Difficulty trading in M coupe for a reasonable price

[mshanno1]

This is more of a rant, and also to get some help from others.

I have been trying to trade in my 2008 M coupe for about a month now, and every dealer I go to wants to low ball me, and offer 25-26k. The first one I went to offered 25k. I laughed at the salesman, and asked if they drug tested before hiring. I walked out, and went to different dealers, but everyone is offering the same.

The car has ~35-36k miles, NAV, Sapphire black/Sepang bronze, and new tires. It has a clean history and it is in perfect condition.

Anyone else having similiar experiences?

Side note: Yes, I love the M coupe. Its just time for a change, and I want something a little bigger.

[inTgr8r]

that's about normal for a trade in.

The best way to maximize the return is to sell it yourself.

[chickdr]

NADA lists trade in for a 2008 M Coupe with 36K on the clock at 25K for rough trade in up to 29K for clean Trade in(assuming you have navigation and premium packages- if not about $1K less). If I was a dealer I would start at the low end as well. Did you just walk out at 25K or try to negotiate?

[SD ///M4]

The dealer is in business to make a profit. He's going to sell your car and he wants to make a profit. The only way he can do that is to offer you less than what it's worth on the market. Isn't this obvious?

Why wouldn't you sell the car yourself? I've never traded in a car. You never get what it's worth, all you get is convenience.

[mshanno1]

Originally Posted by chickdr

NADA lists trade in for a 2008 M Coupe with 36K on the clock at 25K for rough trade in up to 29K for clean Trade in(assuming you have navigation and premium packages- if not about $1K less). If I was a dealer I would start at the low end as well. Did you just walk out at 25K or try to negotiate?

Yes, I did try and negotiate. I'm all for a fair deal on both ends. The problem I'm running into, is nobody wants to keep the M coupe on the lot. They call around to various wholesalers to try and sell the car to before taking posession of the BMW. The first salesman tried the typical stuff, by bringing out paperwork showing what they are basing their price off of. He told me that the typical selling price of my car is $32,500 as stated on the piece of paper they showed me. So, I requested to speak with the GM who came up with the 25k offer. I asked him, what is a reasonable profit for him to make on a trade-in. He told me $2500 (which is BS anyways). So I asked him...if you're showing me a piece of paper stating that my car is worth 32.5, you stated that a reasonable profit for you to make on a trade-in is 2500, then how are you coming up with an offer of 25k??

Does anyone know what a reasonable profit margin is for a high volume dealer on a trade-in?
I was guessing around 3% but I may be way off...

A local BMW dealer offered $28.5k, which is more reasonable. I was hoping to be around 30k

[mshanno1]

Originally Posted by SD Z4MR

The dealer is in business to make a profit. He's going to sell your car and he wants to make a profit. The only way he can do that is to offer you less than what it's worth on the market. Isn't this obvious?

Why wouldn't you sell the car yourself? I've never traded in a car. You never get what it's worth, all you get is convenience.

Thank you for pointing out that dealers are in the business to make a profit... now it all makes sense!

The reason for a trading in a vehicle is for tax advantages....and as you stated convenience.

[mshanno1]

I guess im also kind of bitter, because I turned down an offer 3 months ago for more than what I paid for it.

[GammaZeta]

1. You can trade it into the dealer, take less, but save yourself a bunch of time advertising and showing the car. It also allows you to get a newer car quicker.

2. You can sell it yourself at a higher price, but invest the time and effort needed to sell it for the price you want.

It all depends how much you want/need to get and how much time you want to invest.

[chickdr]

Originally Posted by mshanno1

A local BMW dealer offered $28.5k, which is more reasonable. I was hoping to be around 30k

$28,500 is a great offer IMO. From another thread here I saw your car does NOT have cruise control(thus no premium package I assume?) and I would also think no navigation? so NADA would say your car is worth 24-28K trade in value. 28,500 is a great offer. I think 30K is a pipe dream. I watch Pawn Stars on the History Channel all the time. It amazes me how folks come in with an item and say "it's worth $1,000 so I want you to pay me $1K for it." The shop has to make a profit so it has to be a workable price for them to flip it. They aren't buying the car for themselves(as you already said- they are wholesaling it). That being said you MAY be able to get 30K(or more) selling it yourself, but then you lose the tax advantage(and the time you will spend selling it yourself) so it may be better to take the $28,500 and run with it.

[inTgr8r]

Originally Posted by chickdr

......so it may be better to take the $28,500 and run with it.

^ sounds good to me too.

The only thing you have to watch is what #s they are talking for the other end of the deal.
Some dealers will take money from the other end(new car) to make the trade in sound better than it really is.

The ONLY way to negotiate a trade & buy is negotiate the difference. (net cost)

[Silververtu]

Originally Posted by mshanno1

A local BMW dealer offered $28.5k, which is more reasonable. I was hoping to be around 30k

That's a good deal!! I will trade mine in without a doubt if a local dealer offers me $28.5k, but mine is MY 06

[mshanno1]

Originally Posted by chickdr

$28,500 is a great offer IMO. From another thread here I saw your car does NOT have cruise control(thus no premium package I assume?) and I would also think no navigation? so NADA would say your car is worth 24-28K trade in value. 28,500 is a great offer. I think 30K is a pipe dream. I watch Pawn Stars on the History Channel all the time. It amazes me how folks come in with an item and say "it's worth $1,000 so I want you to pay me $1K for it." The shop has to make a profit so it has to be a workable price for them to flip it. They aren't buying the car for themselves(as you already said- they are wholesaling it). That being said you MAY be able to get 30K(or more) selling it yourself, but then you lose the tax advantage(and the time you will spend selling it yourself) so it may be better to take the $28,500 and run with it.

You're probably right. It's amazing how much the price has dropped the past few months. I could have traded it in the begininng of the summer for 32k.

