Request the Car Dealer's ACV For your Trade In

The "ACV" is the "cash" value the dealer places on the customer’s vehicle. This simply means they could liquidate the vehicle for that amount.  In other words, if dealer chooses not sell the customer's trade-in as one of their pre-owned cars, they could "wholesale it" to another dealer and receive that cash value. 

 

What is important to note, is that the ACV is a "relatively" unchangeable amount whether the dealer chooses to "retail" or "wholesale" the trade-in.  In other words, a dealer will place a similar cash value on a car regardless of their decision to sell it on the lot or liquidate to a wholesaler.  Vehicles are worth what they are worth and dealers know the quickest way to go out of business is to "bury" themselves in their used car inventory.  To counteract overzealous new-car managers (managers responsible for selling new cars) most dealers will have a used car manager that will have the final word on the ACV amounts.

 

Dealers can hide profit in the ACV. They accomplish this by giving the customer a lesser amount than the "cash" value.  For example, the dealer assesses the ACV of the trade-in to be $10,000, but during the negotiation the customer agrees to a $9000 trade-in value. This creates $1000 “Under-Allowance” which results in a $1000 profit for the dealer.

 

They will be hesitant to share the ACV with the customer because it is a value that they created and can change slightly from dealer to dealer. They fear that if they provide the customer with the actual ACV, the customer will go to another dealer, and, of course any dealer can improve upon their competition by a couple of hundred dollars.

 

They fear that if they provide the customer with the actual ACV, the customer will go to another dealer, and, of course any dealer can improve upon their competition by a couple of hundred dollars.

Therefore the customer must express to the salesman that they recognize this dynamic.

 

This can be accomplished simply by saying “I understand that any dealer can beat another dealer's ACV by a couple hundred dollars. I am not interested in “shopping” your ACV.  I would like to know the true ACV so I can work out my budget and provide you with an offer.”

 

Of course, once they disclose their ACV it is wise to compare their value with the on-line resources such as KBB.com and verify that it is in-line with reality.  Normally, if a customer can obtain the dealership’s appraised ACV value, it will be close to the same from dealer to dealer. Also, since it is only one part of the car deal, it is useless to call other dealers and ask if they can show you more. 

 

Furthermore, the dealer will almost always say that the ACV is valid for "today only".  Or they may say, “The ACV is $10,000 however my sales manger is shopping for a higher bid; we can probably show you more if you buy today.”  These are (of course) tricks to get you to start dealing.