Edmunds Answers

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  • avatar grrldriver 09/01/11 9:34 am PST

    knowledgepower: thank you for your answer. I do understand that dealers AND PRIVATE PARTY SELLERS use KBB because it is to THEIR advantage to get a higher price -- thousands higher than Edmunds.com. But that doesn't tell me why Edmunds is thousands of dollars lower.


    For example, on one vehicle I just looked at, Edmunds priced it (dealer price) at $12K; the dealership was asking $18K -- a SIX THOUSAND dollar difference. When I mentioned Edmunds price, on the phone, they went ballistic that they wouldn't even consider an offer anywhere in that vicinity, even as much as $1000 over Edmunds.

    Does that render Edmunds information "rubbish"? Or is the dealer trying a nasty rip off? How can I, as an ordinary buyer, tell? I have not had ONE dealer OR private party seller, in over 4 months, be willing to sell at anything CLOSE to Edmunds price -- by which I mean, private party sellers won't even sell at Edmunds DEALER price, let alone the private party price.

    Is the "Black book" anything I'd have access to? Is it higher or lower than Edmunds? Is it anymore likely to be accepted by dealers?

    Aside from TMV, there is almost no way for a buyer to establish what the average sales price is for a vehicle anyhow -- unlike a HOUSE, where the county keeps records of sales and you can do a "market analysis" showing actual SELLING (as opposed to ASKING) prices. So dealers frequently say they won't come down off the asking price -- not even $500 -- because "they are already the lowest price in the area", even though those are ASKING prices and again, as much as $6000 over Edmunds higher dealer price for the identical car.

    If these numbers at Edmunds, are as you say, "rock bottom" then they are NOT "true market value" -- they are fictional. Is that truly what you mean? That the dealers are right, and Edmunds is not accurate, and I should NOT be going by it?

    As far as the excuse about options: this might be true on some popular or expensive cars, or by a hasty buyer who is uninformed. I am buying a MINIVAN; they are very similarly equipped in most cases, and anyhow, I know each model and option by heart and what each costs. Probably better than the dealers, who often MISLABEL one trim style for another! even when the trim style is clearly marked on the back of the vehicle!

    I also go over each vehicle description with a fine-tooth comb, to be sure every option is accounted for; this has made ZERO difference. I have also ran "fictional cars" with maximum options vs. base models with no options, and found that the difference (in the models of my choice; again minivans are very standardized) of usually no more than hundreds of dollars, not thousands. I have also accounted for mileage. NONE OF IT HELPS. I have had dealers refuse to deal even $1000 off the hyper-inflated price of a van that has sat on their lot for LITERALLY 9 months (proven by CarFax).

    As far as the Japan earthquake: that would make sense if I was considering ANY Japanese models. I am looking for a USED minivan anyhow, and only models made in the US or Korea. Someone shopping for a NEW Prius is unlikely to be edging me out in the market for a 6 year old minivan.

    In short: something more is at play here, and it's either that A. Edmunds prices are totally bogus and lowball, and that's why dealers get angry if you use them OR Edmunds prices are totally correct, but dealers have all colluded to rip off customers by refusing to consider them. Either way, I am screwed unless I willingly pay $2000-6000 OVER EDMUNDS TMV to get a new vehicle.

Answers

  • knowledgepower 09/01/11 6:32 am PST

    I understand your pain, take it from one who used to see customers showing up with printouts of prices that were lower than Blue Book or NADA. Dealers use Blue Book when they want to justify their used vehicle price because they know Blue Book has higher figures than everyone else. NADA is normally used by banks and insurance companies in pricing their used vehicles. Dealers stand by the Black Book from Hearst Publishing that they get weekly and is what wholesalers use to buy at auctions and to appraise vehicles. Customers never see this book but it is what they use, I've used it when appraising vehicles and again it's the wholesale figure. All these books are just a guide and you have to also compare what everyone in an area are selling their vehicles for. The Edmunds prices start out at rock bottom like everybody else but who's going to sell something at rock bottom,these figures give you somewhere to start in negotiating. The pricing is correct but also keep in mind each vehicle has to have all options added correctly which customers almost never do and changes prices dramatically. The used vehicle market has changed recently because of the unavailable new vehicles after the Japan natural disasters which increased supply and demand, that raised used vehicle prices also.

  • grrldriver 09/01/11 9:34 am PST

    knowledgepower: thank you for your answer. I do understand that dealers AND PRIVATE PARTY SELLERS use KBB because it is to THEIR advantage to get a higher price -- thousands higher than Edmunds.com. But that doesn't tell me why Edmunds is thousands of dollars lower.


    For example, on one vehicle I just looked at, Edmunds priced it (dealer price) at $12K; the dealership was asking $18K -- a SIX THOUSAND dollar difference. When I mentioned Edmunds price, on the phone, they went ballistic that they wouldn't even consider an offer anywhere in that vicinity, even as much as $1000 over Edmunds.

    Does that render Edmunds information "rubbish"? Or is the dealer trying a nasty rip off? How can I, as an ordinary buyer, tell? I have not had ONE dealer OR private party seller, in over 4 months, be willing to sell at anything CLOSE to Edmunds price -- by which I mean, private party sellers won't even sell at Edmunds DEALER price, let alone the private party price.

    Is the "Black book" anything I'd have access to? Is it higher or lower than Edmunds? Is it anymore likely to be accepted by dealers?

    Aside from TMV, there is almost no way for a buyer to establish what the average sales price is for a vehicle anyhow -- unlike a HOUSE, where the county keeps records of sales and you can do a "market analysis" showing actual SELLING (as opposed to ASKING) prices. So dealers frequently say they won't come down off the asking price -- not even $500 -- because "they are already the lowest price in the area", even though those are ASKING prices and again, as much as $6000 over Edmunds higher dealer price for the identical car.

    If these numbers at Edmunds, are as you say, "rock bottom" then they are NOT "true market value" -- they are fictional. Is that truly what you mean? That the dealers are right, and Edmunds is not accurate, and I should NOT be going by it?

    As far as the excuse about options: this might be true on some popular or expensive cars, or by a hasty buyer who is uninformed. I am buying a MINIVAN; they are very similarly equipped in most cases, and anyhow, I know each model and option by heart and what each costs. Probably better than the dealers, who often MISLABEL one trim style for another! even when the trim style is clearly marked on the back of the vehicle!

    I also go over each vehicle description with a fine-tooth comb, to be sure every option is accounted for; this has made ZERO difference. I have also ran "fictional cars" with maximum options vs. base models with no options, and found that the difference (in the models of my choice; again minivans are very standardized) of usually no more than hundreds of dollars, not thousands. I have also accounted for mileage. NONE OF IT HELPS. I have had dealers refuse to deal even $1000 off the hyper-inflated price of a van that has sat on their lot for LITERALLY 9 months (proven by CarFax).

    As far as the Japan earthquake: that would make sense if I was considering ANY Japanese models. I am looking for a USED minivan anyhow, and only models made in the US or Korea. Someone shopping for a NEW Prius is unlikely to be edging me out in the market for a 6 year old minivan.

    In short: something more is at play here, and it's either that A. Edmunds prices are totally bogus and lowball, and that's why dealers get angry if you use them OR Edmunds prices are totally correct, but dealers have all colluded to rip off customers by refusing to consider them. Either way, I am screwed unless I willingly pay $2000-6000 OVER EDMUNDS TMV to get a new vehicle.

  • grrldriver 09/01/11 9:42 am PST

    I'd like to add: Black Book (Hearst) is a SUBSCRIPTION SERVICE and costs hundreds a year -- not something that the "one time" ordinary car buyer is going to be able to pay for just to confirm/deny Edmunds.com pricing.


    Again I ask anyone out there with expertise: are Edmund's figures CORRECT or should I be using NADA or KBB instead? Frankly, I think they ARE correct but dealers are colluding to force higher prices -- also, that it is KBB (I don't know about NADA, I am less familiar with it) that is running a sort of "scam" on not just buyers BUT ALSO (maybe more importantly!) on banks and insurance companies, by not just forcing higher sale prices but also higher loans (meaning more defaults) and insurance payouts (meaning we all pay higher insurance premiums).

  • Stever@Edmunds 09/01/11 6:51 pm PST

    I agree with Knowledgepower - those other books exist to benefit dealers. Try expanding your search area, emphasize that you are ready to buy now, and that you have the money and they have rent to pay.
    Dealer Won't Accept True Market Value (TMV)

    What is the "Kelley Blue Book" Price?

    Source: 

  • grrldriver 09/01/11 8:07 pm PST

    Thank you, Steve. I appreciate your input. However, I have read numerous books and magazines (Consumer Reports, etc.) on car buying and heck, I am not a kid and this is far from my first car buying experience. I remember it being a pain back in the days of the first oil embargo (late 70s, early 80s), then in the 90s and early 2000s, it seemed fairly easy -- maybe dealers had a lot of stock, but they seemed eager to sell. NOT TODAY. I go to dealerships, and they don't even come out to greet me. They don't answer emails. And they get OUTRAGED -- seriously angry -- at an offer, even a very reasonable one backed up with lots of online stats.


    They insist to me they are SELLING 5-6 year old cars, at $2000-$6000 and more over Edmunds. com (or what I would think from common sense would be depreciation). I guess "the new math" computes as "you have no choice but to pay about 75-80% of the cost of a NEW vehicle when you buy an old vehicle -- and they are pushing a lot of high mileage cars at high prices.

    Also: I did try going out of my area, even to places several hundred miles away. Great idea but in practice, you simply can't afford to drive 3-4 hours each way, only to find the car in question is not what you were described, or was "just sold". (I had this happen several times, before I caught on that they were lying about having the car just to get me to come in -- no big deal if the dealer is down the street -- a very big deal if he is a 6 hour round trip!!!! with $3.79 gasoline!)

    And: I've tried every strategy I ever heard of -- getting lots of back up information (stats, printouts, Edmunds, KBB et.). NO DICE. I've tried walking away. NO DICE (they honestly do not care). I've tried going at the end of the month. NO DICE (they don't seem to have quotas and don't care if they sell cars or not; most are sitting around the dealership playing video games or yakking on their cellphones). I've tried paying cash. I've tried using financing. I've tried leasing. I've tried trading my old car in. I've tried NOT trading my old car in. I've tried sending my husband (he's a worse negotiator than me though).

    Steve, I've been laughed at -- in an angry way, hostile laughter -- by dealers who had a vehicle I wanted (and still want) that has literally been on their lot for 9 months. I've been yelled at by a private party seller, who insisted she was entitled to full KBB value and if I said differently I was insulting her and her whole family and the car and I should get off her property. She said flatly "Edmunds.com is a lie".

    SO I'm asking here: is Edmunds.com pricing a lie? Because nobody in my town (NE Ohio) will honor it or anything CLOSE to it.

  • 04350 09/01/11 9:42 pm PST

    Although almost every dealer utilizes the internet, I'll bet that most really hate the internet now because to them every prospective customer thinks he/she is the expert.

    You're right - making an offer $100 over Edmunds price won't get you very far.

    I don't know where you live in NE Ohio whether it is Ashtabula or Youngstown but I think that you'd be better off by going to Cleveland
    area dealerships. Get your GPS ready, find 3 dealerships to visit that each has your kind of vehicle that you are searching for and head over there on a Saturday morning. Better yet, a Monday morning would be even better. Have your info available but don't push it on them. Make your offer about $500 to $750 above what you think it ought to sell for
    at a dealership. If they won't budge any, say thank-you, goodbye and we'll do business elsewhere. If you aren't successful, you'll have spent $40 roundtrip on gas + your lunch + your time for the day. Also, be prepared to walk away if your salesperson seems too inexperienced.
    Recognize that the sales/general manager and whoever handles used car trade-ins are running these places.

    I live about 100 miles away from Chicago and over the last 20 years,
    I have not purchased any of my last 4 vehicles, new or used, in my hometown. There's a lot more competition in Chicago than where I
    live and the prices have always been about $1,500 to $3,000
    better differential for me in Chicago than where I live.













  • grrldriver 09/02/11 12:18 am PST

    @04350:


    Again, thanks for responding and I appreciate your time and input.

    I don't know if dealers and salesman hate the internet, or just hate smart customers. I know before this stuff was widely published online, I would get information at the library from actual little "books" by NADA and Kelly, for the same purpose -- but my recollection is it was not reviled and hated so much.

    Remember my question was basically "Is Edmunds TMV legit or not? because dealers/sellers will NOT accept it". Your statement here is apparently "No, it is not legit" which makes me wonder why you read or post here!

    My question is: WHY does Edmunds.com even exist or TMV, if it is totally false, and even an offer OVER their dealer retail is "absurd"????

    I live in the Cleveland suburban area, so I have access to the whole county, plus I go to the neighboring counties which are more rural -- so I've been to the big city urban dealers, the suburban dealers, the exurban dealers and the deep country rural dealers. No difference -- not today in the era of the internet.

    Another poster here, ironically, suggested the COUNTRY dealerships would be cheaper as they are less busy. (IMHO, this is not true -- it just means many of their customers have little other choice, so they just accept whatever the pricing is.) I have not found big city dealers here to be any cheaper, even those in a dodgy inner city locations.

    As you say, I have concentrated on going to dealers mid-week (I am lucky to have a flexible schedule, not everyone can do this) and not Saturday which is far too busy. I have traveled a 3 county area (50-60 miles each way, and that adds up!) AND I have gone out of town entirely 3-4 times as far as Columbus, without any luck. Indeed, it is worse -- a bigger investment of time & gas, often to be treated rudely or "tricked" into coming in, only to find the car gone or the dealer who promised on the phone "I'm ready to deal!" who when you finally show up, tells you bluntly "the sticker price is the price or forget about it".

    I have lost two cars this way, as well as 2-3 on ebay -- a couple where I was prepared to go to another state to pick the car up. I don't get the ebay thing, because it seems few sales happen there except for "junkers & clunkers" and salvage titles. Craigslist is even worse, as almost nobody there is a legit private party anymore, just low-end dealers trying to peddle high mileage junk.

    But to your points: what is the purpose of offering OVER True Market Value? I mean, I can see it on sports car or something racy or unusual. I'm looking for a MINIVAN. What's the point of deliberately overpaying?

    BTW: on one private party transaction, I offered $1000 over Edmunds TMV -- only to be treated like I ran over their dog. They were so angry they sent me hate emails for DAYS (for "insulting them").

    I mean, I'm not being stubborn and saying each car must sell for PRECISELY Edmunds TMV (or even KBB or whatever) -- but if it is GUIDE then it must have some relation to reality.

    Today I tried to offer Edmunds TMV on a 2004 van -- they list it dealer retail at $11,200. The dealer listed it at $16,000. I offered $12,000. They not only refused my offer, but told me theirs was a "one price, no haggle store", that Edmunds is B.S., and nobody will ever sell me a van at Edmunds TMV or close.

    With your theory -- 3 trips a weekend, $40 per trip (gas, etc.) I will be spending $120 a week or $480 a month. I'll be seriously eroding the cash I have to PAY for the van!!!!

    So again: if Edmunds valuations are worthless, how do I find correct evaluations? Is NADA correct? Is KBB correct?

    How do I communicate with a seller or dealer, without making them angry and upset, and negotiate a fair price -- one that is REAL -- without being totally ripped off?

