I don't get it. People in the market for used cars are presumably price sensitive - at least more so than new car buyers - who are already quite price sensitive.
Who are the used car buyers that are paying 20% more and getting bad financing terms? Are they selling a lot of cars to subprime buyers?
They are also falling for the User Experience, much similar to what car max started with "no haggle" pricing, no needing to wait fir F&I from the dealer, etc.
That's it - same old processes, but they have the UX to make it "nice."
They're using the same idealogy of overpricing stuff and listing it in Amazon, so they have the first exposure, even if most expensive, it's most convinient.
I, value 50% of the car's price and don't mind spending 3-6 hours to save $10,000~ but many people, simply have an old car, the mechanic says it needs a new engine, they have a shift working minimum wage-esque and go with the first option of visibility thinking it's a good deal.
Financially poor, financially ignorant and time poor.
I think it is more likely they are targeting budget conscious people that are busy with a high paying white collar job and who don't have the time to visit dealers and haggle and want the luxury of just coming home and having the car delivered.
I agree with all that except financially poor. Most sellers I imagine would prefer their clients be wealthy (because wealthy people on average value a marginal dollar less)
People are starting to take out 6 and 7 year auto loans. Some people only look at the monthly payment to figure out if they can afford the car. Because of this, some “budget conscious” buyers are effectively price insensitive.
Convincing a buyer to be a ‘payment’ buyer is an old trick in the car market. Don’t fall for it - always buy on price and then let the payments work out. With all the online calculators and soft pull applications (no credit hit, but accurate prices) it should be strait forward to figure out roughly what you can afford. If it seems like magic, it likely is.
A huge fraction of the used car market is not price sensitive. They are the same old idiots who finance a boat at 20%. The reason they're in the used car market is because they've been told their whole lives that depreciation is for suckers and therefore they should buy a used car. They aren't price sensitive, they're just doing what they think they're supposed to be doing.
Who are the used car buyers that are paying 20% more and getting bad financing terms? Are they selling a lot of cars to subprime buyers?