Carmax - What's Your Experience?

Kirstie_HKirstie_H EdmundsAdministrator Posts: 11,132
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  • 1racefan1racefan Member Posts: 932
    I tried to purchase a car there a couple of years ago. I found the no haggle price to be about $1000 or so too high (and there really was no haggling).

    I have also found Carmax to be a great place to go if you are torn between 3 or 4 different make/models of cars. Typically they have about everything in stock, so you can at least look at them each at Carmax, without having to drive around town to several places.
  • carlisimocarlisimo Member Posts: 1,280
    Haven't dealt with them myself, but I have a friend who needed a new car after an accident. He didn't know what he wanted, so he liked the idea of something big like Carmax where you can see a wide variety.

    He ended up getting a slightly used RX-8 from across the country (at another Carmax) that they shipped over. He paid a small fee for that, but he wouldn't have to buy the car once it arrived. He had it inspected, and did end up buying it. He paid around $20k for a 15,000 mile loaded model, and he's been very happy with it (except for the fact that he could fit a bigger piece of luggage in his former '99 Miata's trunk than the RX-8's).
  • muzzymuzzy Member Posts: 12
    I took my truck in the other week to see how much they would give for it. kelly blue book for trade in good condition was 7500, they offered 7000. private party 9500, I sold it privately for 9000
  • pschreckpschreck Member Posts: 524
    Does anybody have experience with this CarMax dealer in Laurel MD?
  • 1racefan1racefan Member Posts: 932
    "He had it inspected, and did end up buying it."

    Just curious - was Carmax cool with your friend taking the car to his own inspector, or did he do this after he had purchased it, but still within the return/refund period?
  • carlisimocarlisimo Member Posts: 1,280
    "Just curious - was Carmax cool with your friend taking the car to his own inspector, or did he do this after he had purchased it, but still within the return/refund period?"

    They let him drive it to his mechanic. I don't know what conditions they set, but it worked out.
  • adamsearadamsear Member Posts: 8
    Can anyone tell me if the Carmax TaxTitleTags estimator is accurate?

    http://www.carmax.com/dyn/research/TaxTitleTags/taxtitletags.aspx

    I'm considering what I can afford OTD for a new car, and the estimate of TTT (especially in California) is a pretty important figure. I'm wondering if anyone who recently purchased a car could quickly check against their actual costs and let me know.

    Thanks!
  • basscadetbasscadet Member Posts: 146
    Hi, I have just recently left Carmax after working there for over a year. I can answer most of the Carmax-related questions you folks might have. :)
  • basscadetbasscadet Member Posts: 146
    yes, it is very accurate. Of course, it is only as accurate as the information you put into it. Are you selecting the right tax rates for your area? They calculate based on where you live, not where the store is located.
  • basscadetbasscadet Member Posts: 146
    You will often pay more money for a used car at Carmax for one very important reason - the quality of their used cars are second to none.

    That said, some deals are better than others. You can go into a Carmax and find two identical vehicles and one will be priced $1000 less than the other. The difference is due to the amount of reconditioning necessary to bring the cars up to Carmax spec.

    Carmax spends more money and time reconditioning their used vehicles than most any other used car lot.

    But are they the cheapest place to shop? NO.
  • basscadetbasscadet Member Posts: 146
    Kelly Blue Book prices are completely ridiculous and inaccurate. If you look at the cars that are being sold at Carmax you will see that the vast majority are at least $1000 less than what Kelly says they should be selling for. So if you're getting $1000 less for your trade-in but also getting your new car for $1000 less than what KBB says, it is a wash.

    Relying on Kelly Blue Book to determine whether or not you're getting a good deal at a car dealership is a dire mistake.

    The Kelly Blue Book accuracy on private party transactions are much, much greater.

    If anybody is curious why Kelly Blue Book is so inaccurate I would be happy to explain.
  • basscadetbasscadet Member Posts: 146
    Any car purchased at Carmax comes with an 5 day money back guarantee. There is no restocking fee or mileage limit. It is a no-hassle, no-fine-print guarantee. That 5 day period allows you to have the car checked with your own mechanic.
  • 1racefan1racefan Member Posts: 932
    I am curious - take an average 15,000 mile used car at Carmax. What is typically reconditioned on a car like this? Are all of the fluids automatically flushed, brake pads changed, etc...? I would be curious to know what exactly is reconditioned on an almost new car at Carmax.
  • oghowieoghowie Member Posts: 57
    Would I usually get more than a car dealership on my trade-ins at Carmax or is the value usually pretty close?

    What is the usual profit margin on a CarMax used car? That would help me figure out how much they would be willing to give just based off their website.

    Thanks!
  • dino001dino001 Tampa, FLMember Posts: 5,977
    I know that KBB retail "values" are basically some kind of average (or expected) asking prices in "traditional" dealerships. What is a trade-in "value"?

