Why can't car shopping be simple?
July 15, 2005 7:37 PM   Subscribe

How do the taxes work when buying used (but fairly new) cars?

I'm hoping to buy a new car in a couple of weeks. I've been doing my research, and have test drove a few, and found one I like. I'm going to do the buy in a different city (same province) since there is no dealership for the car I want here.

Something is puzzling me though. The car I want, new, carries an MSRP of $17795. Now, I was browsing the stock for a dealership I want to look at, and they have the same car, a year older, but with the exact same accessories, for $17795. Huh? The year old car has 18000 kilometers on it. Doesn't that mean anything?

I am just puzzled about how the pricing for things like lease returns (which this used car is) works.

Also, do you generally (in BC, if that matters) pay the same freight and such on a used car as a new one? The 2004 would be fine for me, but if I can get a brand new car for the same price, why buy the 2005?

I just don't want to get screwed by a dealer adding phantom charges on, so if anyone can give me a decent idea of how used car pricing works at a lot, I'd appreciate it. I've found lots of sites with great tips for new cars, but not so much for used (or newish) cars.
posted by synecdoche to Shopping (7 answers total)
Everything's negotiable. This is true when buying new, but even more so when buying used.

If the dealer is shipping in the car from somewhere else, sure, they might try to charge you freight. That doesn't mean you have to pay what they're asking. Do your haggling based on the bottom line value that you're going to pay.

It sounds like that dealer is either crazy or is trying to prey on the uninformed. I'd be very surprised if the car actually sold for that amount.

Also, it doesn't make any difference if the car used to be leased -- its the same car either way, so why would the price change?
posted by xil at 8:26 PM on July 15, 2005

Response by poster: Thanks, xil-- it is less the fact that it was leased than it is the fact that it has 18K km on it that makes me wonder about the price.

I'm interested in possibly saving money by getting a used vehicle, but I'm not going to pay that much if I can get a new one for the same. On the other hand, from what I have read online, this dealer has a reputation for never going below the MSRP, so I am wondering how flexible they will be, even on the used one.
posted by synecdoche at 9:26 PM on July 15, 2005

if you can shop around at other dealers, you should ... even if the dealer you've been seeing is the most convenient one to go to, a lower quote from another dealership can work wonders ...

check blue book value for that used car ... and dicker with him ... i can't believe he's going to sell it for the same price a new car would go for
posted by pyramid termite at 10:44 PM on July 15, 2005

Don't know about Canada, but here in Maine, you have to prove that you paid taxes on your auto purchase in order to register it.

I just recently learned about this, much to my astonishment and absolute indignation (purchased the car in NH, where there is no sales tax).
posted by Civil_Disobedient at 11:13 PM on July 15, 2005

Response by poster: Civil_Disobedient, yes, I think there is a similar deal in Canada-- a friend was telling me to buy in Alberta, where there is no provincial tax, but after asking around I quickly learned if you don't pay at the lot you get to pay when you insure the car for BC (or whatever other province).

I guess I should have been more clear: it is less the taxes I am wondering about as much as the freight charge and such. Most of all I am curious as to why an older model of a car, even if just a year older, that has a year's worth of mileage, would cost the same as a new one.
posted by synecdoche at 11:47 PM on July 15, 2005

The listed price is the same as a new one because the dealer wants to list it at that price. Nothing more than that. Pricing works by the dealer putting price on the windshield and then haggling, or not.

I suppose a more in-depth answer would be "The dealer seems to be a not-very-smart businessman," because only a drooling moron with vCJD and severe brain trauma who was under hypnosis and compelled by large doses of powerful narcotics and whose family was being threatened with vivisection would pay the MSRP of a new car for a year-old car of the same make and model.

If you don't like the dealer, go to a different one. If there's not another dealer of that make convenient to you, pick another car. In almost all of the body styles or car types available, there are many cars that will be just fine. If it's an Echo and you don't like the only Toyota dealer within striking range, go get a Civic or a Sentra; they'll be just as good.
posted by ROU_Xenophobe at 1:01 AM on July 16, 2005

One interesting car tidbit: Due to their immense popularity (therefore impossible-to-get-ness), used Toyota Priuses are actually selling for more than the MSRP on a new one.
posted by dirigibleman at 9:05 PM on July 16, 2005

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