Buyer BEWARE: Used Car Market Unstable - No One Knows What Your Current Car Is Really Worth

If people own their trade in, we're advising them to private sell it because we're only prepared to offer well-below blue book at this time.

Used cars have gone from being money makers to a total albatross, thus we are not interested in acquiring more. Sure, we could auction them, but that's not a massive money maker to begin with and now far less so. People aren't inquiring about used cars by and large. Our sales are almost universally new.

Matt, does this mean that used car inventory on dealer lots could be one area to pick up some solid deals? Any tips on how to approach used inventory that has been sitting on a dealership lot for 60-90+ days?

We can deal FAR BETTER on new. There's a lot of money behind the scenes there. There's no cash on the hood on the used cars nor incentives behind the scenes. You can always make an offer, but we've moved more or less to virtually NOT taking trade-ins. Used cars are suddenly big money losers and new are money winners.

For the vast majority of customers, who can not afford to carry an additional car this will be a game stopper. Automakers/Dealers will have to figure out a way to stabilize this before they can home to sell a lot of new cars.

You would think the used market would actually increase as new car sales crash due to people loosing jobs or not qualifying if they have no job? If anything cheap cars would actually boom in demand as people pay cash rather than sign long term debt obligations? I dunno but methinks the shit is hitting the fan and we are in for a rude awakening soon and a much needed economic bitch slap due to the over leveraged entitlements we have become accustomed to.

I just had one of my Fortune 500 customers ask for a 15% reduction in ALL invoicing -even on existing service/product contracts. What is next 180 pay?

Your points are definitely well taken and would fall inline with what happened coming out of the Financial Crisis, with used car prices booming. Regarding your rude awakening comment, I totally agree with you and I believe May 1st is going to be a very tough payment date for most people, which will permeate through the financial markets. The equity market is being propped up by the government stimulus and therefore is not a valid view into what is really happening on main street. I would argue the current market conditions in the energy sector is a better view into what is actually happening.

Most people need to finance to buy any car and the interest rates on used are NOT competitive in my neck of the woods.

What's happening is that people who could have bought used cars largely are not buying anything and people with income still in place are taking advantage of fire-sale pricing.

If this were a real economic downturn as opposed to a self-imposed manufactured one, then used would flourish.

There is probably some validity that once America goes back to work, pent up demand will likely cause a flood of sales of products.

I am never trading in again. My last experience was not good. I expected to not get the best trade in deal. That wasn't the problem. What was the problem was that the dealer took over 5 months to pay off my trade. I started getting threatening letters from my old lender threatening to take me to collections. It finally got resolved but not fun and totally unnecessary. But I learned my lesson. If your going to trade in makes sure your vehicles is paid off!