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Pickups' Value Crashing

4K views 42 replies 34 participants last post by  CHASLS2 
#1 · (Edited by Moderator)
By TERRY BOX / The Dallas Morning News
tbox@dallasnews.com

Big, once-invincible pickups shuddered to a halt this summer, stalled on dealership lots by high gas prices and a crumbling economy.

But the shocking 25 percent drop in full-size truck sales was just the first obstacle for a segment that was formerly one of the industry's most stable and profitable.
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Graphic: Trade-in values (.pdf)

Now, pickup owners may find that the truck-market tremors also deeply eroded the resale value of their vehicles – with some one-year-old trucks worth less than half what they were new. A drop that steep may be unprecedented, some industry officials say, and equivalent to two years' depreciation.

Moreover, the hyper-depreciation is likely to complicate the arrival of the 2009 Dodge Ram this fall and the '09 Ford F-150 this winter – all-new trucks critical to their beleaguered automakers. Potential buyers may find that they can't afford to trade their old pickups for a new one because their trucks aren't worth enough to provide a decent down payment.

"I think this bodes horrendously for the introduction of the Dodge Ram and Ford F-150, which are the best hopes to stabilize these firms," said George Hoffer, a business professor at Virginia Commonwealth University who follows the auto industry and does consulting work for automakers. "These trucks had the potential of being reprieves for Dodge and Ford."

Many dealers say they have scaled back their sales expectations for the new trucks.

"I'm optimistic because we've got a better new truck than ever, a truck that will compete with anything on the market," said Leo Griggs, owner of Park Cities Dodge in Dallas, which formerly counted on the Ram for 70 percent of its overall sales. "But I don't think it will ever be like it was – even here in Texas."

http://www.dallasnews.com/sharedcontent/dws/dn/latestnews/stories/090508dnbuspickups.1d6bc0b.html
 
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#2 · (Edited)
Re: Don't buy brand new Dodge Truck ever!

Whomever wrote that article is wrong anyway. I just checked out the KBB trade-in value of 2007 Ram 1500 SLT 4.7 V8 AT w/ 15k miles and no added options (quadcab and short bed--the most common configuration):

- "Good" condition 2wd = $9,630
- "Good" condition 4wd = $11,650

proof

So it is still bad.....but like mentioned above, no one in their right mind would have paid the full $30k MSRP when new. Say they got it for $24k, easily doable in 2007, in basically 2 years (since 2009's are coming) it lost 1/2 of its value. Who didn't see this coming once gas approached $5.00 per gallon?
 
#10 ·
Re: Don't buy brand new Dodge Truck ever!

Whomever wrote that article is wrong anyway. I just checked out the KBB trade-in value of 2007 Ram 1500 SLT 4.7 V8 AT w/ 15k miles and no added options (quadcab and short bed--the most common configuration):

- "Good" condition 2wd = $9,630
- "Good" condition 4wd = $11,650

proof

So it is still bad.....but like mentioned above, no one in their right mind would have paid the full $30k MSRP when new. Say they got it for $24k, easily doable in 2007, in basically 2 years (since 2009's are coming) it lost 1/2 of its value. Who didn't see this coming once gas approached $5.00 per gallon?
These blue book values are "old", try to actually sell one for 9630$



 
#3 ·
Re: Don't buy brand new Dodge Truck ever!

..."residual value of a common 2007 Dodge Ram 1500 SLT Quad Cab, for example, has plummeted to the point that many owners probably owe far more than their vehicles are worth.

Equipped with typical features like the 4.7-liter V-8, automatic transmission and two-wheel drive, a Ram in average shape with 15,000 miles on it – priced at around $30,000 when new – had a trade-in value last week between $8,970 (Kelley Blue Book) and $14,862 (Edmunds.com).".... :eek: :eek: :eek:
You're quoting a $5K swing there to boot. No truck is keeping any resale and with the current rebates it's only going to get worse before it get's better!
 
#4 ·
This means you can get a hell of a deal on a new one, and a hell of a deal on a used one
 
#9 ·
I understand...and I meant to mention that. I can enter some random zips in to try to see if the price will be less somewhere else....but I think Northern California will have some of the lowest prices. Plus I haven't seen swings too much more than a few hundred bucks.....and certainly not the few thousand dollar difference from the article. ;)
 
#7 ·
If you NEED a pickup to sustain your lifestyle / business this is either good news if you're in the market to buy used or it's not an issue if you plan to drive it until it dies.

If you don't need it, don't buy it. Then you won't be one of the millions that gets screwed for irrational purchases.
 