  • Stever@Edmunds 09/02/11 6:41 am PST

    Until everyone discovers Edmunds, some people will pay too much. But our prices are based on real transactions so perhaps it's your negotiating style or something.

    Check out some car brokers; might save you some hassle.

    Using a Car Broker to Buy Your Next Vehicle

  • 04350 09/02/11 7:47 am PST

    When I read and post here it is because I hope to contribute and learn from other people's ideas.

    I made a suggestion about what has worked for me in the past. You didn't like my idea. Frankly, your response to that was too antgonistic for me.

    Keep an open mind. Good luck.





  • grrldriver 09/02/11 9:31 am PST

    @steve

    As far as I can tell, dealers are well aware of Edmunds.com and REJECT IT, along with TMV, and are angry and upset when buyers attempt to use these numbers. Obviously they want to make more money; I get that. But if all dealers reject Edmunds, and all cars sell at or above KBB, then what is the point of TMV? Where does these numbers originate, that are so false and so unsupportable?

    Don't get me wrong: I love the idea of getting unbiased accurate information online, and having it to use a tool for buyers to get a fair deal. But that's not how it is working out for me.

    @04350
    I am surprised and somewhat hurt at your attitude. I THANKED YOU for your input and ideas, and for responding to me.

    But you assumed I had not tried basic things like shopping in other neighborhoods or traveling out of town; I assure you I HAVE tried these things. Also that you might not be fully aware that spending $40 a day to simply LOOK AT cars whose dealers (or private party owners) won't deal, demand full sticker price, or laugh at your Edmunds.com research, is both expensive and discouraging.

    I would not be posting here if I was not humbly asking for answers, i.e., what am I doing wrong? You suggest I am "confrontational", and that would be funny if not so sad. Actually my problem AS A WOMAN is that I am polite, that I tried using facts, figures, stats, information, being quietly reasonable, asking people to think it over, walking away -- INSTEAD OF being confrontational as I think sometimes men are comfortable doing with one another.

    I also mentioned that one private party, after declining my THIRD offer (all OVER Edmunds TMV for her vehicle) actually harassed me for days online, because (despite my being polite) she was so angry that I "lowballed" her. How is that ME being confrontational? Isn't that actually the SELLER being confrontational?

    What is sad here is that the message appears to be "pay the dealer price, even if it is 30% over Edmunds TMV". Sure I can do that -- takes me right back to the bad old days when nobody had access to online information.

    Again I ask (POLITELY): if Edmunds.com TMV is not accurate, and can't be used to negotiate a fair price, and real prices are as much as 25-30% higher, than what the heck is the purpose of this site? And how do I -- and ordinary car owner (female) find ACCURATE numbers so I can go into negotiations and not be the dupe of car salesmen (a group not exactly revered for being "non-antagonistic")?

  • Stever@Edmunds 09/02/11 4:57 pm PST

    Edmunds exists to educate consumers. Some dealers don't like educated consumers. So if they get angry, tough - it's your money.

    Our numbers are derived using a proprietary formula, but we get sale price information straight from salespeople and other employees at dealers. So someone is selling cars at reasonable prices.

    It's been over a decade since I purchased a new car, but when I purchased, I used the blast fax technique. Most people have gone to email today, but faxes still carry a bit of a sense of urgency. The nice thing about making your offer via fax or email is that it makes the transaction a bit more businesslike and enables the parties to focus on the numbers. And you have a record of who said what.

    Even then, you may leave money on the table (I did!), but hopefully not too much.

    I bought a used car back in '05 or so, and did most everything by email. But in that case I knew the seller.

    Here's yet another idea - when you see a van you like the looks of in a big box parking lot, hang around and chat up the owner. Ask them how they like their car. If they like it, then tell them you'd like one like it but can't afford a new one. With a willing buyer for their used car, some buyers will get car fever for a new one. And hopefully they'll call you if they do, and sell you their old one.

    Source: 

  • grrldriver 09/02/11 8:03 pm PST

    @Steve

    That is certainly an interesting approach (to go to someone in a parking lot, and try to buy their car from them)! I can't say I ever heard of that before!

    Not to overthink it, but you wouldn't have any way of knowing if that particular car was well-taken care of, or even what the mileage is. (Alas for the olden days, when you could see the mileage simply by sticking your face up against the window! not so today!)

    My own technique, Steve, is to read everything possible about the cars I wish to buy -- test drive a number, then whittle down to the ones I like and can afford. Then start researching THAT particular car.

    A few times, I was stymied because the car I wanted and loved was discontinued, or changed so radically it didn't suit me anymore. (For example, between 1994 and now, I have owned FOUR Nissan Quests. But the car they sell as the Quest today isn't the same vehicle.) So I had to start over.

    I don't have a fax, but have used a similar technique in simply going to dealerships, telling them what I WANTED and if they ever got one in, to call me ASAP. Well, it didn't hurt but it never produced a single buyable car.

    My greatest successes were when I fixed on a car that was "unloved" -- like the last few nearly unsaleable Quests after Nissan discontinued them. They got undervalued, and I was able to snap a couple up at below market prices. But you can't count on that.

    I also want to ask you, if you are still posting: WHERE ARE THESE DEALERS SELLING AT REASONABLE (Edmunds TMV) prices? Because that's what I really want to know. Someone should TRACK THIS, and inform customers of "honest dealers" who will use honest methods of pricing. That would be a BIG HELP to us buyers.

    Lastly: there is a lot of funny business in the used car industry, and something afoot now -- the result of "Cash for Clunkers"? the economy? The Japanese earthquake? -- allowing them to suddenly jack up prices, even on poor-selling vehicles, to about 30% higher than they were just 2 years ago. And stick to these prices.

    I gather that sales must be through the roof, despite the economy, because the one constant I found this summer -- the blase attitude that "we don't care and we don't have to help you, and if you won't pay full sticker, go away". I have never seen salesmen more "hardcore" about refusing to hear offers, and turning them down POINT BLANK in emails, not even COUNTERING. There is no negotiation anymore -- just pay my full sticker or get your butt off my lot.

    In decades of car buying, I have never seen it like this. They don't seem to need or want my money and act like they are doing me a HUGE favor by letting me even test drive something.

  • Stever@Edmunds 09/03/11 5:52 am PST

    That's why you chat them up first. If they tell you the car has problems and they recommend you not buy the brand, then you immediately know you don't want their car and you don't go any further with the conversation. And people love to brag about their creampuffs, so that's another good indicator.



    Funny, I have a second generation Quest, but I doubt that I'll seriously consider the recent models when my '99 dies.



    I don't know what else to tell you, but there are lots full of new and used cars, and there's one out there somewhere for you.



    good luck!

  • 04350 09/03/11 9:46 am PST

    I performed a search for 2004 to 2008 Chrysler Town & Country vehicles
    from $8,000 to $15,000 in price range, within 75 miles of Zip Code
    44114, That zip code is somewhere in Cleveland, Ohio (an office building I believe) on the Auto Trader function available at this site.

    There were 135 such vehicles for sale this morning. There were even some around 50,000 to 60,000 mileage range.

    Could some of those vehicles have already been sold? Yes.

    Are each of those sellers absolutely locked in to the (ultimate) price they're seeking? I don't know.

    Do you need to visit each of the 135 sellers? No.

    Can you try a random number of those sellers (let's say 4 per day)
    on a couple of days? That's up to you.

    This website is educational. That does not mean that it is guaranteed.
    I don't think KBB or NADA can guarantee anyone that a seller will take a vehicle on trade-in for the amount that they show as being "the price."

    Should you be looking for secret nuances in this response?
    Absolutely not.

    Like the mother in the Sopranos HBO TV series said in one of the episodes, if you expect perfection from people (and entities), you'll be disappointed.







  • grrldriver 09/03/11 10:26 am PST

    @Steve and 04250

    Again I wish to thank you for replying, and am appreciative of your words.

    Steve, have you ever purchased a car simply from chatting someone up in a parking lot? I think anything is possible, but that's an awfully long shot. One problem (for me) is that many vans that look absolutely fine on the outside are actually near the end of their useful lives, with over 120K miles. You cannot see this until the vehicle engine is turned on, either, anymore.

    At least in my part of the country, approaching someone who is not selling their car and asking if it were for sale, would be considered somewhat intrusive and even offensive. I'm a middle-aged woman, but if a man (like my husband) approached a mom with kids in a minivan, I would not be shocked if she called the police on him!

    If you are talking more about recommendations: yes I have talked to dozens of minivan owners of all different brands and models and years. I have owned 4 minivans in the past 16 years and am very knowledgeable about the different models, options, etc. in the brands I prefer.

    Its interesting you are also a Quest owner! I loved the 1992-2002 model quest and have owned several -- they were comfy, reliable and sharp looking (IMHO) but I have heard from other people (and car magazines) the plain styling is now considered drab and unfashionable. The newer Quests don't seem to have caught on in the same way. They are not only bigger and clunky looking, but the cost has increased by 50%. It is unlikely I will buy one of the new models unless I stumble on one for sale way under book price. (Note: the older Quests were assembled very close to where I live, in Avon Lake Ohio.)

    Yes, there are thousands of used cars in my market, as well as all over; what I was noting is the REMARKABLE LACK OF INTEREST that dealers here have towards selling them unless they can get 30% and more over Edmunds.com TMV.

    04350: of course there are dozens of Chrysler T&C vans, and I have seen and test-driven quite a few. They are not my van of choice, due to their poor service record, and prices on them also (like the newer Nissan Quests) have risen from the very reasonable amount in the 90s and even up to 5-6 years ago, to where they easily top out $35K new. THIRTY FIVE THOUSAND for a Chrysler minivan! Yeesh!

    I have not made any offers on a Chrysler product, BUT I have made offers on over a dozen Kia Sedona, Hyundai Entourage, Toyota Sienna, and Ford Freestar vans, with the door shut firmly in my face. As I describe above, I have made offers at above Edmunds.com TMV several times, and even THAT enraged dealers because their list price was as much as $6000 over Edmunds. Several have refused ANY offer, even $300 off sticker (on an $18K vehicle) because "they are a one price store" or "this is already the lowest asking price in the tri-county area".

    In one case, that particularly irks me, there is a PERFECT 2007 Kia Sedona, sitting on a dealer lot for literally 9 months (since January) -- price has not budged one inch -- and they have turned down an offer every few weeks from me. If I show up (and I'm not a stalker, I've only done this twice all summer) the salesmen go inside and "hide". They insist the van will sell for KBB and they won't take one cent less. Apparently they are willing to wait until winter or even next year to sell this van.

    I do go out weekly to look at vehicles, as well as daily online. It's not possible for me to go out daily! I recently lost a beautiful, perfect Hyundai Entourage because it was listed on a Saturday -- I drove out immediately after calling to be sure it was there -- only to find the salesman told me "Oh...I guess someone sold it at 6PM last night....nobody told me". Meaning I drove 50 miles each way FOR NOTHING. That's 100 miles, 04350, and I get about 20 miles per gallon freeway, so 5 gallons of gas (roughly $19) for NOTHING. Multiply that times every week all summer since May; that a lot of money. I'm not rich. I need my savings to BUY THE CAR, not waste driving around pointlessly.

    I do not hold Edmunds.com TMV or anyone else liable for my problems. However, I am trying to use this as a basis for making a fair offer; otherwise what is the point? If this site says a particular van (real life example: a 2006 Ford Freestar) is worth $8500 dealer retail, and the dealer has it marked $14,999, how do you suggest I proceed? I show them the print out of the Edmunds numbers -- they laugh or even get angry -- they tell me their price is firm. I go back six weeks later; they have dropped it to $13,999. But no lower.

    NOW: do you suggest I pay $14K for a car Edmunds says is worth $8500? Wouldn't that make me a fool? What kind of bank will finance a car for almost twice it's actual TMV value? What if I EVER have to sell it -- I guarantee you that as an private seller, I won't be able to make up for paying six thousand dollars over TMV.

    Education has to mean FACTS that are TRUE in REALITY. I know there is no perfection; if I wanted a "perfect" car I would not be buying a use car. I am trying to do research, be educated, be PREPARED before making an offer. Just as I would buying any other consumer product; however in the US we bargain only really on two major products, HOUSES and CARS. For HOUSES, there are public listings of sale prices, so we KNOW up front how much others have paid and can use this. For cars, all we have are Edmunds, KBB, NADA, etc. -- if dealers won't go by this, then we are helpless to avoid being forced to overpay.

    It is all made worse if we have to buy a car quickly, due to our old car being in an accident or other circumstances.

    Again: my question wasn't "how do I buy a car" but IS THE INFORMATION ON THIS SITE -- the TMV -- true. It either IS TRUE or it is NOT TRUE. I can either use it with confidence OR it is esoteric stuff derived from some "formula" and dealers/private parties are correct that KBB prices are reasonable.

  • knowledgepower 09/03/11 10:48 am PST

    I now know what you're trying to buy, you mentioned a minivan. When I was ordering vehicles for the dealer and selling them I knew the markup as well as Black Book and people were still making outrageously low offers. I'm not saying this you but if these guys refuse to honor that price please remember they are selling based upon what they bought the vehicles for or traded for with a customer. The Edmunds even though correct is again to be a guide, if everywhere you go no one accepts that number because it's too low maybe in your area the prices are a bit high because the market dictates it. The Black Book is what wholesalers use to determine a vehicle price at the auction but when conditions are unusual like right now used vehicle are a little higher iin price. These guys know when they go to the auction the price is going to be higher than Black Book but they have to pay it and pass it on to the consumer. Yes it is a bit of collusion because they don't beat up on each other for price but they do compete for the sale. I do say when shopping for a minivan like any other vehicle just be prepared to negotiate based upon the going prices out there. The bank is on your side because they won't finance too much on a vehicle because it's their collateral in the loan. Good luck but be a little more flexible.

  • grrldriver 09/03/11 11:30 am PST

    @knowledgeispower

    (and I love your username!)

    The exact name/brand of van I am seeking isn't really relevant. I think this would be true REGARDLESS of what sort of car I want, even a popular Japanese make.

    I certainly know that dealerships are businesses, and have a mark-up, and expenses such as rent, salesmen salaries, utilities, advertising and so forth. I assume that Edmunds TMV takes all of that into consideration.

    You talk about people making OUTRAGEOUSLY LOW offers, and I certainly get that nobody will take me seriously if I try to buy a 3 year old low mileage Toyota Prius for $5000 when the dealer is asking $22,000. I'm not remotely doing that. I am trying to use what I thought were REALISTIC, absolutely legit facts compiled by objective sources on ACTUAL SELLING PRICES.

    You are basically saying that the dealership selling an $8500 Ford Freestar van (Edmunds TMV detail retail on that vehicle) really paid MORE THAN THAT at auction or in trade-in, and ergo that investment must be compensated by charging me $14,000 (approx $7500 over Edmunds TMV). Is that correct?

    Because if that is true, THEN WHAT I ASK (is Edmunds accurate?) is a very legitimate question. In that scenario, then Edmunds TMV is totally bogus because cars are actually selling for vastly more than than what they say is dealer retail -- and trade-in and private party are wrong also -- and not by a few dollars but by THOUSANDS OF DOLLARS. Doesn't that render the figures here basically useless?

