By on March 5, 2009

CarMax prides itself on creating a dealership experience unlike any other. Well, now that Saturn is going Tango Uniform. CarMax emphasizes no haggle pricing, easy financing, and a process that involves only one person. No more having your salesperson go back and forth between you and “Bubba” (or “Cowboy” if you are Dodge). You’re greeted warmly, shown any car you like, and guided through a completely transparent transaction, with nothing hidden. That’s the theory. How does it hold up in practice? In true TTAC tradition, I offer a personal critique of one of our biggest sponsors.

My first CarMax transaction occurred before my prose ever graced the pages of TTAC. After buying a Ford F-150 I didn’t need, I decided to celebrate two years cancer-free and 40 lbs. of weight loss by purchasing a sports car I could drive on the weekends.

After wandering through the four-square, fishbowl wilderness, I pulled into my local CarMax. A salesperson immediately guided me to a computer to search the dealer’s nationwide inventory. I’d already settled on a Porsche Boxster S. They located a bright red model in Houston. For a modest $250, they’d transfer the Porker to my 10-20.

Inexpensive relocation is CarMax’s trump card. However, there’s a string attached. When the car shows up, if it’s not to your liking, you can walk away. But your up-front transfer fee payment is toast. To forestall this possibility, CarMax provides an electronic “walk around.” Customers submit questions about the vehicle of their choice to a representative at the relevant dealership. Within a short time, the answers are transmitted back

Like with any computerized solution, there’s a large element of garbage in, garbage out. The remote CarMax rep will answer all your questions, but you’re still talking to a car salesman. A question on how the wear of the driver’s seat returned “normal wear, some wrinkles, looks great! Ready for purchase!” The more specific your questions, the better information you receive.

Once you decide to purchase said vehicle, financing is a simple process. You plug in your vital information on a computer, wait fifteen minutes, and choose which bank loan fits your needs best. Easy. No dealing with an F & I guy breathing down your neck. No fancy calculations, hidden fees or emotional games.

Next: your trade-in appraisal. The sales rep plugs-in the salient facts about your gem/turd into the same computer. While you wait with your salesperson, going over warranty information and other plugs for add-ons (yes there is still that), CarMax’ trade-in expert gives it the once-over.

CarMax describes their trade-in prices as fair, and many times they are. However, top dollar is not yours for the taking.

My Ford F-150 was valued at $14,000 at the Ford dealership, and $15,500 at CarMax. Seems reasonable—until you realize Ford completely low-balled the offer with the full expectation of giving more on the trade to sweeten the deal.

Cars above 100K miles are given paltry values, as CarMax doesn’t sell high mileage vehicles; restricting their income to auction values (where 100K-mile cars are almost worthless).

To my mind, CarMax’s non-negotiation policy is the mega-dealer’s biggest flaw. While it’s great for people inexperienced, wary or anxious at the prospect of haggling, the lack of any sort of negotiation proves troublesome for experienced buyers, especially when they realize they’re going to pay more for a vehicle than they would at a “traditional” dealership.

CarMax justifies their higher prices with a simple guarantee: the vehicle they’re selling you has never been in a frame damaging accident, flooded, or experienced any other incident that would make it an “undesirable.” CarMax has so much faith in the quality of their vehicle selection that all of their vehicles are available with an extended warranty.

To be fair, I’ve found that nearly every car that I’ve inspected on a CarMax lot looks clean and tidy. More often than not, it’s in much better condition than an equivalent vehicle waiting for unsuspecting punters across the street at Super Bob’s Auto Liquidators. WYSIWYG.

For example, I’ve been trying to find a steed to take to Europe. I tried to buy a Dodge Challenger SRT-8. The Dodge Boys changed the numbers overnight. I then attempted to buy a brand new Audi A3 DSG from a franchised store. Audi’s finance company wouldn’t approve it for export. Whilst wrangling with Audi, I looked across at a CarMax lot and spotted a 2004 Pontiac GTO.

Clean as a whistle. Burbled like a dream. Did I pay more than I could have? Yes, I did. Did I get an exceptionally clean car and a decent offer on my trade? Yes, I did.

CarMax provides a welcome departure from the high pressure, cloak and dagger methods of a “normal” dealership. They charge a premium for the lack of aggro and peace of mind. For me and for hundreds of thousands of customers, it’s worth it.

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76 Comments on “Editorial: The Truth About CarMax...”


  • avatar
    Kurt.

    Your Porsche purchase was as all car sales should be in the future. Yes you might pay a (paltry) bit more than if you were an experienced haggler but you will sleep better at night knowing you didn’t just screw the pooch. Your “dealer” made just enough to feed his family and put something away for the future and everyone is happy with the deal.

    Haggling may save you a bit of money, but what are we talking about $100? $250? I’ll even spot you a grand. Is it worth the stress and (several) hours out of your day(s)?

    I wish all car purchases could go as the CarMax commercial. “I want a sports car…a red one…with a convertable…” It would make shopping so much easier.

    Dealers take note…

  • avatar
    KatiePuckrik

    Sounds like buying cars is a nightmare in the United States.

    Me? I prefer (if I’m buying from new) to buy from a third party broker (e.g. http://www.autoebid.com), the discounts you can get are brilliant, some savings completely offset the depreciation you’ll experience in the first 2 years.

    One question, Mike. What do you mean you were looking for a car to take to Europe? Do you mean export it to Europe and go on a roadtrip? That sounds quite costly.

  • avatar
    AKM

    Katie,

    I believe TTAC’s partner Steve Lang offers the same services you describe, and as far as I’ve seen, it’s worth it. I have never bought new in Europe. How is the purchasing process?

    Mike, your automotive tastes are all over the place…which is great!

  • avatar
    KatiePuckrik

    AKM,

    The purchasing process is the UK is quite straightforward. I always use 3rd party brokers and pick up some great bargains. But one thing you can do in the UK (Not, sure about the US) is that if a dealer gives you hassle, you can complain to the maker.

