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How much markup do typical auction bought cars do dealers put on? I'm looking at a 2009 camry for about $15k and the carfax says it was a fleet vehicle sold at auction. I know dealers score great deals at these auctions and I also realize that I will likely never know how much the dealer paid for the car.

However, is there a rule of thumb about the markup dealers put on these types of cars? Like 50%, 25%, etc? I'd like to know how hard to deal on this car.

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Whatever they feel like. It's like Gas Stations, it depends on Location, Owner, and previous issues with the car during inspection.

EconoWallet said: is there a rule of thumb about the markup dealers put on these types of cars?

Poorly worded question.

Find the KBB or NADA tradein value. Offer $1000 below. Good luck.

(if you don't know what the abbreviations mean, google them.)

Dealers don't price based on mark up. They price based on what they believe the value to be

I found a licensed dealer who had a business representing clients at the auctions. They take you on the car lot prior to the auction, you check the cars out, give the dealer your list of license plates (list in order of preference) and what is the max you are willing to pay. Best time to buy at the auctions is in the winter when it is raining; it keeps the number of dealers down. Dealer buys the car at your price and then tacks on a commission fee that includes all DMV paperwork. The particular dealer that I've worked with only attends the lease return auctions but I am sure there are others that deal w/any car auction. Good luck.

xstemcellx said: I found a licensed dealer who had a business representing clients at the auctions. They take you on the car lot prior to the auction, you check the cars out, give the dealer your list of license plates (list in order of preference) and what is the max you are willing to pay. Best time to buy at the auctions is in the winter when it is raining; it keeps the number of dealers down. Dealer buys the car at your price and then tacks on a commission fee that includes all DMV paperwork. The particular dealer that I've worked with only attends the lease return auctions but I am sure there are others that deal w/any car auction. Good luck.

This is what my cheap ass would prefer but I haven't found any dealers advertising this.

Is this something that only people who are friends with dealers can do, or did you find the dealer through craigslist/etc?

ellory said: Dealers don't price based on mark up. They price based on what they believe the value to be
True, and then bargain from that point.

ellory said: Dealers don't price based on mark up. They price based on what they believe the value to be

It's based on how much you want the car.

Dealers use another KBB book, that's a dealers price book but looks like the regular one. It has prices cars are listed for, not sold at so be careful which book they give you to read.

EconoWallet said: Is this something that only people who are friends with dealers can do, or did you find the dealer through craigslist/etc?

Is there an auction lot or two near you? Drive by and see if just down the street is a whole bunch of tiny "car dealers" all jammed in one building (or several). Here, a licensed dealer has to have a lot, signage, and parking spots so these little mini offices sprout up near the auction lots. These guys have the lowest possible overhead and for a cash transaction you should be able to find one or more to help you out. They basically just buy cars to order as they have no real space to retail them.

Most used cars on dealer lots are purchased from auctions. Did you really think that they all came from trade-ins?
/snicker

Wineaux said: Most used cars on dealer lots are purchased from auctions. Did you really think that they all came from trade-ins?
/snicker


Right. That's where most of the smaller private lots get their cars. Most of the cars going TO auction come from dealer trade-ins. Mostly, they're all of the higher mileage and other more risky cars that they've taken in trade that the dealers don't want to bother with selling themselves. Also from insurance companies, bank repossessions, fleet sales, abandoned vehicles, etc.

I've bought from auctions quite a few times and you can get some deals but you need to understand the risk and kind of assume the worst in your pricing. Some are great higher mileage cars. Some are beautiful low mileage cars with some major problems. I wouldn't recommend auctions for most people. The best I thought were repossesion auctions that were run by the banks but they're harder to find now since most seem to just send their cars to the bigger auction operators now. I used to go to some that were held in a big Navy town. The young Navy guys would go out and buy these nice cars with their new-found "wealth" and then end up not being able to pay or getting shipped out and bail on the payments. There was pretty much a revolving-door industry between the car dealers, finance companies, and used dealers in selling, financing, and then rebuying/reselling these cars and you actually could get some really good deals on cars in good shape. Not sure that still exists though.

There used to be a couple of sites where you could review the prices paid at some of the larger auctions. Probably still are but I'm too lazy to look right now. There also are a bunch of sites that are complete BS just trying to get you to pay for their "secrets" to buying cars at auction which aren't secrets and not worth paying for so just be aware if you're out searching.

Wineaux said: Most used cars on dealer lots are purchased from auctions. Did you really think that they all came from trade-ins?
/snicker


I never said that I thought most cars came from trade-ins. Did you not go to school and learn basic reading comprehension?
/snicker

A local car place has a free Carfax you can look at for free & each one stated it was bought at auction.

It all depends upon what the dealer paid for it, and how long it has been on the lot. Typically, most newer used vehicles have a 3-5k bump on them. How low the dealer is willing to go will depend upon how much they paid for it first, and how long it has been sitting on the lot second. If it's been on the lot for longer than 30-days they are much more willing to deal. Longer than 90-days and they'll be willing to go to damned close to cost to get it off the lot. Popular makes/models tend to go for more than less popular vehicles. Buy a used convertible in the winter and sell it in the spring. Buying a used vehicle that was a trade-in from a direct competitor will give you a better deal than buying it from a dealer who sells that brand. In other words, buy a used Toyota from a Nissan/Honda/Mazda dealer and not a Toyota dealer, etc. A manufacturer's dealership values their own used vehicles a lot higher than a competitor does. We bought our used Nissan van from a Toyota dealership for less than the owner of a Nissan dealership (Whom I personally know.) paid for the used Nissan he had bought at auction to sell on his lot. And mine was newer, with less miles, and more features. The Toyota dealership didn't give the original owner all that much in the trade-in, so we won big time. Going to the dealer at the end of the month will get you a better deal than going at the beginning of the month. You'll get a better deal if the weather is really awful as well. Buying a car when no one in their right mind would want to visit the dealership, especially near the end of the month, will result in a better deal for you. Just remember, every car dealer, new or used, has quotas. At the beginning of the month they know they have all month long to make their quota, and so don't cut prices all that much. At the end of the month though, they'll do whatever it takes to make their quota. That's when you have the advantage! There you go. The once upon a time car salesman's car buying tips.



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