I'm not one of those people that has emotional attatchments to cars, I just want a fair price. If a dealer tells me that he could sell the car for $32.5, whether he can or can't, I would think that a trade-in offer of 30k would be fair. Just my opinion.

[mshanno1]

Originally Posted by inTgr8r

^ sounds good to me too.

The only thing you have to watch is what #s they are talking for the other end of the deal.
Some dealers will take money from the other end(new car) to make the trade in sound better than it really is.

The ONLY way to negotiate a trade & buy is negotiate the difference. (net cost)

Usually if I am financing a car, I go ahead an do the math on what the monthly payments would be if I received a particular trade-in value and the purchase price I am shooting for on the new vehicle. That way I don't have to worry about them raising or lowering values to compensate.

[johanness]

Originally Posted by chickdr

$28,500 is a great offer IMO. From another thread here I saw your car does NOT have cruise control(thus no premium package I assume?) and I would also think no navigation? so NADA would say your car is worth 24-28K trade in value. 28,500 is a great offer. I think 30K is a pipe dream. I watch Pawn Stars on the History Channel all the time. It amazes me how folks come in with an item and say "it's worth $1,000 so I want you to pay me $1K for it." The shop has to make a profit so it has to be a workable price for them to flip it. They aren't buying the car for themselves(as you already said- they are wholesaling it). That being said you MAY be able to get 30K(or more) selling it yourself, but then you lose the tax advantage(and the time you will spend selling it yourself) so it may be better to take the $28,500 and run with it.

The same Pawn Stars where he rapes people for 30-40% of the value of the item citing 'auction fees' as his reasoning?
Screw the dealer. Sell private.

[GammaZeta]

You know Pawn Stars is a scripted "reality" show.

The price is agreed upon far in advance by the producers of the show.

[beta]

I fail to see the problem. The car is worth roughly 30k, the dealer is going to offer you 26k, which in theory gives him 4k profit. The floor space, rent, employees, detailing, online ad posting, etc. costs him money. Plus the fact that Ms can sit for a while means that worst comes to worst he might have to let it go for 28k. This means his profit is really anywhere from 500 to 3k.

Same with Pawn stars. If the expert says it's worth 10k, that means they're going to list it for 8-9k because they want to sell it and not have it sit forever. They have a giant store with tons of employees + security, which means that they need to mark it up by roughly 40% just to make a profit. So the most they can pay you is about 6k. He might pay you more if the item is really interesting to him, or is prestigious for the store.

Most people don't understand how retail works, and how big the markups are to stay in business. Clothing has a 100 to 200% markup for example.

The markup on a brand new car is 10% on average. This means that the most you will likely be offered is 20% below retail on a trade in, as there is a lot more overhead (and less profit, since it's cheaper) on a used car. 30 * 80% == 24k.

As others have mentioned if you want to get retail money for your car, sell it yourself.

[ZStig]

Originally Posted by Silververtu

That's a good deal!! I will trade mine in without a doubt if a local dealer offers me $28.5k, but mine is MY 06

+ M roadsters are worth less than coupes

[Nate2046]

If a dealer offered you $28.5 its only because they're taking profit out of the car you're trading for and showing it as added money for your trade. 25-26k sounds about right given my experience over the last couple months working trade deals on my '07. I was about 2k below that and all three dealers offered the same amount. Like you, I wished it was more, but that seems to be all the money out there for these cars.

[chickdr]

Originally Posted by GammaZeta

You know Pawn Stars is a scripted "reality" show.

The price is agreed upon far in advance by the producers of the show.

Irrelevant for the point of this discussion. As I said folks come in and after standing there hearing an expert appraise their item for $1K retail, they will ask the store for $1K because "it is worth 1K". This is the same for cars. Just because it is "worth" $32,500 doesn't mean they will be able to get that price(or pay $30K). If they can't it has to be reduced and they will lose money if they don't buy right.

Originally Posted by johanness

The same Pawn Stars where he rapes people for 30-40% of the value of the item citing 'auction fees' as his reasoning?
Screw the dealer. Sell private.

If you notice the only time they cite 30% auction fees is when the appraiser says the item "may" X price on a good day with the right buyer at auction. An items value is so nebulous as it is only worth what someone is willing to pay. I see Z4M's in the classified here all the time that "should" sell in a day, but sit there forever at what appears to be a very fair price. I would hope my 06 MR with 16K miles would be worth 27K, or so but I would only know if I put it up for sale and found out. There are no guarantees.

[epbrown]

Originally Posted by beta

I fail to see the problem. The car is worth roughly 30k, the dealer is going to offer you 26k, which in theory gives him 4k profit. The floor space, rent, employees, detailing, online ad posting, etc. costs him money. Plus the fact that Ms can sit for a while means that worst comes to worst he might have to let it go for 28k. This means his profit is really anywhere from 500 to 3k.

Exactly. The Z4MC is at a price where buyers have a lot of options for the money - someone paying top dollar for an M Coupe really wants an M Coupe, rather than just haivng $30k for a sports car. Such people were few and far between when the car was new, and are even thinner on the ground now since a lot of us already have one. .

[-c-]

Don't forget it's off season, your going to get better offers early in the spring as its better time to sell cars, as we move into fall and winter the car market dries up and dealers offer less as they are going to sit on the car for a while. As the market is no longer looking for a "summer car"

My dad owns a dealership and that's their practice.

[SD ///M4]

Originally Posted by mshanno1

Thank you for pointing out that dealers are in the business to make a profit... now it all makes sense!

The reason for a trading in a vehicle is for tax advantages....and as you stated convenience.

Well, I felt it necessary to point this out since that fact seemed to escape you.

Please explain how trading in a vehicle gives you any kind of tax advantage.