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>Trade-in amount is completely arbitrary and fictional Which is exactly why it gives dealers a huge degree of freedom to work with for "bottom line" discounts,
by beerandt 5y ago
>Trade-in amount is completely arbitrary and fictional
Which is exactly why it gives dealers a huge degree of freedom to work with for "bottom line" discounts, that manufacturers can't (yet) control/ influence.
Dealers now make very little margin on new sales, and rely on income from monthly/quarterly/yearly kickbacks from the manufacturers, which are based on targets that include sticking to manufacturer approved discounts.
Without a trade-in, they don't have a place on the reciept to pass some of that kickback on to you. If they discount the sale price, they lose the margin they had to give you the discount in the first place.
Technically, you're right, in that they can sell for whatever they want, with no trade-in. They're just not likely to do that if it costs them more on the backend.
- vba616 5y agoAll of the shop talk about how the dealer supposedly makes a profit or doesn't, I think should be treated as small talk that has no bearing on actually making a deal. As a customer it's important to listen and say how I respect them and that they need to make a living, because salespeople think customers are all lying scumbags. It has to be as clear as day that I intend to make a deal as soon as possible. But whether this car is being sold at a profit or why is irrelevant. I'm not their accountant.