    2018 430i Gran Coupe

  • british_roverbritish_rover Member Posts: 8,457
    I have no idea but I think they figure it out from using random numbers generated from sunspots like how the NSA does their encryption technology.

    Seriously though KBB trade in values are almost never ever right and I have no idea how the make them up.

    If people just paid what the KBB retail price was I would have no problem giving them what the KBB trade in value was since things would even out. We over allowed by 3-5 grand on their trade but they also over paid 3-5 grand on the used car they bought.
  • manamalmanamal Member Posts: 434
    The last three cars I 'traded' carmax beat the dealer by 1500, 2800 and 3500
  • oghowieoghowie Member Posts: 57
    Just got it appraised and it beat the dealer by $600. Not bad. I'll prob do this for all my future cars.
  • jipsterjipster Louisville, KentuckyMember Posts: 6,068
    " I would be curious to know what exactly is reconditioned on almost new car..."

    I was thinking the same thing. Probably in most cases a oil and filter change, detailing ...maybe an air filter.
    Thats about $100.

    As far as Carmax having the "best" quality used cars? Someone must have visited an aweful lot of dealerships and used car lots to make that statement.
    2020 Honda Accord EX-L, 2011 Hyundai Veracruz, 2010 Mercury Milan Premiere, 2007 Kia Optima
  • 1racefan1racefan Member Posts: 932
    is that their cars are typically more expensive than other places (@$1000-$1500 on the average car). I am of the opinion that if I am going to pay this much more for a "used" car, I am going to buy it from a dealership that is selling it with a Certified Pre Owned warranty. I have seen many a CPO vehicle at other dealerships with 10-30K miles on them that look everybit as good as what's at Carmax.
  • british_roverbritish_rover Member Posts: 8,457
    Depends on the vehicle and the mileage.

    Just for example lets take a Range Rover with 40k miles on it. These cars have scheduled maintence included so its next service is on Rover but that does not include Tires, brakes and wiper blades. On any car that is not cheap but on a Range Rover it is a lot more. Cost is just under a grand just for the back brakes and front brakes are a little over a grand. You can't put cheapy tires on a Rover since no one makes cheapy 19 inch tires and you really got to use Michelin Synchrones cause any other tire seems to cup badly on Range Rovers. There is another couple of grand in tires.

    All of that is before any cosmetic issues are taken care of. Little scuff here and there little dent in the door, a chip in the window that adds up to hundreds of dollars very quickly.

    Now granted I am using a pretty high end car as an example but even say an average 20k dollar used car with say a little under 40k miles on it is going to need brakes and tires. They probably won't cost 4 grand to do but might cost 2 grand or 1,500 to do.
  • 1racefan1racefan Member Posts: 932
    That's what I would expect on a used, high-end vehicle.

    However, I think the question here is what does Carmax do to a 5,000-15,000 mile used car to command a $1000-$1500 premium vs a traditional car dealer. You don't even receive a CPO warranty from them like you would through a dealer that sells the brand you ae looking at.
  • british_roverbritish_rover Member Posts: 8,457
    I think at that point you are paying more for the convienance of one stop shopping and no haggle pricing. Lets just say that the do an oil change, bring the car up to date with its next major service and take care of all the little scratches and dings in the car.

    Most all other dealers do the same thing so have about the same reconditioning costs.
  • basscadetbasscadet Member Posts: 146
    All fluids, of course, are replaced. Radiator is not necessarily flushed on a low mile car like that. Brake pads and tires not changed unless they have less-than-considerable amounts of wear left on them.
  • basscadetbasscadet Member Posts: 146
    As far as Carmax having the "best" quality used cars? Someone must have visited an aweful lot of dealerships and used car lots to make that statement.

    I've worked at three. I buy a car at least every 2 years.
  • basscadetbasscadet Member Posts: 146
    Certified Pre Owned warranty

    i.e. an extended powertrain warranty that is good to 72 or 100k miles. Which is essentially worthless since most cars (excepting Korean cars and some low-end domestics) built these days have a powertrain good for well over 100,000 miles.
  • basscadetbasscadet Member Posts: 146
    $1000-$1500 premium? I am not sure where you are getting these numbers from.

    On both ends of the spectrum: We sold 04 Cavaliers, low teens, power for $9-$10k. A lot of them. As early as last summer at this price.

    We also sold 03 and 04 7 series BMWs for THOUSANDS less than what could be negotiated across the street from us at a BMW dealership.

