Trade in Values tanking

[ViperJon]

And when the dealers are stuck with lots of used and new inventory remember who the pigs with the ADM's were and pass them by.

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[Whaler27]

Good advice for the majority I suppose. Some know how to navigate these waters no matter how their car gets gone. The tax credit on a trade in can also become a big factor.

no one ever wants to talk about the extra fees that go along with the purchase. tax is a bitch

Many of us forget to consider the impact of sales tax because we’ve never had that tax. Oregon has a heavy tax burden, but we had not had sales tax on anything until 2018 when a new .5% “privilege tax” was imposed on new vehicle purchases — as in not everybody has the privilege of working his ass off to afford a new vehicle, so anybody who does should be penalized with an additional tax (beyond the 11% state income tax on the money when you initially earned it.)

Do dealers “want to have their cake and eat it too?” Of course! Obviously. Like every other business, they want to maximize profit. They will do/charge whatever they can get away with. That’s the nature of a free(ish) market economy. They will start narrowing profit margins when fewer people are lining up to take the beatings. Water would cost $10 a glass if there was an infinite supply of people willing to pay that price.

When I went to buy my Raptor, Oregon dealers had HUGE additional markups on them, and they wouldn’t negotiate, so I bought mine from a great dealer in Maine. The local Raptors still sold, because there were enough locals willing to take the beating to own one. Amazing, but true.

 

[chicknwaffles]

Many of us forget to consider the impact of sales tax because we’ve never had that tax. Oregon has a heavy tax burden, but we had not had sales tax on anything until 2018 when a new .5% “privilege tax” was imposed on new vehicle purchases — as in not everybody has the privilege of working his ass off to afford a new vehicle, so anybody who does should be penalized with an additional tax (beyond the 11% state income tax on the money when you initially earned it.)

Do dealers “want to have their cake and eat it too?” Of course! Obviously. Like every other business, they want to maximize profit. They will do/charge whatever they can get away with. That’s the nature of a free(ish) market economy. They will start narrowing profit margins when fewer people are lining up to take the beatings. Water would cost $10 a glass if there was an infinite supply of people willing to pay that price.

no sales tax

• Alaska
• Delaware
• Montana
• New Hampshire
• Oregon

wonder how bad their income tax is though. govt is going to get their money one way or another

definitely right about dealers

 

[conFUcius]

Wonder if used rubi axles will follow the used car market finally lol.

Not until the prices for D60s and what not come down, haha.

 

[conFUcius]

In some states, you only pay taxes on the difference, here in TN trading a $45k vehicle will save you nearly $4,000 in taxes...

It's that way in Colorado too.

NC is the same way; a flat 3% on the difference. For this exact reason, it’s sometimes better to just trade in to the dealer you’re purchasing from vs. selling to Carmax, etc. outright for a few hundred dollars more.

 

[JSFoster75]

no sales tax

• Alaska
• Delaware
• Montana
• New Hampshire
• Oregon

wonder how bad their income tax is though. govt is going to get their money one way or another

definitely right about dealers

I'm in TN, no state income tax but sales tax is 9.5%... I prefer it that way so that everyone who buys something is paying tax instead of just those that don't circumvent the system, etc by getting paid "under the table". We had a tax surplus this year so they lowered everyone's license plate renewal to $5/ea instead of the $25-$40 it usually is.

TN has approximately $2.12 million registered cars x $20/car equals roughly a $42.4 million surplus by everyone paying sales tax...

https://www.statista.com/statistics...of-registered-automobiles-in-the-us-by-state/

This seems a little off:
Tennessee by the numbers
– Percentage of registered vehicles that are electric: 0.14%
– Total registered electric vehicles: 7,810 (#24 overall)
– Number of statewide charging stations: 691 (#21 overall)
– Number of charging ports per 100 EVs: 21.1 (#19 overall)

https://www.wkrn.com/news/tennessee-news/tn-electric-vehicles/

 

[Whaler27]

no sales tax

• Alaska
• Delaware
• Montana
• New Hampshire
• Oregon

wonder how bad their income tax is though. govt is going to get their money one way or another

definitely right about dealers

Yup. As I said above, Oregon has a heavy tax burden — and it’s designed to minimize impact on those who choose not to work.

As you said, every state takes its bite out of you, but not all bites are of equal size. The folks in New York, California, and Hawaii get bent over the desk for the maximum abuse. Wyoming, Tennessee, and others, not so much. I’ve made a study of this, as I’m trying to figure out where to retire. Oregon is my home, but the folks who have moved here have made it inhospitable for folks like me, so I need to go somewhere, and hope that place isn’t ruined by the same influences.

 

[TheRaven]

If used car prices are going to fall and trade in values tanked. Then new car pricing needs to be more negotiable. Seems like dealers are wanting cake and eat it right now. Low ball the trade but sell new at MSRP or higher still claiming inventory woes.

