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Keith Griffin

Prepare To Deal at CarMax for Your Next Used Car

By September 23, 2009

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CarMax storeThe headline on this article, “Prepare To Deal at CarMax for Your Next Used Car,” is not an endorsement of CarMax, the large used car chain that operates across the country. Rather, it’s my belief that the company makes a lot of money on each used car it sells – so there is lots of room to make a deal.

Way down in its earning statement released yesterday is this tidbit: “Used vehicle gross profit increased to $2,120 per unit from $1,870 per unit in the prior year quarter.” Compare that to this morsel of information from Automotive News in its Sept. 21 edition (subscription required): “The National Automobile Dealers Association says the average net profit per used vehicle sold at new-car dealerships from January through July was $214, up from $161 during the same period last year.”

CarMax doesn’t reveal net profit, but something tells me when your gross profit is 10 times the industry’s net profit, there is room to wiggle. It’s my educated guess the company can still make money with a gross profit of $1000 – so go in there and haggle for that extra $1000 off the sticker price.

September 23, 2009 at 10:48 am
(1) T Stanton says:

It’s my understanding that CarMax is the ‘no haggle’ used car store and that, “the price, is the price, is the price.”

Did this change?

September 23, 2009 at 11:52 am
(2) usedcars says:

No price is truly ever final. You could get a better deal. CarMax counts on people not haggling. Plus, you overlooked one thing – what CarMax will give you for your trade-in. That can always be changed.
Your Guide to Used Cars

September 24, 2009 at 5:25 pm
(3) T Stanton says:

Good point – I’ll have to give the haggle thing a chance. I don’t think they’ll give me anything for +280K 1994 Camry.

September 28, 2009 at 10:18 pm
(4) jeremy says:

hey just wanted to give you a little bit of inside info. I used to work at carmax and they won’t budge on the price they offer u on ur trade in… The only thing that they do is bring in a ‘buyer’ to tell you how they came to that price. I worked as a salesman so i know the process very well. I do not work there anymore so unless they changed their policy, its going to be just a waste of time… Just trying to give a little insider info.

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