Used Car Buyer Advocate Service Releases Pricing Study

SEE ALSO: Kelley Blue Book Can Make Buyers Blue and The Dealer Green (With Your Cash) Originally published August 2002

But First Snide's Remarks; Since the inception of The Auto Channel.Com nearly 15 years ago, we have taken the position that there is NO absolutely NO accurate pricing tool for used cars on the web or anywhere else!

Over the years Kelley Blue Book has worked hard to achieve "the final word" status, and has been assisted in their quest by manufacturer and consumer sites that don't understand that buying a used car is still like horse trading.

A used car is worth exactly what a buyer will pay for it, and because no two used cars are ever the same, setting an exact price based on arbitrary metrics is both misleading and dishonest, no matter how many disclaimers there are in the small print.

We have long argued that as long as car dealers advertise and sell used cars for less than the Kelley Blue Book says they are worth than Kelley Blue Book is not worth much more than any other used car pricing publication...so be careful out there.

And as this study shows, unless you know how to and have the fortitude to negotiate you will pay more for your used car than someone who negotiates.

But price aside, we have always stressed to used car buyers that there is more to buying a used vehicle than the price, and Car Max and other honest dealers offer buyers "peace of mind" and that we believe is priceless. What do you think? msnide@theautochannel.com

Online Car Buying Negotiations Service Carsala, Compares Prices from Used Car Retail Giant CarMax and non-CarMax Dealers to Uncover "Best" Deals

Berkeley, California; A new used-car pricing study released by Carsala, an online car buying negotiations service for value-conscious car buyers, suggests consumers can pay 25% less if they use a negotiations service like Carsala instead of paying no-haggle prices at CarMax.

The Carsala study compared prices at CarMax to prices at competing dealers with similar cars. The average asking price at all dealers (both CarMax and non-CarMax) was slightly below Kelley Blue Book (about 1% below). However, CarMax prices are non-negotiable, whereas prices at competing dealers are just starting points for negotiations. The top 50% of non-CarMax dealers’ prices were 8% lower than CarMax prices (or 9% below Kelley Blue Book). After Carsala negotiations, the prices were 25% lower than the prices at CarMax (or 26% below Kelley Blue Book). This clearly suggests buyers can save money by buying at a dealership other than CarMax, especially if they use a search and negotiations company like Carsala.

“The purpose of the study was to examine used-car pricing trends and how car buyers could save money on their next car purchase,” explained Carsala CEO, Tyler Elliston. “The results of the study were profound in that not only could car buyers achieve a better sales price by negotiating with non-CarMax dealers but they could also save money with simple research and comparison.”

Methodology Summary Carsala analysts randomly selected 20 popular cars and searched for each at Carmax.com. They then found similar cars (same year, make, model, and 250 mile radius) at other dealers and negotiated with a subset of those dealers. The Carmax prices were then compared to those offered by competing dealers, both before and after negotiations. Kelley Blue Book was used as an equalizer, accounting for differences in attributes like mileage and transmission. Finally, Autocheck reports were reviewed to control for vehicle quality.

The study was completed over a three-week period in January 2010. To view the complete study, CarMax Pricing Study, please contact Carsala at press@carsala.com.

About Carsala Founded in 2008, Carsala.com is a car buying negotiations service that helps consumers research, find and negotiate the best deal on a used-car using the company’s proprietary tools and network of experts. Working exclusively for car buyers, Carsala provides consumers with a positive automotive purchasing experience by saving buyers money; reducing the time a buyer spends researching their next car and eliminating the negotiations hassle.

Carsala is privately funded and is financially backed by Labrador Ventures, Launch Capital, Band of Angels and individual investors. For more information about Carsala, please visit www.carsala.com.