Small Dealers

[Steve1]

So, after a year of lurking and learning, I'm getting really close to needing a car (a 200, of course). In the last few days I've set up all the alerts and seem to notice a trend where some of the smaller dealers have 200's up to $10K cheaper than 'average'. When I say smaller dealer, I mean an independent, with 10-15 cars in inventory.

Whilst I suppose in theory that's not a reason to reject it, especially given the savings, I fear that if there is a problem somehow, it will never get resolved, especially with them being out of state.

Carfax shows no damage, regular maintenance at the dealer and low verified mileage.

Is there something I might be overlooking?

 

[Eric Sarjeant]

Be very careful. And I mean VERY careful. I’ll give you some food for thought and let you chew on it.

Those little independents get their cars from one of two places.
1) auctions
2) wholesalers

As a dealer, we are in business to sell cars. Not auction/wholesale cars. When we auction/wholesale a vehicle, we are NOT making money. So that leads you to the question: “why did they not retail it?”. Well, because the problem(s)/damages made it unsustainable to retail profitability, typically due to reconditioning costs or we know of a problem that we don’t want to “deal with later” (Heat case- i.e. oil consumption, slow leaks, intermittent issues, etc.). Anything that would come back and cost us money or tarnish our reputation basically.

What I can tell you is that vehicle almost certainly was traded in at a dealership, and then passed on. That’s a major red flag.

Is it possible to get a good one at an independent? I guess anything is possible, yes.....but I can tell you with 100% certainty. I (personally) would not trust any vehicle from any independent and that includes the big ones like CarMax/Carvana/etc.
You want a trade-in or from an enthusiast, like on the classifieds here on Mud.

 

[PDoyle]

Hello , I have a question. What is the last model year a dealer will put on the lot to retail and with how many miles?

 

[Eric Sarjeant]

Hello , I have a question. What is the last model year a dealer will put on the lot to retail and with how many miles?

There is no specific rule set on mileage/model year. I would have no issues selling anything with a title as long as it passed my service department, was safe, and all (if any) issues were disclosed upfront and signed off on by customer. When we sell FJ40s/60s, this comes up. You’re buying what you see:
A) it passed our safety inspection
B) this is what we did
C) this is what we recommend

 

[Steve1]

Thanks. Makes sense. Forgot about the classifieds here.

 

[CruiserFan88]

I would have to agree with Mr. Sargeant. With some family in the auto auction business, it seemed eye catching and wow factor is what they were looking for to push vehicles, not reliability. Not to say gems cannot be found at auctions as I've witnessed that too. I would not rule out looking at local private sellers. Ultimately thats how I purchased my 08 and though this may be special case, I was able to spend a lot of time with the truck before having to purchase. Check out Cargurus, a lot of it is dealers but there are private sellers, similar to craigslist I would say.

 

[bloc]

Your BS filter needs to be set on high alert with cargurus. I helped someone locate a good 4Runner a while back and the number of obvious scam listings on there was staggering.

 

[Madtiger]

Is it possible to get a good one at an independent? I guess anything is possible, yes.....but I can tell you with 100% certainty. I (personally) would not trust any vehicle from any independent and that includes the big ones like CarMax/Carvana/etc.
You want a trade-in or from an enthusiast, like on the classifieds here on Mud.

I assume that you also do not trust TexasDirect Auto since they are like CarMax? TexasDirectAuto just seems so cool to look at due to their vast supply of cars from cheap to uber expensive.

 

[Eric Sarjeant]

I assume that you also do not trust TexasDirect Auto since they are like CarMax? TexasDirectAuto just seems so cool to look at due to their vast supply of cars from cheap to uber expensive.

The big boys (TDA, CarMax, Carvana, etc) are certainly better since they recon and have a garage to service their vehicles. I was really just making the point- since it’s been through an auction, a dealer passed on it at some point. That’s a red flag.

 

[JohnJB]

@Eric Sarjeant roughly what percentage of sales made in a month at your dealership involve a trade-in? You're capable of absorbing all that used inventory? (edit: for clarification, capable of absorbing every "good" used car that could potentially sell on your lot, not the $500 trade-in that was pushed to the lot)

 

[32cls6speedmt]

Eric
I am not in the car business. Please correct me if I am wrong. Also a Lexus dealership gets first opportunity to buy Lexus lease trade ins. Since there is Lexus open to only Lexus dealerships. Also when dealing with real estate/cars. Take into consideration the number of days on the lot. Typically the longer it stays in the lot the lower the price will go. Supply/demand curve. On avg after 60 to 90 days it gets sent auction.

