I'm not sure I understand your critique of my last point. I understand that many goods depreciate in value over time as a function of use and wear and tear. I

I'm not sure I understand your critique of my last point. I understand that many goods depreciate in value over time as a function of use and wear and tear. I'm describing specifically the dynamics that cause a car that has been sold and driven 3 miles to be worth less on the market than if that same care had been test-driven 3 miles but not sold. My argument is that while we tend to view the sale of the car as triggering a drop in value, that is not entirely responsible for the price drop. The price drop is also a function of available financing options, since the vast majority of cars are purchased alongside a financing product... and the specific product used is not typically available to a customer wishing to purchase the vehicle that was sold and driven one mile. Since price is a function of supply and demand, the price lowers (depreciation occurs) because there is less demand for the basket containing the car without OEM financing than there is for the basket containing the car with OEM financing. This is what you'd expect, which is why OEMs offer financing incentives to increase demand. My argument is not that depreciation doesn't occur (because that is the way we typically describe the "sold" one selling for less)... Just that without the financing incentives demand is lower and since price is a function of supply and demand, price is also lower. The causality is important, since the topic being discussed was the mysterious way in which dealerships work. My point in making this distinction is that consumers are buying a physical product and a finance product bundled together, thus there is room for significant innovation in the automotive industry simply by getting more clever/creative with how the car + finance + insurance are packaged...