OK, I need someone to 'splain this to me... Toyota resale pricing

[Jernik]

I honestly don't get it. Been looking around at some Tacomas (thinking of replacing the Ram), and I can't believe the resale prices I'm seeing. 30K miles or 300K miles, 2014 model or 2008 model doesn't seem to change the resale prices much.

I saw the same with the 4Runners, and I really don't understand it. I get they are reliable and last a long time... but the used prices seem so close (IMO) to new pricing, or do they start dropping the used price significantly once you start to haggle? I know insurance and taxes will likely be slightly less the older the vehicle gets, but at some point having to start replacing wear and tear items (general maintenance things) and the inconvenience of doing such eats into what savings you get from buying used in the Toyota world.

What am I missing? I imagine supply and demand is supporting the pricing, but apparently I need some education on the subject matter, because I'm still . Either that, or I'm just getting to that age where I remember when everything cost a nickel...

 

[KidVermicious]

That's the Toyota Tax. They're trendy, with a reputation for holding their resale value, ergo they hold their resale value.

It's not so much supply and demand as it is a self-fulfilling expectation. Folks charge more for used Toyotas because they think they can, and people pay it because they think they should, and there you go.

 

[bigslimdog]

That's exactly the reason my last 3 cars were all new. Up until 2011 all of my vehicles had been used. I looked around for a 4Runner, Sequoia, and then Tundra for a long time each time I was ready to buy another vehicle. The prices for a used model with low mileage were only a few thousand dollars lower than the new prices. On a $30k+ vehicle it would be stupid not to buy the new vehicle if the prices are that close.

At the same time, I have had amazing trade in values each time I made a change. I never had any negative equity to roll over even though I changed vehicles 3 times in 4 years (yes I know it's stupid but I'm finally in a vehicle that fits my family/lifestyle/budget that I will be keeping for many years). So it may seem like it's hurting you now but that resale value will benefit you when you're ready to make a change. It all equals out.

 

[GhostRing]

Just charging what the market will bear...

 

[28.]

So true.. The thing is that when you try to deal, they will to a certain point then leave you just close enough to where you feel guilty for buying used just to save a couple grand lol.. Focked up thing is that those used cars WILL sell. There are plenty of folks that are willing to not have the latest and greatest to save a few grand.. and you can't blame them because in reality, that's really all your paying for and the fact that you can say you're the original owner.. I just went through this with my wifes new Camry.. I actually prefer the looks of the 2014 but the price gap on a used, low mileage 2014 is so close to an equally equipped 2015, it makes no sense not to just get new.. At least not to me anyway. Plus the 2015 is growing on me though..

 

[Jernik]

Thanks for the replies. It's good if you look to trade cars often, but still kinda crazy. I guess the comforting thing is, people wouldn't keep paying that kind of money for piles of crap, so if I do buy one it should last long enough to pay for itself.

 

[Martinjmpr]

It's not so much supply and demand as it is a self-fulfilling expectation. Folks charge more for used Toyotas because they think they can, and people pay it because they think they should, and there you go.

Yup, this. I call it the "internet feeding frenzy." Enthusiasm generates "buzz" on the internet, which makes sellers think their vehicles are worth a lot, which makes buyers willing to pay more, and since buyers are paying more, sellers are assuming the vehicles are worth more, which makes buyers think they must be 'better' (because they cost more) and are willing to pay more, etc etc etc. Vicious cycle.

It's like a classic "bubble" in the economy. Thing about bubbles is, sooner or later they burst. Not sure when the Toyota bubble will burst but it will. Nothing lasts forever, not even a Toyota. :

I think another phenomenon that's driving this is that the prices of new vehicles are so ridiculous that there's a huge market for used vehicles, bigger than there ever was before, and this is driving the price of used vehicles up (after all, the thing about used vehicles is there's a very finite supply of them.)

To put it another way, the % of car buyers that are shopping for a $36k vehicle is a lot smaller than the % of car buyers that are shopping for a < $25k vehicle.

 

[Martinjmpr]

Honestly, Toyota 4runner and Tacoma prices are so crazy these days that if I was shopping for a vehicle now I probably would not be looking at Toyota.

 

[KidVermicious]

Honestly, Toyota 4runner and Tacoma prices are so crazy these days that if I was shopping for a vehicle now I probably would not be looking at Toyota.

That's the reason I'm DDing a Ford and not a Tundra. Can't afford the Toyota Tax. The Ford is an inferior truck, but not that inferior...

 

[1engineer]

You guys are hilarious.
It's pure supply and demand. Don't make it anything more than it is.

Now, you could debate the reasoning behind the supply (not many 4Runners sold compared to JGC) or demand (reliability, durability, trendy, whatever) but not the true reasons for high resale values which is, you guessed it, simply supply and demand.

As far as a bubble? Dream on. If prices stay high over a long period of time then the initial "bubble" becomes real pricing. I think the 4Runners have been around over 30 years and the used pricing has remained high since the first one was traded in. That's not a bubble.