 

[ceb]

Most dealerships are chains these days and can move cars between dealerships - if the Toyota store takes a Jeep on trade and they think it could be better sold at another dealership (like the Jeep dealership) then it goes there.

Dealers have no issues with sending cars they don't want or think they can't sell, to auction or to "little used car lots" (with whom they often have a relationship).

 

[PDoyle]

Man there are so many avenues to look for vehicles now. Facebook bla bla bla...
I found a couple of 200 series located in AZ
I would love to have one shipped to my upstate NY address. Buying without trying scares me. Warranty too far away. But that's why you buy a LandCruiser right?

 

[LBridges]

Man there are so many avenues to look for vehicles now. Facebook bla bla bla...
I found a couple of 200 series located in AZ
I would love to have one shipped to my upstate NY address. Buying without trying scares me. Warranty too far away. But that's why you buy a LandCruiser right?

A few years a go I sold a Subaru SVX to an enthusiast. He flew in for a test drive, in and around the airport, then gave me a bundle of cash and drove home. If you are thinking of this I would do like he did and set up a try & buy, let the seller know you will be flying in. I personally would never buy a used vehicle without a test -- unless someone I trusted (a lot) did the test drive for me.

 

[bloc]

I’ve checked out a handful of cars at Texas Direct Auto since I am so close. Most were acceptable, but a few left a lot to be desired. I’d put them a notch below Carmax in the average quality department. But yes, along the same lines. It’s an assembly line operation with a TON of product moving through there.

 

[LXstalker]

I thought some dealer groups sent cars to auction after 90 days on the lot? My understanding was Sewell in Dallas, wanted to move cars, so they would “fine” the dealership if a car was on the lot for more than 90 days. They essentially wanted to make sure the GM was keeping inventory fresh.

 

[coleAK]

I sold Porsche in undergrad. Big group also had: VW, Audi, Toyota, Lexus, Volvo, subaru, Land Rover, jag, Nissan, infinity. We sent many “nice” cars to auction or small lots. There are lots of variables and to just imply above that “dealers keep all the nice trade-ins” is misleading. From what I remember Overall vehicles with less mass appeal in general say on the lot longer and went to auction more often. I would say a 200 fits this pattern. All that said and I don’t just trust a Used car since it came from a big dealer and I don’t not trust a car that would come from a small independent.

 

[40Man]

One of my clients is a hobby dealer, and I have gone to auction with him (but never purchased). Auction vehicles are graded on a 5.0 scale. The scale on auction cars are all over the board. At the local dealer auction, you can buy "insurance" on what you bid on. After purchase, a mechanic goes over the rig very well. If anything is discovered, you don't have to buy. My buddy/client does buy the insurance, but he has only used it once (Chevy Truck that the mechanic said shifted funny). It was Chevy owned, and Chevy replaced the transmission for free rather than have it return to auction. Then again, he is doing it for fun, and only bidding on top notch rigs. You see the craps that others are buying, and I can see the hesitance from buying from a small dealer.

I've seen the stock small dealers are buying, and there are some wonderful rigs, and some that I wouldn't dream of buying. They key is to either know cars well, or have it inspected by a good mechanic. If you pay a mechanic $50-$100 to go over a car, you won't get good info unless there are glaring defects. It takes at least three hours minimum to do a decent inspection on a car. If I bought from a small dealer, I'd insist on a good 3rd party inspection.

I walked away from a Tacoma where a small dealer wouldn't allow me to have a 3rd party inspection. He claimed an insurance issue, I claimed bull****.

Any used car has risks. If you are spending $30k+ on a rig, pay the extra $$$ for a true inspection.

