I was inspired to write this article by a story told by our leader Dmitry Izvekov. Thinking about a replacement for his 2007 Land Rover Freelander II, he approached one of the Land Rover dealerships, where the manager of the used car department offhand offered to buy his car for ... 300 thousand rubles, despite the fact that the average market value of 7- summer car with a diesel engine and "automatic" ranged from 700-800 thousand.
Frankly, I was confused. It is known that in the "trade-in" cars are bought a little cheaper than the average market value, and they are sold - a little more expensive. Everything is clear, salons do business, and the client gets rid of the need to post ads, wait for calls from buyers, then spend time selling and reissuing ... But for the announced purchase price to be half the market average, this is already impudence.
test subject
Soon the opportunity turned up to check how fair the dealerships are, on their own experience. To understand this, it was necessary to have a car that I know thoroughly: what are its advantages and disadvantages and how much does it really cost. Agree, this is more correct than comparing with the "average temperature in the hospital", that is, at average prices on free classifieds portals.
There was a good opportunity: a friend bought a Volvo S80, and she attracted me as an assistant. For almost a month we "hunted" for a car within 700 thousand rubles, not very old, and certainly with one owner and a transparent service history. After a series of unsuccessful negotiations and meetings, the desired was found: a chic beige S80 2008 with dealer service in the SwedMobil auto center and a mileage of 70 thousand, which was confirmed by the service book and the service manager in the salon itself. Having found a painted over scratch on the door, a “dead” ignition unit for the gas-discharge lamp of the left headlight, a few more minor flaws and taking into account the need to urgently change all the belts, we bargained 15 thousand from the original 700. As a result, a strong and well-groomed representative of the Swedish business turned out to be in the hands of a happy girl -class for 685 thousand rubles. That's what I tried to "sell" in a trade-in.
Test purchase: "Autobiography"
For the experiment, I chose a dealer cluster on Pulkovskoye Highway, near the St. Petersburg airport. And one of them is the same “Autobiography”, where Dmitry was offered 300 thousand for a 7-year-old Friel. Well, let's start with them. Moreover, in addition to Land Rover, they just sell Volvo.
Salon "Autobiography"
The staff were charming. The administrator met at the entrance and took to the manager. He made out the sale, but seeing that I was hesitantly walking around, he drew attention to me, politely introduced himself and, after listening to my "presentation" of the car, announced: "Tip at 500 thousand rubles. We will put it on a lift, we'll see, of course, but the price will be about the same. Valery (that was the name of the manager) also noted that if I just trade-in the car and do not buy a new Volvo from them, the price will be another 50 thousand less. No attempts were made to conduct at least a cursory inspection: the employee was not interested in either the completed service book or the car itself, which was standing right there, 20 meters away. Although I know for myself that a more or less experienced used car salesman can immediately understand a lot about a car from documents and appearance. No lifts and servicemen are needed here. So, in "Autobiography" the price differed by 185 thousand rubles. Not twice as low in the market, but nonetheless.
Test purchase: Eurosib Mazda Pulkovo
Eurosib Mazda Pulkovo
Somewhat puzzled, I walked to a nearby Mazda dealership. They didn’t meet me at the door (tea, not premium!), but the sales manager for used cars was also free. After listening to the data on the car, he quickly clicked the mouse on his computer and offered to buy our Volvo S80 for 500-550 thousand. With the proviso that the final price will be announced to me only after they study the car at the service station and consult with neighbors from Volvo. Such is the cooperation! Needless to say, both the car and the documents for it again remained unclaimed. Well, it's already better! There was a certain variation in prices and a theoretical chance to win an extra 50 thousand rubles on the sale. By the way, the “fine” for not buying a new Mazda, but simply selling my Volvo to the salon, turned out to be lower here: only 20-30 thousand.
Test purchase: "R-Motors"
Salon "R-Motors"
To consolidate the past, I walked another fifty meters to a dealership selling General Motors products. And there the manager for the same car already offers "around 600 thousand", having previously spent a minute studying the range of Volvo S80 on the well-known site for the sale of used cars. Again, no preliminary "showing", a promise to determine the final price after a detailed diagnosis and a warning to "throw off" the price of 30 thousand if I decide to refuse to buy Opel, Chevrolet or Cadillac in their showroom.
