Quote:
Originally Posted by Camp-a-Palooza
............. The Finance guy had even looked me up on the previous purchase before he made that lowball offer. No shame!
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Actually it is just good business practice. The dealer doesn't make a profit on the new unit until he sells the trade in unit to get that money he tied up in it. And there is little incentive to take in a used unit that he doesn't have reasonable expectations of selling it fairly quickly. And right now dealers, at least in this area, are overstocked to the point there is just enough room to walk between units and some are even parking them out on grassy areas off the main lots.
If he sells a new unit for $80,000 cash, then he recovered the cost of that unit plus pocketed a profit. But if he gives $40,000 trade in, he only gets $40,000 to cover his cost until he can sell the trade in to get the rest of the money. The longer that trade in sets on the lot, the longer before he sees a profit. Simple economics to stay in business.
Just a few short years ago inventories were low and trade ins were better. Now, not so much. Of course, good deals on new units were more difficult also. Supply and demand.