Are you in the market for a used car, bakkie or used SUV?
If you are looking around at different used Toyota vehicles, the first thing that you will notice is that prices vary a lot between different models, between different dealerships and even between different versions of exactly the same used car. Why is that?
One of the big differences between used vehicles and brand-new vehicles is the fact that there is no prescribed retail price for used cars, bakkies or SUVs. Each dealer can set his/her own price, and prices may even vary over time.
So what are the main factors that influence a used car’s price?
To determine a used car’s price, a dealer will usually start with the original selling price and date. Once that is determined, he/ she will calculate the age and the average value that a car loses over time to get an estimate of what the car, bakkie or SUV should be worth. All cars lose their value over time and this is called depreciation.
Dealers can also reference a number of industry databases, where independent companies collate the sales prices of similar cars, calculate average prices and then give a dealer an indicative price of what a used car is worth.
Mileage and condition
The next important influence on the price of a used vehicle, like a used Toyota, is to look at the number of kilometres on the odometer (usually referred to as mileage) and the overall condition of the used car.
You may find two very similar vehicles on a dealership floor – let’s say two Toyota Hilux models of the same colour and manufactured in the same year – that have very different values. It may be that the one has only 60 000 km on its odometer, while the other has already travelled more than 200 000 km. The vehicle with the lower mileage will normally have the higher value.
Equally important is the condition of the used vehicle. If a vehicle has been abused, damaged in an accident or poorly repaired, this would drive down its used price, regardless of how many kilometres it has travelled.
Another influencing factor, albeit a very small one, is optional extras. If you compare different used vehicles of the same make, model and year of manufacture, but the one has a sunroof, an optional cosmetic package or other high-value optional extra, then the chances are that the vehicle with the optional extras will cost more when you buy it second hand. For example, consider a normal Toyota Hilux Double Cab 3.0 D-4D and a Dakar Edition model of the same Hilux. The latter will cost more.
So, what can you do if you want to find the best possible used Toyota for your money?
The first step is to ask around. If you visit a Toyota Automark dealership, you can compare different versions of the vehicle you had in mind. The dealer can also make contact with other Automark dealerships to find other models and prices of the specific vehicle that you are interested in.
You can also speak to your insurance broker, Toyota Financial Services representative or local Automark dealer to find what the average price for a specific model is, whether it is one that you want to buy or a vehicle that you want to trade in.
Lastly, you can visit a used vehicle website like Automark.co.za to compare different models and get an average price for the used Toyota that you have in mind.
Understanding the difference between retail and trade prices
When you shop around for prices on your ideal used Toyota, you will come across the terms “retail price” and “trade price”.
The retail price is the price that a dealer asks you for a vehicle that he/she has on the showroom floor, while the trade price is the price that a dealer will offer you for a used vehicle that you want to sell to him/her.
The trade price will usually be lower than the retail price, because a dealer has to consider the cost of buying the vehicle, repairing any cosmetic or mechanical damage, advertising the vehicle and holding it for a time before reselling it.
There is a third term that you will sometimes hear, especially when speaking to your insurance agent or financier, namely “book value”. A vehicle’s book value is similar to the trade price, but it is simply an estimation based on other vehicles of a similar make, model and manufacturing date.
A dealer will often reference the book value when looking at a used vehicle, but he/she will still calculate an individual value based on the car’s age, condition and distance travelled.
Ask for assistance
Finding the right vehicle at the right price can be daunting and confusing. If you are uncertain about where to start, how much your car is worth, what your ideal car will cost in the second-hand market or even just what is available in the market, then do not hesitate to contact your nearest Automark dealer.
Automark dealers specialise in used vehicles, especially used Toyota models, and they will support you along the way and help you to make an informed choice and find the best used Toyota for your money.