So where does the price come from?
A small "field" investigation did not bring any clarity. I realized that not all salons offer extortionate prices, and some offers sound so that you can already think about them. But there must be a system here, right? Experts from the automotive market came to the rescue. Some agreed to comment openly on the issue, others asked not to give their real names and surnames so as not to lose their jobs, and we met them halfway."As a rule, car dealerships form prices for used cars they buy back based on average market trends and prices for specific cars, taking into account the deduction of the dealership margin component. Dealers also include costs and risks in the difference between the market price and the trade-in price. Risks associated with stagnation of trade-in cars on the sites, also in a good showroom, a specially trained manager and a place to store such cars are needed to sell them."
By the way, apparently, express monitoring of Internet sites and real offers is the only reliable tool for determining the approximate cost of a car. So, if a trade-in manager climbed onto a free classifieds site, don't rush to accuse him of incompetence.
Dmitry Yarygin, leading analyst of the agency "AUTOSTAT"
"There are special software products that help dealers determine the price of cars, but in the current conditions of rapid price changes, they can only be used adjusted for the market situation."
If we take fairly popular cars, then the difference between the purchase price and the sale price is not so great. The opposite indicates that the dealer is "wrong."
“The manager looks on the Internet how much such a car costs on the market (that is, for how much the client could sell this car himself) and simply subtracts 10-20% from this price. "There is impudence and financial problems of a particular dealer. So, if the valuation of the car does not fit into any acceptable framework, you should know: the dealer has financial problems. The lower the estimated value, the more serious the financial problems."
And here is what representatives of car dealerships themselves say about pricing, to whom we could not help but give the floor. In short, they consider the purchase price to be quite realistic and fair.
Vladimir, specialist of the trade-in department of the AutoGermes car dealership (Moscow)
Alexey, specialist of trade-in department of "Maximum-Honda" car center
"The price is set at the discretion of the specialist who accepts the car. He can also accept it at the maximum market price. Technical flaws, external defects, accidents affect the cost reduction. It is not certain that the car will be sold for the money that the seller wants to receive."
Denis Kuzmichev, Head of Trade-in at ROLF (St. Petersburg)
“Many people generally confuse the concept of the market price with the desired value. It is obvious that a client who decides to sell a car first looks at similar ads. the real selling price of the car, it is much lower, because during the sale process discounts are always made as part of the bargaining."
Trade-in managers themselves rarely make really big money. The flow of funds goes to the management and to the budget of the company, but not in the pocket of the seller himself.
Vladislav Martinkevich, former employee of a multi-brand dealer service (name changed for security reasons - ed.)
"150 thousand is the salary of the head of the department, and we must not forget to add his secretary's iPhone here. Managers sit on a small salary (or sometimes without it at all) and bonuses depending on the number of cars sold, the plan completed, etc. All transactions are carried out officially under contracts, money - through the cash desk. Any fraud with the client, mark-up, etc. depends on the specific person hired by the department. In my memory, yes, there was a case when the manager of the department sold the car "past the cash desk" of the company and disappeared. I don’t know his fate, but in any case, this is already a criminal article.”
At the same time, few people complain about working conditions in a trade-in. Moreover, they hold on to this work with all their might, including because the opportunities for side income still remain.
Sergey Krasnov, current employee of one of the dealerships (name changed for security reasons - ed.)
"There are many options. The simplest is the sale of accessories. Let's say a client's car came with winter tires or a bike rack. The manager can safely take it all for himself and resell it - no one will notice. There is also a self-purchase scheme. For example, a client with a very good car - a three-year-old with an honest mileage of 30 thousand kilometers in perfect condition, which will be torn off in the secondary market with hands. Why put it in the showroom? bypassing the cash register. He takes the car for himself and sells it in a week, making good money on it. However, now ordinary employees are paid good bonuses. The state subsidizes trade-in discounts, so the income has grown very significantly."
In general, in our harsh conditions, everyone survives as best they can. Dealership executives are demanding profits, while employees are looking for opportunities to enrich themselves locally. By the way, analysts do not rule out that in the future the margin of salons may decrease. But this is clearly not going to happen soon.