    True story: My father was bought a Honda Civic and some reason, the alternator broke, so the car couldn’t start up without a jump start. Since it was under warranty, the Honda dealer was messing us around, trying to fob us off. Curiously, the only time they could fix it was either:

    a) at a time when my father was at work and couldn’t bring the car in.

    or

    b) at a date when the warranty ran out.

    My sibling heard about this and got involved. He made a phone call to Honda HQ UK and complained about this service. Honda asked the for name of the dealer and the name of the salesman.

    2 days later we got a phone call from the dealer saying no matter what time they brought the car in, they’d fix it, there and then, free of charge. They, also, threw in a free valet service and a nominal discount if they bought another Honda within a year.

    If dealers give you bad service, one phone call to their head office is usually enough. Dealers are terrified when you get the HQ involved, since HQ have the power to revoke their franchise. Or, at least, not renew it at the end of the agreement.

  • avatar
    threeer

    @Mike,

    you heading to Ramstein or something?? Know of many good restaurants just outside the K-town area. Anywho…

    My last purchase was at Carmax. While they don’t negotiate price, due to an advertising mistake on their part (advertised the car as a six cylinder, and even after the “offsite” electronic walk through, they still thought it had six cylinders. When I saw it, I only counted four! They immediately knocked off $500. And then I waited a few days to make the decision and while I was waiting, another $500 came off. So, without negotiating, I paid $1000 less for my ’06 Fusion. That being said, I do completely understand that I probably paid more by going to Carmax than any place else. But, I thoroughly enjoyed the process. The folks on the lot didn’t swarm over me, they took all the time in the world to let me test the vehicle, and I’m comfortable with the way they had the vehicle checked and validated before I bought it. Now we’re looking to replace our old Jeep Liberty and I’m down at the Carmax every few weeks seeing what they have, knowing that if I find something I like (or if they have something across the country!), the purchase experience will be minimally stress inducing. For me, that’s worth the extra they might charge for the car.

  • avatar
    JMII

    I’ve traded in two cars at CarMax, both experiences were pleasant and satisfying. Could have I gotten more for the vehicles in a private sale? Sure, but who has time for that? I attempted to trade in the vehicles at various dealerships and got the standard low-ball offer, I knew the approx value from KBB so I rejected those offers and immediate went to CarMax to off load my ride.

    In the next few months my wife will be getting a “new” (IE: lightly used) Infiniti G35 Coupe, we will be purchasing from CarMax. Their inventory is easy to search online and the no haggle price makes everything very transparent. No monkey business… this is the price take it or leave it.

  • avatar
    Detroit-Iron

    So was there anything wrong with the boxster?

  • avatar
    dwford

    Do I read the B&B extolling the virtues of paying ABOVE rock bottom dollar for a car?? I thought everyone was of the opinion that the dealer didn’t deserve one red cent of profit, yet Carmax gets a pass to gouge you?

    How does the price become “fair” just because it is fixed, yet the same price across the street you had to haggle for is somehow suspect?

  • avatar
    drifter

    Is this a special advertising section article?

  • avatar

    drifter:

    No.

  • avatar
    TaurusGT500

    … CarMax’s non-negotiation policy is the mega-dealer’s biggest flaw.

    But the non-negotiation policy is also their biggest strength.

    In fact – for better or worse – it’s the one attribute that sets them apart from other dealers.

    Think through the unintended consequences: As soon allow haggling/negotiating.. they become just another dealer.

    …. tracking/measuring/rewarding gross profit per vehicle. Spiffs/commissions/incentives to the salesforce, etc etc.

    Now the entire incentive system becomes geared to “working the deal”.

    Meaning? They are what they are and they may not be for everyone.

  • avatar
    Mark45

    It may just be the area where I live but Carmax is way higher on used cars than other places. Last year I bought a GMC Safari van, It is a 2004 and had 70K miles on it. The only problem I could find with it was the passenger side power door lock motor was bad, and in the last year and 30k miles the only problem I’ve had was an AC relay went out. I paid $7500.00 for the van. I just did a search on Carmax and the closest they have is a 2003 Safari with the same options as the one I bought, with 42k on it for $10,599 plus a $749.00 transfer fee. I just don’t see the Carmax experience being worth $3800.

  • avatar
    NickR

    Sounds like a vacation compared to the customary car-buying experience. I wished there was a CarMax in Canada.

  • avatar
    BuzzDog

    Katie, your advice to complain to the manufacturer is sound; in the U.S. there is a Federal law requiring new cars to be sold with resolution information printed in either the owner’s manual or warranty booklet. There is usually a “zone representative” in each region of the country that handles warranty or product defect issues.

    I haven’t known many people who have had to take a complaint up the hierarchical ladder, but in most cases there is some form of resolution, either in the form of a paid or discounted repair. Note that I emphasized “most,” as we are certain to get a comment from someone who got stuck with the cost of a new transmission or engine. However, I’ve never heard of such a case that occurred within warranty, unless the individual was suspected of modifying or abusing the vehicle (whether or not that charge was actually true).

    Unfortunately, in the United States it is extremely difficult for the manufacturer to threaten to pull a franchise agreement with a dealer, as state laws usually are written to protect the local dealer. That being said, I know of legends from years ago of GM dealers who had difficulty getting popular models, or were experiencing “lost” specially ordered vehicles, because they weren’t playing the game up to GM’s standard at the time.

    But in today’s economy, all bets are off…

  • avatar
    steronz

    @Kurt.

    $100? $250? $1,000? Not in my experience.

    When I was car shopping last year, the vans I was looking at were easily priced 3 to 4 grand over what I could pay at a conventional dealership with a little bit of effort. That is to say, a van that was worth about $13k would be priced at $16k at CarMax, undercutting a dealership which had them priced at $17-18k, but at which I could work the price down 3 or 4 grand. I was frustrated that the used car lots were pricing their cars 4-5 thousand over market value, and it’s refreshing to see CarMax getting *closer* to market value, but then you realize that you can’t go down from there.

