A few weeks ago, right around the time I was about to pick up my Rivian R1S, I had to decide whether I was going to trade in my Infinity SUV to Rivian or sell it elsewhere. I went to Carmax.com and they gave me a quote for $16,600. I then went to Carvana and they quoted me $13K. Some people said to try Algo and they eventually quoted me $13K as well. Rivian was going to give me something like $11K. Shocked that Carmax was so high compared to others, I made an appointment with them to look at the car. I wanted to do that because the car had been in 1 self imposed accident and I wasn’t sure if that showed up in the Carfax; also, my wife had backed up into a pole a long time ago so there is a scratch at the bottom of the back bumper. So I really wanted to make sure Carmax was going to give me $16.6 for the car.
I made an appointment for the next day to visit my local Carmax. When I got there, it took them about 40 minutes to look at and appraise my car. Sure enough, they said they would give me $16.6 for it. However, while I was waiting, I wanted to look up the private sale price for my car on KBB.com. It had been a while since I’ve used KBB, but it seems now they sort of force you into providing your info to car dealers to get a quote (I think you can use fake info, but I suggest you don’t.) As soon as I submitted my car info on KBB, I got a phone call from a car dealership across the street from Carmax. The guy was very enthusiastic to buy my car, wanting me to take my car to him ASAP. I told him I’d be there after Carmax was done.
When I got there, naturally he wanted to see what the Carmax quote was, so I gave it to him. He then had his manager drive my car and after the manager came back, the two of them talked in their office for a few minutes. It gave me flashbacks of my Infinity buying experience. He then came out of the office and told me he could give me $16,750 for it. I mean, it’s higher than Carmax…
Then when I was driving home, another dealership called me and wanted me to take the car in ASAP. I told him I had 2 firm quotes already. He told me he could “match or beat it by a few hundred.” I was too tired to deal with him anymore so he said he’d reach back out tomorrow. This isn’t to mention the 5 emails I got on the car as well.
Fast forward a week later, no other car dealership called me and I just wanted to be done with the car. I went back to the car dealership that offered $16,750 and after 10 minutes, I was out the door with a check.
I think where I made the mistake was that I told the car dealership my Carmax price because what if they looked at it and said they’d offer $17K. Then if they came in low, I could show the Carmax price and say you gotta beat $16.6K. I probably could have gotten $17K if I went to other car dealerships and had them bid against each other, but like I said, I was pretty impatient. Oh well, live and learn.
Sharing the carmax quote was a mistake, it did not help your bargaining position. You just made it easy on them to add a tiny amount to carmax and then make it seem like they are the more profitable and more convenient option. Control the flow of information in a negotiation to better your position.
I think the better approach would have been better to say that you just got a carmax offer, but interested in what they would offer. If they ask what carmax offered, say sorry but I’m not interested in sharing that. If they have a problem with that then walk out. Then whatever they offer, even if better than carmax, say hmm, I think I’ll go with carmax unless you can improve that by $500 or $1000 or whatever.
Right. Looking back that would have been the better approach.
Always ask for more first and let them counter offer. Don’t tell what other dealer offered.
Let us know how you like your R1S! Unfortunately, mine just developed a hydraulic suspension leak and had to be towed to the service center for repair – but still love its performance, even if the reliability may not be the best.
Post coming soon. So did Rivian give you a loaner?
They gave me a rental car through Enterprise – another Rivian loaner would not have been practical, since the service center is 200 miles away.
Were you purchasing a new vehicle or used? In some states, had you traded it towards a new vehicle purchase (getting your dealer to match the bid), you might have also saved the sales tax on the trade allowance.
For example, In Ohio and Indiana (I’ve lived in both) you save that amount for new car purchases. You only are charged sales tax on the trade difference.
This is exactly what I just did. That essentially added about $1000 to my trade value vs. selling it to another buyer. Of course, if the dealer decides to keep and resell it, or take it to auction, that is their prerogative.
Another tip: If your new car dealership appraiser is reluctant to match or beat your cash offers, they can sell it that service after you trade it to the dealer.
This method is called a “buy bid”. Appraiser contacts the purchasing company and confirms they will offer $X amount. Then after you trade it to the dealer, the dealer sells the vehicle to them instead of you selling it to them. You get to save the sales tax. Dealer gets the deal on selling you the new vehicle for a little extra paperwork.
I was. Rivian was only going to give me $11K so even with a tax savings of $1K is far less than the $16,750 I got.
I worked for a dealer so the tip about your dealer calling them for a buy bid could have done the trick. My salesman had no idea about this but the appraisers/managers do. It helped us put deals together when we were too far apart from the customer’s target price without it.
In MO, you don’t have to trade it in to get the tax discount. You have six months to sell a current car and you can offset that against the tax bill. Need to know your state’s rules here.
True. It does vary by state! Good reminder. Always check your local laws.