    There is no reason for the market to be high in Cleveland; this is a depressed part of the Rustbelt and epicenter of the foreclosure crisis. And a Ford Freestar? We aren't talking Honda Odyssey, folks. (I can't even dream about buying a used Honda Odyssey, unless one that is 8 years old with 140K on the odometer.) The Freestar was an unpopular and poorly reviewed last gasp of the Windstar. Nobody is fighting to buy Ford Freestars.

    As I stated in my previous post, if I go out to bargain on a HOUSE, I can easily look up all the previous "sold" prices, as well as what people ASKED and what they SETTLED FOR, and if the prices have truly risen. This is all tracked very accurately. The only thing I have with cars is Edmunds, KBB, NADA and apparently (if you guys are right), this is hopelessly inaccurate and unrealistic, so if they tell me a car retails at $8500, then in fact it is really a $14,000 car, and I should just toughen up and cough up $14,000.

    Except when I go to SELL THAT CAR or finance it or whatever, magically it morphs back into a $8500, and an unpopular make and I overpaid.

    I have been told (and I agree) that KBB is basically a fiction maintained by the dealers and the banks, so that they can legally extend very large loans to people on a cars that are not worth as much as the loan. Otherwise, if forced to loan on TRUE VALUE (as in Edmunds TMV), you could not sell cars (used or new) at hyper-inflated prices and you'd have to account for the automatic fall of 30% when you drive that new car off the lot -- it would destroy the auto industry.

    Obviously I do not see any point in being told a fictional number, that is too low to bargain with. If those Ford Freestars really sell for $14,000, then tell me that. I'm realistic. If they really sell for $8500, then why won't dealers sell at $8500? Where does the $8500 come from anyhow? Doesn't Edmunds use actual sales figures? If so, some people ARE buying that Freestar at $8500; but dealers see me, and perhaps see a middle-aged woman and think they can scam me.

    Or sales are just so hot right now -- in the middle of a severe double-dip recession -- they can yak on cell phones and read newspapers and take breaks and totally ignore the CASH CUSTOMER on the lot, because they want to hold onto a Korean minivan for another six months. Because I can document this happening.

    Since all the methods I am using to price cars is wrong, I'd appreciate THE CORRECT METHOD. No, I don't need instructions on how to FIND a car -- I have found dozens, if not hundreds. I need instructions on how to:

    A. Determine correct valuation, assuming Edmunds TMV is so inaccurate it is approximately 30% below actual pricing in my zip code.

    B. Make a fair reasonable offer, in a polite manner, which will not be laughed at or ridiculed, and which won't result in my receiving a whole week of hate emails from a private party seller.

    C. Know when it is reasonable for a dealer to say they won't negotiate, they are "a one price store" and that there is no haggling in car sales, only a buyer who puts up and shuts up and pays sticker, and assumes the sticker price is based on a reasonable profit over dealer cost.

    *****

    In short: a guide which misstates actual selling prices as 30% (OR MORE) below actual selling prices IS NOT A GUIDE, but some sort of masochistic wish fulfillment. ("I WISH I could buy a 2006 Ford Freestar for $8500, but the real price is $14000.")

  • knowledgepower 09/03/11 2:03 pm PST

    I really can't disagree with you and I like B. and C. in your recent post, what I did post earlier is it's obvious the Edmunds TMV isn't working in your area if it's Cleveland then I'm definitely with since that's where I'm originally from. You seem to know what the heck you're doing in your car shopping, the only advise I can give is stick with B. and C. of your post. A dealer will negotiate from his asking price down, they normally mark up used vehicles $2000-$4000 because any more they look stupid. Please compare also Autotrader.com for dealer asking prices. I recommend you change your strategy and not walk into a dealership with all your printouts from Edmunds or anywhere else. The dealers are going to get defensive and waste their time and yours trying to prove you wrong. As long as you have an idea of what the pricing is then keep to yourself when negotiating, don't you get offended either if they try to convince you the figures are incorrect. Just don't take them in there. Managers at dealers have some of the biggest egos in any industry, I've dealt with many and they were jerks. I've been there and done that and seen many deals blown by managers because of ego. Let's not let that get in the way, I've sold to many more women than men and they were excellent so you continue to be excellent. Negotiate from asking price down because you will find the minivan you want at a great price, remember "Knowledge is Power".

  • sjel 09/04/11 12:21 am PST

    I'm really glad that grrldriver asked this question because I'm in a similar situation. It's very frustrating. I've not been able to come anywhere close to TMV most of the time. I just don't get it. Yet, a friend tells me that he told a dealer he'd give them the Edmunds TMV price and it worked! If I understand it correctly, TMV is based on dealer tax receipts, if that's true it seems that if we offer in that ball park we should get a reply that's, at least, a willingness to negotiate. But, like grrldriver, I am getting a more "take it or leave it" attitude right on the asking price. It doesn't bother me, right yet, because I don't have to buy right now. Willing to. Don't have to. But I am befuddled by the stance, I'm not sure how to shop with a lot of distance involved. I don't know how I could get the vehicle checked by a mechanic or whether it's worth a many hour drive. I know people do and have had success but how? I could see driving 4 hours and only having time to look at one vehicle and turn around and drive home or feel pressured to sign on the dotted line so the trip was wasted. Is the market for used cars really that tight? Or is it that they're just trying to create the perception to justify their prices? Will the market loosen up with the 2012 models coming out? Hope that I'm not out of place using this discussion but it seemed to fit.
    Like grrldriver, when budgets are tight EVERY expense counts and every dollar spent that didn't have to be spent on a vehicle could be used elsewhere. Perhaps that puts to much strain on the process and a more relaxed approach is better.
    And, to grrldriver, try to forget about the private seller that was upset with you for trying to bargain. Private sellers can be very touchy about their vehicles because of sentimentality attached to them.

  • grrldriver 09/04/11 11:19 am PST

    @Sjel

    Thanks for sharing your experience. Though I am appreciative of the experience, insider knowledge and advice from other posters here, I think they have not faced down my problem.

    There are many of us in this tough economy, whose income has NOT kept up with the inflation that "nobody wants to talk about" -- higher fuel prices, grocery costs, utilities, local taxes -- and still must have a car to get to work, and when we need a new one we are blindsided by the high costs -- costs that have EXPLODED over just the past 5-7 years.

    In 2005, when I bought the van I am now selling, I could have had a brand new Mazda MPV for $19,999 -- nicely equipped, not the base model, alloy wheels, etc. Today, there is NOTHING at that price -- nothing. I just saw a Honda Odyssey 2012 with a window sticker of $44,999. What the heck kind of family with young kids can afford a $50K (*with sales tax of 8%) minivan???? Look at monthly: that is almost $1000 a month. For one vehicle; most families have 2 adults and need two cars (if not more for teenagers, etc.).

    So once upon a time (*long ago, in the NINETIES), my husband and I could afford a new car every now and then. NO MORE. We can now barely afford USED cars. Since the early 00s, we have had to move back from a 4 year old used car, to a 5 year old used car, to a 6 and 7 year old used car. Yet the prices have gone UP. It is not unusual now to see dealers asking $17,000 for a 2005 or even 2004 van with 90,000 miles on it. Seriously. I can document this.

    If, as you say Sjel, Edmunds TMV is based on dealer tax receipts (as I believed it was), then something is very wrong here. I should be able to buy, FAIRLY AND HONESTLY, at Edmunds TMV. But nobody will sell to me at that price, and some are openly hostile when I even TRY.

    Many of the suggestions simply won't work in the real world. People who are happily driving their nice, clean low mileage vehicle won't suddenly sell it to you in a parking lot. (If someone asked me to sell them MY van this way, I'd be alarmed or even think it was a scam.) You can't take car after car after car to a mechanic to check out -- I tried this. It is very costly. Mechanics are not free. Many of us must check out 6-12 vehicles -- at a cost of roughly $150 each. Even if we had the money, most sellers won't let you drive the car off the lot for that long without a purchase agreement.

    I am willing to drive out of town BUT what if you get there, 5 hours away, and the car is not as it is described? That happens a LOT locally, so it would happen out of town too. THEN WHAT? What if you head out, then arrive 5 hours later and the car is already sold?

    A few posters here do not realize what a tight budget we are on. I need every dime for the new vehicle; I can't spend $150 a week or more on gas, parking, tolls, lost time at work, wear and tear, etc. to drive to other states HOPING to find a car. Also, it's not so easy to do the paperwork for a car title in another state, nor to carry money -- dealers want a cashiers check. How do you produce this when your bank isn't around? When you don't even have a final price to get a cashiers check with? (Do you make TWO trips out of town?)

    I have heard the market is tight for USED cars because of A. Cash For Clunkers, which took many good used cars out of the market and created a short supply and B. the Japanese earthquake, which created a shortage of NEW cars and parts, forcing some buyers into recent used vehicles. I can believe that, but I think there are also more people today LOSING vehicles due to job loss, or unable to buy because of that, or other hard times -- those things should have created an OVERSUPPLY of cars.

    As you say, I think dealers are milking the perception that there is a "shortage" to create panic and desperation and get people to agree to buy a used car at 30% over True Market Value.

    Sjel: yes I understand about the private seller. It was a strange situation -- she had inherited her grandfathers 2005 Kia Sedona with only 20,000 miles on it. I guess she saw it as a cash windfall once she read the KBB price ($9600). Therefore, she would not even look at the Edmunds TMV ($7200). She kept getting offers in the 7000s and this enraged her. I made 3 offers, going up eventually to $8000 ($800 over TMV); this made her so mad she started sending angry email to me for over a week about how I was trying to cheat her! It wasn't even her car; she did not owe any money on it -- but I think she had already spent the windfall in her mind, and anyone who didn't cough up was taking "her money". Very awkward situation.

    Still and all: I don't see minivans often with 20K on them, so I wonder if I did the right thing or should have overpaid. That's the conundrum; I wish someone had a workable real world answer for me.

  • Stever@Edmunds 09/04/11 3:38 pm PST

    I've never heard that about the tax receipts and I've been at Edmunds for over ten years now. And how would a private company get tax receipts and tie them into VINs or other individual model sales identification? I don't think gross receipts would be broken down that way.

    I'm not privy to the "secret formula" but the info comes from people at the dealers and massaged by a bunch of PhD types in the home office.

    If I learn more I'll post - right now I'm in the 3rd week of a month road trip and it's hard to get info from the home office. Usually it's hard just getting on the net. :-)

    Source: 

  • sjel 09/04/11 11:53 pm PST

    grrldriver. I hear yeah! I was thinking about it, and you're right. I haven't really tried to bargain, yet, so I hadn't hit that wall. But, when I go back and figure out, as close as I can TMV it's way, WAY below what dealers are asking. I'd expect a $2-3000 mark up but they're higher than that. I did think that there are more people who, like many aren't bringing in the big bucks so there may be more competition for good used cars and/or people are holding on to them for the same reasons BUT that doesn't explain why TMV doesn't reflect a new market, does it?
    I don't know what to do about the mechanic and travel thing, either. Wish I did. Looks like there is more available and lower priced in the Chicago area but that's a 5 hour drive. I have a pre-approved loan through my credit union and all I need to do is have the dealer fax the contract to the credit union and then the credit union will release the funds directly to the dealer (or private seller) so I've got that part lined up. I do wonder what's going on and it sure doesn't explain cars sitting there for 9 months (and I've seen that, too). They don't want to come down on price and it's got 130,000 miles, so I figure if they want to keep it they can. They must want to.
    I don't know. It's a puzzle!

  • Stever@Edmunds 09/12/11 9:01 am PST

    Any luck yet, Grrldriver?



    To respond to your earlier question, I have chatted people up about their cars quite a bit. Not to buy them, but since I work for Edmunds, I'm always curious about how people are liking their rides. Naturally you have to pick the situation, and I won't approach many people if I think they may be uncomfortable.



    For learning about reliability and comfort, I've learned a lot from talking to owners at gas pumps, not to mention getting an earful about their fuel economy.



    I did a "safer" variation of this technique when I bought my Subaru in '04. I had moved to snow county and wanted an AWD vehicle. And an old friend had gotten a new one in '97 as a retirement gift. So I emailed her and asked how her car was running and told her I would be interested in buying her car if she ever decided to sell it.



    Well, she wrote back that she loved her car and had no intention of getting rid of it. But my hint worked and within two weeks she had visited the dealer and checked out new Subarus. Knowing she had a buyer for her car was the motivation I think. We exchanged a few more emails about price and I drove it home soon after she picked up her new car. She was a banker and wanted NADA. I sent her the TMV link and that helped bring her around to a more reasonable price.



    I learned the "chat them up" trick from a poster up in Northern Idaho who purchased a couple of cars that way.



    And yeah, the second generation Quests may be plain but they work well. Actually I think they look pretty good for a minivan. My recent vacation was a month long road trip in the Quest and I felt comfortable enough with the reliability to leave town with 159,000 miles on it. Pushing 165,500 miles now.



    And yeah, new minivan prices are nuts these days. I'm going to try to run mine into the ground.


    Source: 

  • oneeyedpilt 11/27/11 11:09 am PST

    From my recent experiance, Edmunds vehicle values are flawed. Edmunds would be better served by figuring out what is wrong than by burying their head in the sand by insisting their values are accurate.

  • looking4value 12/17/11 1:55 am PST

    To Grrldriver,

    I just Googled ("why is Edmunds price so low") as we were comparing Used Car prices to KBB and find your question. I agree that the responses don't answer your basic question "why is the TMV laughed at by both dealers and private parties?"

    We just purchased a 2008 Escape (Limited) from a dealer here in town. We had several from other dealers ("asking prices" for 2008-2011) to compare it against.

    The KBB suggested (dealer) retail for this vehicle was $19,000. The KBB private party "excellent condition price" was $17,000; the "very good condition" price is $16,500. The Edmunds "dealer retail" is $15,250 so that started my search on Google because I had the same question ("why is Edmunds price so low").

    My wife is the tough negotiator but the only time we used Edmunds was for new car prices (to compare dealer cost to the window sticker) and make an offer $100 over cost (after adding transportation cost, etc, etc) which is what the Edmunds book used to tell us to do before PCs and the Internet existed.

    So basically we have the same question. But I learned to never bring Edmunds Used car prices up to seller (dealer or private). We just have to look at the value to us and then if no one bites on our "best and final offer" we say we have to think about it, shake hands and say good night. We settled with the dealer on the 2008 Escape for $16,250 ... that's $1000 over Edmunds "dealer retail".
    To us it was worth it, but I know your feeling. My wife made the deal and still asks "should we have paid that price"? I say yes based on what we have seen; plus we keep the cars for 10 years.

    The last new car we purchased was in 2000; we have been very happy buying used cars since the kids became teenagers. I also like to buy a "one owner vehicles" from the private party if I can find one. I always thought the depreciation of driving new cars off the lot was the killer which is why I like to keep them for 10 years. As it turns out that also helps my mind rationalize the cost with used cars (spreading that "depreciation" over 10 years).

    I can't explain why your Edmunds TMV is $5000 less than KBB on other vehicles. Again I never tell them "we've looked at Edmunds"; it just starts food fights. My wife tries to make offers close to it but it never works.

    She uses the strategy of making her offer as "out the door" (includes taxes, title, documentation, and any incidentals they would try to add back). It usually starts the dialog on a positive note. If we don't close the deal, we tell them we need to convince ourselves and that we need to keep on searching. They usually respond with "how about if we can find you one for your price (a little older; a few more miles, etc), If it's a private seller we usually just say "the color is not what we really wanted", or "we really want leather", or something that doesn't offend. We always try to keep the door open but tell them we will search around too.