    On average I believe Carmax sells cars for a little more money, but nothing as much as $1000.
  • british_roverbritish_rover Member Posts: 8,457
    Thats not true for all CPO cars though. The CPO Rovers we sell have a 6 year 75,000 mile bumper to bumper warranty. Identical to the factory warranty except for a 100 dollar deductible and no included scheduled maintaince.
  • basscadetbasscadet Member Posts: 146
    Perhaps Rover are an exception, but I believe most makes only offer powertrain coverage as a benefit of being a CPO.
  • exb0exb0 Member Posts: 539
    Which book Carmax uses to appraise cars, and how far back of that book they’re shooting in their appraisals?
  • 1racefan1racefan Member Posts: 932
    Another thing to remember about CPO is that a lot of times, CPO vehicles also qualify for lower finance rates (special new car rates such as 1.9, 2.9, etc.. in many cases) thru the manufacturer.

    So If I were a financing buyer (which is the majority these days), I would take the CPO warranty (powertrain, and in some cases bumper to bumper), with the lower interest rate. Just my opinion.
  • basscadetbasscadet Member Posts: 146
    So If I were a financing buyer (which is the majority these days), I would take the CPO warranty (powertrain, and in some cases bumper to bumper), with the lower interest rate. Just my opinion.

    That is an excellent point. The lowest rate I've seen through any of Carmax's banks (and you certainly do not have to use them, in fact, Carmax doesn't care if you use your own bank...they make no $ on the financing) is about 6.9%. Last summer it was around 5.9%.
  • basscadetbasscadet Member Posts: 146
    The buyers don't use books. They simply go through the auction history of similiar vehicles and see what they sold for at that time.

    The books are simply not accurate.
  • mackabeemackabee Member Posts: 4,709
    basscadet, so why did you leave Carmax?
    Mackabee
  • 1racefan1racefan Member Posts: 932
    Speaking of financing...

    If I were to go to a Carmax on Saturday (say my bank is closed, and I go there on a whim) and see a car I just gotta have. I know that my bank's current interest rate on auto loans is X%, and it ends up that Carmax can't touch the rate. What is the Carmax policy on holding vehicles? Would they take a nonrefundable deposit from me to hold the car until Monday (when my bank would reopen)?
  • basscadetbasscadet Member Posts: 146
    I could not handle the stresses of living on commission. :cry:

    It's very, very tough.
  • basscadetbasscadet Member Posts: 146
    What is the Carmax policy on holding vehicles? Would they take a nonrefundable deposit from me to hold the car until Monday (when my bank would reopen)?

    Carmax will not hold cars. There are just too many flaky customers and honestly...Carmax cars sell much quicker than the average dealer can sell his. This is due to the online transfer system they use. Carmax cars last on average 12 days on the lot.

    But what they will do is allow you to drive off the lot using their financing, then coming back within 3 days with a check from your bank to pay off the loan. If for some reason your bank is dragging their feet and you don't get your check that quick, just return the car with their 5 day return policy.
  • audia8qaudia8q Member Posts: 3,138
    I could not handle the stresses of living on commission

    I have had some good salespeople candidates who didn't make the jump because of comission fears. It's understandable. OTOH, I could never be happy with the same check every week...I know that if I work hard I get more and if I work really hard I get alot more income...it's nice to give yourself a raise when you need it!!
  • isellhondasisellhondas Issaquah WashingtonMember Posts: 20,350
    All of work on commission in a sense. Work hard, get paid and maybe a raise. Goof off, get fired!
  • rroyce10rroyce10 Member Posts: 9,359
    ... **The buyers don't use books. They simply go through the auction history of similiar vehicles and see what they sold for at that time. The books are simply not accurate.**

    I'll agree with your last 2 points .... but the reason why Carmax conducts business the way they do is because of their corporate thought process -- and that doesn't make it good or bad ... it's just the way they think.

    Their thinking, is to keep the cost of many employee's out of the auctions, they feel they save money on transport, auction fee's, floorplan, time, etc ...

    That said, they also have the highest cost of recon, which is an immediate profit to the dealer because they balloon the cost and they also have the highest "pack" .. this way they are only paying 17.5/$19% commission across the board .... again, immediate profit for the "house" and the buyers still pay more money for the product ...... good for the dealer principle, not so good for the sales staff or the buyer .. ;)

    Terry.
  • mackabeemackabee Member Posts: 4,709
    I thought Carmax paid a salary plus flat commissions on every car, plus spiffs of warranties, appraisals and accessories? From what I understand people that work there make pretty good money. Even the part timers. Not so?
    Mackabee
  • basscadetbasscadet Member Posts: 146
    All of work on commission in a sense. Work hard, get paid and maybe a raise. Goof off, get fired!

    I always worked hard and I would see my paychecks fluctuate according to the whims of customers. I will not allow whims to determine my income.