Mikhail Chaplygin, Project Manager Auto-dealer.ru-Petersburg
“In the future, if dealers convince customers that it is profitable to buy used cars from them, and more buyers go, then, willy-nilly, they will have to increase purchase prices. After all, whoever has more choice of cars will be in favor. If prices are adequate, of course."
What happens to the trading machine in the cabin?
Only in a conversation with insiders, I was able to understand why none of the managers in the showrooms went to see our Volvo S80 car with its service book and work orders. There are a lot of clients, but there is also enough work. They are already working with those who are morally ready to give the car cheaper.
Vladislav Martinkevich, former employee of a multi-brand dealer service (name changed for security reasons - ed.)
“If the client’s sum immediately indicated 10-20% below the market does not suit, what is the point of wasting time on inspecting the car. But if it suits, then the conversation about the service book, diagnostics and technical condition check starts, after which the assessment may drop even more.
It is worth noting that the car dealership is not interested in buying emergency cars, somehow putting them on the move and selling them. Reputation in this business also costs money. Restoration of non-conformity is mainly done by private resellers and "gray dealers".
Vladislav Martinkevich, former employee of a multi-brand dealer service (name changed for security reasons - ed.)
“As for the condition and pre-sale preparation, then again everything depends on the particular dealer. Large and self-respecting companies, of course, do not twist the speedometer and handicraft “shamanization”. They won’t even take frank trash for nothing. then they are usually eliminated during pre-sale preparation, especially if the car is one of the brands that the dealer sells (for your car, both spare parts and service work, of course, go at cost).Then the final price can be declared higher, and the gain is greater. Cars with serious defects are usually not repaired and are sold like this.They are trade-in at the lowest possible price (minus the full cost of repairs at the dealership), and they are also sold for cheap.A self-respecting dealer usually frankly says that the car is like this , the disadvantage is this, that's why the price is this. If you want to take it and do it, if you don't want it, don't take it. Very often, by the way, such cars resellers buy it, somehow fake it in garages and only then pass it off as "candy". Well, as for the incomprehensible, yesterday opened dealers of some unknown Chinese brand, then there can be anything. And twisting the odometer, and restored junk, and substandard imports."
Reading time: 6 minutes
What tricks do car dealers and manufacturers go to in order to sell their goods. These are discounts, and bonuses, and gifts, and even the opportunity to exchange an old car for a new or used one, but better. In this article, we will tell you what Trade-in is, because the service is beneficial to everyone without exception. Also compare it with the federal recycling program, which operates on a similar principle.
Principle of operation and legal framework
Let's start with a definition. Translated from English, trade-in means a method of promoting a product in which buyers are offered a fixed discount on the price of a new product in exchange for a used one. In our case, the principle of the Trade-in program is as follows: I drove into the salon, left the old car, and drove out in a new one, paying the difference. That is, the seller receives part of the cost in the form of a car that the buyer rents to him. Very tempting.
It is worth noting that this type of trade has been known for a long time. Even in the USSR, some goods could be exchanged for new ones with a surcharge.
Car exchange under the Trade-in system is two operations in one transaction - the sale of an old car and the purchase of a new car.
This is beneficial and convenient if you do not want to remain a pedestrian for some time, because:
- The old car will have to be deregistered and the new one registered.
- A new car is bought more often not where the old one is sold.
- To sell, sometimes you have to spend a lot of time and effort.
And now let's look at how Trade-in works on a car. The owner comes to the salon, and after the diagnosis and if the necessary amount is available, he can leave in a new car in a few hours. It saves time and nerves and changes vehicles without any problems. At the same time, the transaction takes place safely, and the specialists of the center deal with the paperwork.
Order of the Ministry of Internal Affairs of the Russian Federation No. 605 dated 07.08. 2013 made adjustments to the procedure for providing the service. Now it will not be possible to deregister a car if it is not disposed of. So they do it like this:
- Selling the car to a dealership.
- Conclude commission contracts / for the sale and purchase of a new car.