    At least everyone leaves smiling. The grumbling doesn't start until you leave. Hope this helps somewhat. I can't answer why TMV is so far off "real world" most of the time. Sorry about that.

  • gscolla32 02/10/12 3:05 am PST

    I'm not going to write a two page story but I just wanted to make a point. After reading all the reviews I came to one conclusion. Somebody is lying. But the problem here is that buying at the tmv would mean the the salesman would make no real money. I'm not siding with them because I too am looking for a car. I refuse to pay much more than they will give for an as is trade.I think edmunds is right on. I drove 55 miles to hagestown maryland from baltimore to buy a car.


    I used clearbook to value my car. Clear book shows the trade-in value. How does this help me you ask? Well consider if they get a trade in , more than likely somebody has been ripped off. What I mean is delers never give you what your car is worth on a trade in. With that inmind clear book gives a true value for you car based on sales statistics through out the year. First they give you a black book value, then a trade in value, and finally the value they would charge you for the car.
    But what cool is you get high and low values. I.e. you get your cars highest selling points with all the options and the lowers selling point.

    This is based on actuall sales. I am looking for a mercury milan awd. I i like these cars so i looked up the value its was 12726. now this particular car has everything in it leather gps ...it was "loaded". rewind back to my net search where I looked this car up and found several vehicle with in a 75 mile radius all at different prices.

    This car had the the most items in it it was a 2007. I called the the dealer and negotiated over the phone. I told him what I was looking to spend.(about 14K) and that I wanted to make a reasonable deal where he and I can be happy. Now maybe because this guy was young that he was will to make the sale but he reall didnt oppose my deal.

    We got to the table and after settling on 13400 I agreed. now once we set at the table the new prices was 14700. Edmunds made me feel like I could do so much better, so I walked away. Now this guy did not want me to go. And once I got home we kept in touch. after 3 1/2 weekswe came to 14100. I though to myself I going back out there friday. only to get a call during an exam by him telling me someones looking at the car. I though he was bluffing. But it sold the next day.

    Moral of the story, Edmunds is right on based on their pricing before taxes I would have payed about 13000 for it. A great deal the car has 35K on it clean carfax . But here the kicker....

    IT WAS ADVERTISED ON THE INTERNET FOR 15999.I almost had it out the dorr at 14100. I hate myself everyday for not jumping on it. But I thought others would comply. Everyone else Has laugh at my offers and it pisses me off. I don't need someone to sell me a car. I know what I want so I really don't need a sales man. IT stupid to go on a lot looking for a good deal with out doing research.

    The sad part is people keep paying the inflated prices because the dealers make them feel like they are gonna pass up a good thing. This aint a house its a car. Im not paying for someones mortgage foff a days sale. I have to work a week to make my mortgage.

    So my point is I think it hurts the salesman when we come with our figures and offers. they want to make that 3K off of us. so they sell One car a month and they are good. The salesman act like they own the dealership. things need to change its 2012. They are making up prices to see who will pay the most. It sucks but you can give in to them.maybe they need a side job.

    I always say that I will give up a bit of money to make a sale but think about it all those prices a flexible...it sales for gods sake. Nothing is in stone.


    Source: experience

  • Stever@Edmunds 02/10/12 8:50 pm PST

    Dealers never give you what your car is worth on a trade in because that's how dealers make money. Buy low, sell high. Nothing wrong with that - your job is to get as much as you can for your trade-in or sell it privately.

    This story from The Truth About Cars may be a bit dated, but it's a fun read about following the money at a dealership.

    Avoidable Contact: Who Really Runs The Dealership?

  • eda5 05/06/12 4:40 pm PST

    I'm also finding that Edmunds prices seem too low. This is compared to clearbook, kbb, and nada. Another comparison is carmax. You can watch the cars listed at carmax and when they are gone, that's what they sold for (they will lower their price after many weeks, and it's possible it would sell that day for cheaper than you last saw it online, but whatever). Carmax is very strict about their no-negoation policy, so that's really the price. Granted, people pay a little more at carmax for the no-hassle sale, and supposed service, but only a small percent more, maybe $1-2K more.

  • Stever@Edmunds 05/06/12 7:56 pm PST

    Hm, $1,000 on a $10,000 car is 10%. That's high in my book - wish I had a bank account paying that. Or even 5%.:-)

    Carmax had a great reputation for value 4 or 5 years ago, both for buying and selling cars. Now they sound more like a typical used car dealer. Not so good, in other words. You can follow the trend in the Carmax - What's Your Experience? discussion on the Edmunds forums here.

    I'm not familiar with Clearbook, but last I looked, KBB said on their site that they assume that dealer used cars are in "showroom" condition. I wouldn't buy a used car from anyone without having it checked out by a mechanic or more knowledgeable friend, so I don't put as much stock in KBB retail prices (except when they agree with us, lol). My guess is that they are often over-inflated.

    I mentioned my banker friend above and her reliance upon NADA. It's been my experience that the state taxing agencies, among others, like NADA because their book values also tend to be higher. That means more tax revenue.

    Other sources you can check are the Prices Paid forums here, Craigslist asking prices in your area and eBay Motors. And search around here for an expert by the name of Morin2. He's got a good system for buying used cars, if you don't mind negotiating "hard".

    Here's another interesting resource that Texas uses for tax purposes, based upon information from Price Digests. You'll need a VIN but if it's not in the ad, you can take a photo of the VIN through the windshield or on the sticker and type it in when you get home

    Standard Presumptive Value

    Good luck in your car search!

    Source: 

  • eda5 05/07/12 3:05 pm PST

    Oh, you got me. I'm looking at $35,000 cars, not $10,000. So sorry, I should have specified that.


    Thanks for the info, helpful person.

  • Stever@Edmunds 05/07/12 5:33 pm PST

    For a more expensive newer used car, ($35k is pricey to me), I think I'd shop CPO cars as well. You'll pay more, but the factory warranty should be extended and you might get some other benefits, like loaners when you take it in for service. My guess is that the dealers cherry pick the CPO cars a little bit too.

    Edmunds has TMV for CPO cars too btw.

    Source: 

  • edmundsrlz 05/13/12 2:59 am PST

    grrldriver, after looking though this thread, I need to ask you, are you only going to be satisfied if they tell you that Edmunds is wrong? I see that no matter what is said to you, because of your experince it appears as if you keep coming back to that, that Edmunds TMV must just be wrong. Now to try and be helpful. A while back, somehow everyone seemd to get it in there head that KBB meant something. I worked on a car lot, we tried to sell by KBB prices, but used cars would never have been bought at there prices, ever. I noticed that someone referenced the Black Book earlier in this post, that is what we based prices off of. Not KBB. I bought an 01 Acura CL recently. The KBB price was $7500 or something and the TMV was $5500. Of course the dealer tried to treat me like I was stupid, saying I was doing something wrong, or that it wasn't the same vehicle. I pulled it up on his computer right in front of him, still he acted as if this number was ridiculous. I ended up leaving because after offering $6500 out the door, he would only come down to $7100 + tax and title, in this case they called me back on the following Friday and I bought the car for $6700 out the door. I came up $200 and paid $1200 over what TMV said. It had been 7 years since I worked at a dealership, so I had lost my conections and I had to pay a little more, because of the market. I still feel that the TMV helped to negotiate the price lower. And after I bought the car I noticed that the dealer had a link on there website, titled Black Book.Com "See what your trade is worth" When I punched in the vehicle I had just bought for $6700 that the dealer told me I was crazy for showing him the TMV of $5500, the vehicle came up as trad in value of $4000. Which if I was trading it in the dealer would not have paid me more than that. The TMV was allowing the dealer a $1500 profit which is more than enough. The dealers will tell you anything. From what it sounds like to me, your a lady that tries to research and know about cars as much as possible, sounds like the dealers you have went to have been just bad to me. As long as people keep going to KBB and paying it, it will be defacto, but I still think TMV has value as a starting point or a bargaining tool. And if you go a couple places and no one will take it, then you will get the same result I did, but I still think it is valid in the fact that it gave me an argument to pay a lower price than KBB, in my case by $800 + Tax and title on $7500. I put the link down for you to get the BLACK BOOK value for what ever cars you want to compare, of course you have to enter your info to get the price from them but it is way lower than TMV in all case and it is what the dealers buy their used cars on.

    Source: http://www.acuracolumbus.com/black-book
    ....

  • Stever@Edmunds 05/13/12 7:58 am PST

    Too bad your Black Book link requires contact info to actually get the information. Names, addresses and phone numbers are a valuable commodity these days and I'm sure the data is collected, massaged, packaged and resold. You can verify this for any site by reading their privacy link and seeing who they share your data with.

    Then the consumer winds up getting badgered with spam and phone calls from car dealers and finance and warranty companies and whoever else buys "car leads".

    I think the better practice is not to provide your personal information until you've decided on a car and are ready to buy.

    Source: 

  • Stever@Edmunds 05/14/12 5:50 pm PST

    This Edmunds article focuses on getting an older, higher mileage car. But it shows that the deals are out there.



    "There were a couple of factors at work in the discrepancy we saw between TMV and real-world prices. First, not everyone uses TMV as a pricing guide. For example, other pricing guides have rosier pricing that tends to favor the seller.



    Second, we also realized that in this low, low price range, the market value of cars meant little to independent used-car dealers. They often set the price based on what they paid for the car at auction and what they spent to recondition it."



    Finding and Buying an Affordable Used Car

  • jeremyr32 06/23/12 9:44 pm PST

    If you really want to know the true market value then use NADA. The used car market is a tough one right now and dealerships are paying average to clean trade prices at dealer only auctions. KBB values are to high and Edmunds is just not there. These are all guides to what the values are. In the end it comes down to what you want to pay. Just remeber that you may think that dealers are getting great deals. The reality is they are working hard to sell you a car. I am a small dealer in Utah and I make about 500 on a car. Thats a good day. The next time your at the dealership just ask them to show the manheims market report and you see that most cars go for avg to clean nada trade.

  • glstein 07/03/12 2:16 pm PST

    I know this is an old question thread, but I completely agree with the original poster. Not sure why many of the responses are so critical of her...

    In my case I am trying to figure out what a 2001 Ford F-150 Super Crew King Ranch truck is worth. KBB says it's worth $11,915 (fair condition, private party). Edmunds says it's worth $5,758 (average condition, private party). Those numbers aren't even close! We aren't talking a few hundred difference here, we are talking almost $6000 difference on a car probably worth less than $10,000.

    Because I am not shoping for this car, and instead trying to sell it, I haven't tried negotiating a price with a dealer, and therefore haven't been turned away like the original person who posted the question. Also, I am not necessarily accusing Edmunds of being incorect with their price, as it could be KBB. But, someone is way out of the ball park with the price of this particular vehicle.

    I should do some random spot checking and see if there is that big of a gap with other cars.

  • Stever@Edmunds 07/03/12 2:41 pm PST

    May as well shoot as for the moon; maybe you'll get it. :-)

    Didn't see any King Ranches on eBay Motors. Yahoo says $8,109 for one in good condition, 132k miles, dealer retail. NADA is similar for trade in prices. Plenty of other hits on a net search you can browse and compare prices on.

    Kelley sure seems high on this one.

    Source: 

  • mattyv1908 07/27/12 2:38 am PST

    As a longtime car business individual currently in finance but having over a decade of both sales and management experience, I'll do my best to try and answer this as accurately as I can. Some of this some of you won't believe but regardless I'll answer as truthfully as possible.


    With regards to used cars, I believe there's a gigantic amount of information being left out of the equation when people formulate their opinions on dealerships pricing strategies. Before I get into specific examples I want to touch on the trend in the last 2-3 years concerning used vehicles. Ever since the economic slowdown, new car sales have decreased. The lifeblood of a dealerships used inventory comes from trades from new cars as these are the one of a kind inventory that are not readily available at local and regional auctions. Because this premium source of inventory has dwindled, dealerships are left competing for the more common rental car offerings and factory lease returns at auctions causing a rise in prices paid simply to keep a 60-90 day inventory of used cars on the ground. My best friend is a used car manager at a major franchise dealer in the Seattle metro area and for the last two years there's typically 90+ buyers for the 60-70 cars running through the local auction each Tuesday. Before there would be 200+ cars running at these same sales. It's simple supply and demand. The days of picking up half a dozen year old Malibu's for 3-4k back of wholesale book at the auction are over. There may be the occassional great auction buy, but by and large cars are bringing upwards of wholesale book and in some cases more.

    Now let's consider what happens once a car is purchased via auction or trade in. Let's pretend a used car has a KBB wholesale value of $22,000 and the dealership purchased it for $20,000. I'd say 97-99% of all dealerships pay their buyers a buy fee of $100-200 for each purchase. Consider this a finder's fee for the people who's sole job is to locate and purchase used inventory. Next, by state law (which varies) a vehicle is required to pass a safety inspection. This term is loosely applied because it requires that safety items (brakes, lights, airbags, seatbelts, sparetires, etc.) specifically pass a regulated standard or dealerships face liability lawsuits should a safety related item fail resulting in damage, injury or death upon leaving the lot. Often with more expensive used cars (as this example would indicate) other repairs for minor work would be done as well as opposed to a $5-8k high mileage car where the implied standard is lower when it comes to condition. I'd say the average service bill on these vehicles range from $300-600 when you consider most states require brakes and tires to be above 40% life in order to pass regulated safety laws. Next comes a full and comprehensive detail which I'd say the average cost varies from store to store in the range of $100-150. That's about the average price depending on vehicle class were you to take your car to a professional auto detail vendor. If there's any paint or body work (most likely taken into account in the price paid for a vehicle) it is then performed after a detail.

    What does that mean in real life? I'd say an accurate cost per used vehicle a dealership retails receives between $800-1200 of reconditioning costs before it ever hits the lot for sale.

    Now let's factor in a cost of sale 99% of dealers add to their used cars. Most dealers add some form of a fixed cost 'pack' to their vehicles which ranges on average from $400-600 to every vehicle they sell which salespeople do not get paid on when factoring commission. Since the average advertising expense is somewhere around 15% of gross profit this accounts for advertising, flooring (the cost of credit commercial banks that finance a dealer's inventory) and support staff (lot attendents, etc.) this charge against the sales department makes up for those expenses.

    How does all this factor into real life pricing and why you're having trouble with trying to get TMV pricing (which I honestly believe is an inaccurate figure) when shopping for used cars? That same car the dealership paid $20,000 for has a sales cost of around $21,500 with a $22,000 wholesale book and a retail book somewhere around $26,000. Let's say the asking price on the lot is $25,999. If the inventory is relatively fresh (1-30 days in inventory) I'd say a decent negotiator can get a dealership down to the neighborhood of $24,000 resulting in a gross profit of around $2500. That number may decrease as the vehicle ages and the dealership can replace that car for less money due to price decreases in book values and auction prices. When TMV pricing is less than wholesale and often times less than the cost is of a particular vehicle in real life, it's obvious why dealership personnel may scoff at such an offer.

