Trade In Value

Probably a stupid question:

Does a dealer typically meet or exceed Kelley Blue Book value? I checked Kelley and estimated trade-in value is $18,000 on my truck. I have a 2016 SR 2.7 liter 4 cylinder, 4x4, manual transmission with a Leer XR camper shell, ceramic tint, Ravelco anti-theft device, Method Race double standard wheels, BFG KO2s, OEM bed mat, Weather Tech mudflaps and 64,400 miles. No dings, scratches, perfect interior, but does have a tiny little (repaired) star at the very bottom of the windshield. Dealer offered me $15,000...or do they go by a percentage based on the value of your intended purchase? Seemed low to me. I laughed at him.

I got $11,000 for a trade in on a 2001 with 150,000 miles back in 2007.

 

The dealer will not take into account your add-ons like your shell and wheels. You may want to remove them and sell private party unless you want to lose all value for it. KBB isn't a standard that all dealerships must follow. You'll get what they want to pay you for it, if you don't like the offer, try another dealership or sell private party.

 

Dealers have a different database called black book. They dont care about anything not stock, and they are looking to give you the lowest offer you will take.
You can negotiate a trade value just as you would a purchase price.

 

Yeah, I decided to keep it. I told them I wanted $20,000 for it. I was just curious how they determine value. Have never traded in a vehicle and gotten less than KBB and I’ve purchased a new 2001 Tacoma, new 2008 Toyota Yaris, new 2011 Tacoma, new 2014 Scion XB RS10 and the 2016 Tacoma all from the same dealership, though not the same location.

 

If you're serious or looking to sell, look into private party. My wife posted her Corolla at a college and paid $49 to have it posted on their site until sold. The car was worth $12k on KBB and we got $11.5k cash for it.

 

Yep, all of those goodies that seem great to you are not considered in trade in value. But they are also not considered in the KBB pricing you looked up. So you have a 2K difference. Perhaps you were considering your truck as "excellent" condition and the dealership evaluated as something lesser. I'd ask them, and also take off anything of value that you could possibly sell. When I traded my 2018 Sport, I removed a TRD CAI, TRD Cat back exhaust, TRD slid plate, Husky floor mats, bed mat and a homelink mirror even though those were on the truck when they did the inspection and trade estimate. They didn't bat an eye and only wanted me to return the air dam I removed to install the skid plate. They did put these items on the new truck I purchased for a small labor fee which I was fine with.

 

Dealerships are not your friends and you are not theirs. They want the vehicles at the lowest price and you want the most. Dealers do this by making it seem like they are your new best friend. It works in most cases. Hell I sold my old frontier for a great price I thought and then saw it listed for sale for 5k more.

I am not mad. I believe I got a good deal. They are just better at this than most of us. They sell cars all day and we sell them once in 3-5 years.

C

 

Dealer always used KBB when I did trade-ins. They even printed the website results for me. That said I always got more because I negotiated with them. When I bought my truck I traded in my Corolla. We came to a price and I said the only thing holding up the sale is the trade-in and it took us essentially walking out for them to budge but they did and we got what we wanted.

 

If you are trading on another vehicle, determining the dealer price paid of your trade is quite difficult. If you can't sell private party, check with CarMax and see what they will give you. They are non-negotiable but they will give you a realistic market number. Ideally, do not tell the dealership you have a trade and negotiate the price of the vehicle you are buying first. Once you are comfortable with that number, then you can start negotiating your trade-in price. If you are financing through the same dealer (not recommended), that is another negotiation that can impact the price of your trade-in.

 

We agreed on a price for the car before I told him about the trade in. I had driven the car a couple of days prior but when I went back to the dealership my salesman wasn’t there. Salesman had mentioned during the test drive that $20,000 wouldn’t be far fetched as a trade in value for my truck. That was the only reason I went back. Then, when I returned, I had to deal with the Sales Manager. He came down $4,000 on the price of the car (including a $1,500 promotion that Toyota is currently running through the end of the month) but then only wanted to give me $15,000 for the truck. I was going to give him $$$ for the difference, so no financing. My offer was the truck and $4,000 cash for a new Corolla hatch. I’m ok with keeping the truck.