Formally, the car will remain with the previous owner until a buyer appears. TN will have to pay, and after the sale to control re-registration.
Conditions and required documents
Participation of a car in the Trade-in program is possible if it:
- In sole ownership.
- Not in bail, under arrest or stolen.
- Technically correct.
In the showroom, first of all, they will conduct a legal assessment of the transaction. The car will be driven through the databases, the documents will be checked, and only then the procedure will be continued. In addition, most dealers set their own limits. For example, it does not accept cars that have been in serious accidents, as well as domestic over 5 and imported over 7 years.
Documents for Trade-in will need the following:
- SOR, PTS, insurance policy;
- two sets of keys;
- MOT ticket, if any;
- service book (if any);
- civil passport of the owner or power of attorney.
Legal entities will additionally need:
- certificate of tax registration;
- extract from the Unified State Register of Legal Entities or a certified copy not older than 3 months;
- seal and details of the organization;
- power of attorney for a representative.
Used car trade-in
It is allowed to exchange a car for a used vehicle via Trade-in. There are plenty of salons offering this service. The mechanism of the transaction is no different. Cars offered for sale undergo diagnostics and full service.
Just keep in mind that tracing the history in this case is just as difficult as in the market. True, the legal purity of the transaction is guaranteed. Do not forget that you can bargain here.
The procedure for handing over a car to Trade-in involves an assessment of the residual value. It is clear that this is the most important stage for the owner. And not only for him. The dealer will never buy a car at the average market value. For him, profitability starts at a difference of 20-30%. This necessarily takes into account the liquidity and prestige of the car.
The dealer has all the necessary tools and personnel to assess the technical condition. The car will be thoroughly checked. That is rubbish compared to this.
The age of the vehicle is very important. For the first year of operation, cars lose 20% of the original cost, for each subsequent year - 10%. The dealer will definitely take into account if the box is mechanical, the paintwork is “non-native” in places, the interior is a little worn, and the rubber is slightly worn out. There will be a lot of questions, and the car owner will have to fight for the price. The assessment at the dealership is free of charge. 
Online assessment
Many salons offer to use special calculators to calculate the approximate cost of the vehicle. The assessment of a car for Trade-in online on the dealer's website cannot be objective, but it will give an opportunity to understand the "relationship" to your car. The algorithm of the program is made taking into account, first of all, the interests of the dealer. The more input data the car owner specifies, the more likely it is to get the exact price that will be offered in the cabin. But it is best to use the services of an independent professional appraiser.
We buy cars by Trade-in
Now about how the car is bought by Trade-in. Having decided to change the car in this way, you will first have to decide on the choice of model and car dealership. This is not as simple as it might seem at first glance. The fact is that in a decent and trustworthy salon there may not be suitable offers, and vice versa.
It remains to call or contact the dealer through his website and clarify the procedure, discounts, the possibility of obtaining loans, and so on. The further Trade-in algorithm when buying a car looks like this:
- Choosing a new car.
- Checking documents by the dealer.
- Checking the state of the vehicle.
- Drafting contracts, resolving payment issues.
Where is the exchange possible?
Today there is a huge selection of proposals. The Trade-in service when buying a car is provided by many salons of official dealers and small trading floors. The choice is up to the car owner. It’s easier, of course, to give the car to the center where it was bought - firstly, the history is already known, and secondly, there will be fewer questions about the assessment.
Small traders can be more aggressive in terms of defending their own point of view on the assessment, and their legal support for the transaction is often lame. It is recommended to Trade-in the car in the showroom of the official dealer of the manufacturer. This is the safest and best option.
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Manufacturer programs
The production of some popular brands of modern cars is now localized in Russia. Automobile plants are given the right to independently determine the size of discounts and offer unique preferential conditions for the purchase of products.
Almost every manufacturer has its own Trade-in program. And in 2020, automakers are unlikely to change anything in relation to the Russian consumer. That is, their programs will continue to work without changes. 
Is the program profitable
Now about whether it is profitable to rent a car in Trade-in. That it is convenient, once again it is not necessary to say. What about benefits? If you remember that time is money, then it is definitely profitable. It is generally impossible to estimate the cost of saved nerves.
