Month: December 2020

We recently purchased a new to us vehicle. You can read more about our data driven decision making in that post. With three cars in our possession and only two drivers, it made logical sense to unload the oldest vehicle.

The first option that many Americans utilize is the Trade-In. When you buy a new car, you sell the old one. Dealers offer the least amount of money, but it is one of the easiest ways to unload a vehicle. Given the age and mileage of our used vehicle, the dealer that we bought from was very straightforward that he would give us bottom dollar for it and suggested we try CarMax instead.

CarMax is a used car dealership that specializes in buying and selling lightly used vehicles. There are many franchises open around the USA, and they make the transaction process very simple. Before I went over for their spiel, I first wanted to explore another low hurdle sales option, friends and family.

While I was cleaning out the Pontiac for a future sale, one of my neighbors commented that their son was in the market for an economical vehicle. It usually pays to listen to others and file away that knowledge for later dates and times. Well, it was a later date and time, so I informed said neighbor that the vehicle was going to be on the market. We were heading out of town for a week, so I left them the keys for an extended test drive and left them with the neighbor discount price.

Friends and family are an easy sale because you know who you are dealing with. There is very little uncertainty about being stiffed or hoodwinked. If there is, you need better friends!

Upon arriving home, we found out that the son was not interested in that particular vehicle. Bummer, it would have been an easy transaction, but it did give me the opportunity to try out CarMax. First though I needed some insurance for if the deal went south.

On Sunday, I took Frugal Boy with me to photoshoot the car ‘just in case’. It was a nice sunny day and I found a great spot in a nearby park to glamour shoot our beauty contestant. With about 30 photos in hand, I had a backup plan in the wings. Now I had a contingency plan in place. You never want to go into a negotiation without a backup plan, an escape hatch, or anything to give you an out. If you have no out, you are hosed and at the mercy of the other person at the negotiating table.

I had looked up the KBB trade-in value for a 2006 Pontiac G6 GT with 116000 miles, and it was around $2200. I would have taken $2000 from CarMax and been done with it. With Christmas, New Years, and work trips all coming up, we don’t want to have the mental baggage of a car sale on our minds while we are busy with life. At a certain point, you lose efficiency trying to squeeze the last drop of juice out of an orange. The CarMax in town was quiet on a Monday afternoon. A representative politely greeted me, explained the process and then set about taking pictures of the car and inputting data into the computer. About thirty minutes later he had an offer available for us.

I braced myself mentally and physically…

It was a whopping…

One thousand dollars.

What?! $500 is considered junkyard status. This was a vehicle that still ran and didn’t have any major known mechanical problems with it. With tender, love, and care, this vehicle would still be running ten years from now.

I put on my best poker face, thanked him for his time, asked for a print out of the offer, and told him I would have to talk it over with my wife.

CarMax offers are valid for 7 days, so you needn’t feel rushed to accept the offer right there and then.

With the borderline insulting CarMax offer in hand, I activated my contingency plan. Craigslist!

Craigslist now charges $5 to list autos. I listed our car at $2700. That put it on the lower end of the KBB good value for private party, but it was also more than any other offering to date.

Here are some of the glamour shots.

Picking good lighting and a good background is key to making your ad stand out. I had even taken the car to an automatic carwash beforehand. Frugal Boy and Frugal Girl were enamored with the whole process.

This was the text of the ad.

Clean, ultra-low mileage, non-smoker car with loads of premium features! Service record available. Priced under KBB value for a fast sale.

• Leather & Heated seats
• Remote start (perfect for cold winter mornings)
• Powerful v6 Engine
• AC
• 116000 miles (well below average)
• Newer tires
• Newer battery
• Synthetic oil changes like clockwork

This is reliable transportation that will get you to and from work/school in comfort. Priced to sell, very little negotiating room. Serious offers only. Cash or Cashier’s check. Test drives available by appointment, first-come, first-serve basis.

Instead of saying it has combined gas mileage of 20mpg, you phrase it as having a powerful V6 engine. Similarly, if you have a scrawny inline 4 cylinder, you would phrase that as getting great gas mileage, not that the 0-60 time is in the double digits.

