Am I off base on this car?
January 13, 2011 12:17 PM   Subscribe

Am I being unreasonable on this used car price?

I looked at a 2007 RAV4 that I liked this weekend with 55k miles. It's the base 4x4, silver. Pretty clean and my mechanic gave it the thumbs up. The guy wants 15750 for it and won't negotiate at all. (It was originally 16k). I'm not used to a dealer who won't negotiate... I've been working on him for a few days now, and he just made it clear he doesn't want to talk about it further. Does the hive mind think this price is reasonable and I'm not? I was hoping to pay Edmunds which is about 15k. I'm worried that I'm letting my pride trip me on this one.
posted by selfnoise to Shopping (19 answers total) 2 users marked this as a favorite
IDK about the intricacies about the specific situation, but the Blue Book value for that car and that mileage in Excellent condition seems to be about $18,750... just as a data point
posted by edgeways at 12:25 PM on January 13, 2011 [1 favorite]

Are you in talks with a salesman, or the sales manager? I'd go up the chain, and then if you don't want to pay and they don't want to bargain, walk away. There will be other cars!
posted by kpht at 12:26 PM on January 13, 2011

I know I wouldn't pay $750 over Edmund's dealer retail. Heck, i wouldn't pay dealer retail. But I don't think 'reasonableness' comes into it. He doesn't have to negotiate, and you don't have to buy.

It sounds as if you've invested a fair bit of time already, and paid your own mechanic to inspect the car. The dealer probably thinks you're beyond the point where you can easily walk away. Is he right?
posted by jon1270 at 12:28 PM on January 13, 2011

I must have used different calculations than edgeways, but I got a KBB of $15,235.

The short answer seems to be that he knows what the car is worth and isn't willing to take a bath on it. Hard to blame the guy.
posted by valkyryn at 12:34 PM on January 13, 2011

I used the private party value. Retail value is closer to what edgeways got.

Sounds like he's offering you a decent deal on it.
posted by valkyryn at 12:35 PM on January 13, 2011

Interesting -- I used Edmund's, and got $14,919 dealer retail for a clean '07 Rav4 w/55K miles, in the OP's location.
posted by jon1270 at 12:40 PM on January 13, 2011

If you don't need a car right now walk away. Don't be surprised if you get a call by monthend asking if you are still interested. Counter with $14,750 and see how close you can get to that price.

The dealer probably paid $12k or less for this car, there is plenty of money for him in the price. His commission is probably around 30% of the gross but it's zero if he doesn't sell it. Winter is a tough time to sell cars, he's not looking at a lot of additional traffic for the month.
posted by JohntheContrarian at 12:42 PM on January 13, 2011 [3 favorites]

2nding Johnthecontrarian. NEVER buy a car before the last week of the month. Dealerships and their employees get hefty bonuses if they meet or exceed sales goals. If the guy is one car short at the end of the month he stands to lose hundreds of dollars in commissions on not only that car, but every car he sold that month.
posted by Gungho at 12:50 PM on January 13, 2011 [4 favorites]

It isn't so much about what he paid for it but how much he thinks he can get someone else to pay for it. Besides, if it was traded in, he might have paid too much for it and is willing to sit on it.

As far as waiting for the end of the month, I think it is largely a myth. I used to sell cars for a living and I can tell you that we always worked every deal as hard we could. If your salesman happens to be on the cusp of hitting some bonus AND he can convince his manager (who usually holds the authority on the price) you might get a better deal on the very last day of the month but if he is three cars away from the next bonus level, he'd probably rather wait until a new month to start working on that month's bonus.

You might try asking him to show you what he owns the car for and tell him to add $500-$750. When you are negotiating with him be very clear that you will buy that car at that price. Don't say, "Would you take $15,500?" Say, "If you sell it to me for $15,500, I'll buy the car right now."
posted by VTX at 1:19 PM on January 13, 2011

He's being completely reasonable, in that he's under no obligation to sell you the car and you're under no obligation to buy it. He has a price he wants to sell the vehicle for, and doesn't even want to waste any more time discussing a reduction in price. His reasons for that are his own business - if the deal doesn't suit you, look elsewhere.
posted by TravellingDen at 1:46 PM on January 13, 2011 [1 favorite]

The RAV4 seems to keep its value pretty well, so it's not surprising that negotiating is tough, but unless I'm wrong, you're only $750 apart. He's already said he won't negotiate further, so unless he's throwing nonverbal cues that this is just part of the sales dance, I'd just walk. He may call you if you wait, especially toward the end of the month. In the meantime, keep looking.