 

I sold my 2015 Jeep Wrangler on craigslist and got 5k more than what the dealer was offering. It was the lowest priced on the site for the age, condition and features, and it sold in a few hours.

 

That's the game and you fell for it. Give the customer KBB trade-in and subtract it from full MSRP plus hidden fees.

 

If your gonna try to trade at a dealership then look up and bring the NADA value. Always higher and closer to the actually value of the truck. KBB is never right

 

NADA is $20,000 which is what I told them I wanted for it in the first place.

Didn’t “fall for it” because I rejected their offer, didn’t feel like “negotiating” further, better to sell the truck to a private party than trade it in, but I’ll probably keep it and put another 200,000 miles on it.

Thanks for everybody’s input. I love Tacoma World!

 

I'm in the biz and can say we use more than one source for reference on trade-in values, typically NADA, KBB, Auto Auction results and nearby competing dealers retail, then average the group and add slightly (10-20%) for extra equipment, plus deduct for worn items (paint, brakes, tires, interior etc). We're not experts, but we do this everyday so we have a good feel. The market really sets these values if you look at it closely. And yes your add-ons might not be desirable for the next buyer, or they may limit the number of people who might be interested in your vehicle, so recovering all your investment is unlikely. I get a kick out of those who go on and on about all the improvements they added, then when I go out to look I find its be redesigned, bolted on and hacked up by a 12 year old in the backyard...or they comment about how "this item" and "that item" is easy to fix, yet THEY haven't fixed it for some reason!

You mentioned you wanted $20K for your trade, the sales guy said sounds reasonable, and it probably was initially because you said you agreed on a price for the vehicle. Now with the additional $4K in deductions on the price the manager offered, he just adjusted the trade a similar amount, $20K minus $5K to $15K (he was trying to make an additional $1K on your trade) but maybe figuring you might counter and settle at about $15.5-16K. It's just basic math. Ultimately the difference between the two is the only thing that matters. He could have stayed at the intial agreed upon price and not deduct the $4K, and then value your trade at $20K and you'd be in the same final position, yet "feel" better.

One other note, in our state you get tax credit on the trade (and many other states do the same). The trade value is deducted from the new vehicle price therefore reducing your tax burden. So make sure you figure that into your math if you want to sell your vehicle on your own. Make sure to add the tax savings you would have gotten to the asking price to cover and come out ahead on the private sale.

 

A 4 Cylinder 4x4 Manual would be pretty easy to sell privately if you wished to do so.

 

Every time we sell and buy a vehicle we incur sales taxes, doc and registration fees and dealer profits, none of which we ever get back.

If you can keep a vehicle that is running well and paid for, that’s usually your cheapest alternative.

 

If they did take in your truck, they would either remove some of those parts anyway (or maybe not) and still sell it for what they would a stock. The extras would be making their job easier to move it since it already has the fun stuff attached.

 

Depending on your state's tax laws trading vs selling privately has some implications. In my state (Texas) the tax on new vehicle purchase is only assessed on the net cost less the trade in value so you save 6.25 % on the trade in value. If you can beat that selling yourself then that's the way to go. It generally works to your advantage when you are trading older vehicles. If you are getting $20,000 or so trade in value, you'd have to find a buyer for $1250 more to off set the tax savings and in most cases that's just not worth the hassle.

 

First I generally pay cash for my new vehicles unless 0% is being offered. I also tend to trade in my vehicle (sales tax savings, no hassle in getting rid of the old vehicle, etc). I also will research enough on what the new vehicle should cost me and my vehicles value. That sets my price of trade + dollars = new vehicle. If the dealership can meet the trade + $X, then we have a deal.

I also go into the dealership with the mind set of I would like to have the vehicle, but I don't need it. It is not hard for me to walk away if the price is too high.