Why Canada’s used-car world is becoming a buyer’s market

TORONTO — The balance of power in the used car market is shifting towards shoppers as improved data and online offerings create more opportunities to push for the best price.

A fast-evolving online marketplace is providing more intelligence on the fair value of cars, said Cliff Banks, a Detroit-based auto retail expert.

“I don’t know that it can be any more transparent…they all provide intelligence on the pricing and the deal of the vehicle, whether it’s a good deal, a fair deal.”

Kijiji Canada recently announced it will add a standalone auto sales site that will roll out later this year to keep up with shifting expectations. The site will add reviews of dealers as well as market pricing information from Carproof.

“The key feature for us, and one of the biggest, the biggest win for us is what’s called price transparency or price analysis,” said Matt McKenzie, general manager at Kijiji Canada.

The online classified company, owned by eBay, already boasts of being the largest player in the Canadian market with about 500,000 vehicle listings. Autotrader, owned by Etobicoke-based Trader Corp., lists about 444,000 vehicles on its site while there are many other offerings on the market as well.

Listing companies are boosting their online presence as the used vehicle market is set for significant growth, said Dennis DesRosiers, president of DesRosiers Automotive Consultants.

“There’s tremendous opportunity, and that brings in all the different retail players and their approach of, how do I get a piece of that?”

While new vehicle sales are expected to be largely flat at about two million this year, the used vehicle market is set to add half a million more in sales in the next three to five years, on top of the three million that changed hands last year, said DesRosiers.

The rise in the used vehicle market comes as improved quality in the past decade means cars and trucks are lasting much longer, allowing for a potential lifespan of four to six owners from the two or three expected not long ago.

“It takes 23 years to remove the vehicles from the road now, a decade ago it only took about 12, so it’s essentially doubled,” said DesRosiers.

Used vehicles also offer margins that are two to three times higher than for new cars, adding to their appeal, he said.

The quality and information improvements have significantly changed the overall used retail market, said DesRosiers.

“It’s not that far long ago, call it 15 years ago or maybe 10 years ago, where the used car market was largely a culture of deceit…even if the online capacity was there, there was just so much riffraff in the used car market that it was very dangerous. A lot of that has changed.”

The improved access to data means used-car retailers have to be more transparent and competitive about their pricing, said Jamie Tekela, director of pre-owned operations at Pfaff Automotive Partners.

“You need to really justify what you’re asking, why you’re asking it, and you can’t go asking $500 more for the same Honda Civic with the same mileage. It just it doesn’t work any more.”

“It’s night and day, to be perfectly honest. It’s gotten a lot more customer friendly,” he said.

The improved information on crash reports, comparable sales, and other metrics hasn’t done away with potential negotiations but does give more justification, said Jamie.

“There’s always going to be negotiations when trying to buy and sell vehicles, but with so much information available to each and every one of us, it’s a lot easier to explain our rhyme and reason why we’re asking what for a car.”

Car-buy advice: 6 affordable entry-level luxury rides

TORONTO — Luxury automakers long ago realized that in order to grow, they need to move down-market by making smaller, more affordable vehicles.

In 2005, Mercedes launched the diminutive B-Class hatchback. BMW began producing the 1 Series in 2004.

While rich customers spending $100,000 on full-size luxury sedans from these companies might’ve been mortified to see such plebeian vehicles in showrooms, semi-affordable entry-level models are now a staple of every luxury brand’s lineup.

The vehicles assembled below are the most affordable ways to drive off a luxury car dealer’s lot. They all have prices under $40,000 and come in all kinds of shapes, from coupe, to sedan, to SUV.

In Europe and the U.S., luxury vehicles make up a larger percentage of the overall market than they do in Canada.

However, that’s changing. Sales of luxury cars and SUVs in Canada are leading industry growth, posting double-digit, year-over-year increases, according to a 2017 Scotiabank report.

Expect entry-level luxury cars to feel fairly Spartan — unless you dive into the option list — and be smaller than something similarly priced from a mainstream brand.

Your head tells you to resist. You’re paying more to have that luxury badge on the steering wheel. But, increasingly, our hearts prevail and desirability takes the day.

Volvo XC40

Price: $39,900

Aston Martin’s chief designer, when recently asked which other brand is doing good design work, replied: Volvo. The Swedish company’s turnaround is in full swing. They’ve come so far from those boxy station wagons. The XC40 stands out from the masses of other small SUVs by looking both distinctive and stylish. The interior is full of useful details, too, like hooks for takeout food and a removable garbage bin for receipts and old parking passes.

