Road Ahead: Used Car Dealers in the US Industry Market Research Report Now ...
24.05.12
In the five years to 2012, US automakers struggled to stay afloat. Before filing for Chapter 11 bankruptcy in 2009, General Motors and Chrysler accepted nearly $25.0 billion in government assistance. Turmoil in the market for asset-backed securities eroded the balance sheets of auto financiers, triggering dramatic tightening of credit standards and availability. While Used Car Dealers industry operators “have a similar structure and are sensitive to some of the same factors that new car dealers face, the industry weathered these challenges much better than other industries in the automotive sector,” says IBISWorld industry analyst Radia Amari. Over the five years to 2012, industry revenue has contracted at an annualized rate of 3.7% to $71.6 billion. In 2012, revenue is expected to grow about 1.2%, supported by financing revenue from credit-poor consumers, despite losses of customers to new car dealers.
Used car dealers offered independent financing solutions to outperform the automotive sector during the downturn. While new car dealers rely on financing companies to fund consumers' purchases, used car dealers often offer in-house financing known as buy here, pay here (BHPH). Traditionally, customers who purchase vehicles on a BHPH basis have C- and D-grade credit ratings. Says Amari, “Even customers with B-grade credit had difficulty finding affordable financing during the credit crisis.” These customers purchased vehicles from used car dealers on a BHPH basis rather than opting for traditional financing from new car dealers. The Used Car Dealers industry is firmly in the mature phase of its life cycle and has a low market share concentration. With the diffuse and highly saturated nature of this market, significant changes in industry concentration are unlikely to occur. Major company CarMax's notable growth was achieved organically, with no mergers or acquisitions. So any major increases in industry concentration are most likely to occur within CarMax or another used car dealer adopting similar business practices.
Car dealership general manager Patrick Beck opens with the soft sell when someone he meets is considering going out of town to buy a vehicle.
But in his back pocket he keeps this: Look in the eye of a local firefighter and tell him you've decided to buy outside the county instead of buying locally, which would support local fire services.
Below the belt? Maybe. But some say it's time to drive home the point that buying cars and trucks within the community has big implications for local government services, businesses and jobs.
Not only is more money riding on where people buy their vehicles as sales begin to rebound, but also, competitors in Los Angeles County recently demonstrated they have no qualms about trying new tactics to lure car shoppers out of Kern County.
City officials met last summer with Bakersfield car dealers in an attempt to work out new sales incentives to counter a threat from the Antelope Valley. Although results of the talks were more modest than some had hoped, dealers are working to maximize local purchases with initiatives such as the spring sales drive they are hosting in conjunction with area credit unions.
www.100dollarsmore.com - Austin, Texas Used Car Dealer Pays More Than CARMAX
Visit: www.100dollarsmore.com for complete details. Suzette Burrow in Austin Texas with CAGaustin's offering more money for your trade!
Does anyone know if CARMAX, the used car dealership, is willing to haggle on prices?
Mar 14, 2009 by Rockstar | Posted in Buying & Selling
Im currently shopping for a used car and I see that Carmax has had the car that Im interested in for sale for the last 21/2 months. Their ads online say "no Haggle pricing" Is that true, they will not haggle?
Seeing as they proudly advertise that they don't.....not even sure how you would need to ask this question....
You already have the answer.
I don't blame them, either. When I sell cars, my prices are 100% non-negotiable. The price is, what the price is.
Makes for so much less headache, and a whole lot less whining customers, lmao.
Vipassana | Mar 14, 2009
No, the prices are not negotiable but you should look at what they offer in terms of inspections, guarantees, warranty and return policy before you conclude that you want to try to find a cheaper price somewhere else. Plus you don't have to deal with sleezy scumbag salespeople. Sometimes a little extra money is worth it.
turboguy | Mar 14, 2009
no they offer the best price possible up front..... so that way they dont have to drag you along and you dont have to wait for them to drop it.... what you see is what you will pay if you want it.... i have gotten 3 of my cars through carmax
colinhill | Mar 14, 2009
If you're looking for a bargain, don't bother with CARMAX.
mike s | Mar 14, 2009
I'm thinking of going to carmax to buy a car, but want to know some things before I go?
Feb 09, 2008 by ccccc | Posted in Buying & Selling
I have a loan on my car now. Will carmax buy my car off of me? Whatever they buy my car for will the rest of the money be tacked onto the new car price? Does carmax offer warranties like normal dealerships? Does carmax offer financing through them?
Carmax offers all the normal functions of other dealerships warranties, financing, trade-ins the works. I would just suggest to make sure you shop around, do your research and remember no matter where you buy a car from if your buying used get it checked by your mechanic.
Also it is always a good idea to sop for a loan and financing that way you know if the dealer is offering you the best deal on these items!
autosellingmaster | Feb 09, 2008
Don't Go. You are trading cars,they are not buying your car.