That's also already in the process of changing. I'm carefully watching the truck market cause it's time to trade up from my Tahoe, and Silverados and F150s are already starting to see some discounts (7-8% off MSRP right now). I have a relative who works for a major OEM supplier and his team tracks supply/demand trends and they are forecasting a big price crash in the new truck market around the March-April timeframe. Month over month inventory is up 25% in January and that number will only grow for February and March. A glut is coming, and with that so are discounts.

 

[conFUcius]

I'm in TN, no state income tax but sales tax is 9.5%... I prefer it that way so that everyone who buys something is paying tax instead of just those that don't circumvent the system, etc by getting paid "under the table". We had a tax surplus this year so they lowered everyone's license plate renewal to $5/ea instead of the $25-$40 it usually is.

TN has approximately $2.12 million registered cars x $20/car equals roughly a $42.4 million surplus by everyone paying sales tax...

https://www.statista.com/statistics...of-registered-automobiles-in-the-us-by-state/

This seems a little off:
Tennessee by the numbers
– Percentage of registered vehicles that are electric: 0.14%
– Total registered electric vehicles: 7,810 (#24 overall)
– Number of statewide charging stations: 691 (#21 overall)
– Number of charging ports per 100 EVs: 21.1 (#19 overall)

https://www.wkrn.com/news/tennessee-news/tn-electric-vehicles/

Could they also increase the speed limit around TYS and Alcoa? I was there the last two days for work and that main highways/road should not be 40 MPH, haha.

 

[LuvHydro]

NC is the same way; a flat 3% on the difference. For this exact reason, it’s sometimes better to just trade in to the dealer you’re purchasing from vs. selling to Carmax, etc. outright for a few hundred dollars more.

Our state is tax on the difference, including sales to Carvana even tho I did not purchase my vehicles from them.

 

[LuvHydro]

That's also already in the process of changing. I'm carefully watching the truck market cause it's time to trade up from my Tahoe, and Silverados and F150s are already starting to see some discounts (7-8% off MSRP right now). I have a relative who works for a major OEM supplier and his team tracks supply/demand trends and they are forecasting a big price crash in the new truck market around the March-April timeframe. Month over month inventory is up 25% in January and that number will only grow for February and March. A glut is coming, and with that so are discounts.

I spend too much time tracking the vehicle market and I believe you are correct.

I've saw predictions this whole mess would forever change the industry. They claim, even with the return of capacity, by design, there would be virtually no on-lot inventory, everything would be ordered, everything would sell at MSRP, yada, yada.

While that could be, I have my doubts. I believe we will end up back in the same messed up cf we've seen for years.

It's unfortunate vehicles can't be sold like normal products. Here's the price, take it or leave it.

I remember my Dad talking about Saturn. Apparently they had no-haggle pricing, but people were so used to not paying sticker, they didn't last long. But I think their cars were shit too.

 

[TheRaven]

I've saw predictions this whole mess would forever change the industry. They claim, even with the return of capacity, by design, there would be virtually no on-lot inventory, everything would be ordered, everything would sell at MSRP, yada, yada.

It definitely HAS changed the industry, permanently. And yes, big automakers like GM and Toyota have indeed stated that dealers won't be carrying the level of inventory that they used to. I believe that. But I don't see it stopping the discounts from coming back. With new vehicle prices having increased the way they have, the demand isn't going to be there. So the reduction in inventory will simply be commensurate with the reduction in demand. We'll get back to 10%+ routine discounts, but we're still looking at significantly higher prices because of the higher MSRP. As always, incomes have not increased to keep pace with the higher prices, so demand is going to stay down.

 

[Steph1]

And lets not forget the feared electric turn is approaching fast. The closer we get, the less ICE vehicles will be worth. I don’t get the people ordering new expensive Jeeps these days, especially if you’re gonna finance it long term. By the time they’re paid, they’ll hardly be worth anything.

They were talking about the huge Montreal auto show on the news this morning which is getting ready to start tomorrow. The news was that over 40% of all vehicles present are hybrids or full electric. ‍

 

[JSFoster75]

Could they also increase the speed limit around TYS and Alcoa? I was there the last two days for work and that main highways/road should not be 40 MPH, haha.

I never understood why even our Interstates here in Northeast TN are mostly 65mph... People drive 90mph regardless...

 

[TheRaven]

And lets not forget the feared electric turn is approaching fast. The closer we get, the less ICE vehicles will be worth. I don’t get the people ordering new expensive Jeeps these days, especially if you’re gonna finance it long term. By the time they’re paid, they’ll hardly be worth anything

Not sure why you would think that as ICE vehicles become harder to get, they'll be less valuable. The exact opposite is going to happen. The government is going to have to keep subsidizing EVs to get people to switch, and that's going to artificially depress prices. They WANT ICE vehicles to be more expensive than EVs. So actually the ICE vehicle is the more financially secure purchase for the foreseeable future.

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