    Ultimately I decided to stick with private party sales and I get a killer deal on a great van.

  • avatar
    no_slushbox

    CarMax is what everyone says they want. Their car prices are higher than almost everyone else, and their trade-in offers are lower than almost everyone, but there is no haggle.

    If you are an experienced car buyer you can almost certainly get a better deal somewhere else (the CarMax guy won’t even try to haggle, he’ll just be like “that is a better price, you should probably take it”).

    If you are not an eperienced buyer then you are unlikely to get completely screwed there (although they do have a lot of stuff they try to upsell you on), and you will never get a worse price than any other CarMax buyer.

    If you need to dump a used car fast, without dealing with all the ass-clowns on Craigslist or trying to out-do the dealer ads on Autotrader then CarMax is really good for that. Remember, you can’t do financing (yes a bank can finance a private party transaction, if you are willing to wait for a buyer that is willing to go through that process and is able to qualify).

    CarMax will poorly respray a perfectly good body panel instead of touching up the rock chips, so watch out for really poorly painted body panels if you buy a car there.

    I looked at a G35 there and the hood was horribly painted with awful orange-peel and a not-quite-matching color. I told the guy that the car must have been in an accident. He looked into it with the office and said that they just resprayed the hood because of some rock chips.

    Yes, they could have been lying, but because the front bumper was painted perfect with some normal wear, and because off the accident guarantee, I doubt it.

    But remember, CarMax may have resprayed it because of rock chips, but there is no way the next dealer will believe that when you trade the car in.

  • avatar
    Robstar

    I have been looking at carmax for a used mazda5 for the wife (her request — The minivan that doesn’t look like a minivan).

    Carmax is the same or CHEAPER than the online dealer used inventory, even for vehicles with low miles.

    That being said, I still will probably negotiate with the closest 4-5 dealerships before making a final comparison to carmax.

    The sucky thing is that they give almost nothing for cars that are +100k miles. We have a neon that is nearing 170 and it is bone stock reliable. Outside of replacing wear parts (brakes, tran fluid, oil changes, struts) after reasonable amounts of miles, we have only really had 3 “major” problems:

    1) Alternator died. replacement + installation with taxes included cost us $228.

    2) Motor mounts (don’t remember the price but it wasn’t too bad)

    3) Trunk lock broke. No way to get into the trunk now. Still deciding if we should fix it or not.

    I wouldn’t mind buying a car like that for $cheap ($2k-$3k?) if I knew it was going to be reliable and it was taken care of.

    From the article above, I guess carmax will offer us maybe $500 or something. I’d rather give the car to my parents (who are using a 93 buick century) or donate it to charity before taking $500.

  • avatar

    Tsavo

    This comments section will NOT devolve into a discussion of TTAC’s editorial bias. Any further comments on the subject will be deleted.

    I invite anyone concerned with our editorial independence to consider our record and/or email me personally (robert.farago@thetruthaboutcars.com).

    For the record, I told Mike to “tell it like it is.” And, of course, comments critical of CarMax are not and will not be deleted (within the bounds of reason and taste).

    We call it like we see it. Period. Always have. Always will.

  • avatar
    no_slushbox

    steronz:

    It probably depends on the price of the car, but I paid $20,500 for a 2005 G35 6MT sedan from an independent dealer back in early 2007 when CarMax wanted at least $25,000 for the same car with the same miles. So they were $4,500 higher.

  • avatar
    Richard Chen

    I went with a buddy a few years back to Carmax, a very nice experience. Smooth, quick (as he wrote a check), and they gave him (metal) license plates on the spot. Another colleague just picked up an Odyssey Touring this past weekend, and liked the experience as well, thanks to detailed online inventory. She didn’t find out about the PAX tires until she got home, though.

  • avatar
    jaje

    I usually stay away from CarMax. They charge such high premiums versus buying used. Plus most of my vehicles I trade in are higher mileage and they actually give me lower #s than the dealer.

    Anyway – I guess it’s time for me to worship at the alters of Rush and Coulter. Excuse me while I throw my shoes at them.

  • avatar
    John Horner

    It sounds like CarMax is giving a lot of buyers what they want and is making a good profit at the same time. Saturn did well for a long time with that same philosophy.

    One thing people fear deeply is that someone is getting a better deal than they are. CarMax resolves that fear. I doubt I will ever buy a car from them, because I’m confident I can do better fighting the dragons on my own … but for a lot of people CarMax is a highly desirable way to buy.

  • avatar
    mocktard

    I bought my first car out of college through CarMax, and the experience was pleasant enough that I went back two more times over the next few years. Not as easy as my most recent Honda purchase, but not bad, and definitely more consistent.

  • avatar
    dilbert

    I agree that the Carmax experience is pretty good, no/low pressure sales people that are willing to work with you to get what you want. I was very close to trading in and getting a car from them, and I felt bad for not doing it because my sales guy bent over backwards for me and didn’t let on an ounce of negativity even after I told him that they weren’t for me.

    The reason? Price. My trade in was a 04 IS300, manual, nav, premium sound, etc, and I wanted a 1 year old TSX with auto transmission for my then pregnant wife. If I had went ahead with the transaction, I would’ve lost about 2.5k-4k of haggleable money between the lower price on the IS and higher price on the TSX.

    I ended up selling the IS on my own for 2k over the Carmax offer, and got a new TSX at below invoice and holdback from a below average dealership with a scummy service dept. Probably still left some money on the table as it was Dec and they wanted to get rid of the cars, but not thousands worth.

    I would consider them again, but the price gap would have to come down quite a bit. I figured I spent about 10 to 15 hours and saved 2k on just the trade in car alone, for me, the hassle was worth it.

