Getting the best out of your trade-in

This week we examine the lost art of trading-in your old car at the local dealers and advise how to make the best of that depreciating asset stuck on your driveway and get the best out of your Trade-In!

The upswing in new car sales which came with the turn of the new year is a very good sign that the Irish economy is, if not quite off the floor then at least balanced on one knee. The early January figures were up by a significant percentage and while we were all worried that the market couldn’t sustain itself, and that it would collapse back down again, thankfully that hasn’t been the case and sales to the end of February were up 27.3% on last year.
With that rise in new sales, clearly many of you will be looking to trade-in your old smoker against something new and shiny, but that very act of trading-in can be a vexed issue. It seems that too often there is an antagonistic relationship between buyer and seller before a foot has even crossed the threshold of the dealership.
It’s a shame that this is the case, but it’s borne of years of miss-trust of the motor trade and there are some very simple little rules that can help you not only get the best possible deal for your old car, but also carry out the process in as pleasant a way as possible.

1. Be nice to each other.

While you would, rightly, expect any car dealer or salesperson to act in a courteous and helpful manner towards you, please remember that courtesy is a two way street. If you go in with your back up before a word has been spoken, you’re going to be on to a loser straight away. Be nice, be firm in your own decisions and never be afraid to, politely, ask questions. Remember the salesperson is a human too, and by and large they are as keen on helping you get the best deal possible as they are on improving their own sales charts. Why? Because it means you’re more likely to come back for more and repeat trade is how companies really survive and prosper. A little niceness, in both directions, will help everything work more smoothly. Conversely, if you genuinely feel you’re being spun a yarn or flat-out lied to, just turn on heel and walk away without a backward glance; there are plenty more dealers out there.

2. Be realistic.

Unlike some retail trades, the motor trade lives and works on very, very small margins. On all but the most premium of new motors, the margin for the dealer is probably less and eight per cent. So, there’s no point in marching in expecting first a hefty discount and then a massive trade-in. Business is business, and the dealer will almost certainly low-ball your car’s valuation at first, simply because that’s the best way for them to protect their margin. Be patient and be informed. A quick glance through the second hand ads is not the way to value your own car – those prices, remember, have a margin and a cost of sale built in. The rule of thumb is that the price on the windscreen sticker on the forecourt for any second hand car is the value of the car plus a margin. This could be around €1,000 for the average vehicle but is very much dependent on the value of the car to start with. The lower the value the lower the margin. Work that figure into your own calculations.

3. Wash up.

You would be amazed at what a difference a simple valet can make to a car. It may cost a couple of hundred Euro to get a proper job done, but it can literally add thousands to the value. If a car looks clean and spiffy inside and out, then it will at least appear to have been better cared for and that will drive its value up. Get the chamois out…

4. Papers, please.

It sounds obvious, but you would be surprised how many of us trip up on not keeping a complete paperwork file for our cars. I don’t just mean the logbook and the NCT Certificate either – I mean everything. Every receipt, every service stamp, everything right down to the credit card stubs for that time you treated it to a luxury hand wash. If you can hand over a file bulging with paperwork to show just how carefully you’ve been looking after the car (and a fully rubber-stamped service book should be the absolute minimum you should contemplate handing over) then you will be offered a better deal for the car.
While we’re here, it behooves us to blow our own trumpet and suggest that including a full history check from in with the paperwork might not be a bad idea. If nothing else, it will swiftly prove to the dealer that the history of your car is sound where mileage, condition, write-off and finance are concerned. Pays for itself, really…

5. Look at the endgame.

In most cases, it matters more what you are trading-in against than what you have to trade-in. If you are going for the most popular new model, the one there’s a waiting list for, then you’re going to get the bare minimum trade-in. Why? Because there’s a queue of other people waiting to get the same car and they might not be so bothered about trade-in's. If however the car you’re looking at is slightly less popular, or better yet, the dealer has three identical models sitting out the back waiting to be sold, you have leverage to drive a harder bargain. Be aware of what you’re buying, and do your research – it makes as much a difference as the intrinsic value of your trade-in.
So, with all that done, you should be able to get a decent price for your own wheels and be motoring home in something new and shiny. Just remember to look after it and keep the paperwork neat – the day you buy is the day you sell, after all…