Carmax:The Way Car Buying Shouldn’t Be
posted in Carmax, General |So Carmax locations are popping up around the country, with about 74 locations in 35 markets Carmax is quickly becoming one of the biggest players in the US used car market. As a car dealer myself I’m in total shock that they are reporting higher and higher profits every quarter. I’d say their are two main aspects of their business: buying and selling.
When we look at their purchasing of cars its one of the biggest rip offs in the business. The way they have you believe the process works is, you look up your cars Kelley Blue Book pricing and go into Carmax and walk out with a very similar amount. What happens nine times out of ten is you walk out with thousands more or get such a low ball offer you leave in astonishment. Unfortunately their are lots of people in such desperate situations who have no other option then to take their offer. The way Carmax buys cars is this, they buy it from you so cheaply that they can either sell the car themselves, mark it up a boat load or even take it to the wholesale dealer only auctions and still make a profit on it. Either way, don’t expect Carmax to give you what you’re asking. This has nothing to do with the difference between private party and trade in pricing, this has to do with the difference of Carmax pricing and trade in pricing.
The other aspect of their business is selling cars. This simply leaves me amazed beyond belief. They have the whole gimmick of no hassle, no haggle pricing… its pure business genius. They are preying on the people who hate dealing with salespeople… what happens here is you get over charged for a car worth hundreds and in most cases thousands less. Go on their site and do a simple search for a car and you’ll be amazed the prices they charge. For example, at the moment at our car dealer we have a 98 Civic, which I found almost an identical comparison at Carmax. Carmax is asking $8995 for a 98 with over 100k miles !!! I’m selling the same car for $5995 and I’ll even throw in a year warranty.
Do a little car shopping people, Carmax is the biggest rip off in the used car market. I’m really not trying to make other dealers sound better, but my goal is to show the absurd prices and the effect of doing a little more homework before you buy your next car.