People often ask me in my professional capacity what my opinion is on the value of a car, which by and large I can confidently give. Hopefully the last 25 years mean that I am not a million miles away and nor would, I suspect most trade professionals. That was until now; it seems that whatever value I put on a car lately I am not completely sure whether I am anywhere near what this crazy market says it’s worth. With so many dealers chasing similar stock it appears that, as we are constantly saying, everybody is out to trump everyone else and the prevailing attitude seems to be “if we don’t buy a ticket we can’t win the prize”.
What strikes me as even more alarming however, is that whilst we are happy to buy cars which we pay much more than they are “worth” from auctions and other wholesale sources, we continue to hear from dealers who say the only way to get a car cheaply is through a part exchange or buying privately from a seller who is going abroad! It is probably a question asked by many people but, I guess, it must be an inbuilt chip which means that undervaluing customer’s cars is a sport which the motor trade has to indulge in and paying top dollar to wholesalers and auction vendors is part of being in the club!
Well in this market with prices on a seemingly unstoppable ascent to an unknown and mysterious summit, it is time to realise that if a customer who has already bought a car from a particular dealer and wants to trade it in 2 years later to the same dealer then that dealer must surely be happy to pay the same as he would on the open market. He will get another sale and the opportunity to sell on the part exchange and make another profit; in fact even as I type this I cannot believe that such a simple obvious selling tool needs to be spelt out because it isn’t happening automatically.
If we allow customers what the market tells us the car is worth then word will spread and more cars will sell and more trade-ins will be generated, which could lead to yet more sales and more profit opportunities and more happy customers. Surely there must be a catch.
The other strange thing is that all we hear from the trade is that stock is scarce and expensive, yet everyday in every dealership customers walk past salespeople to get their cars serviced and maintained without ever being approached by them to at least attempt to present an opportunity to upgrade their current car. Again this could lead to more business, and captive business at that, which generates another saleable car in the process.
As a customer it may be time to spin it round and ask if there is any value in changing car at present, you never know if the mountain comes to Mohammed there may be some appetite for actually doing something positive about addressing the current market situation.