Money is more difficult. The car in the cabin will be valued below market value. Trade-in benefits can be real if every little detail is considered correctly, and most of the options in your car are not of interest to the dealer. It is important to look at the issue comprehensively. Firstly, what is the difference between the offered and the market value of the car being sold, and secondly, what will be the discount for the purchased car. On average, the benefit can reach up to 5%.
The choice between Trade-in and disposal
Possible nuances
The system is good for everyone, but there are Trade-in pitfalls, which we will now talk about. First of all, we point out the main disadvantages of such trading:
- limited choice - both models and equipment;
- low cost after evaluation, which is often associated with the dishonesty of salon workers;
- the difficulty / impossibility of returning a car with high mileage, after an accident or with serious breakdowns;
- unfavorable credit conditions.
Users note the following nuances of handing over a car in Trade-in:
- the need for a technical inspection and independent examination to confirm the technical condition described in the conclusion issued by the salon;
- there were cases of twisting odometers, hiding information about the participation of cars in an accident;
- there are hidden fees. For example, for diagnostics in case of refusal of a purchase.
Now about whether it is possible to hand over a car to Trade-in with a general power of attorney. This is allowed if the car is registered, and the seller is not its owner. Previously, it was possible to transfer a power of attorney to the salon so that it would deal with the deregistration procedure and so on. It was simply issued for three days, but today it makes no sense.
You can issue a power of attorney to terminate the registration of a car upon subsequent sale, obliging the salon to control the registration of the car by the new owner. The Trade-in Agreement must be read very carefully. It should indicate the terms in which the salon is obliged to sell the car, it is noted who is responsible for the vehicle, and so on. The dealer must also notify you of the sale, hand over one copy and the act of transferring the car to the new owner.
It makes sense to use the service when the car has already been selected, preferably in the same salon. If you just hand over the car in Trade-in and get money, it is unlikely that you will be able to buy something on the market for this amount without additional payment. It is possible that prices may go up. This is a loss-making option, in this case it would be more profitable to sell the car yourself.
Summing up
Having carefully studied all the pros and cons of exchanging a car by Trade-in, we can come to the conclusion that participation in the program gives:
- Convenience and time saving.
- Saving money. The old car does not have to be put in order on your own - the dealer will do everything.
- Guarantee of personal safety and technical serviceability of the purchased car.
- Possibility of buying on credit.
- Exchange of any car (meeting the requirements of the dealer).
- Nice little gifts. For example, free service, maintenance or discounts on parts/accessories.
The offer is interesting, but often unprofitable, because you have to pay for convenience. Therefore, it is up to you to decide whether to use the Trade-in program or not.
Trade-in. Advantages and disadvantages. How not to be deceived: video
The desire to update the fleet or replace an old car with a more modern, reliable and comfortable analogue is absolutely normal. And car dealerships AVTORUS PODOLSK in Moscow are ready to provide you with a unique opportunity to purchase a new car on the most favorable terms under the Trade-in program.
What is "Trade-in"?
The essence of the service is that your old car is accepted by our salon as a set-off for a certain part of the cost of a new car, which allows you to solve several problems at once:
- On the best terms and at a completely objective price to sell an old car
- Buying a new car with maximum benefit for yourself
- Save a lot of time and effort
Benefits of buying a car under the Trade-in program
Many people are familiar with the problem of selling an old car. Finding a good buyer who would agree to buy a car at an objective price is very difficult. The Trade-in service relieves you of these problems. The company's appraisers carry out a complete free diagnostics of the car, which shows its current technical condition. The current market price of the car is also taken into account. Based on these data, experts calculate its objective cost, which will offset the purchase of a new car.
The key advantage is the ability to purchase a new car with the lowest material investment. Customers of AUTORUS Hyundai car dealerships also enjoy certain privileges, including a number of additional services or “Swap car rental”, as well as professional and prompt scheduled and urgent car maintenance at authorized service centers.
