Honda Pilot Trade In -
Initially when I was considering getting a new vehicle I wasn’t thinking trade-in, it was strictly bring back the Pilot and get a new vehicle. But as you probably know by now I bought the Pilot so a trade in was a possibility. I had a new factor in my car buying decision and it made my dealings with car salespeople even that much more interesting. I have gotten trade-in quotes from four dealerships to date, in order of offer date: Volkswagen, Subaru, Toyota
#1 Volkswagen – Ok so there about two months back I was looking at the Volkswagen Golf Wagon TDI. I had read some good things about the diesel engines and I liked the look of the wagon, I’ll discuss the vehicle, test drive and what not at a later date just focusing on the trade in aspect now. So off I went to test drive the VW and the dealership said they would have a trade in for me done in about 10 minutes. So I was back in about 15 minutes and they said they called around to their used car guy and offered me $12,500 in trade. I nodded politely thinking they were out to lunch and told them I would get back to them once I had thought it over. Of course there was no way I was going to accept $12,500 in trade. We emailed back and forth a bit with the salesperson explaining to me that I would also save the tax on the trade in and that I would actually have to sell my vehicle for over $16,000 to get the same as he was offering with the $12,500 trade…. An explanation is in order:
When you trade in a vehicle they take the trade value off the before tax amount, but if you put cash down on a vehicle it comes off the after tax amount. Let’s use an example of a vehicle that costs $20,000 plus tax and a trade in vs cash down of $10,000:
Vehicle Price | Trade In | Tax on Vehicle | Cash Down | Total Paid | |
Trade In | $20,000 | ($10,000) | $1,300 | 0 | $11,300 |
Cash Down | $20,000 | 0 | $2,600 | $10,000 | $12,600 |
So that would partly explain why I would have to get more than $12,500 in a private sale because I would also save the tax on $12,500 trade in which would be $12,500 X 0.13 = $1,625. But that still doesn’t mean I have to get $16,000 for my vehicle so there was something else included in what the salesperson was telling me. I figured out that he was quoting me the figure if I had tax included in my selling price. If I sold my vehicle for $16,000 tax included then I would have to remit the sales tax, which would be 13% of the selling price. That would leave me with $16,000 / 1.13 = $14,160 to put cash down which is roughly equal to $12,500 in trade. But of course I would never sell my Pilot for $16,000 tax included and for every dollar I could sell it privately for over $14,125 ($12,500 trade + $1,625 tax savings from trade) would be an extra dollar in my pocket. For a reference point just go to autotrader.ca and look at what a 2007 Pilot EX with 100,000 km sells for….. it is nowhere close to $14,000. I could save myself thousands by selling privately. Yes it is a bit more of a hassle but we are talking THOUSANDS of dollars, nothing comes easy people.
Anyway we went back and forth a bit and he said I could bring the Pilot back in and he would shop it around. As you know by now I enjoy the back and forth deal process so I brought it back in. I dropped back (after another test drive) and he told me that he was getting a smell of coolant which I would have to get fixed before anyone would look at it, he was concerned I had serious engine trouble he said. Turns out I had a coolant line clamp that was rusting so $250 later Honda had my $10 coolant line clamp fixed. I let him know it was fixed and he said the $12,500 offer still stood. I have no idea if he had any intention of giving me more than $12,500 or if he just wanted me to come back in, but in any event I still wasn’t trading the Pilot in for $12,500. In a later email he referred to a trade of $12,000 so I lost $500 somewhere along the way. That was the end of trade in adventure #1.
STRIKE 1!
#2 Subaru – A couple of weeks later I made a visit to Subaru, my mind was switching back to needing a 4wd vehicle. I made an appointment to see a salesperson who I contacted via email. On my first visit he was a no show and second time he was busy so I just dealt with someone else. They have a big shiny new dealership but seem to have a salesperson shortage for some reason. Anyway the guy said their finance guy would look at my vehicle and give me an idea of what I could get on a trade. He asked me what I was looking to get for it, I told him I was expecting Canadian Black Book Trade value. Obviously they want to know your limit and then get the vehicle for much lower than your limit. Normally I would not have said anything but I figured I would try this to see how it worked. So the trade in guy looked at the vehicle, got on the phone, went to Black Book website http://www.canadianblackbook.com/ and offered me a staggering $10,000. He went as far to say that they would only sell the vehicle for $14,000. I am a reasonable person, I am not a stupid person, he was talking to me like I was a stupid person in my opinion. I told him he was way off the mark and left. The salesperson emailed me the next day saying he understood they were a bit off on their trade in estimates. I emailed back saying they were over $2,000 off the trade in offer I had from another dealer and never heard back from him. If I decide to get a Subaru in the future I will just get a different salesperson.
STRIKE 2!!
#3 Toyota – Ok, so there are good deals happening on RAV4’s and I was still curious if there were any better trade offers out there so I went off to Toyota. Salesperson I dealt with is great, nice guy, seems very honest. He sent his guy out to get me a trade estimate and it came back at $12,000…. There was a definite trend emerging here. It was at this point I figured I would not be trading the Pilot and decided I would go get the brakes done on it and hunker down for the winter. Then all of a sudden I got a call from Toyota sales guy indicating he may be able to get a better trade offer through one of his other appraisal people…. This seemed strange but I said go ahead, then I mentioned I just went and got a full brake job on the Pilot and I felt the wind come out of his sails. I guess he figured this means I would be looking for another $1,000 on top of the better trade offer and he was right. I never heard back from him either….. maybe stories are getting around about the difficult guy with the beautiful black 2007 Honda Pilot EX.
STRIKE 3!!!
#4 Kia – I just couldn’t resist trying to see if I could top the $12,500 offer from VW. The Sportage looks kind of cool, has a new turbocharged engine and had good rates (its no Honda pilot mind you) so I figured I would take one out and let them make me an offer on the Pilot. Again they asked me what I wanted, I gave a vague answer then I waited 15 minutes for some back room talks to take place and salesperson reappeared with an offer of $12,500. Now I am sure they are all in cahoots, I am also sure that $12,500 is all I am going to get on trade for the pilot. He tried a few common sales techniques on me but as usual I just said I would think it over and left with his offer scribbled on the back of his business card.
STRIKE 4…….
This does not mean I won’t go to other dealerships just to gather more trade in stories however so stay tuned for further updates!
Here is the actual Black Book Trade Value report for my Pilot:
Your trade-in estimate based on : | ||
Vehicle : | 2007 Honda Pilot EX 4D Utility 4WD | |
Distance travelled : | 94000 | |
Options : | DVD Entertainment System | |
Low † : | $16,142 | |
High † : | $18,562 | |
I don’t see $12,500 mentioned here anywhere……
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