 

[Ammomac]

My 13 FJC sold for more @ 1.5 years old w/20 thousand miles than original MSRP.

 

[Martinjmpr]

I think the 4Runners have been around over 30 years and the used pricing has remained high since the first one was traded in. That's not a bubble.

Not as high as they are now. Right now prices for 4x4 Toyotas are at stupid high levels. Sooner or later people are going to realize that Toyotas are mechanical devices just like any other and they can break, just like anything mechanical can. And they're going to realize they can save a ton of money by buying a non-Toyota product.

Honestly if it wasn't for multi-mode 4wd I would have gotten an Xterra or an R51 Pathfinder instead of my 4runner. I'm happy with my choice but if I was buying today I'd probably go with the Nissan just to save money.

One of the interesting aspects of the Toyota mythology is the way it makes people discount failures or problems. Once people have convinced themselves that Toyotas are "better" than the competition, they will shrug off any problems (like the well documented HG problems on early 4.0s or the 4wd actuator problems that are only going to get worse as the 4th and 5th gens age) and figure "oh, I must have gotten the one bad one in the batch."

OTOH, often times people who drive what are perceived as "low price" vehicles will b!tch when they have a problem and say "this Chevy/Ford/Dodge/Nissan is a piece of crap!" even though the actual % of major problems is roughly the same. :shrug:

I'm trying to get the wife to sell her little Altima so she can have something that will pull our 15' travel trailer. Xterra is at the top of the list. 4runner isn't even on it because (a) we have one already and (b) the prices are stupid high.

 

[ben550]

I love tacomas...

Used with 50-80,000 miles going for $28k ish

New going for $35k ish...

If and when I finally get one of those It will be hard to justify not buying new... Just does not make sense to buy used at that fat price... especially considering all the general maintenance that will have to be done around the 100k mark.

 

[Martinjmpr]

Another factor

Another factor that comes into play is that Toyota, at this point, pretty much "owns" the mid-sized/compact truck and body-on-frame SUV market.

Not because their vehicles are "better" but because most of the competitors have left the field.

Think about this: 20 years ago you could buy a mid/compact sized truck from Toyota (Hi Lux and then Tacoma), Ford (Ranger), Chevy (S10), Nissan (Hardbody), Mitsubishi, Isuzu (a rebadged Chevy S10), Mazda (a rebadged Ranger at this time), and Dodge (Dakota.)

Fast forward to today. Nissan is a minor player and Chevy is trying to claw its way back into the compact truck field with the Colorado but beyond that there simply are no competitors because Ford and Dodge ultimately realized they could make more money selling full size trucks and that their small trucks were not really benefiting the business as a whole, and Isuzu and Mitsubishi have pretty much left the US market (well, I guess Mitsubishi remains a very minor player, but not in terms of trucks or SUVs.)

Same for BoF SUVs. 20 years ago in addition to the 4runner you could get an Isuzu Trooper, Mitsubishi Montero, Nissan Pathfinder, Chevy S10 Blazer, Ford Explorer, or Land Rover Discovery. All were mid-sized body-on-frame SUVs. You could also get the Jeep Cherokee or Grand Cherokee and while they weren't BOF they competed in the same arena.

Today the only competitors to the 4runner left are the Jeep Wrangler and Grand Cherokee. Again, the big boys (Ford and Chevy) figure they'll make their money with full sized rigs (Expedition and Suburban/Tahoe) rather than try to compete with Toyota on the mid-sized market. All the others have either disappeared or turned into unibody crossovers (Explorer, Pathfinder) that appeal to a bigger market.

So at this point, since Toyota owns the market, they can set whatever price they want. As long as the market remains small the competitors will probably figure it's not worth it to compete and Toyota will remain king of the hill. But if another manufacturer figures out that they can make money in the same market space, they will be in a good position to start taking market share from Toyota just based on the insanely high prices that Toyota's command. :shrug:

 

[nevada]

I saw the same with the 4Runners, and I really don't understand it. I get they are reliable and last a long time... but the used prices seem so close (IMO) to new pricing, or do they start dropping the used price significantly once you start to haggle? I know insurance and taxes will likely be slightly less the older the vehicle gets, but at some point having to start replacing wear and tear items (general maintenance things) and the inconvenience of doing such eats into what savings you get from buying used in the Toyota world.

repairs are almost nonexistent, until fairly high miles. general maintenance yes of course. but you will have the same with any vehicle.

You guys are hilarious.
It's pure supply and demand. Don't make it anything more than it is.

Now, you could debate the reasoning behind the supply (not many 4Runners sold compared to JGC) or demand (reliability, durability, trendy, whatever) but not the true reasons for high resale values which is, you guessed it, simply supply and demand.

As far as a bubble? Dream on. If prices stay high over a long period of time then the initial "bubble" becomes real pricing. I think the 4Runners have been around over 30 years and the used pricing has remained high since the first one was traded in. That's not a bubble.

agreed.
when I bought my 06, they were very hard to find. I talked with the dealer about it, and they said they rarely get them in, and when they do they sell fast.

he said most people don't want to sell, and keep them for much longer. which hurts the NEW vehicle sales. I would expect this to prompt the manufacturer and as well as the dealer to lower the NEW prices, to help increase sales...