In the future, i.e., before people tell you they don't want to talk about it anymore, if you're bargaining with the dealership, consider asking for things which have some slush built in, like car mats or other accessories, maintenance, etc. which you can use to shorten the gap when you're less than $1,000 apart.

Finally, always keep in mind that people who are not actually ready, willing and able to walk away from prospective sales will never get the best deals. Pro Tip: Next time you pay the mechanic, ask him to prepare two reports - one for you as to whether you should buy the car, and another about all the problems it has or will soon have so you can lower the perceived value in the salesperson's mind.
posted by Hylas at 3:03 PM on January 13, 2011

If there is nothing special about this car walk away. Call him back in about 10 days and restate your offer. If he doesn't go for it forget it.

(I am curious why VTX says the following "When you are negotiating with him be very clear that you will buy that car at that price. Don't say, "Would you take $15,500?" Say, "If you sell it to me for $15,500, I'll buy the car right now."" What's the dif?
posted by pandabearjohnson at 3:03 PM on January 13, 2011

Be honest and straightforward. You like the car, but you want a better price. Tell him you are going to keep looking, and would he please call you if he can call improve the price. I find that honest is a refreshing way to deal with used care sales, in that I have an honest willingness to look for a better deal. I've walked away from a car deal, and had the salesperson call me back in several days with a better price. As a customer, as long as you are civil, you are not unreasonable. BTW, I quite like my 97 RAV4.
posted by theora55 at 3:49 PM on January 13, 2011

The classic definition of Fair Market Value is, "What a willing buyer is willing pay to a willing seller, absent outside influence." Are you willing to pay his price? If yes, the car is worth it. If no, the car is not. From his side of the deal, if he is not willing to accept your offer, your offer is not fair.

KBB or any other "valuation" is an average of what others have paid under numerous variable circumstances. It has no bearing (except as a general guide) upon your deal. Decide what you will actually pay, not what you are wishing for. If he is not willing to accept that amount, simply go to the next dealer. He is not your BFF. He is a business man who knows how he wants to conduct his business.
posted by Old Geezer at 5:46 PM on January 13, 2011

Response by poster: Thanks for the advice all. We were negotiating via email and I think he may have gotten the impression(wrongly) that I wasn't a serious buyer. That said, I am going to let this one lie and take the lessons into the next time.

Just for the record, I don't think he was being unreasonable. He's got to do what he's got to do. The question was about whether MY price expectations were unreasonable. I guess I don't have a good sense of what the market is like these days... I last bought a used car in 2002 and the salesmen were much more eager to sell then. I've been to a few dealers and have sort of gotten the "eh" treatment everywhere. It's weird.
posted by selfnoise at 6:40 PM on January 13, 2011

Pandabearjohnson: (I am curious why VTX says the following "When you are negotiating with him be very clear that you will buy that car at that price. Don't say, "Would you take $15,500?" Say, "If you sell it to me for $15,500, I'll buy the car right now."" What's the dif?

To a salesperson, the first one sounds like you're asking so you can use it as leverage for some other deal at another dealership. It more generally sends the signal that you're not really serious about buying. You're talking about a hypothetical. "If I were serious about buying this car (since I'm not actually serious) would you take $X?"

The second statement makes it clear that whoever finds a price that works for you is going to sell you a car.

When I was selling cars, if someone said, "Would you take $15,500?" The most common response was something like, "If I could sell it for $15,500, would you buy it?" The customer would usually respond, "I don't know." At that point, the price doesn't matter since we haven't established that this is the right car. There are still other objections to tackle before we need to worry about the price (need to show SO, still need to test drive, mechanic needs to check it out, I want to look at this other car, etc.). If your SO hates it, it usually doesn't matter what the price is.

Things like, "If you can sell it for $15,500, I'll buy it right now." Means you're ready to buy and if I can only make the price work, I'm putting money in the bank. A motivated buyer makes for a motivated seller.

I should have also added a disclaimer that I sold cars in Minnesota and dealerships and, while my advice is generally correct, what works and what doesn't can vary considerably in some markets and some dealerships. YMMV.
posted by VTX at 7:25 PM on January 13, 2011 [2 favorites]

Leave him alone. Contact him in 2 weeks. He will negotiate.
posted by hal_c_on at 11:30 AM on January 14, 2011

Response by poster: Actually it took more like 48 hours of silence... I think the guy was just having a snit. Car bought, thanks everyone!
posted by selfnoise at 2:06 PM on January 15, 2011

What did you buy it for if you don't mind sharing?

I recently was shopping for used Toyota's, ended up buying new, but I still watch the market to get a recent make used for friends or family.

I would think the fact the vehicle was inspected by your mechanic would show you were a serious buyer - most people don't do that.
posted by abdulf at 5:42 PM on January 22, 2011

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