The negative value of your trade will be applied to the next vehicle and it won't be worth what you are going to have to pay off plus interest. That is called upside down and you do not want to be upside down. Find out what your vehicle is worth before you go anywhere to trade. Good Luck,your going to need it.
msgtpepper | Feb 09, 2008
Who gives a higher price to buy a car, a dealership, or CarMax?
Aug 23, 2010 by PearApple | Posted in Buying & Selling
I want to sell my car to get cash ASAP, which one will give me a higher offer- thank you,
A dealer ship will not buy your car out right. Or carmax for that matter. If you want a good price for your car you are going to have to sell it your self. Advertise. in the paper the local money saver.Craigs list. look up the value on Kelly blue book site. Or the NADA site. this will give you the true value of your auto.Dealer ship sell cars they rarely Buy them. unless They know they can rip you off , and give you very little for the car.THey are there to make money not spend it.
| Aug 27, 2010
it really depends on what you may be buying. If you are trading it in on a new car, they can give you a lot more. But they aren't really giving you more. My friend traded in their 95 civic, all beat up to hell a dent on every body panel, probably worth 500, and gave them 2500 since they are purchasing a new vehicle they will make that off them in interest alone. Best way for cash asap, i would list it on craiglist.com with some good pics.
Kevin K | Aug 23, 2010
Call both of them and see what they would offer
Chas | Aug 23, 2010
how hard is it to take it to carfax and get an estimate then go right down to the dealership and get a no car buying estimate, also if necessary show them whos giving you more to see if they price match or beat
manueljamesbou | Aug 23, 2010
Most car dealers will not buy your old car outright. They will only give you a trade in allowance towards a new car.
CarMax is the only place that will buy your car straight up. Take in your title, current registration, ID, and the car. They will do an appraisal and make you an offer to buy in writing. If you want to sell, they can buy it right away. You will get a bank draft that you can deposit immediately in your bank.
The best price will be selling it to a person using Craigslist, ebay, Auto Trader, etc. You will have to deal with all the morons and flakes out there, but if your car is priced right and looks decent, it will prolly sell. You will have to handle all the paperwork yourself.
Uncle Bo | Aug 23, 2010
Depends on your car.
You could take it to 4 dealers and get 4 different offers. All will be slightly below wholesale and its very likely you wont be happy with even the highest offer.
If your car is only a few years old, the same brand dealer may offer the most.
If its a VW, the VW dealer will probably offer the most for it but not always.
n | Aug 23, 2010
Why are Carmax cars more expensive than dealership cars?
Oct 06, 2009 by Worried | Posted in Other - Cars & Transportation
I don't get it. I would have assumed that dealerships start out with higher prices because you're supposed to haggle. But it seems generally dealership tag prices are cheaper than Carmax's no haggle prices. Insight? I'm trying to figure out whether to go for Carmax or a dealership.
I agree with Rick on this one. People see no haggle and think they are getting a fair price. I too looked into buying from Carmax back in 1997 and discovered that their prices are outrageous.. Whatever package you are getting at Carmax (if there is one) is still not worth purchasing from them.
Terrence B | Oct 06, 2009
I plan on selling my car, but will a car dealership (CARMAX) accept a car that has aftermarket parts?
Nov 14, 2006 by JustxMCx21 | Posted in Buying & Selling
Aftermarket parts include : AEM intake, 18" Wheels, aftermarket headlights, HID lighting system.
generally I prefer to receive a car in "factory" condition. Which means I want the factory wheels, lights, exhaust, intake, and so on. Because I am a new/used car dealer, I can certify the cars, and they can not have been altered or it would void the warranty. CARMAX is a little different, because they are strictly a used car dealer. The have a market for cars that hav aftermarket items installed. However some of the other responses are correct. The items you installed WILL NOT increase the value of your car as a trade. They may even tell you they have to replace them and therefore deduct from the value. When you have a modified car, you WILL get the most money if you sell it yourself.
Used car dealership chain CarMax Inc. should post strong earnings for its fiscal second quarter, according to a William Blair & Co. analyst. and more »
Used car dealership chain CarMax Inc. has broken ground on its first new store in more than two years. The Richmond company said Tuesday it has begun Used-car retailer CarMax begins construction in Baton Rougeall 21 news articles »
As used-car prices continue to rise, the stocks may be set for a boom. Carmax (NYSE: KMX) shares are up 15% since the beginning of this month and AutoNation
Goldman Sachs upgraded the stock of CarMax Inc. (KMX, $23.11, +$0.72, +3.22%) to neutral from sell saying the used-car dealership company's "higher used car and more »
-Associated Press Used-car dealership chain CarMax has broken ground on its first new store in more than two years. The Richmond company said Tuesday it has and more »
