Due to bad economic situation, many people are considering to visit used car dealers even though they can afford to purchase a new one with or without having to go through auto financing option. One of the few good reasons is that car value for any specific model will go down after 1-2 years of release dates; however it still maintains a good quality on mechanical side, and customers can enjoy all other features with cheaper price.
On the other hand, the reputation of those used dealerships has not been that good over the decade. Part of the reasons is that they were reported to be involved in unfair deals and were claimed by many consumers for allegedly wrong doings. How much of all those will be really true? It could be some or a lot, but most importantly the final responsibility might need to fall upon the buyer who will sign the final sales contract. They are the ones who need to know what they are buying and how much is being charged on the vehicle that they are dealing with. Unless there is an outright committed fraud by the dealership, the customer is fully responsible for the final contract paper which is fully written and disclosed to them before they put the signature on it.
Across the country, there are many independent used car dealers who are not affiliated with the big auto manufacturers and franchise dealerships in most states. Due to growing trends of sending once popular gas guzzler vehicles to the junkyard, they are struggling in this tough field of automotive business. At the same time used car wholesale prices are up to new highs at a time when cost-conscious buyers who sometimes rely on dated information from guide books, are not willing to paying more as they used to. According to the National Independent Auto Dealers Association, some of those independent small businesses are literally being forced to sell cars for less than what they paid at the auction, which will hurt more on their end.
Often times, consumers are most likely relying on the weekly published Kelley Blue Book or NADA Used Car Guide, but they would calculate the value of used cars based on their own criteria and formulas which is not known to the public. With current rapidly increasing price trends, the fair market values could become already outdated by the time it is released.
The Black Book is a different guide book which portrays the auction prices on a daily basis; however consumers and lenders won't favor it because their main focus is on the dealer side of point. Their main customers are mostly dealerships and independent business people who are in this automotive buying and selling business and would like to know accurate price gauge every day, which would be a valid reflection of the current market.
Because of this price disparity between auction sale and the book value, more independent dealers are selling cars at prices less than what they paid at the wholesale auction. Some dealers are upfront and show the invoice telling the customers what they paid for the specific vehicles, which sometimes is understandable by many customers.