#13 ·
I agree with that. The majority of people with pickups in my area don't do anything but haul their a$$ to work and take family to groceries and whatnot. Those sales should go to vans or crossovers but no, some men must feel superior and make up for something they lack. A crossover for them is not manly.
 
#8 ·
this texas where they call pick um trucks cowboy cadillacs,everyone drive a pickup whether they need one or not and the or nots have dropped out.
 
#14 · (Edited)
If you ever wanted a pickup as a "third vehicle", and you have the cash, now is the time to jump. I am talking about a weekend trip, gee I need to haul something today, omg look at all the snow kind of vehicle. Imagine what you can get a '04 or '05 with say 60K or 70K miles on it for?! There are a TON of pickukps and suvs for sale in my neighborhood. Some newer, but some 5 to 10 years old too. The market for not so late model trucks and SUVs has colapsed as well. Even worse news for truck makers. With used prices so depressed, why on earth buy new?
 
#15 ·
I work on the edge of the NW side of Chicago. Across the street sits an F-350 long bed
4x4 crew cab with a lift kit.

I've never seen anything in the bed.

Maybe the guy goes home and tows 14,000lbs every weekend, but the owner is essentially using it as a commuter vehicle that's 'badass.'

Pickukps have enjoyed a massive profit margin for decades - now it appears that's simply going to have to change.
 
#17 ·
Frankly, I could care less what the depreciation is on my new '08 F250. I bought it with the intention of keeping it long term. For now, until it is paid off, it will be my commuter (no biggie, I go through one tank a month), and then I will get a commuter vehicle.

We will be buying a travel trailer next year, after we pay off the majority of our debt.

I got a good deal, and love my new truck.............. other than that, I could care less what anyone else thinks. :)
 
#37 ·
Frankly, I could care less what the depreciation is on my new '08 F250. I bought it with the intention of keeping it long term. For now, until it is paid off, it will be my commuter (no biggie, I go through one tank a month), and then I will get a commuter vehicle.

I got a good deal, and love my new truck.............. other than that, I could care less what anyone else thinks. :)
EXACTLY! Thank you. My 07 Sierra is my daily driver, I got a good deal to start with; I will be keeping it for a long time; and I actually use it (last two weeks, a dishwasher, two couches, helped a friend move and two loads of garbage to the dump (mine and buddies).

Reg cab gets decent mileage (I average 20mpg US gallons mostly city driving), its comfy, good view of the road and I like driving it.

My p**** is just fine thanks!!LOL Why is it when somebody buys something they want or like, they are compensating for something? Seems to me the people making comments like are compensating for something as well (jealousy? lack of imagination? boredom?).
 
#18 ·
I'm driving a 2007 GMC Sierra Flex-Fuel SLT, I paid $38,759 for it, and I would not trade it for any small car no matter what the mileage. I average 19 MPG 21 on the highway, driving sensibly, and that is good enough for me. I LOVE MY TRUCK and would not drive anything else. I would like gas prices to drop but if they don't I will adapt, I have my standards and they don't include a prius.
 
#20 ·
When housing picks back up they will rebound some but not to the same level and the glut in the market must be takin care of. I bet when construction starts back up, that contractors are just going to get higher trim levels because the price is right.
 
#22 ·
Some people like trucks because they are still BOF and most have a V8 just like a bazillion American cars did up until the late '80s. Why do you think most trucks seat 5 or 6 nowadays? Back when GM built traditional cars just about every truck they built sat 3 at the most. Those were the people that needed trucks back then too.
 
#29 ·
agreed, before the market went bust, was not the average profit on a fullsize SUV or truck in the $10-20,000 range?

count me in as a truck hater, but i never understood paying high end luxury prices for low end utility vehicles. leather or no leather.

besides, when u consider the numbers that these vehicles sold in just a year ago, the tooling and cost of developement has long since been paid for on most of these trucks/suvs anyway.
 
#24 ·
If you ever wanted a pickup as a "third vehicle", and you have the cash, now is the time to jump.
If I get another convertible many years from now I may just do that. I have an old Tahoe for #3 now.
Trucks last a long time so I don't have a problem buying one that's 8-10 years old.

High gas prices will probably mean a nice selection of low priced, low mileage trucks years down the road, since a lot of people who have them aren't commuting in them.
 
#25 ·
Here in Cali the dealers are offering 1/2 of what Edmunds.com prices trade-in for big SUVs and full size trucks. The dealers will not even take in anything that isn't in excellent condition. The lots here are loaded to the rafters with trucks and SUV, and the number of close dealers is staggering. All the dealers that are being closed the OEMs have to take back the stock of those vehicles and dump them on the remaining stores. If you need a full size truck or SUV buy now and HAMMER the dealers cause they will not think twice about beating you up on a trade in.
 
