TDV8 RR Bid from Land Rover
Discussion
After 4 days of chasing a certain dealer in up North for a part ex value on a 2006 TDV8 Rand Rover Vogue in Buckingham Blue with 67,000 miles on the clock they came back to me with a bid of £12,000! A whole £15,000 under book money. HOW do these people stay in business.....well actually I suppose with margins like that it is a silly question!
Bish said:
After 4 days of chasing a certain dealer in up North for a part ex value on a 2006 TDV8 Rand Rover Vogue in Buckingham Blue with 67,000 miles on the clock they came back to me with a bid of £12,000! A whole £15,000 under book money. HOW do these people stay in business.....well actually I suppose with margins like that it is a silly question!
Sounds like a mistake to me.From your profile arent you a dealer and if so cant you retail it or trade it (autotrade-mail) etc??
There is no shortage of 2006 TDV8 RR Vogues with that level of mileage on Autotrader for around £25k so, while an offer of £13k probably means they just did not want to buy the car, it is probably not as far off the actual trade price as it sounds (when the dealer has factored in what they estimate it will cost to get the car up to scratch and put a 12 month warranty on it, and make some profit).....
Mr POD said:
There's a negotiation ploy, and there's a piss take. They tried it on, they thought you were 'one they'd seen coming' as in more money than sence.
Phone them back and tell them you'll happily take £12K as long as you can have a NEW one with £20K off the list price.
When you've agreed the price on the new one with £20K off, but before you sign over the old one tell them you'll sell the part exchange yourself. Phone them back and tell them you'll happily take £12K as long as you can have a NEW one with £20K off the list price.
R12HCO said:
So surely they would be looking £18-£20k?
I think the bottom line is that main dealers are not keen on buying in relatively old, high mileage cars - they will take them as a trade-in but even then often put them through the auction rather than trying to sell them. They will happily pay more money for younger cars, still under manufacturers warranty, give them a quick polish and stick them on the forecourt for a quick turn around.Re the mark up on what they buy the car for to what they sell it for, you have to bear in mind the large fixed overheads a main dealer wil be carrying. As well as the cost of the site (whether rented or owned, probably well over £100k pa) they have an overdraft to cover the value of the stock they hold (say 30 cars at an average cost of £25k = £750k @ 7% interest = £52k pa) plus salaries (say 25 staff at average £25k = £625k + NI = c£700kpa) plus workshop equipment, insurance, accountants, admin, cleaning, advertising etc etc. So an average sized main dealer will have fixed costs of c£900k pa to break even - which means he needs to make a profit on cars and servicing of around £18k a week.
Hence the trade-in price and the forecourt price can sometimes seem to carry a large mark up but they have to factor in how many cars they sell a week to what they need to keep the business running.
philcray said:
I think the bottom line is that main dealers are not keen on buying in relatively old, high mileage cars - they will take them as a trade-in but even then often put them through the auction rather than trying to sell them. They will happily pay more money for younger cars, still under manufacturers warranty, give them a quick polish and stick them on the forecourt for a quick turn around.
Re the mark up on what they buy the car for to what they sell it for, you have to bear in mind the large fixed overheads a main dealer wil be carrying. As well as the cost of the site (whether rented or owned, probably well over £100k pa) they have an overdraft to cover the value of the stock they hold (say 30 cars at an average cost of £25k = £750k @ 7% interest = £52k pa) plus salaries (say 25 staff at average £25k = £625k + NI = c£700kpa) plus workshop equipment, insurance, accountants, admin, cleaning, advertising etc etc. So an average sized main dealer will have fixed costs of c£900k pa to break even - which means he needs to make a profit on cars and servicing of around £18k a week.
Hence the trade-in price and the forecourt price can sometimes seem to carry a large mark up but they have to factor in how many cars they sell a week to what they need to keep the business running.
I understand the above; but if they make a habbit of offering stupidly low, they will never have any cars to put onto the forecourt to even attempt to make turnover/profit on. Re the mark up on what they buy the car for to what they sell it for, you have to bear in mind the large fixed overheads a main dealer wil be carrying. As well as the cost of the site (whether rented or owned, probably well over £100k pa) they have an overdraft to cover the value of the stock they hold (say 30 cars at an average cost of £25k = £750k @ 7% interest = £52k pa) plus salaries (say 25 staff at average £25k = £625k + NI = c£700kpa) plus workshop equipment, insurance, accountants, admin, cleaning, advertising etc etc. So an average sized main dealer will have fixed costs of c£900k pa to break even - which means he needs to make a profit on cars and servicing of around £18k a week.
Hence the trade-in price and the forecourt price can sometimes seem to carry a large mark up but they have to factor in how many cars they sell a week to what they need to keep the business running.
From what I can gather talking to someone fairly high up at a group of LR dealerships the prices of used Range Rovers are taking quite a hit at the moment-this particular group are overstocked,business for used FFRR is slow and the cars have started dropping considerably in the trade guides each month.
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