    Another thing to keep in mind is that most new car dealers that sell used cars are so concerned with their reputation that they will often pay for repairs that suddenly arise on used cars shortly after they are purchased even if they are sold as is outside of factory warranty. Most people don't realize that the extended service plans and various insurance options that are another profit center are mandated by state law to offer them due to lawsuits that may arise were they not offered it and a major expense occured after purchase. For example, we just paid for a starter on a 2007 used Silverado with 60k on the odometer two weeks after point of sale to keep the customer happy even though starter's can fail on a whim and there was no warranty purchased due to our 58 year reputation in the area. We ate the $600 bill in service. Had there not been the profit margin in the deal originally we wouldn't have the luxury of going the extra mile.

    Remember, everybody makes money. Unless you work for the fed who has the power to print and borrow money whenever needed all companies operate on profit. It's how they can afford to pay your salary, whatever it's size. When you operate with the mindset that dealerships are only interested in ripping people off (and that does happen on occassion, in part because not everyone is ethical and sometimes in part due to customers being unprepared) it's no wonder why your car buying purchase may take longer or be more challenging than it needs to be. I don't find the same outrage when 3% is paid to both the purchasing agent and the selling agent in an average real estate transaction.

    Some advice from 15 years in the industry: Find a car you like that you can afford and you feel the price and service provided is both fair and reasonable and don't second guess yourself. You'll be enjoying your new purchase weeks and in some cases months sooner than those spending extra weekends off continuing their agonizing pursuit to save a few hundred bucks which equates to $5-20 a month savings. I wouldn't trade quality time spent with my family doing the things I enjoy for that difference for anything, and if the difference mentioned above is make or break in your household budget it's safe to say you are not in the position to purchase anyway.

    Hope this helps. Remember, if it's too good to be true it usually is.

  • mercedesbenz2 08/10/12 2:43 pm PST

    Simpy put Edmunds value are useless.


    That's from my experince from checking prices on edmunds for the last 5 years. I trade a few car a year and always check and do market research before I post a car for sale. Edmunds is so low, that it makes me wonder where in the world they get their numbers.

    I also have access to the Dealer Market Report also known as MMR and edmunds has prices from a few hundred to thousands less than what dealers pay at the auction. This is based on my experince.
    That is why people get mad at you, or won't negotiate when you show them edmund pricing. It's because you are telling them to sell a car for much less than what they paid for.


    In my opinon, even private sellers do some resarch and know aproximaplty what similar cars sell for. They are not stupid to sell it for $2 or $5 thousand less than the asking price.

    If you are getting a car at edmunds sugested value, I would be very worried about it and would check it with a magnifying glass.
    The people that are selling it at edmunds value know something about it that you don't know.

  • Stever@Edmunds 08/10/12 4:15 pm PST

    If you know the MMR buzzword you probably know the CRM one too. Dealers take their numbers and sell that stuff back to the industry (or agree to "give it away" as part of dealer management or lead creation tools they buy). Those numbers include actual sales transaction prices. I think all the majors like Cars.com and Kelley and Edmunds get that information and massage it. In other words, the book numbers don't simply get made up out of whole cloth.



    It's pretty easy to compare notes among the various sites too, not to mention cross-checking asking and sold prices on eBay, AutoTrader, Craigslist, the Prices Paid forums here at Edmunds, etc.

  • 58mano 08/19/12 9:35 pm PST

    i do not agree with knowledgepower at all . If you look up 1961 honda 50 classic motorcycle the C102 model which is rare because its an automatic transmission special order version, an automatic on a motorcycle was not common and rare for a 60s bike. Kelly Blue book puts this bike at $1045 in excellance condition and thats a dirt cheap price no one will sell you one at in excellance condition, go try to buy one in perfect condtion for that price, it will never happen, so kelly blue book is cheap on price not high. On the other hand Nada list this bike at $3200 in excellance condition or perfect condition and $1045 for good condition, Nada price is more in line in what you pay for this bike. I ask kelly blue book 2 times in 6 month to explain how they get such a cheap price and they keep saying they are looking in to it but never do anything or change it or give a reason for it. I wouldnt trust an outfit that acts like this.

    Source: kelly blue book and Nada price book

  • gbrew 09/15/12 11:29 am PST

    It is unfortunate that there are no serious answers to the original question: why is there a growing disconnect between Edmunds prices and actual prices. I would think this is something Edmunds might be concerned with, given that providing pricing information is the basis of their business.


    If there is a growing perception that Edmunds pricing is as much wishful thinking as KBB, just in the other direction, why would Edmunds expect people to continue coming to their site?

    I have used Edmunds to price the cars I have bought since the late 90's. I have bought I think 4 cars, and sold one, and was able to find one at the private party TMV price in each case. But in each case there was a reason why the seller was motivated, and I was somewhat flexible in what I bought. Up through my last purchase, Edmunds was slightly lower than NADA but not that far off.
    - 1998: bought 1995 Sonoma P/U at private part price, high miles.
    - 2000: bought 1999 Forester at private party price. bought in virginia where it was not a popular model.
    - 2000: sold Chrysler minivan at private party price
    - 2005: bought 2003 Sierra from dealer just below dealer TMV price. dealer kept a computer available for customers to check prices wherever they wanted.
    - 2009: bought 2006 Cobalt from dealer at private party price. trade-in that didn't fit their image, so they were letting it go just above wholesale.

    I didn't spend more than a day or so looking for any of cars, I think the 2003 Sierra took several visits to dealers, but when we saw the one I bought I knew right away it was a good price. Didn't even try to talk the dealer down, it was a good fair price and we both knew it. Still driving it, no problems.

    Now we are hunting for a newer subaru, and it is a little tougher. Missed one that was selling at private party price at a TX dealership through ebay.
    We are going to look at one today that is at KBB private party price, and that is 16.5 vs edmunds 15k. Maybe we'll get it for 15.5, though the 16.5 is below dealer pricing. Have a second one lined up that is selling right at private party price, older model. That's two out of maybe 50 on craigslist.

    It is definitely taking longer this time, and it is clear there is a divergence in Edmunds pricing and the Subaru marketplace, but the internet makes it possible for us to review hundreds of possible deals before picking a couple to pursue.

    Edmunds ought to answer what they are doing about the divergences in pricing that appear to make their site of limited value.

  • Stever@Edmunds 09/15/12 7:04 pm PST

    Well, it's a bit hard to compare TMV with "asking" prices on Craigslist. I don't know of anyone compiling "sold" numbers from craigslist ads. If someone is paying a high asking price for a car on craigslist, then they aren't doing their research.



    You can get that kind of private sales information from completed eBay sales, but that's not what I'd call a representative market for typical used cars. Costs a lot to run an ad there for one thing.



    I don't know what part of the country you are in but I'm in the UP and people are talking about the first frost. If I was going to sell my Subaru, this would be the start of the time of the season to put an ad up.



    If you want a bargain Subie, try TN or Florida or similar locations. Selection may be slim though.

    Source: 

  • gbrew 09/15/12 10:40 pm PST

    reached agreement (2005 Forester XT, 75k miles) with dealer in Chicago suburb, within $200 of dealer TMV. Called, him, said we're buying a subaru this weekend. He said give me 5 minutes, I'll give you my best price, and it matched both what I was comfortable with and what Edmunds said it should be.

    will catch a cheap flight out, tour around chicago a bit, drive it back at a leisurely pace. Nice long weekend.

    we live in colorado, subarus are extremely popular here, you will pay 3-4k over edmunds tmv here.

    so the differences between grrldriver and me, as far as I can tell:
    - I'll commit to a car unseen if dealer has good track record
    - I'll drive it cross country if my local dealers arent' dealing. why should they? subi's here sell like hotcakes.
    - I'll go a couple of years older or a few miles higher if the condition is good.

    Reading this long thread was very helpful to understanding different factors that might be going on in the used car market, I hope grrldriver who started it found some satisfaction at last.

    So, to get a car at TMV, I looked at a hundred ebay ads, 50 craigslist ads, talked to 3 sellers, made 2 serious offers, one accepted. Took about 6 hours of checking asking prices against Edmunds and thinking through what we would NOT accept for a used car.

    Will make another post after we pick the car up in a couple of weeks.

  • gbrew 09/16/12 10:49 am PST

    To get back to the original question: does TMV work?
    For grrldriver in the Cleveland area, it apparently did not, she looked a long time with no success in that area.
    For me, over a period of about 12 years, 6-8 purchases, it has worked as a guide for what someone out there is willing to sell a car for, but not what most dealers are selling cars for.

    I've learned not to waste time referencing Edmunds or really any other reason for my price, I have my reasons; the seller has theirs. If the there is a large gap between the bid/ask, it's a waste of time arguing about it.

    Still, there is the idea that the TMV price ought to reflect what the average dealer is willing to negotiate down to, that it reflects average actual selling prices. On prime 2-3 yr old cars I haven't found that to be the case. Edmunds could do a better job educating its users what to expect from their TMV prices between different catefories: new, prime trade-ins, middle aged cars.

    My neighbor just bought almost the same car that I am getting. He paid 17k vs the 19k sticker price, and feels he got a good deal. He decided on Thursday he needed a car and on Friday he drove it off the lot. I spent a couple of days researching, and am going to fly/drive a thousand miles to buy that same car for 11k including shipping, and that's just over the TMV price. I'm taking some risk to buy a car this way, but I've done it before. Which of us is really the smarter consumer?

  • buyer1125 10/06/12 9:49 am PST

    Looks like this thread has been going on for over a year but I cam across it after searching for "why are edmunds prices so much lower than kbb and nada". With all do respect, I am of the impression that edmunds.com used car prices are bogus and totally off base from true market value. I suggest that you do as much research on the perticlar vehicle you want Craig's list, cars.com, nada.com, kbb.com, edmunds.com, hemmings.com and any other online place you can find. From my research I have found that most dealers are looking to make $1000 to $2000 over their cost and most likely price it accordingly.


    To support my original statement I have the hard numbers from one of my searches below.

    This is for a 1993 Corvette convertible with 35,000. The dealer is asking $16,990. In my opinion, way too much but that is beside the point. All the numbers below are assuming "outstanding condition", do not include options and are "retail" prices.

    Edmunds.com = $6,159
    KBB = $12,696
    NADA = $12,187
    Hemmings.com =$15,600

    Using that information combined with the asking prices on cars.com and Craig's list I would venture to say that a fair retail on that car is somewhere between $12,000 and $13,500.

    Now, here is where it get interesting. I have a friend that is a dealer and can find out how much someone paid wholesale at auction for a particular vehicle. The vehicle in my example sold at auction for $11,900. Although I feel that $11,900 is the top of the mark at wholesale, it supports my calculations that retail should be around $13,000.

    Bottom line, research, research, research, research, research and research! On top of that, edmunds used car prices are totally bogus. And there is nothing anyone can say to convince me otherwise. Use edmunds as a tool but don't believe the prices. They say that they come from the dealers tax information but if that is true then either the dealers are all reporting bogus tax numbers or there is a flaw I how Edmonds reads them.

    I used to be a big fan of edmunds back in the 90's when you could see exactly what a dealer paid for a car and how much negotiating room you had. Back then there was a good $1500 to $2000 difference in what a dealer paid and MSRP but today because of all the "hidden" dealer incentives and bonuses, ther is only about a $500 difference. Anyone that thinks a dealer is only making $500 on a car is crazy. If edmunds wanted to regain my trust they need to start showing all the hidden money dealers are making so we, as consumers, can negotiate better.




  • Stever@Edmunds 10/06/12 11:40 am PST

    A couple of comments.

    You can't compare asking prices with sales prices.

    Edmunds has access to auction reports too; sometimes the general public can find them now and then as well, but usually they are password protected on the auction company web sites.

    The other funny thing about auctions is that you are looking at one example of a make/model, instead of actual sales numbers for a 100 copies of similar models. And dealers often pay too much too. :-) Or they wind up with a car that needs a lot of reconditioning and they fix it instead of sending it back to auction.

    Finally, we have several questions from people on Answers (just had one in the last couple of days) where someone wants to know how much profit a dealer makes on a car.

    The answer is no one knows, including the dealer until the accountants close the books for the month or the quarter. There's all sorts of bonuses, spiffs, demo deals, "free" training, holdback, service incentives, cruises, trips to Vegas, who knows. Often the salespeople don't have a clue either, although they are often told they'll get a $100 bonus for moving certain cars that week.

    With used cars there's generally no manufacturer spiffs and more leeway for a dealer to price them. Depending on the bank account, a dealer may sit on inventory and try to maximize profits instead of churning the inventory to generate cash flow. It's long be common knowledge that the used car side makes a lot of profit for the dealers. New car profits are usually less than the used side and the service side.

    When you compare prices around the various sites, don't forget eBay. And the Prices Paid discussions in the Edmunds Forums where people report on what they actually paid for a car around the country (these posts tend to focus on new car sales but people do post used prices too).

    Source: 

  • Stever@Edmunds 10/11/12 9:54 am PST

    Some relief may be in sight. With all the new car sales this year, inventory of used cars is climbing and wholesale prices are falling, per the Detroit News.

    Source: 

  • justliberty 10/20/12 8:27 pm PST

    It has been interesting to read through this thread. I've been buying used cars for about 35 years. I've bought quite a few in the last 6 years as my teenage children destroy them at a rather rapid rate. I've probably bought more than a dozen off of individuals and 3 or 4 off of dealers. I've only purchased one new car and that was a fairly horrible experience. For the last 10 years, I've found edmunds to be a very good pricing guide- much closer to actual sales prices than kelly blue book.

    I've only purchased one car after the financial down-turn and that was from a dealer. I don't see why the down-turn should affect the relationship between kbb or edmunds and real used-car pricing. Even with a slowdown, there is plenty of data for them to update their prices.

    My last experience may be typical. When I counter-offered the dealer's asking price (which was on a special sale- mostly because the car was a camry and (1) was just old enough to not be certifiable, and (2) this was when camry's were in the news for unattended acceleration), he treated me like crap and pretentended to be insulted. That is a SALES TACTIC. They use it almost always. I did not mention edmunds, I just made another offer and gave the salesman my phone number and asked him to call me if he wanted to talk about prices closer to mine.

    He eventually called and we made a deal over the phone. I actually think I left a couple of hundred dollars on the table when I got it for less than edmunds retail pricing. This was on a 2005 camry with less than 10,000 miles on it and the transaction took place in late 2010. kbb pricing was over $2k more than I paid (out the door, after tax price was about $12k, if I remember).

    I used many of the tactics often talked about: end of month, rainy weather, leaving the lot, etc.- but I did not completely shut down the deal when I left. I'm often interested in cars with seriously low mileage (but high probability that it hasn't been doctored) as I believe other people don't value the miles enough- and that gets reflected in the guide-book pricing.

    I often find that individuals are also horribly offended by offers near edmunds pricing. I just forget about them and find other sellers. These people often get tired of trying to sell their car to individuals and end up trading them in, getting a price which may be near, but a bit below, the kbb trade-in value. I think that is the main function of kbb being available on-line: to set everyone's benchmark at a favorable place for the dealers and to make people frustrated to buy in the person-to-person market.

    Why the discrepancy? I believe kbb retail pricing is a SUGGESTED ASKING PRICE and if you read their descriptions, is for an AWESOME example of the vehicle: in the top 5% of vehicle condition or something like that. People confuse it (this is intended by kbb in my opinion) for a real average selling price.