  • avatar
    Gardiner Westbound

    To my knowledge CarMax does not operate in Canada. There are no lemon laws. Official consumer protection is virtually non-existent. CAMVAP, the government sanctioned, manufacturer dominated, arbitration system is hopelessly inadequate. The car marketplace is a wild west show. Purchasers are on their own!

    In my view used car purchases contain too many unknowns and a large potential for excessive risk. My best successes have resulted from a low cost buying club membership. Approved dealers carefully select, recondition and guarantee their wares. Special orders are acceptable. The club enforces the guarantee and will arbitrate disputes, though they are rare. The cars are as good as CPO cars at superior prices. Transactions are haggle and bullshit free.

    In my experience purchasing a new car is far easier than buying used. All significant new car variables are obtainable and readily evaluated. I secure a firm quote from a broker, visit a couple of local dealers for a demonstration drive and to do a check price. If I improve the broker’s quote by $500 or more, about 50-percent of the time, I go with the dealer. Otherwise the broker gets the deal.

  • avatar
    AKM

    Thanks for the reply, Katie.

    I’m not sure if there’s a CarMax in NJ, but I’d be curious to check it out and experience how their service works firsthand.

  • avatar
    Rusty Brinkley

    I’m another satisfied customer of CarMax, sortof. Like Mike, I’m getting ready to move overseas myself, just to the Pacific instead of Europe. I took my 2002 Mazda Protege to the local CarMax for an appraisal…I need to sell it since I can’t take it with me to my next duty station. The staff was friendly, upfront, and answered all my questions. If I had to buy another car, I’d look to them to see what they had to offer.

  • avatar
    Dragophire

    I have bought three cars from them over a ten year period and have gotten far better deals with them than at a dealer. I get to pick my color and options (although I have to wait till the car I want becomes available.) that I dont get to do at a used dealer. I usually take my time and begin my search before I need to actually buy the car. I acquire my loan through the local credit union that is good for 90 days then start my search. Each time it took about six weeks for me to find the car that I wanted at the price that I wanted but at the same time I checked against other dealers and its worth it to me. The last two cars in my family have been new so I havent used them in the last five years but I know that in six years when I am ready I will do so.

  • avatar
    no_slushbox

    Robstar:

    If your car is that cheap then you can probably sell it private party without too much hastle. Someone is going to have more cash under their mattress for a working car than CarMax will offer you.

    Selling private party gets really tricky when you get into a range where people need to finance.

    On the other hand, if you sell to CarMax you will never have a crazy guy calling you/showing up at your house because the engine went out on him. That might be worth $500-$1000.

  • avatar
    Kurt.

    @Mark45 – There is a big difference between 42k miles and 70k miles. $3800 worth? Probably not and the discussion is not worth the effort to look it up. I still stand by the jist of my comment and the majority of folks here agree. Now if most car lots we like CarMax, might their price come down? Who knows.

    @steronz and Robstar – I stand corrected. I don’t work for CarMax. It doesn’t hurt my feelings if you don’t agree with me. For the record, “I” have never bought from CarMax either. I firmly believe you can find a better deal from the paper (Autotrader) or online (eBay (don’t get started) or Craigslist) – both buying and selling. Buying with CarMax however provides you with some choice (they will bring a car to you for a small fee – cheaper than you can probably do yourself) and with their guarentee/warrenty. Selling a car or Trade-in? Sell it yourself. Any car that starts and passes local state inspection is worth $1000.

  • avatar
    afuller

    I have limited experience with CarMax. A few years ago I was getting set to move out to AZ, I had a 2005 Dodge Magnum that I needed to get rid of before the move.

    I tried for months to sell it in a variety of ways, the only offer I got was a complete lowball that was quite unattractive. Even so I eventually called the guy back to take him up on his offer but he’d changed his mind.

    Just days before the move I went down to the local CarMax to see what they’d give me. The experience was quite satisfying to say the least. The CarMax offer was thousands more than what I’d received to date and was handled immediately.

    While I’ve never purchased a vehicle from CarMax they would certainly be on my radar just from my previous experience. I’ve had family members purchase from them and they’ve been quite happy as well.

  • avatar

    I’ve found their new car prices to be decent. Their used car prices to be mostly high. Their trade-in offers to be mostly low. Their relatively quick buying experience to be nice. Their country-wide inventory to be pretty good. Their transfer fees to be somewhat high. I think, ultimately, they can be a decent value sometimes.

  • avatar

    Mike: would you have paid that price premium for the GTO if you weren’t in a time crunch?

    That’s how CarMax hits the sweet spot: people can’t/won’t spend more time/stress on this transaction and (maybe not in Mike’s case) prefer to wash their hands of their current car and find something else.

  • avatar
    Hank

    Our minivan out in the drive wears a CarMax badge. It was by far the most pleasant buying experience we’ve had. Good trade-in (better than book…it was a very low mileage car with a nice options list and we were only trading in because a child had a arrived), good service, even a playroom for the kids while we waited. I had to take the car in for a warranty repair, and the service was prompt, courteous, and 7 years later still fixed.

  • avatar
    gslippy

    I didn’t know anything about CarMax, so I found the article – and the comments here – rather informative. Thanks a bunch.

    @Tsavo: If staying eternally silent about your sponsors implies you are uncritical of their product, then why is speaking positively about them any worse? Why must praise of friends be suspect?

  • avatar
    AWD-03

    This site and the comments are correct. I haven’t bought a car from carmax, because of some the very comments here. I basically negotiated a better deal for my Subie. However, if my wife (unexperienced car shopper) were to have tried to get the same deal, it wouldn’t have happened. Carmax is the perfect location for those people and anyone else who is just tired of the old run around.

    dwford : I would like you to reread those comments again. No one here is saying the dealer should not make any money off of sales. Just that the system of hide and seek to find the true prices involved make the process of buying a car into a contest between the buyer and the seller. Carmax is the place to go for no game. Could you play the game and win a better deal elsewhere, sure. Does everyone want to do that, no.