Additional information on the Trade-in service
It is important that your car is not subject to a lien or property claim (it should not be litigated), and that it is less than 10 years old. All documents for the car must be in perfect order (do not arouse suspicion of their legal purity). In order to use the "Trade-in" service, you just need to contact our competent consultants who will provide you with all the necessary additional information and tell you in detail about the conditions for the provision of the service. To contact the service department, you can use
Reading time: 4 minutes
Trade-in is an agreement on the mutual repayment of obligations to pay for goods. In this case, the car serves as a partial contribution for a new or used car. It is not difficult to become the owner of another car using this system, you just need to deliver your old car to a car dealership. The salon employee will determine its cost and calculate the amount that the owner will have to pay extra for a new car. To decide whether such a deal is profitable, you need to figure out how a car is valued and which cars are not taken for trade-in.
How the system works
According to experts, up to 80% of cars are sold all over the world according to the system we are discussing, which has been operating for several decades. Although this scheme is far from being so popular in Russia, the trade-in car exchange is also of interest to domestic motorists.
Here are some of the perks of the deal:
Many car owners complain that the car is sometimes not sold for months. And all this time you need to meet with potential buyers, update ads in newspapers or take the car to the market. To ensure its presentation, you have to regularly go to the sink.
Trade-in allows you to shift the worries of finding buyers to a car dealership. Employees also draw up all the necessary paperwork and.
These benefits will be appreciated mainly by busy people.
Along with this, it should be borne in mind that car dealerships do not work for free. This means that you will have to pay something for the provision of the service. As a rule, this translates into some loss of funds due to the valuation of the subject of sale below its real market value.
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What is the evaluation process
How much a car is valued at trade-in by car dealerships depends on the age of the car. It is generally accepted that in the first year of operation, the vehicle loses approximately 20% of its original value. Then the price decreases by 10% with the onset of each subsequent year.
To get a client, car dealership employees claim that they take any car into account. However, it is not. Business rules require that the subject of sale be liquid, that is, that the salon should not have problems with the subsequent sale. The main requirement for a car: age up to 10 years and cost up to 1.5 million rubles. Dealers are most interested in five-year-old foreign cars.
Even if the salon agrees to take an old car, you need to be prepared for the fact that they will offer a meager amount for it.
Experienced drivers believe that the deal will be more profitable if you bring a spare key, service book and receipts confirming the work. Based on the documents provided and the results of the conversation with the owner, the manager will try to recreate the history of the car: the number of owners, the availability of a guarantee, who was entrusted with maintenance and other significant circumstances. 
After compiling the history of the car, it is alternately driven to the sink, to the site for visual inspection and to the service. Specialists will record all identified mechanical failures, problems with electronics, varnish defects, etc.
Criteria for evaluation
Understanding how a car is valued for a trade-in will help you make an informed decision. As a rule, crediting is carried out according to a number of criteria:
- Machine brand.
- Year of manufacture.
- Optional equipment.
- Engine power.
- Availability of a set of documents.
- The number of kilometers travelled.
- Options set.
- Technical correctness.
- The presence of damage to the body and paintwork.
These points are assigned a certain number of points, which are subsequently added up to determine the value of the car.
Drivers who have already experienced how a car is evaluated in a trade-in note that the loss of a key and the lack of a reliable service history are a wake-up call for experts.
If the driver himself is well aware of the weaknesses of his car, an online assessment will save him time and nerves. By calculating the preliminary cost of the car in advance, he will be able to avoid disappointment.
In addition, having received a general idea of the price that will be assigned to the car, he will more realistically approach the choice of a new model or begin to select what is feasible.
How to calculate the cost of a car by trade in
The easiest way to find out the value of a car is to use an online trade-in car valuation calculator. You can make preliminary calculations at any time of the day, and for this you don’t even have to leave your home or office. It is enough to enter the characteristics of the car and your contact details. A similar service is provided on the websites of many car dealers. Please note: the more detailed the questionnaire, the more reliable the answer will be. 
Of course, an online trade-in car valuation will only give a potential customer a rough estimate. As mentioned above, the final price depends on many factors, including some that the car owner may not be aware of. However, if he tries to give the most objective answers and, if possible, uploads high-quality photos of defects, the result will be more realistic.
The most accurate answer can be obtained if you calculate the cost of a car in a trade-in using a calculator posted on the website of the company whose services the owner is going to use.
