Hammer Time: Gaining New Insight

We now have two hybrids on our lot. It won’t last and, trust me, I know that. But I’ve always tried to buy low and sell high when it comes to cars, and non-Prius hybrids are actually reasonable these days. The car in question was a 2001 Honda Insight that was offered by a domestic dealership that had little experience with the product. The check engine light was on (recall related), the A/C was blaring ($35 of tint solved it), and the retail price was a bit prodigious ($6988 with 145k miles). They had a sealed bid sale and I got it for $4001.

I’ve always believed in the words of Wee Willie Keeler who was fond of saying, “Hit em’ where they ain’t.” There are LOTS of aint’s out there these days. VW dealers trying to sell Ford minivans. Toyota dealers selling Lincoln LS’s. Even impound lots that find themselves with three-car haulers and scooters aplenty. On average, there’s always a greater opportunity to secure a good deal on a product when you know more about it than the fellow across the table and the competitors are few (and friendly). Especially if your choice just happens to be the unpopular choice.

Last year I started changing my own inventory to reflect this. I loaded up on minivans and unpopular Detroit sedans and did very well. They’re easy to finance and simple to repair. Before I started financing vehicles, I bought a lot of “wanna-bes”: Volvos, Subarus, Saabs, Infinitis (pre-2003), and large domestic sedans with conservative leanings made up my inventory.

Over time, though, they got expensive at the dealer auctions. Folks these days are now looking for that social cachet that these second-tier luxury models bring. Rather than fighting that raging river of higher prices and lower margins, I found calmer waters in lower-end financed vehicles. So far, so good. However, if the torrent of consumer demand changes, I may have to explore brand new niches. Like that car hauler.