What Your Toyota Trade In is REALLY Worth
Jason Lancaster | Jan 08, 2014 | Comments 16
UPDATE: This year, Ford is gearing up to release an all-new truck at the 2014 Detroit Auto Show (Tim will be there on January 13 and 14). With this in mind, we thought it would be fun to rehash this article about trade in value.
One of the benefits of buying a new Tundra is that it is consistently at the top of the industry in terms of resale value. All things being equal, a Tundra holds it’s value as well as or better than an F150, Ram, or Silverado/Sierra – at least according to studies released by KBB.com, Edmunds.com, AOL autos, and many others over the last few years. As a result of all this positive press, many Tundra owners expect top dollar for their trucks…but how does a Tundra owner figure out what their truck is really worth?
Online Pricing Guides – Use With Caution
Based on conversations with a few Toyota dealership personnel, here’s the inside story on figuring out what your truck is worth.
Online pricing guides are a mixed bag. As you can see from the table below, there’s a pretty fair amount of variation between guides.
Wholesale/Trade-in Values As Listed by NADA, Manheim, and KBB
|Vehicle||NADA Wholesale||Manheim Auction Value||KBB Good||KBB Excellent|
|07′ Toyota Tundra Dbl. Cab SR5 4×4, 50k miles||$19,625||$20,200||$18,650||$19,600|
|07′ Ford F150 Super Cab XLT 4×4, 50k miles||$18,025||$16,850||$15,900||$16,750|
|07′ Chevy 1500 Extended Cab LT 4×4, 50k miles||$18,675||$18,800||$16,750||$17,600|
|07′ Dodge Ram 1500 Quadcab SLT 4×4, 50k miles||$17,800||$17,650||$15,925||$16,775|
All truck values calculated Nov. 21, 2010 using 5.7, 5.4, 5.3, and 5.7 liter engines (in order), short bed, and no other adds. Values are for “average” vehicles in Denver/Western States market.
The Manheim auction data we have is not available to consumers – it’s only available to dealers who pay a fee to access this data. However, it’s the most accurate source of data on what trades are worth. It’s based on actual auction transactions from across the country, and auction value is synonymous with trade-in value in most cases. The data changes from day to day.
KBB.com tends to be fairly accurate (they update data weekly), but they also give consumers a chance to over-estimate their vehicle’s value once people start checking off options (more on that below).
It’s harder to over-estimate your truck’s value with NADAGuides.com, but it’s also possible the NADA value will be too low.
We didn’t even bother to list the Edmunds.com used car “True Market Value” data for average condition used trucks. It is significantly lower than market – so much so as to be useless. This is surprising considering the accuracy of their new-car data.
Used Vehicle Pricing Guide Rules of Thumb:
1. No vehicle is “excellent.” Excellent vehicles are, by definition, rare. 1 in 10 rare. Maybe even 1 in 20. Therefore, there’s a 90%-95% chance your truck is average. Of course, this cuts both ways: there are very few poor trucks too.
2. Don’t go crazy with options. KBB.com and NADAGuides.com both give consumers a very long checklist of options that they can check off, but most of these options don’t actually add to the value given. Here’s what dealers typically add when appraising a trade:
- Trim package (TRD, SR5, Limited, etc.)
- Power train (which V8, which transmission)
- Misc. options like sunroofs, leather interior, lift kits, larger wheels and tires, and navigation systems
Things like tow packages, alloy wheels, after-market stereos, bluetooth, running boards…none of these items are really “adds.” The reason? Consumers come to expect these things on the average used truck.
3. Miles count – a lot. Low miles help a vehicle’s value – sometimes more than the guides add. Conversely, high miles hurt value – sometimes more than the guides deduct.
4. Pricing guides are just guides. Every vehicle is different, and very few vehicles are worth exactly the amount listed online. If you want to know what your trade-in is really worth, you need to ask a few dealers for appraisals.
Of course, you don’t have to trade your truck. If you can sell it yourself, you’ll make a lot more money.
A whole book can be written on trade-in negotiation, but when it comes to estimating a vehicle’s value and then using that in a negotiation, the best advice reads like this:
- Print out your vehicle’s value as determined by KBB.com and NADAGuides.com, adding for as many options as you can (even though many don’t actually count)
- Find ads from competing dealers that are selling cars similar to your trade. You can use these ads to demonstrate to the dealer what price they can ask for.