  • avatar
    carguy

    Mike – I’d have to agree. The first car I bought when my company transferred me to America was from Carmax. I had no credit history and they went out of their way to find me a local S&L that would deal with me. The price was fair but not a bargain but the service and experience were excellent. Even their extended warranties are OK – just as well as my E36 BMW developed some transmission problems after a couple of years and it ended up saving me money. They also allow to you cash out the remainder of the warranty when you sell the car (which I did).

    For anyone who hates dealers and can’t be bothered playing the game, Carmax is a decent alternative.

  • avatar
    ZoomZoom

    Again, another article on track. Not depressing, not pessimistic. But it’s about the truth, and that’s what I come here for; I don’t care if it’s a cheerful subject or not. My own experiences fall into line with the author’s, so I find the accusations of conflict-of-interest to be not relevant.

    I sold my Corvette to Carmax when I bought my Z3, and a year later, I sold the Z3 to Carmax and used the cash to put down on my Prius.

    My dealings with Carmax have been easy, straightforward, and in the case of the Z3, the car brought $3,000 to $5,000 more cash than the other dealers in town would give me for it.

    Yes, you will pay more for a car at Carmax, but I despise dealers, and I despise negotiating with most people. Plus, there’s always a risk that the payment won’t be good. Cashier’s checks, personal checks, and other payment vehicles can be futzed in such a way as to leave the seller with no money and no car. Even cash can be counterfeit, stolen, or otherwise suspect.

    I’m just a private citizen who does not have the tools to determine whether or not a check will be good, and I don’t have the skill to recognize some of the better-made imitation money. Plus, I just don’t want to deal with any of this!

    Luckily for me, I plan to just about drive the wheels off my Prius (It’ll probably have about 130K to 150K on it when I unload it) so when the time comes, I probably won’t be able to sell that car to Carmax.

    But I will have kept it long enough that it’ll have been worth it.

  • avatar
    marcj

    To me the best deal for a higher mileage trade-in continues to be putting an ad up in the auto trader/Craigslist/Kijiji. You’re likely to get a few lookyloos (a lot of folks want to experience the thrill of buying without actually buying anything) but I’ve never failed to sell a car within 2 weeks, and for more cash than the dope at the dealership offered me. More stress, yes, but it’s worth it to me to not feel like I’ve been taken to the cleaners on my trade-in.

  • avatar
    bleach

    Sajeev, you really hit on the appeal of Carmax for even experienced shoppers. Saving time and effort are huge incentives when you just don’t have enough of it to spare.

    To me Carmax is the convenience store of auto dealers. You can get what you want, the transaction will be easy and you pay a premium for it. Use them or not, but they have a place in the market.

  • avatar
    Strippo

    To me the best deal for a higher mileage trade-in continues to be putting an ad up in the auto trader/Craigslist/Kijiji. You’re likely to get a few lookyloos (a lot of folks want to experience the thrill of buying without actually buying anything) but I’ve never failed to sell a car within 2 weeks, and for more cash than the dope at the dealership offered me. More stress, yes, but it’s worth it to me to not feel like I’ve been taken to the cleaners on my trade-in.

    More stress, plus where I live the extra sales tax you’re having to pay on your new whip because of the lack of a trade-in has to be factored in. It adds up and dealers are more than happy to point that out. Choose your poison.

  • avatar
    ZoomZoom

    It just occurred to me that I know this location in the picture! It’s SR 436 (Semoran BLVD) just north of MCO (McCoy), now known as Orlando International Airport.

    Your picture for this article is actually of the neighboring Chrysler/Jeep dealer. The Carmax (at the angle of this picture) is actually to the right…the next parking lot over.

    I am under the impression that the entire complex is owned by the same business entity, so the pic is partially right.

    That building on the left is “Miller’s Ale House”, sometimes called “Orlando Ale House”.

  • avatar
    nuclearay

    I see much TRUTH in this write-up.

    The 04′ LS1 is an incredible deal right now — tons of car for not much money. I should know, I’m on my second GTO in as many years (both ’06s).

    Carmax empowers the consumer more than any other system.

  • avatar

    It wouldn’t happened to have been a dark red ’04 GTO at the Plano Carmax would it? If so, I sat in it (and hit my head on the way in). I was originally their for a 335i, but the asking price was too high. It’s come down $1K since, but still a bit high for my tastes. The interior color wasn’t my ideal choice anyway, and I ended up getting a loaded new ’09 Pontiac G8 GT with high end bluetooth added for $26.1K

  • avatar
    walksatnight

    no_slushbox,

    Thanks for pointing out the re-painting policy. I’ve never used CarMax but if I did I wouldn’t have thought about them doing that. That might be a problem if you spent $500 to have a specific car transferred and it looked like hell. I would try to find some thing on the local lot but I can see if you really wanted something specific you might want a transfer.

  • avatar

    @ Sajeev,

    If I weren’t time crunched, as in I’m days away from moving to Europe, I would have shopped around more. That said, I tried selling my Jetta TDI on Craigslist, and on the Tinker Lemon Lot, to no avail. People in this area do not want a small diesel car with a manual, no matter the high mpg’s.

    Plus, I’m of the variety, when I find the right car, at the right time, for the right cost, I will take it. I reached that point where I was tired of waiting for Audi to make up its mind on whether or not they were going to let me export the A3. Ultimately, they would have had to let me export it, with the military clause and all, but by the time they figured that out, I decided a LS1 GTO capable of 170mph on the autobahn for half the price of an A3 was just the ticket.

    @ redwood

    The car is a silver 6-speed with the red leather interior, and it was at my own Oklahoma City location… hence how I spied it by chance next to the Audi dealer here. Good thing I can identify cars 200 yards away at 65mph!

  • avatar
    kansei

    I for one just recently got a stellar deal at CarMax. I didn’t go to CarMax to look for a new car, rather I found a car on autotrader that was perfect and oh hey, it happened to be at a local CarMax.

