In these cases if the sales manager cares at all about the salesman (and often they do not care) he will negotiate a 'commission' with the salesman.

This is why often times an offer for a used (or new) car is rejected by the salesman (as if he has any real say in the matter) because he's afraid the sales manager will say yes and the salesman loses his commission, or makes a minimal commission on the car.

It is because of this that when one is seriously trying to buy a car to be sure he's talking to the sales manager or at least the salesman is talking to the sales manager, taking one's offer to the sales manager for consideration.

If the sales manager is not nearby and I can not see my sales man taking the offer to the sales manager I'll follow the salesman as he walks to the distant (in another building sometimes) sales manager with my offer to be sure the salesman is taking my offer to his sales manager. Earlier in my car buying experience, after the salesman left with my offer on his way to the sales manager's office, after a short delay on a hunch I got up and walked to the sales manager's office. There was no salesman in his office giving him my offer.

Walking about the inner corridors of the sales area I found my salesman in the break room smoking a cigarette with his salesmen buddies.

Sincerely,

Macster.

fskof

Go back to the dealer at the end of the month with the same offer and see what happens.

AF330i

On Long Island they use the Galves book usually ..
Going on the basis of a nice clean car without any accidents see below:

A base 2008 C2 Coupe with 33,000 miles would be $42,500

If the car has Navigation which seems to be the only add on add $1,300.

With 14,000 miles it shows an add on of $4,250 totally $46,750 trade in BUT I have never gotten full value for low miles ...

My best guess if this car was traded in today without Navigation they paid around $44,000. to $45,000.

Keep in mind if it is a Certified Porsche that has to be worth an extra $3,000. plus the dealer would want to make some profit as well ...

mgordon18

It's got nav but it's not CPO (not a porsche dealer), so it looks like they're probably in for about $45-or 46K. It also needs the 4 year maintenance, which I guess I could split with them, so I'm betting an offer of $48,500 or $49,000 would be decent.

As my father always says, "A compromise is when both parties get up from the table thinking they got screwed."

CAA

In our area, Metro DC, 997's are marked up at least $5k and sometimes up to $9k. How do I know? Auction results. That's all they offer on trades as well. Here are the latest results for '08 Carrera 2's:

12/01/11 RIVRSIDE Lease $43,000 39,400 Avg SILVER 6G A Yes
12/01/11 RIVRSIDE Lease $40,500 42,822 Avg WHITE 6G 6 Yes
12/06/11 RIVRSIDE Lease $42,000 38,530 Avg GREY 6G A Yes
12/12/11 DFW Lease $47,500 23,419 Above BLUE 6G O Yes
12/14/11 PALM BCH Regular $51,000 11,269 Above BLUE 6G A Yes
12/15/11 RIVRSIDE Lease $42,000 43,774 Avg GREY 6G A Yes
12/15/11 DFW Lease $40,500 41,201 Avg BLACK 6G 6 Yes

Tcc1999

This is a bit off topic but I don't understand the logic behind dealer trades. Some may remember that I offered my '08 2S for the lease buyout price (which was right at 50K) in June of 2011. It had 18K miles but not too many options. I asked my dealer if they would trade for the lease buyout price and they wanted nothing to do with that deal. Maybe because it was Speed Yellow. By all accounts asking the lease buyout price was a really good deal; I got about 18 inquiries, six of which were ready with cash immediately. I suppose that my particular dealer just didn't want to work very hard because they probably could have made 10% or so on the sale of my car - if it were silver maybe they'd have had a different response. Perhaps a smaller, hungrier dealer would have taken up the offer. (In the end, I felt so much better giving a fellow RL'er the deal as opposed to giving it to a dealer who I knew would make a profit.)

AYHSMB

For the dealer : they are looking at a lot of considerations other than just the "value" of the car, such as whether they have similar cars already in inventory, how much space they have on the lot, etc.

For the consumer : in many states we are essentially forced to do dealer trades by the tax code, which charges sales tax only on the difference after a trade-in. eg. if I trade in my $50k car for another $50k car, I pay no tax. But if I sell my car privately and then go buy another one, I pay 10%, or $5k. That means a dealer trade for $45k is roughly equal to a $50k private sale for me. Furthermore, the time savings of not have to deal with showing your car to private buyers is pretty massive.

ClickClickBoom

You have a 10% sales tax. I'd move.

Jay H

I agree, there are many factors in play.

I traded a mint 1998 Z-28 on my 1990 911 years ago. The Porsche dealer told me that they had zero interest in a Chevy for their lot. Until I showed up in the Z. They loved the car so much that they gave me more money for it than originally promised and kept it for their lot. I brought the car in completely detailed and with under 12,000 miles, so that helped too... It (the Z-28) was on their lot less than a week...

Always bring the car you wish to trade in all detailed (or at least cleaned up) and in the best possible condition. Take out the misc. junk you have laying around, spend 10 minutes with a vacuum, get the car washed and buy a $3 bottle of tire shine. It really helps add value for not much of your labor or money out of your wallet.

aaks38

I agree with the above post, every car ive ever traded in has went for the kbb trade in or slightly less such that the dealer can net about 10-15% profit. Carmax also tend to buy cars at trade in or below.

MUSSBERGER

Everybody in Jersey uses "Galves" on the buying side and the rest of them on the selling side

A car that can't go right on the lot for sale after trade most likely will end up at an auction.

And if you think you really worked them for a great trade in value on a car in demand you are probably wrong.