- Explain that you are considering selling your trade outright, but that a good trade-in offer would convince you to save time and give it to the dealer.
- Get appraisals from competing dealers, preferably in writing and not contingent upon a purchase (only that’s a tough thing to do in some markets).
- Take your time. Trades depreciate over time, but waiting a couple of weeks to look for a good deal isn’t going to hurt trade-in value too much.
Filed Under: Buying a Tundra
Good points. I have traded in over 15 1-4 year old vehicles in the past 20 years or so and can tell you that every dealer will be different in price. For me, it was up to about 1,000 difference in trade-in price and is definitely worth going to 3-6 dealers to see what they want. Some will low ball you terribly while others will want your truck to give you higher than you expected. However, one comment about selling your vehicle outright being better than trading it in is not the case at times. Reason being is say you sell your Tundra outright for 30K and dealer will give you 28.5K on a new vehicle purchase. You are not gaining anything since the 28.5K is deducted from a new vehicle purchase at say the going sales tax rate where I live around 6%. That extra 1500-1800 bucks savings in sales tax on the trade in vs. new price means you would have to sell your 30K vehicle for more than that just to make up for the savings in trade in sales tax savings. Unless, I have found a few dealers who are still willing to do a pass-thru meaning I find a buyer for my truck myself, bring the customer into the dealer and have the dealer technically do all the paperwork for us where dealer technically on paper sells the vehicle to my buyer I found. I usually only have to pay 100-200 bucks tops to do a safety inspection of my traded in truck and still save 1500-2,000 in sales tax savings since trade in value is deducted off purchase price when it comes time to pay sales tax on a new vehicle purchase.
Wow, in 45 years of driving I have never traded in anything. Sold a few but I drive most until they are almost dead. I donate them or basically give them to someone who needs it more that I do if it’s still safe to drive.
Are you replacing them because of business reasons, deprecations etc? If it’s just because you like having the new models I can understand that also.
In that time would you say that most of the 15 vehicles were still in good operating condition?
I tend to get attached to old cars and trucks and want to run them forever. Even if I was worth a hundred million bucks I would still keep cars and trucks till their end. I will admit that I am a total cheapskate for sure. My 1994 Subaru was rusting out with around 350,000 miles on it. When the fuel pump died I junked it. My T100 was rusting to death last year so I gave it to a friend and then replaced it. I would have kept that one for sure.
mk – Great point about paying sales tax on the difference. If your trade is valuable enough, you might be better off trading.
Thanks for bringing it up here – it’s an excellent point.
Your welcome Jason. It is a very valid point on savings on sales tax with a valuable trade-in. I use to trade my chevy silverados in every 1-2 years tops and am finding so far that 2-3 years on the tundra is not too bad either of a trade in price thus saving well over 1,000 dollars just in sales tax alone. Now though I hear a newly redesigned tundra is not coming out until say 2014, so don’t know if my 2010 tundra will hold its value 4 model years from now??? I can only hope by then they will build me my dream truck, a crew max 6 1/2′ bed length. If that happens, I could care less what I get for a trade in since it will be gone for sure if they build me what I want.
mk – 2014 is the model year, but we might see it in 2013. As for the 6.5′ bed on a crew? I’m not sure. Glad to hear the trades are working for you every 2-3 years.
one thing with overall truck value resale, etc.
it’s always been hard, to me anyway, to really figure out what truck has better resale value vs another brand.
Yes, toyota is at the top of all those lists but the fact is I walked into a Ram dealership and got over 10K off a few months back, which toyota would not even come close to even though they start around the same MSRP. So that has to factor in somewhere.
Also, it depends on the market, where you trade it at (toyota to a toyota dealer, ford to a ford dealer, etc), I traded a tundra in at a Ram dealer, they pay more for there own since it’s easier for them to sell.
There is also personnel negotiation skills and timing.
bottom line, I just feel like there are way too many variables to truly say one truck brand has better resale value than another, when you talking about just your own situation.
