Quote:
Originally Posted by Overflow
Went to go see... Carvana offered me $12,000. NADA offered $15,500. KBB offered $16,500.
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Quote:
Originally Posted by Overflow
No one said KBB or NADA purchase cars. But 9/10, dealerships base car trade in values on either KBB or NADA.
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Very few dealerships, less than 1 out of 10 base trade in value on kbb or nada consumer guides. It was common to use Black book. Now it's more common to use
MMR. This is a online system that allows you to review the recent weeks results from Manheim auto auctions (the biggest chain of auto auctions in the US) on the exact same or similar cars to what you are evaluating. You see this gives closer to a actual cash value, that way if they needed to unload it for whatever reason (not selling, not the right kind of car for their lot, they need the cash flow), this is close to a number they can actually get for it at the auction. Furthermore, this is a number closer to what they can go to a auction and buy the car for. They don't want to pay much more than they can sell it for or buy it for at the auction. There's a little room there to close a deal on another unit and savings in buying cost and transport costs but this generally what a good used car manager bases his numbers on.
Both black book and access to MMR data is something the general public dosen't have access too.
This might not be the way most people have decided it works in their head, but it is the facts of how this part of the business is done
Carvana probably has some algorithm that factors black book values, MMR reports and then errors on the low side to spit out a instant number
I'm not trying to argue with you, just providing real hard facts about how the business works. I know a little bit about this ��. My information is based on doing it for many years, for large cooperate dealerships and small time one location Independents.