    This is a problem specific to Carmax. At a regular dealership I had a lot more control over my income but at carmax...with their automated "Ups" system, the selling process was more like a lottery draw. Would you get:

    1) Customers who want to see "what their car is worth" via Carmax's much-advertised free appraisals. They have no intention of buying or selling anything.

    2) Customers who want to "lower their payments" because they cannot afford their 2005 GMC Yukon Denali XL and want something closer to $300 a month.

    3) "The BMW Guy"...usually a young professional (w/ girlfriend in tow) who thinks he has more money than he really does and wants to do nothing but test drive BMW/Acuras/Lexus' all day without having the means to buy anything. Usually wearing nice clothes that he put on his maxed-out Banana Republic credit card.

    4) Customer who has champagne tastes on a beer budget.

    5) Customer who is extremely and unreasonably picky about options and color and does not understand that there aren't Nogaro Blue Audi S4's on every dealer lot.

    6) people with bad credit and no money down

    7) A customer who, if they find the right car at the right price, is willing to buy a car.

    So when I sign in to the front desk at Carmax, I am at the mercy at whatever customer walks in the door. There is a very slim chance I will get customer #7 above. If Customer #7 happened to call or email Carmax beforehand and I sell them a car, whomever they spoke to in email or over telephone gets HALF my commission.

    When undesirable customer 1-6 comes through the door, Carmax policy dictates I am assigned to that customer and cannot leave them until they leave the store's property. I am stuck with the losers. At a regular dealership, I can "broom them" and find a better prospect.

    The only reason I worked at Carmax is they allowed part-time sales. At a regular dealership you don't see people who are selling 16 cars one month and 4 the next. Sure, there is some fluctuation, but not that much. At Carmax, huge fluctuations are the norm...and these fluctuations are despite the salesperson's best efforts.

    For whatever it is worth...
  • basscadetbasscadet Member Posts: 146
    There is no salary at Carmax. If you don't sell a car all month you get paid $7.75 an hour for as many hours as you worked. If your commission exceeds that, then you're paid whatever your commission is.

    Commission is flat.

    Accessory spiff is a joke, honestly not worth your time to sell and the equipment is garbage to boot. They're selling Sparco stereos at Alpine prices.

    Warranty spiff is good and worthwhile the effort. If you don't sell a warranty with a car, you won't last long at Carmax.

    Money CAN be good, but not as good as traditional dealership.
  • jipsterjipster Louisville, KentuckyMember Posts: 6,068
    bass, what's the turnover at Carmax as opposed to traditional dealership?

    You stated if you don't sell a car all month you're paid $7.75 an hour. How long would a "greenpea" last selling only 1 or 2 cars a month...providing they didn't quit?
    2020 Honda Accord EX-L, 2011 Hyundai Veracruz, 2010 Mercury Milan Premiere, 2007 Kia Optima
  • basscadetbasscadet Member Posts: 146
    I think you are definitely safe for the first 2 months. After that, if you're not selling at least 8 a month you will be "talked to", but not fired. You would probably have to have at least four 2-car months in a row before you would be asked to leave.

    It is very, very hard to get fired at Carmax by not selling enough cars. They are very lenient and supportive.

    Carmax's turnover seems (to me) to be lower than that of a traditional dealership.
  • isellhondasisellhondas Issaquah WashingtonMember Posts: 20,350
    I think I would fall asleep!

    An 8 car month is acceptable?? Wow!
  • british_roverbritish_rover Member Posts: 8,457
    I am working on a bout a 7 car month right now.

    Little different product though.
  • 1racefan1racefan Member Posts: 932
    #3 cracks me up. This guy knows that he would be laughed off any new car lot BMW/Lexus,etc...) if he tried to go joy riding there. Nothing like trying to impress the little lady by driving used luxury rigs at a used car lot - Classy!!! I guess he knows that Carmax salesmen are obligated to cater to him doing this kind of thing.

    This brings up an interesting point though about a negative to being a Carmax salesman....What's to keep the average shopper that is looking for an SUV, but doesn't know which model to come to a Carmax lot just to drive several different models in order to try to decide which one they like the most (with no intention of buying from Carmax)? Seems like they open themselves up to being a "testdrive fleet" for people like this, since they carry just about everything you can imagine.
  • jipsterjipster Louisville, KentuckyMember Posts: 6,068
    He wrote if you're not selling at least 8 a month you will be talked to...and that four consecutive months of 2 per month will earn you your walking papers. But, then again...CarMax profit margins on sold vehilces are A LOT higher than new car dealerships.Think outside the box. ;)
    2020 Honda Accord EX-L, 2011 Hyundai Veracruz, 2010 Mercury Milan Premiere, 2007 Kia Optima
  • isellhondasisellhondas Issaquah WashingtonMember Posts: 20,350
    I would be bored to death with that kind of volume.

    Don't be too sure about their "higher" profit margins either.
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