Buying a new Car

[Owen]

After a phone call today from a friend looking for a valuation on his MINI, I decided it would be no harm to give people an insight into how part exchange valuations work, especially now that the new MINI is on the way.

Let say you buy a MINI, and the new MINI comes out later this year. You eye up the shiny new car, and decide "Yes, I'm having it". You have an idea in your head what your car is worth, because you've seen them on Carzone, approach your Dealer to wrap it all up, and get the shock of your life ... your Dealer is offering you a lower price than what you felt the car was worth. So why is that?

Well, a private sale on Carzone can dictate it's own price - and people who want to sell their own cars want top dollar for them. But a Dealer? Well, if you see a Dealer's price of € 21, 500 for a similar car, it could probably be bought without a trade in for € 20, 000. Factor in Dealer profit, and the car is costing perhaps € 1k less? Nope. Even when you factor in Dealer profits, you're forgetting about overheads and warranties. And they're not cheap. This is before tyres @ 200 Euro per corner, Bodywork, etc. So a car retailing for € 21, 500 could be originally traded in for € 17k!

So why the warranties and overheads? It's because, quite simply, if you expect a Premium used car to come in pristine condition, and be every bit as good as a new car, then Dealers are obligated to put the car through very thorough checks. That .5 inch scratch on the bumper is acceptable to you? It won't be to the next owner, and painting a panel can cost anything up to €300. So you can quickly see that everything must be accounted for. And this isn't exclusive to MINI, it happens in every brand in the world.

So the next time a Dealer gives you a panic attack by valuing your car for less than what you feel it's worth, ask them to explain it. You'll see most Dealers are reasonable, and the costs will be justified. And of course you can still haggle aftewards, but the Dealer's job is to sell more cars, and the only way we can do this is to give you the best value possible for your own car, to encourage you to continue your MINI Adventure.

Hope this helps!

[leyland]

Good article Owen, What determines when the garage decides to have a sale, Is it space restriction, change of model, time of the year or any other reason

Regards
Richard

[Owen]

Usually, time of the year, but mostly when we're over stocked. I'm delighted to say this will never happen with MINI. Used MINIs are so difficult to get your hands on, and so sought after, they usually live on the forecourt for approx 10 days at most.

[laura]

I don't get how some dealers over here make a profit, not least th eone that bought our convertible ol:

Do you have the same massive variations in P/X we seem to suffer?

ie P/X for MCSC (march 06, 4k miles etc) between 16.5 and 20.5k?