    Final mention. Want a rule of thumb for car pricing for cars in the $3000 - $13000 range? Try this: Look up the asking price for similar cars on dealer's lots. Throw away the highest (and lowest) few, unless you are looking at a car in incredible shape, and average the remaining ones. You can probably buy the car for $1000 less than that average from a dealer. You can probably buy it from an individual for $1000 less than that and you would be lucky to trade it in (unless they are giving a false trade-in to make up for a real high sales price on the new car) for $1000 less than that.

    Good luck. I'm in the process of replacing yet another car wrecked with one of my kids sitting in the driver's seat....






  • rekmeyata 12/08/12 11:25 am PST

    I found this to be a very interesting question because I've been seriously complexed about it.


    The one thing I will say, I thing KBB is way over priced method of basing the sale price on a car. I find cars with over 150,000 miles priced at over $6,000, I find that to be just plain crazy to pay that much for a car with that many miles. Maintenance on those high mileage cars will put you into the poor house over a 2 to 3 year period, with transmissions lasting an average of 125,000 miles, engines lasting an average of 225,000, and suspension problems etc. And you have no way of knowing how well a car has been taken care of by the previous owner(s), if it was treated poorly that car could fall apart in the first year! And when you discover the price to rebuild your engine or transmission you will become very shell shocked and probably will suffer from PTSD!!!

    So when I look for an older car I take the prices of Edmunds and search till I find a car priced close to their prices and not KBB prices. I think it's a fairer pricing even though I know most cars are price significantly higher due to KBB. But thanks to the internet you can shop for any car you want, and if your patient one will pop up with a price darn close to Edmunds. I was patient and found a 99 BMW Z3 I6 at a new car dealer with just 48,000 miles for $7,500 when others with more then three times the mileage were going for more! I even was able to to get the cost down a tad more even though I was willing to pay that price.

    Just remember, time is on your side, don't rush into buying a car and settle for the KBB price, you will find one closer to Edmunds prices if you just keep searching over time, it took me only 2 months to find that Z3 and it is in mint condition.

  • prodigalsunmtc 01/04/13 8:37 am PST

    here's another example of how all the guides may not be reflective. last weekend i tried to work a deal on a 1996 a4 with 64k miles. The dealer was asking 7k. edmunds was 3k, NADA 3.7k, and Kelly 3.8k. I tried offering 3.2k. they came down 5 dollars. i offered 3.8. they showed me a printout that said they had 5.7k into the car, and their bottom line was 6500. I offered 4500 and got nowhere. I walked.


    The car is still on the lot as I type this.

    regarding KBB, my understanding is that their dealer retail values are so high because its based on average asking prices, not negotiated prices.

  • Stever@Edmunds 01/04/13 9:24 am PST

    From my link way up top:

    "But what is that "Kelley Blue Book" value he showed you? Is it the price at which cars like yours have recently sold to other buyers? Is it even an estimate of the actual transaction prices?

    Surprising to most used car buyers, it is not! It is only an estimate by Kelley of the "listing" prices being asked by dealers — not what they are really getting for the car. As Kelley forthrightly says in the book, these are "suggested retail values"

    I've read that those suggested values include "extensive" reconditioning by the dealer as well. Used cars from dealers never break down, after all. :-)

    But check out mattyv1908's post too; he makes some good points about why dealers sometimes get ambitious with their prices.

    Walk (but make sure they have your phone number first).

    Source: 

  • goingforbroker 01/11/13 5:11 pm PST

    This thread has been a fascinating read for me. I arrived here after Googling "Why are Edmunds prices so low?", which seems to be a very common search (after typing "Why are Edmunds" into the search box, the first suggestion was my exact question).


    First, in the name of full disclosure, I am a licensed used car dealer in the state of Georgia. I am an independent auto broker, with the bulk of my business coming from clients searching for a particular make and model, down to details as specific as as heated seats, navigation and color choices. I also carry anywhere between four and eight vehicles in my inventory at any given time, usually "highline" vehicles such as BMW, Lexus, Acura, etc., though I will sell any make and model that makes sense financially.

    Many of you have asked what the average markup or profit is for used cars sold by dealers. I can speak only for myself, but my goal is to make roughly $1,600 profit on each vehicle after reconditioning costs; sometimes I make more, and very often I make far less, just to move the inventory along. Not exactly a king's ransom, but enough to keep the lights turned on and provide motivation to keep the business up and running.

    Before I continue, I want to be clear that I view Edmunds as a fantastic source of information regarding vehicle reliability, performance, specs and reviews, and I visit the site dozens of times a month for this sort of input.

    That being said, I decided to ask Google about Edmunds' pricing because I, like so many others here, find their numbers to be absurdly low and not at all indicative of the real world. When I am considering purchasing a vehicle, either for a brokerage client or for my inventory, I always check multiple guides for suggested pricing, including Edmunds, KBB, NADA, Black Book (dealers only/subscription only), and ClearBook. I also look at AutoTrader.com and Cars.com to get a feel for what else is available in the market. Without fail, Edmunds' "True Market Value" prices are the lowest of any of the guides, with their suggested RETAIL price often 15-20% below the Black Book WHOLESALE price, and are also nowhere near the actual prices being asked by local dealers and private sellers alike (and yes, I understand that asking price and selling price are rarely one and the same, except in the case of classics or rare cars).

    For example, this morning I purchased a 2001 BMW 330Ci convertible with hard top from a large dealer-only wholesale auction. The car has 92,444 miles on it, has had only one owner and has a clean Carfax report with no accident history. It's loaded with every option that was available at the time, other than a navigation system. The condition is outstanding, especially considering the vehicle is now 12 years old.

    Here are the suggested retail prices listed by each of the sources I checked, from highest to lowest, as well as the "Average" and "Clean" wholesale prices recommended by the industry-standard Black Book:


    Black Book Wholesale "Clean" Condition: $11,900
    Black Book Wholesale "Average" Condition: $9,800

    EDMUNDS TMV RETAIL: $8,629

    **These prices are as of January 11, 2013, so they will obviously differ for those of you reading this post in the future. However, the pricing discrepancy between Edmunds and the rest will likely persist.**

    Now, keep in mind that I purchased this car from a wholesale auction that is closed to the public, and was bidding against other dealers who are educated on the marketplace and desirability of the cars they bid on. My winning bid for the car was $9,250, which is a bargain because it's the middle of January and the auction was in Pennsylvania (not exactly convertible season up there right now). The auction adds $275 in buyer's fees, plus $170 for a post-sale inspection to ensure that there are no hidden mechanical problems or undisclosed body/frame damage. I'll pay $300 to have the car transported from Pennsylvania to Georgia. So, after fees and transportation, my total investment in the car is almost exactly $10,000 on the nose. My initial list price will be $12,595, with the expectation that I'll be talked down by 10%. So, basically, I hope to sell this car for around $11,400-11,800 after some light haggling (just part of the process, unfortunately).

    Now that you know what I paid for this particular BMW, take another look at the suggested pricing above. ClearBook, KBB and NADA all priced the car within roughly $1,000 of each other, and about $2,000 above the Black Book "Average" condition price, leaving me some room for profit after expenses are covered. However, according to Edmunds, a buyer should be able to purchase that same car from me for $1,371 LESS than my wholesale cost, and $1,171 less than even the Black Book "average" condition wholesale price. Keep in mind that this is a one-owner car that is in well above average condition.

    I've sold two 2001 330Ci convertibles nearly identical to this one in the past 12 months.One with 106,xxx miles sold for $10,000 ON EBAY and one with 76,xxx miles sold to a local buyer for $12,500 plus 7% sales tax. Neither of them had the optional hard top, which is a very desirable item for many buyers and should add an additional $500 or so to the price.

    And folks, this is not an anomaly; I could run each car in my inventory through the same process, and in virtually every case, the Edmunds TMV price would be 20-30% lower than any other guide. This is not a new phenomenon, either. For as long as I can remember, the Edmunds price has seemed as though it's just completely made up out of whole cloth, and not based on any sort of actual data. Kelley Blue Book tends to be slightly overpriced on most cars, while NADA and ClearBook tend to be most aligned what's actually going on in the marketplace. In this particular case, KBB is right on the money.

    Steve, you've taken on the role of de facto Edmunds spokesperson in this thread since you're an employee, but you've offered absolutely no concrete evidence to support your claims that TMV pricing is in any way accurate or fair. Instead, you've chosen to denigrate the other guides as unreliable or some sort of industry collusion, and painted used car dealers as shady operators who "don't like educated consumers" and will do anything to milk every penny out of them while we laugh all the way to the bank.

    While there are certainly people in this industry who don't represent us well, the large majority of used car dealers are honest businesspeople who are trying to make a decent living selling a good product at a fair price. The market has a way of ensuring that we won't get too much or too little for our cars; unfortunately the "PhD types in the home office" who create your secret formula are grossly underinformed about the market in nearly every case, which is why a thread like this can go on for years without a clear answer to the original question: WHY?

    I realize that most of the original commenters in this thread probably moved on long ago, but I wanted to insert my two cents to ensure that anyone who happens upon the conversation down the road is better educated about the reality of the pricing guides.

    And for anyone who may be wondering, whenever a customer presents me with a printout of an Edmunds TMV report for a car I'm selling and tells me I'm asking far too much, I just present them with four other reports that support my price. I don't get insulted, and I certainly don't treat them rudely; I just try to explain that Edmunds TMV pricing is, unfortunately, completely unreasonable and arbitrary. Maybe someday we'll get an acceptable explanation for the discrepancy, but I'm not holding my breath.

  • Stever@Edmunds 01/11/13 5:46 pm PST

    Well, it sounds like you're paying too much at auction and not making enough at resell. :-)

    Where Does the Car Dealer Make Money?

    Here's another good place to double-check prices - some of these forums members wish they could buy and sell almost as many cars as you do. Be curious to see what reaction you get if you run your BMW deal by them. You don't even have to mention that you posted here; they probably aren't reading this thread and it'd be fun, and perhaps instructive, to see their posts.

    Chronic Car Buyers Anonymous

    Thanks for your comments - it's always good to get points of view from "insiders".

    Source: 

  • goingforbroker 01/11/13 7:32 pm PST

    So, again, rather than attempt to shine some light on WHY Edmunds stands so far apart from literally every other pricing guide (including wholesale books), you choose to question my business model and how I buy and sell my inventory.


    I would remind you that the very nature of an auction dictates that my bid was only one increment above what another dealer was willing to pay for the same car (in this case, the bid went from $9,150 to $9,250 before the hammer dropped). I'm quite confident that I know what I'm doing, but thanks for your advice.

    Furthermore, the article you linked to about where dealers make their money is laughably vague and bears no relevance to our conversation here. The one miniscule section (two paragraphs) in that entire piece that deals with used car sales is little more than a blatant shill for TMV pricing. What we're all still trying to figure out is why the discrepancy between TMV and the rest is so great, not whether dealerships make money in F&I or service departments -- that's not exactly one of life's great mysteries.

    Oh, and that "one dealer" in your article who mentioned that $5,500 is a "nice profit" on a used car? Please give me his contact info so I can find out what currency he's dealing in, because a profit of $5,500 USD on one vehicle is unheard of and unsustainable. It may happen once in a while, but it's by no means the norm anywhere, regardless of the type of vehicle. Maybe he meant 5,500 pesos. Or 5,500 Japanese yen. Or maybe he's just a big talker.

    I eagerly await the arrival of one of your "PhDs from the home office" in this thread to shed some real light on the issue, rather than more marketing platitudes about why Edmunds is so right and the rest of us are so wrong.

  • Stever@Edmunds 01/11/13 9:42 pm PST

    Again, I invite you post your BMW deal over in Chronic Car Buyers and see what the folks in there say.

    Profit stories are all over the map.

    Increasing revenue in the used car deal

    How Auto Dealerships Can Average $3000 to $4000 Gross Profit Per Vehicle Sold

    Used-Car Profit Engine

    Dealership Gross Averages – Finding the Sweet Spot

    And there's this from our Chief Economist:

    Used Car Prices Softening – Those lease terminations should have a ripple effect on the auto industry —especially on used cars. Off-lease vehicles and more trade-ins will flood the used car market and help to bring down prices. Edmunds.com expects the average used car price to fall $200-$300 per vehicle in 2013, which will continue the price drop we saw this year after used car prices peaked in 2011.

    Edmunds.com Predicts 2013 Sales Trends: Growth of New Car Sales Will Slow, Used Car Prices Will Fall





    Source: 

  • dantampa 01/23/13 1:14 pm PST

    This whole discussion has been interesting. I too was wondering why Edmunds pricing appears to be on the low side while KBB appears to be on the high side. I had few cars bought out from under me because I didn't feel I would be getting a good deal if I paid more than Edmunds TMV.

    Having said that I have seen a few cars that I was interested in that were sold at Edmunds TMV by private parties...never a dealer...even ones I have bought cars from in the past. I think the reason is because dealers may be inflating the value of a trade...in order to sell a new car. I think dealers sometimes are more interested in volume sales of new cars rather than if they can sell the trade-in at the price 90% of potential buyers want to pay.

    When I look at used cars on new car lots I go straight back to the area where recent new car trades are that haven't been detailed or serviced and if I see one I like...I make a fair (on the low side), but serious offer. Each time I have written out a check for the amount I want to pay, gave it to the salesman and told him I was going across the street for lunch and he can go talk to his sales manager. When I come back, either have the car out front and the paperwork ready to sign or be prepared to give me back my check because I WILL NOT NEGOTIATE as the price on the check reflects my best offer. Have bought 3 cars that way. If that car had been through service and detail departments I would never had got it at my price. (Oh yeah, the sales manager will alawys try to hit me up for another couple hundred, but I simply ask for my check back and every time they have backed down and sold me the car.)

    Anyhow, back to the original question...rather than try and figure out who's stated value is wrong and why...I simply created my own formula. I take the KBB private party "very good" retail and average it with Edmunds private party "clean" retail and that price would be the absolute maximum I would pay for a garage kept, well maintained 1 owner car. I will call that Dan's Maximium Price or "DMP" from which I start deducting based on the condition of the car.

    For example a 2004 Kia Amanti with 80k miles shows a KBB "VG" private party retail of $5859...Edmunds "clean" private party retail at $4589. Averaged together that has a "DMP" price of $5224.

    I located the above car when the owner had placed it on Craig's list at $5500 and I immediately offered him Edmunds price of $4500 and the owner balked. I have noticed the owner recently lowered his price in his ad to $4950. That is still higher than the Edmunds TMV but is now lower than my "DMP" of $5224. At this point I may end up with the car at a price both the owner and I can live with.

    I have run this formula against recent cars I was interested in and what they sold for and found it to be pretty accurate way of helping determine what the realistic price one can expect a car to sell for. The only time I personally would pull out the Edmunds pricing is if the owner pulls out the KBB pricing. Then I would suggest the fair way to settle the descripancy would to be to average them together and that puts us right where I want to be...at Dan's Maximum Price.

    Happy car buying...I have a Kia Amanti owner to go talk to.

    Source: 

  • pkincy 02/14/13 9:28 pm PST

    After reading this multi year multi response thread it appears clear that Edmunds prices are totally unrealistic. If no one on the thread has been successful buying a car at Edmunds prices from either a dealer or private party what does that tell you?

    If the prices had any basis in fact than you would be successful if you offered what should be a reasonable price.

    They are not reasonable and not by $2-3,000 as has been stated but more in the %20+ low range. So they are only $2-3,000 low on a $10-15k car.