Well written article Jason. I know mileage is a downfall. How many can say their truck has over 170k miles and still have the looks of a new truck? If truck is well kept up and no issues then it should get a fair price on trade-in. With the prices from both KBB, and NADA you have a guide on which you can fight on trade-in.
I hear you, and I believe your truck is probably the nicest 170k-miler in the country.
However, mileage is a cold hard fact, and those are sort of inescapable. Even if you have the nicest high miles truck in the world, it’s still a high miles truck…and therefore not going to bring the money of an average truck with fewer miles.
What that tells me Jason that those who come up the prices don’t believe in vehicles are made to last. With that said, dealers shouldn’t advertise as such either. It’s false if they do.
It’s a fair point – a lot of people are working under the assumption that they want a vehicle with less than 100k miles. As consumers begin to recognize that vehicles can last much longer, prices will rise.
What I am going to do is keep the truck pass 200k miles. Hey Toyota can take my truck apart at 200k miles. I will fix the issues I have and it still in great shape as for paint. It has less than 6 months payments left so there will be plenty to fix issues and just ride the truck.
I find around me no dealer wants a vehicle even if say 5 years old with over 100K miles, they don’t sell so dealers don’t want them, even the tundra. Your best bet is to keep it forever after say 120K unless you can find someone to buy it outright not trading it in at all.
PLus, another point of trading in vehicles every 2-3 years is the cost of new 18″ tires is pushing 1000 bucks and all toyota dealers around me won’t put a used vehicle on their lot even if 1/2 tread left and will replace with the cheapest new tires they can get. When the sales guy tells me that the tires are say 5/32″ of an inch and they are not able to sell my tundra without new tires I tell them that is your problem, not mine, and shouldn’t be held against me since technically about 1/2 tread left at say 20K miles should last pushing another 20K miles at most = NOT my problem.
This way, I figure I am saving near 1000 bucks in tires alone trading the tundra in at 2-2 1/2 years or so and I don’t allow the dealers to deduct for tire wear since is normal for the cheap OEM tires to barely last 36K miles is all. I also tell the dealers if Toyota mfg. wouldn’t be so cheap by putting the cheapest, NOT very long lasting OEM tires on these trucks, they wouldn’t need to be replaced so soon under 40K miles.
Tundra: The clear leader on QDR and finally a dealer network that is beginning to understand what truck buyers want. It is the intangibles that are now beginning to yield bigger dividends for the company and its customers. This yields a better product and service to the customer.
GM troubles: Pick-up sales rate down recently by 16%, the major recalls in place – one just yesterday and it’s a biggie and 3 to 5 month supply of trucks on the dealers’ lots.
Ford troubles: Failures in engineering, warranties that are not honored, riding solely on the ill will of GM’s woes.
RAM: Is it Italian or German? It does not matter; it’s a 100% foreign. Granted their last two year growth rates have been stellar but with the major changes that have occurred will that momentum be maintained? Will the quality go up like Tundra or down like GM and Ford?
All of the above indicate to me, the Tundra will hold more value longer for the consumer and that gap is widening significantly. That’s what building a better product and service will do for a company.
around here, I think the tundra holds their trade in value more than your listing vs. the competitors do meaning the tundra trade ins are more than chevy and ford by more than just say 1400 bucks. Reason is everyone here drives chevy and fords (dime a dozen) and only just a few drive the tundra making it more valued come trade in time. I bet 200 to 1 ford and chevy sale over a tundra sale at least, if not a lot more. This is ford/chevy region and I like to be different. The 2 people I know who drive tundras love them over their former chevy silverados.
If that is true about GM woes and tons of chevy silverado’s on dealers’ lots, the rebates will be right back up to 4-5K like always with GM which is not what they wanted to do when they launched the much more expensive crewmax 6 1/2′ bed being 43K msrp as I would equip it. That is more than the crewmax tundra at around 40K apples to apples equipped. I still might consider the chevy 6 1/2′ bed crewmax once the rebates go to 4K since that is the bed/cab config I desired for so long in a true 1/2 ton truck and tundra doesn’t offer it and ONLY company that doesn’t have it now.
If I knew the tundra in 2015 would offer a crewmax 6 1/2′ bed which I doubt they will since toyota is very slow in changing, I’d wait though and get it then for sure.
hello everyone -wanting to sell my 2014 toyota tundra –