    I walked in and purchased a car and was out the door in under 2 hours. I walked in with no proof of income (I had it with me but they never asked for it), no trade in even. Oh and I didn’t even bring a down payment, just went to an ATM during the process and pulled out some cash to hand over.

    Since I knew it was the car I wanted and the price they were asking seemed completely normal to me (actually.. a pretty good deal IMHO), I really enjoyed the no-haggle thing. Plus I have aspergers (think of “social anxiety disorder” mixed with a pinch of autism) which makes high pressure sales environments a nightmare –like where I need a day to recover.

    This was back in January of this year so I really didn’t even expect to get approved for financing given that I just graduated from university and have well over 100k in student loans. Luckily I have a good job (they took my word for it) and I got approved at a rate I was fine with paying from a reputable bank (are any these days?).

    I couldn’t be happier. I picked up a 2004 Mazdaspeed MX-5 with 7k miles on it (yes, just seven thousand) and the car is absolutely new and perfect inside, outside, and under the hood. Every bolt looks new, every piece is original. It was $15k, which is the going rate for one from a private seller with 5-8x the mileage on it. I think Carmax didn’t realize that it’s a really special car :)

  • avatar
    SupaMan

    I praise CarMax for their philosophy. Thing is, once you spot a car you like, you’ll have to act fast.

    Anyway, I sold then my 2002 Hyundai Elantra (125k on the odo) got around $2000 for it and walked away. Pleasant, no hassle and worry free. I was only slightly turned off by the no-haggle philosophy when I saw a 2008 Dodge Magnum that I thought I could bargain $1000 off the asking price.

    Oh well…

  • avatar
    davey49

    The nearest Carmax is 60 miles away in another state. Not sure it would be worth driving there to get/sell a car. Their prices seem pretty high.
    Is there some law against them being in NY? or have they just not got around to that yet?

  • avatar
    Steven Lang

    A few notes about Carmax…

    Right now they’re in the midst of a very substantial restructuring of their operations. The basic premise of their operation is very good. No hassle for those who value convenience above all. But the CPO programs, the sub-prime fiasco (which has hurt them tremendously in terms of acquiring financial support), and the rise of online dealers with strong feedback ratings have all made their mark on Carmax’s stock price. Currently they’re off over 80% from their highs.

    Hypothetically, it would be far better for them to enact a ‘pull’ strategy where they simply buy to order from the auctions. Unfortunately their consumers are usually either extremely fickle or ‘finance’ driven, and Carmax specializes in buying the ‘showhorse’ vehicle instead of the ‘workhorses’ that are better suited to that model.

    If new car dealers went towards eliminating the hassle and bogus fees approach for their Certified Pre-Owned vehicles, Carmax would be in a very challenging situation since they only offer a basic 1 month warranty. But instead of being honest and decent, many of them will play games with the public. Until that dynamic changes, Carmax and other online dealers will remain competitive.

  • avatar
    JuniorMint

    Love Cramax, but agree with Supaman: if you spot a ride you like on the ‘net and go in to look at it, you’d better be prepared to buy it right then and there. They go fast.

    I took one of my girlfriends from work “just to look” at an ’06 xB. While we were standing there, two other couples had a peek at it. She bought it that night.

    …and her old Mazda threw a belt in the service bay. HA! Carmax guy was like “Uh, well, it’s our problem now!”

    I don’t know about anybody else, but an extra $1000 premium for cutting out all the bullshit associated with my personal second-biggest purchase is more than worth it.

    Hell, I would drop an extra $20 a month just to deal with smiling, knowledgeable people than sleazy, uninformed morons. It’s nice to leave the dealership without that thin coating of slime on you.

    A word on the return policy: as someone who’s actually used it, I could not be more pleased. I was upside-down on my trade-in, but I hated the truck I bought. It really is a no-pain process. I couldn’t believe it. I’ve gotten more crap for returns at Wal-Mart.

    I still got a little chill when I read the headline on this article. For a moment, it was like when mommy and daddy start fighting.

  • avatar
    no_slushbox

    Steven Lang:

    You’ve had a lot of really good advice on buying used cars, do you have any advice on selling them. Is there any alternative to CarMax for people that don’t want to screw with Craigslist and Autotrader, either because they cannot provide financing on a relatively expensive used car, or do not want to deal with angry buyers when selling a beater? Can individuals put cars up at auctions?

  • avatar
    CarMaxChris

    Just a quick note of thanks for all the comments about CarMax. We’re reading them and we are glad to hear that we’re sticking to our founding principles. We always knew there had to be a better way to buy a used car and we’re working everyday to earn our customer’s trust and repeat business.

  • avatar
    kken71

    When I was selling a four year old Civic Si, I was researching the market and found one at Carmax that was approximately $3,500 more than most people were asking (and keep in mind that Carmax prices are firm). In fact, the Carmax car was only $1500 less than I had paid for my car new, four years earlier. Admittedly, they do a good job of reconditioning cars so they look new, and I guess having a short warranty on a used car gives some peace of mind.

    I’ve also gone to Carmax to get some used cars appraised. Their offers are fair, but you can do about 20% better if you are willing to put in the time and take the risk of selling it yourself. If nothing else, getting a Carmax quote gives you a floor for your negotiations.

  • avatar
    jkross22

    I don’t understand why an educated consumer (a la Syms) would go to a car dealer for a used car. Why not buy a used car from an individual – my perception is that you’d get much closer to the truth about how that car was treated by going for a ride with the owner and asking questions about repair and accident history.

    Get the car you like inspected by a trusted mechanic, negotiate with the individual and buy it. If you’re buying from a good seller, there will be no slight of hand or dealer type BS to deal with.

  • avatar
    jd arms

    If for any reason I am not available (“carried off by a twister”) and my wife needs a car, she has been instructed to go the Carmax route.

  • avatar
    Dynamic88

    So, the young man we read about a few days ago – the one who couldn’t buy a Jeep for cash – the one I called a ninny – he should go to CarMax and look for a lightly used Wrangler?