Assessment nuances
It is noticed that damages on a body - scratches or dents - cause the greatest dissatisfaction of dealers. Many of them proceed from the fact that if there is even a small defect, you will have to invest in painting the entire element. This will reduce the cost of the car by several thousand more.
Trying to cover up the damage by going to a paint specialist won't improve your chances of selling your car for a higher price. Car dealership employees always use a thickness gauge - a device that evaluates the thickness of the paintwork. They will immediately determine whether any element has been repainted, and they will suspect the fact of an accident. It will be very difficult to prove that the cause of the damage was a minor incident near the supermarket.
It is also impossible to exclude pitfalls when drawing up a contract with unscrupulous car dealerships. Some of them draft the treaty in such a way that its provisions can be interpreted in two ways. In this case, even an experienced lawyer will not be able to help pick up the car without paying for a number of services and collecting interest when the agreement is terminated.
Many salons do not charge money for assessing the value of the car. Some are even willing to reasonably bargain with the client. To compare conditions, you can visit another car dealership or evaluate a car in a trade-in online to make sure that the intermediary is not disingenuous.
Trade-in. Advantages and disadvantages. How not to be deceived: Video
Classic trade-in
Every third new car today is purchased using trade-in, says Oleg Moseev, president of the Russian Automobile Dealers Association (ROAD). According to him, the share of transactions in the more expensive segment is higher than in the mass segment. This is due to the peculiarities of trade-in. Among its advantages are the efficiency of the transaction and its transparency. It takes several hours for the dealer to evaluate the car and complete the transaction, and the car owner can immediately purchase a new car by paying the difference.
However, the convenience of the transaction has a downside: the dealer evaluates the car below the real market value. Sergey Kanaev, President of the Federation of Car Owners of Russia, says that by selling his car through the trade-in system, a car dealership customer loses 15-20% of its value. And when it comes to the mass segment, not all owners are ready to lose even a part of the possible benefits.
Andrei Karlov believes that the discount depends on the brand of the car. If these are popular mass brands that are leaders in sales (for example, KIA, Hyundai, Mazda), then the underestimation of the cost will be 5-15%, and if we are talking about rare or unpopular cars (for example, Jaguar or SAAB), up to 30% . At the same time, he notes that every year the gap between the price on the market "from the hands" and the cost at which the car is estimated by dealers is shrinking. “Trade-in has reached volumes that allow this segment to influence the used car market. 10-20% of all cars on the secondary market are trade-in,” he says.
The dealer will not agree to buy every car, but only one that can then be easily sold. According to ROAD estimates, on average, every third car owner who wants to make a trade-in transaction is refused. “Dealers will agree to work with a car that is less than ten years old, has a transparent history (that is, it has not been, for example, pledged or not been the subject of litigation), has one or two owners, and is accompanied by documents on regular inspection and maintenance. in a car service,” says Oleg Moseev.
One of the main reasons why a trade-in is denied is mileage “twisting,” a scam that underestimates actual mileage before selling, dealers say. The President of ROAD advises against doing this, since it is quite easy to check what mileage the car had before.
The owner of a right-hand drive car is also likely to be denied a deal.
If we are talking about an exchange within the same brand (this service is offered by official dealers), then the salon will be less picky about the technical characteristics and service life of the car - it does not want to lose a client of this particular brand and is ready to offer him bonuses and discounts on a new car purchased by trade-in, for example, a discount on Casco or free service in the service.
Exchange of square meters
Trade-in transactions also exist in the real estate sector - developers began to practice this scheme against the backdrop of market stagnation after the 2008 financial crisis. Due to falling demand, apartment owners could not sell their old housing, and, accordingly, they did not have the opportunity to purchase a new apartment with the proceeds.
“The trade-in scheme assumes that the developer buys an existing apartment from the client, but with a discount of about 20%. Then he sells real estate at a market price, which makes up his income, ”says Natalya Shatalina, general director of Miel-Novostroyki.