    If NADA and KBB are the prices that sellers are receiving or even close and if Edmunds prices are laughed at by all selllers, than it is obvious that you can't rely on them.

    I think the advice given is a good one. Take a look at both and if you can get a discount off of KBB or NADA and you really like the car and it has been checked by a mechanic and looks good to you than your deal is a good one.

  • justliberty 02/16/13 12:15 pm PST

    My Experience: I have had 3 teenagers burning through cars at a rapid rate and so have had to purchase (or help a kid purchase) around 10 cars in the last 15 years. All but one have been used cars. I've used Edmund's and kbb prices as reference points. Most of the transactions have been private party. For these, it is not too easy, but not too hard to get prices (on cars properly categorized as to condition) near the Edmunds pp TMV price. It is very hard when the seller is fixated on the kbb price. Some of these latter cars go unsold for weeks or months.

    For transactions with dealers, it is very difficult, but not impossible (for me) to get a price near the Edmund's retail TMV. I've only been able to do it if the car had a blemish or other circumstances like buying Toyotas at the height of the uintended acceleration scare, at the end of the month, when it is just too old for Certified, in the rain, etc. etc.

    In my experience Dealers (or pp sellers who happen to be in sales whether auto or not) always get hostile when you present them an offer substantially below their asking price. This is a *tactic* that works on most normal people. Just keep your cool. When I leave the dealership, but also leave them my phone number, I have gotten return calls and made deals very close to my offer price- near the Edmunds TMV. Leave, but don't kill the deal. Let the sales person think about the couple of hundred they could make with a simple phone call. I'll never buy from a dealer again without leaving the lot at least once.

    I would never recommend actually talking about Edmunds pricing when talking to a dealer. They have rehearsed responses. Instead, do some homework and find similar cars nearby (both dealer and pp) so that you can use the current market in your negotiating.

    Salespeople at the dealer are trained sharks. That is their job- to extract the last possible $ from you and from the market. This is one reason to buy private party- preferably from normal people who are just wanting to get a reasonable price- which is going to be somewhere between what the dealer trade-in price and the dealer selling price (note: not asking price). As mentioned above, people with a sales background are more difficult to deal with. More likely to, uh, surgarcoat the condition and history, 'forget' to tell you relevant things, and work hard to cover up defects.

    To the person that started this thread: you might want to try an experiment. Go negotiate on a car you like. After a few days, have a friend (preferably a large blue-collar male with grease under his fingernails, a very stable temperament, and a good poker face) negotiate on the same car. Is there a difference? Get that person to negotiate for you or try to adopt some of their behavior.

    I hope you are able to get reasonable autos at reasonable prices in the future. I'm about to go look at another one today. We don't need to talk about the kid hitting the brakes on ice on a little road perched on the side of a very steep hill.....

  • mike9691 03/14/13 12:29 pm PST

    I wish I could buy a car at Edmunds prices. I could make a living reselling them! I have a 1990 Corvette ZR-1 with 25,000 miles. It's insured value is $27,000. It is a classic "collectible". Edmunds says I should be able to buy one in outstanding condition with these miles for $5,230! You couldn't buy one from a junkyard for parts for that price. If anyone came to me with a printout for that price I'd know that they know absolutely nothing about Corvettes and probably nothing about cars in general. Seriously, I don't know how Edmunds calculates used car values. If anyone could show me a car like mine with twice the miles in only "fair" condition going for even twice the price that Edmunds says that it's worth, I'd like to see it. I know at least a half a dozen people that would buy it and think that they are getting a bargain. I'm only using my car as an example. Edmunds is way off.

  • MrShift@Edmunds 03/14/13 1:27 pm PST

    Oh well that looks like a programming glitch---the appraisal tool didn't pick up the ZR-1 option. You're getting values for a base coupe.


    One problem is that all used cars are different! No two are the same, and if people do not calculate properly, or over/under estimate the car's condition, or don't list all the options, or don't plug in the right zip codes, the results could be quite a bit off from the "reality" of the actual car being sold.

    The dealer's, or seller's "asking price" is a number picked out of a hat. It's their First Amendment Rights being exercised.

    They don't HAVE to sell you the car at your offer. They don't have to sell you the car EVER. They can keep it for a full year if they want to, if they think that one buyer is out there to give them top dollar or over book. I've seen this happen. The dealer or private party is so buried in the car they can't sell it for normal retail. They'd rather die than take a loss.

    I think that we have to look at a "market" as a concept--it's the sweet spot in the bell curve, and there will always be outliers to "prove" the bell curve "wrong"---but it's not wrong, because it's a generalization. It's not aimed at one car in one lot in your neighborhood.






  • henry4hire 03/15/13 5:10 pm PST

    The pricing for the Corvette ZR-1 is being reevaluated. Thank you for the feedback. Expect a change within a week along with a few other cars.

  • boomchek 03/16/13 12:24 am PST

    Just like Mr Shiftright said, no two used cars are alike.

    All of these online price guides and book values serve just as that: guides, guidelines etc...

    There is no national standardized system where every 2003 Accord or 3005 XYZ model gets exactly the same trade in value at every dealer in every region or nation wide. Why? Because once again no two used cars are alike.

    What affects used vehicle pricing are quite a few factors:

    -Year, make, model, trim level (obviously)
    -Engine and transmission combination
    -Mileage
    -Color
    -Modifications if any (usually in a negative way)
    -Service history
    -Accident history
    -Condition, both cosmetic and mechanical
    -Amount of money a dealer put into a vehicle after they took it in trade
    -Availability of said make and model in local markets
    -Popularity and demand of said make and model in local markets
    -If used car is only 1 or 2 years old, then manufacturer rebates of same brand new models will have an effect on used market
    -Lease maturities and fleet returns that will lead to market saturation
    -Popularity and sales figures of the car when new, and when used
    -Supply vs demand
    -Ability and ease of financing by major banks (usually hard to finance 6 year old or older vehicles which means smaller purchasing audience)
    -Finance rates of such vehicles
    -Auction values and what the dealer can buy an equivalent model for at the auction
    -Any negative publicity of specific models in terms of recalls, high accident rates, or high theft rates

    That's the basic overview of what affect used vehicle pricing.

    So even though you can find approximate values of these cars from various sources, it is not these sources you are buying these vehicles from. You are buying them from individuals and dealers who each have a specific amount of money vested in them and are looking for a specific return.

    Example:
    If Edmunds or KBB said car XYZ with 60k miles should retail for $10,000 at a dealer, but it's priced at $14999 there could be several factors involved on why it's priced the way it is using the above points I mentioned:

    -If a dealer had to make a new car deal happen to make their sales target and overpaid on trade in, then obviously it will be priced higher than average.
    -If after the car was traded in, the tranny or wheel bearings or something else broke on it and needed $1500 worth of repairs, then those costs will be reflected in a higher asking price.
    -If everyone in the city is asking $14000 to $15000 for these cars because they sold them for close to this price before, then they'll hold at the higher price because they know they can get that money for them.

    On the other hand if you see cars priced closer to book values but way below what they are priced in the regional market, or priced below book values then that could mean a few things as well:

    -Seller is aware of upcomning major repairs and wants to offload the car quickly before something breaks.
    -Dealer took the car for very cheap on a trade in because the customer didn't want to negotiate and at their lower asking price than anyone else the dealer will be happy with the margins they receive.
    -Maybe the car had an accident or was rebuilt that wasn't declared in the advertisement but will be declared (hopefully) when you actually come to buy it.
    -Seller is in a money bind or a time crunch and needs cash quickly and has prepared to accept a lower than market value price in order to get cash quickly.

    Now, say a 1 year old model XYZ is priced at $16999. A brand new 2013 equivalent has an MSRP of $19999. Say the manufacturer introduces a rebate on the new models of $2000 for 1 month bringing the MSRP down to $17999. That will have an effect on the value of the 1 year old model as the price will have to be adjusted down probably by $2000 to make it appealing enough for someone to buy it, and that might skew the reporting of paid prices to various national book guides and organizations.

    So sellers have many reasons to ask a certain price for their vehicles.Obviously everyone will start off with the highest number to see what the market will bear. You can never start low and then raise the prices if you realize you underpriced your vehicle, so you always start high and then incrementally drop the prices.

    At dealerships I worked at and when I sold cars privately I always start high on the asking price BASED ON WHAT THE LOCAL MARKET IS FOR THESE CARS, not book values, and go down in $250 or $500 increments until the phone starts ringing and people start to come to look at the car. Some will low ball, some will point to book values and others will come, look, negotiate a little more and then buy. And almost always if you actually do look at book values you'll rarely find cars that are priced close to them or below them.

    So never let a low price fool you into thinking you scored a crazy deal or that the seller is religioulsy following book national values and wants to be fair, especially not when it's priced thousands cheaper than other similiar models as sometimes you might be getting into a money pit that will cost you more in the long run than if you were to pay a little more and buy something with proven history and clean bill of health.

    I hope that clears things up a bit.

    Source: I worked in the car sales business as a salesperson and manager for about 10 years and bought and sold many cars privately for myself and my family and friends.

  • hj07 04/03/13 12:46 am PST

    I'm a loan officer at a credit union. We use Black Book to determine retail, trade, and wholesale values.
    Here is a link to Black Book that you can use, compare to Edmunds, NADA, KBB.
    I typically see dealers price their vehicles between clean & average retail, though I've seen them price them as low as clean trade value.
    http://www.cudlautosmart.com/Research/T
    r...


  • Stever@Edmunds 04/03/13 12:15 pm PST

    When I appraise my '99 Quest GXE with 182,000 miles, Edmunds retail ("average") is $650 lower than the last link.

    One way to look at that is that a higher number allows the bank to approve a higher loan amount. More profits for the lender in other words.

  • tukkarab 04/09/13 3:26 pm PST

    >-If a dealer had to make a new car deal happen to make their sales target and overpaid on trade in, then obviously it will be priced higher than average.

    That doesn't seem so obvious to me. Once the dealer pays for the car, the amount they paid should be regarded as irrelevant to any future transactions involving that car. It's a sunk cost.

    >-If after the car was traded in, the tranny or wheel bearings or something else broke on it and needed $1500 worth of repairs, then those costs will be reflected in a higher asking price.

    Again, economically speaking, this makes little sense. Those repairs, once completed, are also a sunk cost.

    The buyer does not know or care how much the seller paid for the car. The particulars of who performed or paid for repairs and maintenance are also irrelevant to the buyer, except that such information might be used to infer something about the current condition of the vehicle (if the dealer had to perform costly repairs to make a vehicle saleable, to me that's a red flag that would actually lower my estimation of its value). It's really only the current condition of the car that matters though, not how it got the way it is.

    >-Dealer took the car for very cheap on a trade in because the customer didn't want to negotiate and at their lower asking price than anyone else the dealer will be happy with the margins they receive.

    Again, this is economically illogical. The dealer should not be leaving money on the table like this. Setting an asking price and making a decision on any particular buyer offer should not take sunk costs into account, except as one point of historical information to consider -- just like book values (which actually should be given more weight, since they're based on a more robust data set). Instead the dealer should try to extract as much value as possible from potential buyers (value in the form of the price paid, money made from financing, factory/government incentives, trade-ins, and even "goodwill"), balanced against the possibility of losing sales, alienating customers and incurring various future costs.

    I know that not all businesses/dealers operate in a perfectly rational, profit-maximizing way, but is the reasoning I've called out here actually the norm in the used car industry? I guess it wouldn't surprise me too much, as I understand that the whole process is pretty adversarial (pitting the customer vs. the sales staff vs. various levels of management) which might result in some split incentives and other inefficiencies.

    In any event, I thank you for your post. It goes some way towards explaining some of the discrenpacny between pricing guides and reality.

    Like the OP, I'm skeptical of Edmunds TMV and don't really know quite how to integrate it into my car-buying approach. It seems like if Edmunds TMV is accurate, I ought to be able to input all of the relevant information (including trim level, mileage, condition and zip code) and then offer a dealer the private party price as an opening offer and expect to end up within a few percentage points of the TMV -- perhaps not on every car, but on SOME car, eventually. In my limited experience, however, and based on the anecdotes I've heard here and elsewhere, that approach seldom will get you anywhere, and even using the dealer TMV itself as an opening offer will not cut much ice.

    But maybe these anecdotes are coming from a vocal minority and Edmunds really is legit. My suspicion is, though, that its algorithm needs some a lot of fine-tuning (or else it needs a better source of raw data) before TMV can live up to its name.

  • shawnnalynne 04/16/13 11:09 pm PST

    I'm so glad to have found this thread as I'm been baffled at the significant difference between what edmunds say is the "true market value" and every single other source that I, as an ordinary consumer, has access to.

    Shame on you edmunds for not admitting you've gone off track.

    You've lost my support and trust.

  • tcsherry 05/22/13 12:29 am PST

    I've bought four cars at less than the TMV listed at Edmunds, with no argument from the dealer. They were happy to get an offer. There are a-holes (lots of them) in the car business who act all insulted when you make them an offer, and plenty of them on the private side too.



    Have other options available. Do your research on C-list first, see what they're listed for; what they're apparently selling for; and compare those to the TMV. I'll NEVER pay more money than what is reasonable relative to the Edmunds used car appraisal tool.



    In my market, the numbers work in my favor.



    As far as I'm concerned, KBB is owned and operated by the car marketers, and is not to be trusted in any case. Take their numbers, take 40% off, and you're in the neighborhood.



    I'm looking at a new (used) pickup. 92-96 F150 extended cab, 4x4, 5.8L, auto. Dealers are listing numerous copies of this truck for almost $8,000. TMV is around $3,000. Private parties are in the $3,800 to $4,400 range. I have a half-dozen to choose from in apparently good condition, and dozens more in worn out condition. I figure to spend around 3K. If someone's insulted by me wanting to keep my money, they can p*** off.

    Source: 

  • ckw4 06/19/13 7:10 am PST

    Don't give in or up.

    My co-worker said the on-line price is normally about 10% higher than a dealer will accept, but you have to be willing to wait and keep searching. This has worked for him twice in 3 years.

    I got a link to this Q/A from a Redwood City (California) Kia sales person (Marty) 16 Jun 2013. He was telling me that using edmonds.com for a price was a waste of time since "Edmunds doesn't sell cars sir."

    When I sent an e-mail to Momentum Nissan of Fairfield for a similar car with the edmunds.com price plus about $300, their (Aisha) 17 Jun 13 response was "yes it is possible at that price." I made a 19 Jun 13 appointment to see/test drive the car, which I now need to cancel (I did tell her I was working with Fremont Chevy on a different car, which she said they would beat the price).

    On 18 Jun 13 when I went to Fremont Chevy, they initially kept to the on-line price (26,888, which was below the 27,995 price posted on the car), but they later agreed to a price at 0.205% ($53) above the edmunds.com price (25,888 vs 25,835). Although this is not the 10% my friend has negotiated for his last two cars, I'm okay with it since it is close to the edmunds.com "Dealer Retail" price.

    Hope this helps.

  • Stever@Edmunds 06/19/13 10:50 am PST

    Don't give up or get frustrated. New car buying is changing.

