Whether your looking at a Used Vehicle on a Used Dealer Lot or a New Franchise Dealers Lot. Chances are that vehicle was purchased at a Dealer Only Auction. A majority of New Franchise Dealers will sell "Trade Ins" at these auctions. New Franchise Dealers train their sales staff how to purchases Trade Ins at bottom dollar prices. One of the Worst things a consumer can say when purchasing a New Vehicle is "I have a vehicle to trade in". Dealers spend thousands to train sales staff to get these vehicles at rock bottom prices. Even though on paper You think your getting a deal....Trust me unless you know exactly how to interpret their math. They bought your Trade at a rock bottom price. They know they can sell it at Auction and make another $1000--$2000! This is how New Franchises dealers business model is. A New Vehicle Dealer is several businesses within a main business. For example I own David Marks Ford. David Marks Ford is the parent company. Under David Marks Ford is...Parts Dept...Service Dept...Sales Dept. Each Dept is it's own separate business, with it's own set of financials and the parent company David Marks Ford expects each Dept to make a profit.
Sales Dept sells a New Vehicle and buys a trade. Sales Dept pays the Service Dept to inspect that vehicle. Sales Dept will use that report to determine if they will resell that vehicle or sell it at auction. Typically each Dept charges the other Retail for services/parts rendered. Remember each Dept has certain profit margins the Parent Company expects. If the report from the Service Dept comes back that the reconditioning will cost more then the sales can afford. They'll send that vehicle to auctions. Since they got that trade at rock bottom price, sales Dept will still make a profit on the trade.
The larger dealer groups sell ALL their vehicles at Auctions. Days of being able to buy clean trades from these dealers are few and far between. That's because these dealer groups know, they can make more money at Dealer Auctions. After new vehicle inventory dropped dealers (new/used) started advertising "We Buy Vehicles".
What makes Us Different buying from Auctions. When possible I will Personally inspect vehicles at Auction prior to the sale. We have certified Technicians and Factory Authorized Equipment to perform any repairs prior to You purchasing a Used Vehicle from Us.