Trade-in relieves the owner of the apartment from worries about its sale, as the developer immediately gives the client the money, without waiting for the resale of the apartment. The main disadvantage of the scheme is that the client loses part of the market value of his property. In the current economic realities, the scheme turned out to be unprofitable for developers as well. “In order to sell the buyer's apartment, the developer must have a staff who will be involved in the sale of the secondary property. This is unprofitable, especially against the backdrop of a decrease in the cost of apartments and an increase in the period of their exposition,” says Natalya Shatalina.
At the same time, trade-in implies certain requirements for the apartment that the client wants to sell. For example, in order for the developer to buy it, it must be fully owned by one person, that is, transactions with shares of apartments, as a rule, are not considered. Also, the company will not buy an apartment located in another city.
According to Oleg Repchenko, head of the irn.ru Real Estate Market Indicators analytical center, if a developer claims to offer a trade-in service, today it is most often assumed that its real estate division is ready to take over the sale of the buyer’s apartment, after which a transaction will be carried out for buying an apartment in a new building. Currently, according to him, approximately every tenth apartment in a new building is purchased using this scheme.
Unlike the classic trade-in, in this case, the old apartment is sold without a discount (at market value), but the client will receive the money only after the apartment is sold (according to Oleg Repchenko, the average exposure time for an apartment today is three months). In this case, the developers assign to the party to the transaction a reservation for an apartment at a fixed price (usually for two or three months, less often for six months).
“The advantage for the client is that he applies to one agency, all the processes associated with both the sale and purchase take place within the agency - a new apartment is fixed for him and the sale of existing housing is actually guaranteed,” says Natalia Shatalina.
But at the time of signing the contract with the developer, the client will most likely have to make an advance payment for a new apartment (about 10% of the cost). And for the services for the sale of the apartment you will have to pay a fee (about 3-4%).
As in the classic trade-in, the developer will not agree to make a deal for every apartment. According to Repchenko, developers are more willing to take on liquid options - inexpensive odnushki and dvushki with good transport accessibility.
Progress Discount
Retail chains have also begun to use the “old goods in exchange for a new” scheme.
According to Elena Naumchik, co-founder of the Association of Customer Loyalty and Customer-Centricity (CLIC), most often it is networks specializing in electronics that offer to purchase goods in trade-in. “The need for such promotions is due to the fact that the client has a product that he is already dissatisfied with (out of fashion or technically outdated) and he wants to make room for a new one,” she says.
Chains that accept old things in exchange for new ones value the goods brought by the buyer below its real market value. “For example, the cost of a received smartphone is estimated by a special program and assigned in accordance with the prices for used equipment in the official international markets for mobile devices,” the press service of the Svyaznoy network said.
In one of the electronics retail chains, owners of the iPhone 7 Plus 256 Gb can get a 30% discount on the purchase of an iPhone X with the same amount of memory under the trade-in program.
The price of a new gadget is 87 thousand rubles, that is, the company estimates a used gadget at about 26 thousand rubles. The average price when selling such a smartphone from the hands, according to ads on the Internet, is about 40 thousand rubles.
A rational discount cannot exceed 20-30% of the selling price of the goods, marketers say. “Discounts are on average lower than the profits from hand-to-hand sales on the market,” says Valeria Andreeva, an official representative of the M.Video network, noting that there is still demand for such shares.
In retail, trade-in applies mainly to smartphones as the most frequently replaced gadgets. If you look at other categories of goods, Elena Naumchik notes, in most cases, chains do not offer hot goods, but get rid of things that are in abundance in the warehouse.
The terms of the deal depend on the specific network. Some stores accept any equipment in any condition, others accept only certain categories of goods. As a rule, within the framework of promotions, stores exchange goods within the same category, that is, it will not be possible to exchange a gadget for a refrigerator.
But this scheme also has its advantages. Valeria Andreeva notes that trade-in is a convenient “here and now” transaction format, ensures its transparency and security, including in relation to the protection of personal data that could remain on the old smartphone. Specialists of chain stores promise that all data of the previous owner will be deleted and will not fall into the wrong hands.
In the case of trade-in in retail stores, the client receives satisfaction not only from the fact that he purchased the goods at a discount, albeit a small one, but also from the fact that he got rid of the old thing, experts say. The psychological factor here may be stronger than the rational desire to get a big discount.