So at this point, since Toyota owns the market, they can set whatever price they want. As long as the market remains small the competitors will probably figure it's not worth it to compete and Toyota will remain king of the hill. But if another manufacturer figures out that they can make money in the same market space, they will be in a good position to start taking market share from Toyota just based on the insanely high prices that Toyota's command. :shrug:

the price is consumer driven. especially on the used market.
sure they can set whatever price they want. but if its too high, and they sell nothing, they will have to adjust it.

which is what I believe to be happening. due to more people keeping their Toyota longer.

 

[Jernik]

I will say, prices for trucks in general are stupid high right now... but it's weird that you can get a new full sized ford/chevy/dodge for about the same money as a Tacoma (similar options, except for size). I think the Tundra is a nice truck, but it's off the charts on pricing, IMO - new OR used.

The Colorado/Canyon seems to be priced similarly as the Tacoma, with the Canyon maybe a hair higher. Time will tell if GM can keep the pricing/profits up on them.

I'm almost beginning to think we need $5 a gallon gas again to bring truck prices back down to reality. :madgrin:

 

[Martinjmpr]

which is what I believe to be happening. due to more people keeping their Toyota longer.

I think this is applying across the board to used vehicles, not just to Toyotas.

As vehicles have gotten better over the years, people keep them longer.

This results in fewer used vehicles for sale and since many people who are shopping for used vehicles are simply not considering new vehicles, the competition for late-model and low-mileage used vehicles is higher, driving up prices.

 

[1engineer]

Another factor that comes into play is that Toyota, at this point, pretty much "owns" the mid-sized/compact truck and body-on-frame SUV market.

Not because their vehicles are "better" but because most of the competitors have left the field.

Think about this: 20 years ago you could buy a mid/compact sized truck from Toyota (Hi Lux and then Tacoma), Ford (Ranger), Chevy (S10), Nissan (Hardbody), Mitsubishi, Isuzu (a rebadged Chevy S10), Mazda (a rebadged Ranger at this time), and Dodge (Dakota.)

Fast forward to today. Nissan is a minor player and Chevy is trying to claw its way back into the compact truck field with the Colorado but beyond that there simply are no competitors because Ford and Dodge ultimately realized they could make more money selling full size trucks and that their small trucks were not really benefiting the business as a whole, and Isuzu and Mitsubishi have pretty much left the US market (well, I guess Mitsubishi remains a very minor player, but not in terms of trucks or SUVs.)

Same for BoF SUVs. 20 years ago in addition to the 4runner you could get an Isuzu Trooper, Mitsubishi Montero, Nissan Pathfinder, Chevy S10 Blazer, Ford Explorer, or Land Rover Discovery. All were mid-sized body-on-frame SUVs. You could also get the Jeep Cherokee or Grand Cherokee and while they weren't BOF they competed in the same arena.

Today the only competitors to the 4runner left are the Jeep Wrangler and Grand Cherokee. Again, the big boys (Ford and Chevy) figure they'll make their money with full sized rigs (Expedition and Suburban/Tahoe) rather than try to compete with Toyota on the mid-sized market. All the others have either disappeared or turned into unibody crossovers (Explorer, Pathfinder) that appeal to a bigger market.

So at this point, since Toyota owns the market, they can set whatever price they want. As long as the market remains small the competitors will probably figure it's not worth it to compete and Toyota will remain king of the hill. But if another manufacturer figures out that they can make money in the same market space, they will be in a good position to start taking market share from Toyota just based on the insanely high prices that Toyota's command. :shrug:

Um, Toyota doesn't set the price, consumers do. That goes for both new and used.

In 1984 I drove a 4Runner off the showroom floor. That was my first new vehicle. In 1987 I sold it for about $1K less than I paid for it.

You just keep on trying to justify it to convince yourself man. If posting here helps then by all means keep doing it but your logic is convoluted at best.

You always get what you pay for, nothing more, nothing less.

 

[Jernik]

In 1984 I drove a 4Runner off the showroom floor. That was my first new vehicle. In 1987 I sold it for about $1K less than I paid for it.

Nothing personal, but I hate you. :jk: Where are these suckers at when I'm trying to sell something? :dammit:

 

[Martinjmpr]

Nothing personal, but I hate you. :jk: Where are these suckers at when I'm trying to sell something? :dammit:

I hear ya. When I put my '99 up for sale in 2012 I figured people would come running from the hills to get a clean 3rd gen with tall coils and a factory E-locker.

Nope. Got two offers and still ended up selling it for at least $500 less than I thought would be my 'minimum' price. Had lots of looky-loos but no serious offers.

Of course, for that I blame the aftermarket tube bumper. I learned my lesson with my 4th gen - I got an aftermarket bumper but wisely I put the original factory bumper in my garage. When it's time to sell the aftermarket bumper will come off and the factory bumper will go back on.