#26 ·
KBB is totally irrelevant.
V8 Trucks of any kind are trading for $8-12K below wholesale KBB. (by the way, so is my Z4, which I get 34MPG tank average- Pickup trucks and full-size SUVs are now officially a "niche" vehicle based on trade values)

Lenders are turning to Black book values. Dealers use vAuto and other "real-time" auction results for evaluating trades and are scared out of their wits they are going to lose money trying to resell a truck or SUV.
Comparing real-world values (buy at dealer, trade at dealer), these vehicles are losing 75% of MSRP in 1 year or more.

Ironically, traditional "disposable" cars- cheapies that went for $12-14K when new are actually GAINING value based on the books and are trading at auction ABOVE KBB wholesale- in some cases above RETAIL, and that is before reconditioning!

Everybody is nuts. I don't want to play anymore :lmao:
 
#27 ·
Study: Used truck prices rebound

Automotive News
September 5, 2008 - 4:13 pm ET
UPDATED: 9/5/08 5:00 p.m. EDT

Falling gasoline prices helped boost wholesale prices of large used trucks in August, NADA AuctionNet data show.

Average August wholesale prices of used full-sized pickups rose 7.7 percent -- about $900 -- from June 30, when gasoline prices peaked, according to AuctionNet. From Jan. 1 to Aug. 31, prices of big used pickups declined 14.5 percent.

Similarly, August auction prices of large SUVs rose 8.9 percent -- about $1,300-- from June 30, but were down 11.3 percent for the year. By contrast, wholesale prices of intermediate compact cars were up 22.0 percent for the year.

AuctionNet data are based on auction sales by Manheim, ADESA Inc. and independent companies. NADA Used Car Guide compiles the data.
 
#30 ·
If you walk into a dealership with the intent to buy a truck and have no trade or are trading in a car then you can probably get a steal of a deal. You want to give us a car and take a truck!?!?! HALLELUJAH! :)

For the amount of driving I do I could probably buy a truck/suv and the savings on the purchase price would more than cover the increase in cost of gas for the life of the vehicle.

Almost to 25 months with the Saab 9-3 and still can't get to 20,000 miles. Though I did turn down the offer to interview for another job, the increase in pay also came with an increase of commuting from 27 miles per week to 35 miles one way.... I could do all of my required driving in a week for less than a one way trip to work. Sure, I will drive that far, but to really get me to consider it you will need to up the offer by a few $ ph more.
 
#31 ·
Might as well keep the 9-3. It'll be years before you "need" another new car. :) I played with the idea of buying a Sierra or Ram recently, but I only drive about 10 miles a day in my almost 20 year old Suburban. It runs fine so why bother with a note? I'm holding out for something i really want, like the Camaro or Challenger.
 
#34 ·
I guess that these new falling values mean the wife's '98 Silverado is really taking a pounding. We keep our vehicles forever, and it only has 110,000 on it now....

Guess the moral of the story is don't trade in this market until it settles down.
 
#35 ·
I sold my vehicle outright, and put cash down on my new truck................ so I got a good deal. I figure the $9000 I got off of MSRP buys a lot of fuel for a V10............ when you only drive 300-500 miles a month. LOL

If you can afford a gas guzzler, it is a great time to buy.
 
#36 ·
Just last night, my wife and I bought a 1 year old Nissan Xterra 4x4 and paid $12,000 less than the guy paid for it new 13 months ago. That is after his rebates, etc. We got one hell of a vehicle, and the price was so low that we can pay for a LOT of gas with those savings.

Besides....Her 2007 Hyundai Sonata V6 SE got 17.8mpg combined. This is with us checking it manually over the course of 4 months. 17.8. She got 48mpg in her VW TDI Jetta. Anyway, we figured with the Sonata being such a PIG at the pump, we may as well get something that can tow a travel trailer and boat!

I'm already looking for that bumper sticker saying "My truck can drive over your Prius".
 
#42 ·
All of the "Media" hype of the Big 3 cutting production of Full Size Pick Ups may have jumped the gun somewhat.

Do I need a FS truck to go 1 mile back and forth to work? No.

But I do need 1 to pull the boat to the lake every other weekend, I do need one for my Snow Plowing side business. Our family still needs a Mini Van for traveling with 2 kids and 2 dogs.

That being said, Pick ups are not going to become extinct, but they are going to become purpose orientated. You cannot haul a slip tank in a Focus, Drywall in a Yaris, or go to the dump with a Prius. They did take a big hit though, we are terming leases that 3 years ago, Ford figured the residual at $25000, that we can buy for less than $15000
 
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