New or Used : Buy Retail? Sell Wholesale?
Steven
Love your articles on TTAC. Especially those on auctions, your dealership, and used cars.
I was wondering, do you provide services to buyers looking to buy a specific car? The prices in ATL are much better than the market in New England, to the point where I would be willing to fly down, buy a car and drive it back up. (I also have some friends in ATL anyway.)
If you do please let me know. I’ve been hunting for a decent priced NB Mazda Miata – and in my neck of the woods many are quite over priced.
If not no worries. I’ll continue to enjoy your articles.
Thanks!
Even before I wandered aimlessly around the Internet and found this place, I tried to build a car buying service that would serve the public.
The problem back then was the same problem that exists now. The general public wants to buy “showhorse” cars for “workhorse” prices.
That’s a tough market to serve, and to be frank, I got tired of being jerked around.
Corporate customers were willing for me to buy the workhorse so long as it met certain criteria. Before AirTran merged with Southwest, I used to buy their vehicles for the Atlanta market. All I had to do with them is check three simple boxes. White, under 60k miles, and it had to be a Ford. Windstars, Rangers and Tauruses were their primary wants. They paid me cost plus $500, and I was trusted to serve their interest at the sales.
Meanwhile, I ended up dealing with three types of public buyers.
1) The Online Hamlet
This is the guy who sees a great vehicle that fills every single one of their needs and then says, “Let me think about it.” 90+% of the time these customers are just wasting your life’s energy.
2) The Illusionist
These folks always thought that the auctions were loaded with a cornucopia of cheap and plentiful vehicles. These misguided souls wanted the quivalent of an immaculate five year old Maxima for $5000…. with leather! After showing them the realities of the auction market through the Manheim Market Report, they would write back every once in a blue moon asking me if I had anything. When I did, they became an Online Hamlet.
3) The Extremist
There were two versions of the extremist. Those who wanted me to find a very specific type of vehicle; which was almost always old or rare. They weren’t so bad to deal with because they knew their stuff, understood that old cars aren’t perfect, and could often carry a conversation that went beyond the words, “I, me, mine… gimme! gimme!”
The flip side of that coin were those who had absolutely no care about what I got, because I was buying a car to help them solve a problem. The goodhearted fellow who was purchasing a car for a parent or child who needed a car to drive. Ss for what type of car, it didn’t matter so long as it was white and the size of a Camry.
I would ask these customers what car the person had been driving before, and just buy a newer version of it. Camry drivers got Camrys. Accord drivers got Accords. Volvos begat Volvos.
Which brings me to your unique situation. To be blunt, there are two issues. The first is I wholesale the overwhelming majority of the vehicles i buy
The second hurdle (more like a brick wall)i s that you are asking me to buy a highly popular and seasonal vehicle during the very worst time of year to buy it. A well-kept Miata in the springtime will get all the money in the world at the auctions. Even an unpopular droptop, such as the Volvo C70 I bought for $1000 last November, will end up selling for about $2700 (less auction fee) during this time of year. I was unfortunate to buy it with a transmission that was going south, but fortunate to buy it at the right times. So I made money on it.
If you want me to buy a vehicle, it’s cost plus $500 and I will only buy a “lemming” these days. Late model cars that are off-lease, a rental, or a repo. A 2012 Mazda 5 Sport, silver with a black/gray interior an 62k miles I’ll try to retail for $12k. But if I bought it for someone who already gave me a 20% non-refundable deposit on the average book value before the sale, they would wind up paying around $10,500.
Late model, less popular cars are worth my buying. A car that I can flip to another dealer that specializes in that type of vehicle? Not so much.
Good luck!
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I have long since completely lost track of the number of used vehicles I have purchased over the years for myself, my spouses, my family and my friends. A few principles stand out: 1. The great 20th century financier Bernard Baruch was entirely correct when he advised: 'buy your straw hats in the Fall.' 2. Know your merchandise. Your indie mechanic is your best friend. You can hardly overpay for a good used car. You always overpay for a bad one unless you happen to be a mechanic. 3. Certain unfashionable vehicles can be just the ticket unless, of course, you are trying to attract a woman. They often sell at huge discounts. I have at various times owned a used Pontiac Astre, a used AMC Pacer, two used Sterlings and even a used Daihatsu Charade. 4. Even the much maligned used car salesman can be a highly useful resource. If you are on their Rolodex (or its modern equivalent), the fact that they know what you like and they see so many used cars can work to your benefit. 5. Cash is king.
I've used a broker for three of my last new car purchases; my family has bought about 20 cars overall from him (new and used) in the last 15 years. A few-hundred over invoice, and he'll make everything happen for you, even delivering the car to your door if desired. Same with used cars; tell him what you want, and he'll bring it to you to test-drive, then buy. No haggle. No flim-flam.