    Edmunds Price Promise℠ is car buying made easy

    If you're buying this weekend in NoCal:

    Edmunds.com and Lexus of Stevens Creek Team up

    Source: 

  • cadillacmike 07/26/13 6:18 pm PST

    Wow, that was a long read.
    I have found the opposite to be true. I Have found Edmunds TMV to be thousands HIGHER than KBB, Blackbook, etc in my searches in the fall of 2011 and spring of 2012. I was looking for difference types of vehicles though, namely 6-18 month old Cadillac CTS or STS with low miles for their age and CPO. In that market segment TMV seemed to be off in the opposite direction to what the original poster has encountered, which is strange, but not unheard of I guess.

    For the corvette ZR! person, cars older than 11-12 years old just don't fit well in Edmunds TMV, there was no way anyone who had a 1996 Fleetwood would sell me one at edmunds TMV price, sort of similar to what you saw. TMV is way too low on these 16-25 year old cars.

    hjo7: I looked up that site and tried to get estimates on my last two purchases, a 2009 STS and a 2011 CTS. I put year model, etc in and noticed that the MSRP (now irrelevant with a used car) was WAY OFF. So i put in the actual VINs of the two cars. It picked them both up, but again it was way off on the MSRP, making me suspect the validity of the estimates it gave me.My wife's car MSRPd at over $50,000 but http://www.cudlautosmart.com site said MSRP of $41,565, that's over NINE THOUSAND DOLLARS LOWER. My STS was even worst, the site showed MSRP of some $56,000 but the car had an actual MSRP of $75,500, over NINETEEN THOUSAND dollars off. If it can't figure out the MSRP with an actual VIN, how accurate is the rest of the information???

    When i get some time I'll re-look all the sites and see where they sit - but not until i get back home (still in the desert on deployment).

    to grrldriver: I heartily agree with others that you not show or demonstrate your edmunds TMV or other info, it just aggravates the dealers. Just keep at it, and you'll find something (you probably already found a car by now).

    Regards all,
    Mike

  • authorizeduser 10/17/13 7:17 pm PST

    Great discussion. Pricing Infiniti G37S sedans. Edmunds is about $2K below KBB, and KBB is about $1.5K below NADA. I've already been laughed out of a dealer last week over mentioning an Edmunds price.

    Would be nice if you'd reveal more about how you calculate your prices.

    BTW, this whole problem could just be a user interface problem that doesn't make us option out the vehicles correctly.

    On this car, options are bundled into packages. Instead of giving us the packages, you list the packages' components separately.

    Here's why this causes confusion:

    The Sport package requires the Premium and Navigation packages.

    If I select only the Sport/Performance Suspension option (does this mean Sport package plus the other required packages???), a "clean" condition 2010 Infiniti G37 Journey sedan with 39,500 miles and black paint is $21,621 dealer retail.

    However, if I go and try to select every option that I am aware that the Sport, Premium, and Navigation packages come with (see bottom), the price rockets up to $24,513, which is higher than the dealer's asking price (!).

    KBB is $23,539 and NADA is $25,225.

    So how is it--am I supposed to meticulously figure out every one of the 29 options and select all of them individually, or is there an option that actually represents a package? If the former, this is poor design since many of these options cannot be ordered separately, and if it's the latter, then options are not labeled correctly.

    Here's the options I selected:
    -Satellite Radio with Traffic Reporting
    -Power Glass Sunroof
    -10-Way Power Driver's Seat
    -Wood Center Console Trim
    -Front Video Monitor
    -Limited Slip Rear Differential
    -Audio/Video Input
    -18 Inch Alloy Wheels
    -Bose Audio
    -Steering Wheel Transmission Controls
    -Bose Speakers <-- you can seriously get a Bose radio without Bose speakers!?
    -Rear Parking Sensors
    -Memorized Exterior Mirror Settings
    -Voice Activated Navigation System
    -Front Sport Seats
    -Memorized Steering Wheel Settings
    -Driver's Seat Memory
    -Sport/Performance Suspension

    Sorry for the random order. That's how your site presented them when it showed the TMV price. Another site design problem.

    Source: http://www.motortrend.com/cars/2010/inf
    i...

  • brianamc 10/29/13 7:29 am PST

    This entire discussion has a very simple answer that everyone forgot to mention... NADA stands for National Automotive Dealers Association. The reason the NADA value is so much higher than the other references is because it is created by dealers for dealers. The bottom line is, NADA is created to make you, the customer, try to pay more. That's it. Most of the public uses KBB, which is slightly on the high side, and Edmunds is slightly on the low side. If you split the difference between KBB and Edmunds you end up with True Market Value. NADA also does this with classic cars. For example, I had a 67 Cougar A-Code last year, the car was beautiful and turn-key. The market value was $11k and I sold the car for $11k. Do you know what the NADA value is? $22k. Bottom line is, NADA is a joke and for suckers.

  • johntraveller 11/09/13 6:02 am PST

    I thought I would share an experience I just had today buying a 2010 Toyota Prius. It simply isn't true that you can't buy a used car using Edmunds. The dealer, of course, wants to use NADA because, as pointed out, it is much higher than Edmunds or Kelley. One needs to keep in mind that a market only exists when a willing buyer and a willing seller come together and agree on a price, regardless of what Kelley, Edmunds or NADA say. So the first thing you need is a buying strategy. Just using one or more of these sources doesn't make sense, at least not to me. What I do is target dealers that have taken in trade ins that are not their brand. Don't go to a Toyota dealer to buy a used Toyota. Go to one that doesn't sell the car brand you want as their business. The reason for this is that:


    1. they know they are not the main source of the brand you want, even though they have one.

    2. having another brand on their lot leads prospective customers to think "hmm, I hadn't thought of buying a Toyota at this Suburu dealer. Maybe I should look at them as well as Suburus (or whatever). Dealers hate that, as they are effectively marketing another company's brand on their lot and losing what they really want to sell, which is their own brand. This is a very powerful motivator to get the other brand off their lot.

    Today, using this strategy, I went to look at a Toyota Prius I found at a Suburu dealer. Of course, I got the "SubuEdmundsu is a great car. Don't you want one of them" No, if I wanted that I would have gone to a Toyota (or whatever dealer) for that because of my strategy.

    I went armed with the Edmunds pricing which, they, of course, would appalled at. They went the NADA approach insisting that was what all dealers used, as if I gave one hoot about that. After a discussion back and forth, they said their price was non-negotiable and take it or leave. So, I pulled out a list of other Priuses available at other non-Toyota dealers and said thanks, I'll just go to them then, since the Edmunds retail dealer price was my non-negotiable price. I then asked for the keys to the Prius to get my stuff out of it. Before I could open the door, the salesman came rushing out with a story that the general manager has just come in and said take my price and get the car off the lot, just as I thought they would do. Bottom line was that I got the car at a whopping $3 more than the Edmunds dealer retail price, generously rounding up my offer. And, to top it off, the Prius is still under warranty for between another year and 3 years depending on what goes wrong, which is basically nothing for a Prius. As you might expect, they had zero success in selling me their extended warranty plan. Have fun.

  • kwethington1 12/16/13 12:38 pm PST

    Years ago, maybe even 20 by now, KBB, and EDMUNDS had the same pricing. In fact, KBB books were being brought to the dealer, or copies to show them what price was fair. In response, dealers across the country purchased KBB. Then, their prices went up for selling a new or used car and down for trading one in.

    I am 57 and have buying new and used cars and motorcycles since 1972, 23 in all. I use EDMUNDS all the time, and usually successfully. But, I either know the dealership and their reputation or learn it. I do my homework. I never discuss trade in until the deal is settled. Then, if I don't like the offer, I sell it myself. I keep my vehicles in good condition, mechanically, and they sell in a couple of days. For new care, what sells for this amount in one area will cost more in another. Large urban areas where sales and competition are the greatest is the best place to buy.

    Second, if you want a good deal, be prepared to work for it. You can't just drop a price, have them laugh and walk away. The last van we bought was from a dishonest sales staff, so we purposely kept them at the dealer until past 1am. It took eight hours, but we got the price. We kept them there because of all the lies they were trying to use on us.
    Further, I worked in sales for a while, so I know what their tricks are. In general the mark-up is much less than it was because you can do most of the work, online, on your computer.
    We have used EDMUNDS to buy our last several vehicles and gotten TMV or below every time. Just know, a national dealership organization is either the outright or majority owner of KBB. And, know you have to do your homework. I even bought my last truck for almost $300 under the best deal price dealership whose prices on the vehicle are usually lower than all others, after you get done with the fine print additions others add on. I brought the loss leader full page ad in and asked them if they could beat that price. Another time I made a photo of the best deal paperwork bottom line and took it to what I knew to be an honest dealer and asked the manager if he could beat it. He said if he coud would I be willing to buy it now. I said I would have to get my wife first. He said if he could beat it by another $100 would I do it now. I called the wife and bought the truck on the spot.
    Patience. Plus, learn nothing is more fun than ripping up all that nice new paper coming out of the expensive printer. Always be nice, and do not fear to walk away. I usually walk away at least twice, before they get the message. In addition, buy in the off season, like the winter, or when it is raining or snowing. Buy during the week, never the weekend. And, buy close to the end of the month, when salesmen are either trying to get a bonus for selling a number of cars, or trying to keep their jobs by selling their quota. That is about it.
    One final thing, the best way to know you have gotten a good deal is after the sale is done, the salesman and more so the manager, do not look happy. This is business and they are not my friends or my famiy, but I do stay polite, because it is afterall, only business, not personal, usually.

    Sincerely,
    Kevin Wethington

  • kwethington1 12/16/13 6:01 pm PST

    Sir,

    I realize that your question.statement is over two years old. I ran acrtoss it, which means others will too. In addition, it is a very good question. Although I did mention that the Kelly Blue Book was purchased in whole or a majority of its ownership, a couple of decades ago, I believe (this I learned from a salesman and followed up in the early days of the internet to learn it was true. What i did not mention and what is to some, common sense, is what NADA is an acrymn for, the National Automobile Dealers Association. You can find them under NADA.org. You can read what NADA actually means by magnifying their seal at the bottom of some of their pages on this site. Obviously, they have a right to make money as a business. However, they might not like this but, since buyers have to pay taxes on the vehicles they buy, customers have an access to the information of what everyone pays for their vehicle, if not by name, by vehicle, accessories, and where in the USA it was purchased. You pay taxes on the car you buy, the government has a record. As a citizen, you have a right to know this information, Dealers do not want you to be this informed, and are happy when you are not, but, legally, they cannot stop you from learning this information. Just do not expect to get it from KBB or the NADA. I look at these two organizations like I do used car dealer salemen from lots with piles of sawdust behind their building and enlisted military recruiters.
    Sincerely,
    Kevin W

    Source: 

  • wever 05/12/14 2:15 pm PST

    I haven't bought enough cars to know how true the Edmunds "TMV" is, but I'm also skeptical of their numbers based on the prices I see being asked as I currently shop for a used car, at least in the $3,000-8,000 range. I think the used car market is still a mess from the economic crash and people want crazy prices for old / high mileage cars, and the supply of cars being sold by real private parties is small in my area (not out in the middle of nowhere, but not a large city).

    I worry a bit about Edmunds' math. See their article The Debt-Free Car Project ( http://www.edmunds.com/car-buying/the-d
    e...
    ), for example. It's not entirely clear at the end of the first page what out-the-door price they paid for the car, so I assume the $3,800 they mention. The numbers on the last page are interesting. They say that they have mixed feelings about the success of the project, but by my calculation they had to lay out $7,086 in cash in 13 months and pay $4,418 net (-$3,800 purchase + -$3,286 "maintenance" + $2,668 sale) to own a 16 year old car for 13 months. (Granted, it was a luxury car, although I'm not sure how that makes sense as a "vehicle" for getting / staying out of debt.) In my book, that lands solidly in the fail column, but I guess their measure of success is beating what you'd pay a buy-here-pay-here dealership.

    I believe the narrative is that they bought the car without having it inspected by a mechanic, *then* took it for that and were told it needed in excess of $3,600 (almost as much as the price of the car) of maintenance / repairs (granted that was dealer pricing and they ended up paying less for some or all of it). I don't see how it makes any sense to buy the car without getting it checked out first, especially for someone who is in a financial position that would lead them to a buy-here-pay-here dealership.

    But what's most interesting about the article in the context of this discussion is that they say the Edmunds private-party TMV price when they sold it was $2,668, but that they think they could've asked about $4,000 for it on Auto Trader and *sold* it for around $3,300. Huh? I guess the suggestion is that they could've found a sucker who was too poorly informed to know the true value of the car.

  • hubby44 05/20/14 12:27 pm PST

    I agree with what others have said about Edmunds being a STARTING point in price negotiations, and that in some cases their figures having no bearing on reality in a particular region. In my area--in the Pacific Northwest--SUV's of all kinds are valued, because in many locations (higher elevations, east of the Cascades, etc.) we have icy and somewhat snowy winters. They are also a bit of a status symbol. Thus, in my area, "fair market value" is higher than what is often listed even on KBB or NADA. Our local dealerships won't negotiate much off the price of an AWD./4WD vehicle, simply because they know that someone WILL buy it within a few months. This tends to be true regardless of whether the vehicle in question is new or used. The nearest major metropolitan city to me is 3 1/2 hours away, but it is close enough to skiing, hiking, camping, etc. that even in that larger city, SUV prices are still higher than the "fair market value" listed on the auto pricing sites.


    The bottom line is this: "fair market value" is not what a pricing guide says it is. Rather, "fair market value" (the same as in real estate) is what a ready, willing, and able buyer will pay for something. So it doesn't matter if KBB, NADA, Edmunds all say that a 2014Toyota Rav-4 has a fair dealer retail of $18-21k if that vehicle is actually selling in my area consistently for $25-29k. By the way, I drew those prices out of my hat just for illustration purposes--I believe the actual prices for a 2014 Rav-4 may actually be much higher.

    Another thing I've noticed is that shopping for a 2-3 year old vehicle to benefit from initial depreciation is no longer the money-saving tactic that it used to be--at least for the highly-regarded, high-reliability vehicles. Oh sure, you'll save SOME money, but not as much as you used to be able to.


  • mountainbkr 07/20/14 8:14 pm PST

    I don't have any facts to back up my theory but I wouldn't be surprised if Edmund's TMV pricing is somehow influenced by the dealerships to use as a source for vehicle trade-in values (lower pricing good for them). Just a thought.

  • Stever@Edmunds 07/22/14 11:12 pm PST

    @mountainbkr, I love posts like yours. It's the old "trust but verify" situation and it's terrific that more shoppers are taking all information with a grain of salt.

    In our case, we've always had a strong focus on the consumer and the consumer experience dating back to the mid 60s. It's hard to build trust but easy to lose it.

    We've sold ads to car manufacturers for years to pay the bills. But there's a firewall between our reviews and ad sales. We've been working more closely with dealers the last few years. Smart dealers know that sales are easier when consumers are educated. We try to simplify the car buying process and one way we do that is by collecting sales data on what people in your area are paying for a car similar to what you are considering buying. It's getting easier for consumers to report on their deals and dealers who aren't competitive will get left behind (see the Prices Paid and Leasing discussions in the forums and our Dealer Reviews).

    Dealers will always try to pay "wholesale" for a used car, justifying that by their overhead costs and costs of reconditioning. But just because a dealer is trying to buy your car for an auction price or another book price (Galves, etc.) doesn't mean you have to accept it. That's why we recommend that you separate the numbers - focus on the new car sale price separately from the trade-in price. And many times, if you're willing to deal with some hassle, you can do better selling your old car yourself.

    Source: 

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