 

[LXstalker]

One of my clients is a hobby dealer, and I have gone to auction with him (but never purchased). Auction vehicles are graded on a 5.0 scale. The scale on auction cars are all over the board. At the local dealer auction, you can buy "insurance" on what you bid on. After purchase, a mechanic goes over the rig very well. If anything is discovered, you don't have to buy. My buddy/client does buy the insurance, but he has only used it once (Chevy Truck that the mechanic said shifted funny). It was Chevy owned, and Chevy replaced the transmission for free rather than have it return to auction. Then again, he is doing it for fun, and only bidding on top notch rigs. You see the craps that others are buying, and I can see the hesitance from buying from a small dealer.

I've seen the stock small dealers are buying, and there are some wonderful rigs, and some that I wouldn't dream of buying. They key is to either know cars well, or have it inspected by a good mechanic. If you pay a mechanic $50-$100 to go over a car, you won't get good info unless there are glaring defects. It takes at least three hours minimum to do a decent inspection on a car. If I bought from a small dealer, I'd insist on a good 3rd party inspection.

I walked away from a Tacoma where a small dealer wouldn't allow me to have a 3rd party inspection. He claimed an insurance issue, I claimed bulls***.

Any used car has risks. If you are spending $30k+ on a rig, pay the extra $$$ for a true inspection.

Agree, if someone ever said you can’t do a PPI, I would walk out too. Both local Indy dealers I went to had no problem with me taking to get inspected. End up buying private party as the dealer cars were just too much, which should have been obvious to the dealer when 2 out of three I wanted to test drive on the lot wouldn’t start

 

[Lester did that]

I walked away from a Tacoma where a small dealer wouldn't allow me to have a 3rd party inspection. He claimed an insurance issue, I claimed bulls***.

Any used car has risks. If you are spending $30k+ on a rig, pay the extra $$$ for a true inspection.
[/QUOTE]

The dealer that I bought my LC from was a clear grifter. I brought my mechanic with me and he said the same thing. It's an insurance thing. I can't just let some guy walk into my shop or have it towed to some random place. What if something happens than I am liable. So we just played really stupid and my mechanic told me this would happen. He drove it not me and did some really good inspections when they didn't even know it.

This place was so disorganized and unprofessional. I was going to pay cash money for the rig. My mechanic told me to apply for a loan to waste their time while he poked around. The first thing the guy did was offer me weed and a drink while we ran the loan paperwork. Tried to tell me my credit was not that good, hahahahaha, but found me the best loan rate he could and a $2500 one year full warranty. This took 4 hours! Most of the people coming in where desperate. Just got a tax refund need a car any car to get to work only have $1000 to spend. And they where more than happy to sell them some hoopty. And yes the place was filled with cigarette smoke.

So during those 4 hours my mechanic found the service records stashed in a separate envelope under the passenger seat. They where mint. Like the old lady that owned the car, one owner, had this rig in the dealership every 6 months. Less than 150k and replaced the radiator, starter, timing, transmission filter and fluid 2x, oil 2x a year, everything retorqued, you name it. He called the dealer up in CT and she and her family where great customers for decades. When she passed away the family auctioned off everything thru one auction house to keep things simple. He also talked to the mechanic that worked at the stealership and he told him the only thing that was wrong with it when it came in was the battery was cooked for some reason. They put a new one in and it started right up and all the electric checked out fine.

So I pulled the trigger. Told the grifter I don't like the terms of the loan. I'm going to pay cash. He told me they don't take personal checks, red flag, and asked me why I wasted his time? So I made him an offer in cash And that SOB said he couldn't do it because the warranty cost. I told him I don't want the warranty and said oh well. After a full 8 hours in this hole of a place I was ready to be done with it. Then I just opened my backpack and pulled out a banded grand and told him you wasted my time too. Thx.

The story ends with me driving away in my semi used LC. Now there is more to the story. The paperwork was so messed up. I bought it out of state. They messed up the title and taxes. I paid cash and they didn't want to file the proper tax paper work ect. So I ended up having to park it off the streets for 3 weeks and deal with the DMV and state here in NY. Not fun. But it's all clear now. And so far really good as far as the rig goes. I really think this guy didn't even know what he had on the lot. I don't think he cared. After all the headache I did get it $4-5000 less. Would I do it again? Nope. Hell No. Nada. But maybe?! I owed my mechanic his day rate and dinner. But he gives me a good rate now because he enjoys working on LC's

Buyer beware with the small places from my experience. Although you might find a gem that fell through the cracks