Wednesday, October 6, 2010

Whatever Happened to Penny Cars?

At least once a month I get asked if I have any cars for under $1000? 15 years ago I might have said yes, but nowadays that car is a rare find. Let's break it down.

First off, let's preface this conversation with some facts. When I say $1000 car, I mean one that has no major mechanical problems and can pass a state safety and emission test fairly easily. And gets you from Point A to B and every now and then Point C. Let's say your budget is $1000 (the reason why you want a car in that price range) the tax's and fee's alone are going to be up to 20% of that budget. For instance, a 7% Sales Tax would mean $70 Tax, plus $50 Smog and Safety Test, and $100 in DMV License Fee's. This totals $220 and makes up 22% of your budget.

Now we are talking about a $780 car! Let's say I go to a Salvage Auction because generally the cars there are cheaper due to the title and light damage. All Auctions have what they call a Buyer's Fee, a fee for this bid price would probably range in the $150 zone. This means we are now talking about a $630 car! This is before any of the damage on the car is repaired, remember we are buying cars that have damage, which is the reason we are getting them so cheap.

Much to the dismay of many Liberals, I prefer to be in the business of making a profit! Generally, the risk and time involved demands that I make a minimum profit that rewards my efforts. Therefore, if I am able to buy a reliable vehicle that I can honestly sell to a customer that can use it for at least 1 year under normal wear and tear, I would have to be purchasing it for no more than $300. Because after I fix the vehicle to make it road worthy and beyond, I am barely making a profit worth my time and efforts. We are talking less than $300 folks! I'm not greedy, but even that small of profit margin is slim for anyone's efforts.

Just like their is no such thing as penny candy anymore, I say their is no such thing as "Reliable" $1000 cars anymore. I firmly believe that it takes a minimum of $1500 to get into a reliable car including tax and license fee's. Even these are a rare find!

However, I have found one! I currently have a 1988 Toyota Corolla with 75k Miles in my inventory. It's in great condition considering the year and I have it only priced at $1500! We can talk about the Tax and License Fee's :)

OTIS

Tuesday, June 1, 2010

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Thursday, April 1, 2010

Toyota is Back!

As I explained in a previous post, Toyota owners would not stop buying Toyota's due to the "Major" recall issues and the Fed's pushing the point. Instead, they not only didn't stop buying Toyota's, but they increased the buying by over 35% in March.

So all the skeptics and so called "experts" who spouted off about Toyota not bouncing back from this for at least a year and how huge this would be for Ford, Dodge, and Chevy were flat-out wrong!

(Click on the Blog Post Title for Complete News Story!)

Let me say this one more time, Toyota Owners worship the brand! OTIS

Thursday, February 4, 2010

Government Motors Pushing Toyota Recall?

During my 35 of being in the Auto Industry I have never seen a recall get this much attention with the execption of the Ford Firestone Tire recall. It's all you hear about when you read the paper, watch the news, listen to the radio or hear what's coming out of the politicians's mouths. It makes one wonder who started this fire and who continues to pour gas on it. The comments that Ray Lahood made yesterday telling Toyota drivers to stop driving there vehicles immediately only adds more fuel to this recall conspiracy theory.

Additionally, it's interesting how GM and Chrysler already had ads ready to go once this recall was announced telling Toyota owners they could trade in their recalled Toyota's and get $1,000 extra trade-in incentives plus zero % financing. Was this good timing or a chance to gain marketshare based on previous knowledge or pressure?

The problem with this strategy is that Toyota owners worship this brand. I cannot imagine that very many Camry owners will be lining up to trade-in their cars for a Chevy Malibu. I often purchase Chevy Prizm's because they are built by Toyota for Chevy and are identical to a Toyota Corolla. Yet, trying to convince a Toyota Brand lover to purchase the Prizm over the Corolla is like trying to get a Liberal to vote for a Tax Cut. It's not going to happen. So when I listen to these "so called" experts on TV spouting off about how this is a great opportunity for American Car Companies to gain marketshare, I just laugh out loud to myself. It's not going to happen.

This is just a small blip in the road for the Toyota Brand, which will regain it's place atop the Car Chain again in a matter of months!