With the ad posted, it was time to wait, and boy of boy did we wait.

A whole 16 hours before someone was test driving it on Tuesday afternoon. They loved it, and agreed on the spot to buy it at asking price. They just needed a day to get the money together.

By Wednesday morning, less than 48 hours after I posted the ad, the car title was signed over, cash in hand, and two families were very happy.

I thought our last car sale was fast. This one was even faster.

I’m going to enjoy taking the followup phone call from CarMax on Friday.

We have been dragging our feet on replacing our aging 2006 Pontiac G6 for years now. Our frugalness has extended the longevity of that car.

In a few years, we’ll replace it

It still runs

The repairs are cheaper than buying something else

Buying a new or used car is too much of a headache

It is better to stick with the problems you know

After several costly repairs earlier this year, the mental gymnastics to justify keeping it around were getting much harder.

It had been a few more years, a few years ago.

It was still running, but it had its share of quirks and when I forced myself to list them all out, I was a bit surprised at the size of the list. It is after all a 14-year-old car.

The repairs weren’t all that cheap, and instead of fixing the problems, they just revealed new ones.

Buying a car is a headache, and will continue to be a headache in the future. There is never a good time to buy a car, but there are bad times to buy a car (like when you need one right this instant).

As my daily driver, I knew all of its problems and could experience them on my commute to and from work every day. That familiar rattle, the untraceable knocking noise at highway speed, the newly added percussion of parts that were either too tight or too loose to sound the way they should. The headlight fluid was always full (condensation in a headlight assembly). The list went on and on.

It was time. We had the money saved to buy in cash and had had it for a while.

First, we narrowed down our selection to a particular make and model. We wanted something that would work well in town, something that was small enough to zip through parking lots, but with enough ground clearance to get out of our steeply sloped alleyway without scraping the bottom. Those two criteria eliminated a wide swath of choices. We also knew of several brands that we thought favorably of and some that we had a bad experience with or just had an unfavorable opinion of.

With all of that and a budget in mind, we were able to narrow it down to a Subaru Crosstrek. The Crosstrek underwent a redesign in 2018 and hasn’t changed substantially since then. That knowledge gave us a nice floor for vehicles and it just so happens that 2018 models are coming off their three year leases right about now so there are plenty of them out there for sale.

I went to the local dealership to test drive one. We had no intention of buying a new year model, but we did want to verify that we liked driving it before doing extensive shopping. One nice thing about car shopping during a pandemic is that you can usually test drive by yourself without the salesman. I was able to drive the vehicle over to a local park and meet Shae and the kids there instead of dragging the whole gaggle to the dealership. With four votes yea to that make and model, we started our data driven car shopping.

First, we needed data. We input our parameters, make, model, year, trim level, and sought after options into online searches. CarMax, Vroom, and Carvana all offer slick digital storefronts with no-haggle pricing. They also ship cars nationwide, so it is easy to gather many data points for a very specific vehicle. Then we broadened our search to include traditional dealerships. These listings were often trade-ins and were frequently at other brand stores like Kia and BMW.

Right-click and open the image below in a new tab to see the chart we based our good deal indication off. Each blue dot is a car for sale.

Any car over the blue trend line was a bad deal and taken off our radar. The perfect car would be at minimum X and Y values (mileage, price). One surprise that I had doing this was that the trend line valued miles at 11.2¢/mile. The IRS lists the mileage rate at 57.5¢/mile. Perhaps Subarus hold their value better?

One other data visualization that we added was a positive error bar to represent sales tax and other out the door costs.

What we ended up with was an easy guide to good or bad deals. Simply find the data points that are farthest below the trend line and buy that car.

Our first choice sold while we were inquiring about it. Our second choice was not as advertised and had extensive damage. There was a “too good to be true” deal at the higher miles range, but it had been extensively modified by a DIY for rally racing and didn’t seem like something worth pursuing.

At the end of a very long day of driving to the city and back with stops at two dealerships, we had our car. Yipee!

Haggling was very minimal. Most dealers were not interested in negotiating large discounts. The largest I negotiated was 4% off their asking price and I still didn’t buy that vehicle because it was only halfway to my number. 1% was far more common.