  • avatar
    ajla

    So, the young man we read about a few days ago – the one who couldn’t buy a Jeep for cash – the one I called a ninny – he should go to CarMax and look for a lightly used Wrangler?

    Interesting you mention this. CarMax actually sells new Jeeps at two locations. However, they do not allow transfers on new cars.

    Anyway, the Georgia CarMax store has a 2009 Wrangler X Unlimited 4×4 with power locks/windows, the hard top, Sirius, auto transmission, and the Red Rock color. Basically the exact car that the guy from the blog wanted. CarMax wants $25,800. IIRC, the dealers were trying to sell him similar Jeeps for between $27,700 and $31,200.

  • avatar
    Lee

    One thing that hasn’t been covered here is that because carmax has a nationwide network, they have the ability to send vehicles to other locations where there might be higher demand, and therefore can ask a higher price, for said vehicle.

    As opposed to an individual dealership that will often base their trade in valuation to some extent on their possibility of being able to sell said vehicle for a reasonable profit, at THEIR location.

  • avatar
    suedenim

    For what it’s worth, I had a great experience selling my 100k+ Acura RSX at Carmax. I was buying a new Honda Accord, and was disappointed by their trade-in offer of $2,000. (I was realistic, expecting it to be low, but not that low.) So the day before buying the Honda, I took the old Acura to Carmax for evaluation. They offered me $3,000, which I took the next day before getting a ride to the Honda dealership.

    All hassle-free.

  • avatar
    Dave M.

    I love the hunt of a new car purchase, and do it numerous times a year to help friends through the pathetic process.

    When I ultimately decided 2 years ago that my mid-life crisis mobile was going to have to be used, I located exactly what I wanted through Carmax. This was after numerous test drives of similar vehicles in the area, and running VIN numbers through CarFax. One looker from a local reputable dealership came up “Dual airbag event” or some such notation, although the car drove fine.

    It broke my heart to not be able to negotiate, and yes, Carmax’s price was $1200-1500 more than what I could have done I estimate, but again – I got exactly what I wanted ($150 transfer fee) with a clean history. I even sprang for the extended warranty inas I bought a European car and my past experience dictates the extended warranty is cheap insurance.

    Several friends have traded in cars there (with no resulting other car purchase) and Carmax has been very reasonable in their offers.

  • avatar

    For what it’s worth, when I was selling Fords I would have people come in and rave about Saturn’s “no-haggle” policy. I had a simple answer.

    “Sir, I’m pleased to tell you that we have a ‘Saturn Experience’ available right here at this dealership, and you can take advantage of it right now!”

    “How does it work?”

    “It’s very simple. I will go introduce you to the service manager and everybody at the dealership. Then we will come back and sell you the car for the window sticker. No haggle, no hassle. We can have you on the road within in the hour.”

    “But… but… but… I don’t want that! I don’t pay sticker for cars!”

    “Well, Sir, at Saturn you would, and if you do it here I will treat you with all the courtesy Saturn offers and then some.”

    You can imagine how it went from here. Most people don’t really care how much they pay for a car; they care about what other people paid for the same car or type of car.

  • avatar
    levi

    bleach: To me Carmax is the convenience store of auto dealers. You can get what you want, the transaction will be easy and you pay a premium for it. Use them or not, but they have a place in the market.

    Day-ham, that’s practically poetic. Succinct, poignant in its simplicity.

    Forty words. Kudos, bleach.

  • avatar
    mpresley

    The theme here is: if you know what you are doing and are a good negotiator, you are better off dealing elsewhere. But few are. For most, there is only one experience worse than shopping for a used car at a traditional dealer, and the digital you get from the proctologist only lasts a few seconds, so it might actually be a better experience. A used car is always a crap shoot. Hell, a new car is, too. Might as well make the deal pleasant.

  • avatar
    davejay

    I’ve sold two cars to CarMax so far, without buying one. In both cases I got what I wanted for ‘em, which was a fair value without a hassle — if I wanted top dollar I would have had to deal with flaky private party sales, and by avoiding a trade-in at the dealership I can keep things nice and separate.

    On the other hand, I’ve traded twice at the dealership, and wasn’t happy with how much I’d gotten for either car.

    So I have no idea how the buying experience is, but the selling experience has been (for me) terrific.

  • avatar
    Schm

    I’ve bought from Carmax. I found the experience to be quite good. I went on a test-drive, the sales rep was very informative (and he was from Spain, who knew there were that many Spaniards in Kansas)and seemed to actually like cars. The price was a bit high, but I found it to be comparable to what the other dealers were charging, epically from what those thieves at the local BMW dealer. I’m not afraid to haggle, and I was also interested in a different car (A used SLK). However, the dealer wouldn’t deal from his price, which I judged to be about $4,000 too high, so I simply walked away and bought at Carmax. And sure enough, a couple weeks later, the Mercedes’ price dropped to $22k, and someone bought it. Life’s funny like that. Anyways, I’m very satisfied with the Carmax experience, and would probably consider buy there again.

    My best car-buying advice is not to get hung up on one car, and never be afraid to walk away if you think a dealer is trying to stiff you. (Note: Stiffing is different than making a profit.)

  • avatar
    highrpm

    Jack Baruth, I completely agree with your comments about folks caring less about the price and more that they paid the same or less than OTHER folks who bought the same car.

    This is the only rational explanation for why the Saturn model worked so well for them.

    Like you said, I can go to any dealer in the country, pay sticker price, and I’ll be treated like a king since I didn’t haggle with them. The only difference is that I’ll feel like a sucker because other folks have paid less for the same car.

  • avatar

    Bought an Audi Allroad from carMax. Two days later check engine light came on, code reader showed bad Torque Converter (at 32k miles). Went back to carmax and took them a month to fix while I drove their loaner. They gave me $250 for the hassle (or the option to walk).

    I bought the maxcare warranty for $1699, and they have paid out 10k in warranty claims (my local Audi dealer has been great in getting them to honot claims).

    Carmax promised to reimburse me $158 for a busted switch and despite repeated faxes they never paid.

  • avatar
    Strippo

    When I stress test Carmax for high value metal based on my parameters, the Audi Allroad comes up a bargain. My instincts always told me that the thing was forbidden fruit. Lucky me.

  • avatar

    We purchased a 2010 impala and it had 19 thousand miles on it. My husband and I think the whole process was so easy the car is in very very good shape. I think it took 2 hrs total between looking and doing a small amount of paperwork!!! I will suggest Carmax to anyone I know very fair with pricing and personality GREAT!!!

  • avatar

    I just shipped a car from another city to here for $249.
    I will do a thorough check of the car at a dealership right after purchasing.
    For my trade-in, Toyota gave me a teaser at $9800. I got a solid buy price for $9000 from Carmax and a Hyundai dealership gave me a first estimate of $7500 and once I mentioned you are juking, they upped it to $9000.
    I did two weeks of research on car prices using cargurus.com for what I was interested in, an used Lexus ES 350.
    I found one from carmax to be a good price but had to pay the shipping cost.
    You really need to spend some legwork money, if you cannot wait.
    Hope mine is great when it gets here. If not, I know where my bottom line is.
    Nobody needs to be a good haggler, one just needs to do homework.
    For those of you who see this posting, please pray for me.  I like carmax’s business model, I just hope they are as good as they aspire to be.

  • avatar
    UsedCarWeary

    I worked for a Honda dealership out of high school in California. When my dealership purchased a Chevy Venture from another local dealership, my boss brought me down to pick it up so I knew were to go for future pickups. We were dropped off, signed the paperwork, and picked this used, somewhat decent looking vehicle up. On our way back to the dealer, still curious, I asked, “Why did we buy this from another dealer? I wouldn’t think people would come to a Honda Dealership to buy a used Chevy…” and that’s when my boss explained that we bought the Chevy for dirt cheap because there is a problem with the engine that would cost several thousand to fix, so instead one of our techs would go in and remove the check engine light. From that day on I have never considered anything used from a dealer, either brand new or private party. It still makes me sick to this day.

  • avatar
    wrbailey

    “To be fair, I’ve found that nearly every car that I’ve inspected on a CarMax lot looks clean and tidy. More often than not, it’s in much better condition than an equivalent vehicle waiting for unsuspecting punters across the street at Super Bob’s Auto Liquidators.”

    Well it certainly is too bad that it is now 3 years later since this was written and I’ve been to a few Carmax dealerships in the Phoenix, AZ area and can no longer find this to be true. If the car came in clean, it will be clean. If the car came in needed a really good detail job… don’t hold your breath.

    I used to work for a couple different Carmax dealerships from 2002-2007 and I always said how much pride I had in the vehicles we sold. The cars were ALWAYS clean and even the smallest things were fixed, from paint to broken interior trim. My wife and I went to the local Carmax dealerships this past month (with me still saying to everyone how great the cars are there and you get what you pay for as far as paying a little more from Carmax) and I have to say I was seriously EMBARRASSED!!! Every single car we looked at had chips and scratches in the paint and the interiors reminded me of dirty rental cars (don’t get me started on the rental car industry) and were so dirty and many had smells that were “off”. Many had broken interior trim pieces as well.

    This was a different area of the country than I used to work, I worked in the D.C./MD/VA area, but there is no excuse for the condition these cars were in. I really want to go back to the east coast just so I can hopefully see that those stores are still doing it right! But as far as paying more for the cars in the PHX area at the Carmax dealerships, don’t do it. Go to other dealerships, which is what we did, or even private sellers (getting a pre inspection of course). Many of the private sellers at least respected their cars to clean them, inside and out.

    I’m so disappointed in Carmax. Shame on them.

  • avatar
    fgallow

    More truth:
    CarMax = used RENTAL vehicles. At least, that’s the truth when it comes to nearly all late-model mid-size vehicles I’ve seen listed. If you peer down into the vehicle history, look for events having either the word “RENTAL” or more often “FLEET” – and there you have yourself a car that’s seen some abuse. Another hint is that most of these have racked up about 30K miles per year.
    As for this article – weak and superficial. Most of us know the said philosophy of CarMax already, I really had hoped to learn something more meaningful here today. I think CarMax could have written themselves a more critical review.

  • avatar
    Leah Jay

    I highly recommend staying as far away from CarMax as possible. I purchased a vehicle, a week later it needed an entire new brake job. They agreed to fix a window with a rock chip when I purchased the vehicle and then tried to get out of it. In replacing the window they trashed my paint and dented my door He also BLATANTLY lied about the window he put in saying how new it was… and it is OBVIOUSLY NOT. Fine… But dont lie about it AND ruin my door in the process. I have been in tears about how badly this experience was. DO NOT GO TO CARMAX. Especially the Menomonee Falls, WI location. The service manager, MIke, will treat you like crap and ruin your car right in front of you.

  • avatar
    Lori834

    Bought a 2014 Jeep Grande CHerokee from CarMax in Calgary. As soon as they dropped it off when I got in, the engine light and oil pressure is low sign was on. I messaged the car salesman and he tell me that the sensor just needs to be reset as an oil change was just done. I took it to the dealer afterwards and it actually needed all new sensor parts and oil pressure parts. I was out a vehicle for a week due to this. When I had asked about this my messages were ignored. The service is horrible and there was not support there at all. No voicemail for the owner, finance and salespeople. I was treated like I was causing the trouble. There is also a recall in the vehicle due to sun visor wiring. In which, I was not told by CarMax. They do not take these vehicles to the dealer to get a proper diagnostic testing done. This will be my last vehicle from CarMax. I also left something in my older trade in jeep and they did not follow up with me as to whether they found it and took no initiative in finding it for me. WORST business and customer service ever!!!


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