Mercedes-Benz B-Class

Price: $35,900

While popular in Europe, the B-Class never sold well in the U.S. Here in Canada the smallest Mercedes always found more buyers. The three-pointed star is the car’s most prominent design feature on purpose. You wouldn’t spend this kind of money on any other front-wheel-drive sub-compact. If you’re interested, you may want to wait for the upcoming A-Class hatchback. The price will be a smidgen higher, but it’s more of a bona fide luxury car and the interior is in a different league.

Cadillac ATS Sedan

Price: $37,945

This is your last chance to buy Cadillac’s often-overlooked ATS. Production of the compact sport sedan is winding down as of this year. The rear-drive machine had the performance and handling chops to rival the best Germany had to offer. The base 2.0-litre motor made 272 horsepower, and the big V-6 was good for 335 hp. While the interior was never quite up to par, it was a solid comeback effort from Cadillac. Expect it to be replaced, eventually, by an all-new sub-compact model.

Audi A3 sedan

Price: $34,300

The A3 sedan was introduced in 2013. Compared to its German rivals, the smallest Audi feels grown-up. It looks just like the bigger A4, which is a large part of its appeal. Refreshed for 2017, the four-door A3 is a more practical choice than BMW’s 2 Series coupe or Mercedes’ fastback CLA sedan. The base model is front-wheel drive, but all-wheel drive is available for $39,100. If it’s performance you’re after, the $62,900, 400 hp, RS3 is both the cheapest model in Audi Sport’s lineup and the most fun to drive.

BMW 230i Coupe

Price: $38,050

BMW is the only one of the German luxury automakers to offer rear-wheel drive in its most affordable model. For many purists, this car is a return to BMW’s glory days. Handling is nicely balanced and the controls are feel-some. The punchy four-cylinder makes 248 horsepower and 258 lb.-ft. of torque, enough to get the car from 0-100 km/h in 5.6 seconds. A six-speed manual transmission is standard while a paddle-shift automatic is available for an extra $1,600. The $1,850 Performance Pack adds adaptive sport suspension. Downsides? It’s heavy for such a small car and it only has two doors, which will limit its appeal.

Acura ILX

Price: $29,990

It is mightily affordable for a car with a premium brand badge, but if you put it next to a Honda Civic you’ll quickly see why. The ILX has always been an up-market version of the best-selling Civic. For 2019, Acura gave it a visual overhaul, dressing it up with fancy jewel-like headlights and leather upholstery but its humble origins show through in big chunks of black plastic in the cabin. The 2.4-litre engine makes a fruity 201 horsepower, and is mated to a dual-clutch automatic transmission. The Acura has good residual value and gets top marks for initial quality, but it’s hard to forget it’s a Civic.

Infiniti QX30

Price: $38,490

This is Infiniti’s all-new entrant in the red-hot compact luxury SUV segment. The QX30 is built in England and was co-developed with the Mercedes GLA. Infiniti undercuts the BMW X1 and aforementioned Benz, and offers a (relatively) cavernous trunk. The 208 horsepower engine won’t light your hair on fire, but it’s enough. Leatherette trim is standard. Optional real-leather on the seats and dashboard make the cabin feel properly luxurious, but it’s part of a $5,000 option package. Infiniti expects the QX30 to attract first-time luxury car buyers, targeting customers in their early 30s.

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The Financial Benefits of Purchasing Your Next Car Used

If you are seeking out ways to save money in the future and watch your finances, choosing to purchase your next car used is a wise decision. Cars are not good investments and the odds of you selling any car for more than you purchased it for are quite slim. Therefore, it is important to focus on minimizing depreciation. Additionally, used cars have lower fees and insurance rates.

Less Depreciation

It is no secret that depreciation is problem when it comes to cars. When you buy a brand-new car and decide to sell it a few years later, you will be fortunate to get anything over half of what you paid for it originally. Alternatively, used cars depreciate at a much slower rate because the greatest amount of value is lost as soon as the new car is driven off the lot where it was purchased.

Lower Payments and Fees

A few of the other major advantages to opting for used cars include the lower car insurance rates and the cheaper registrations costs. Since there is less risk for insurance companies in the unfortunate case you get in an accident with a used car, they are far more likely to offer you attractive rates. You can even choose to opt out of collision coverage all together and save a significant amount over time. Lower payments essentially equate to less stress because you will not be fearful of getting in an accident and having to deal with expensive repairs of fixing your new car.

Considering used cars as opposed to new ones can be a smart financial decision. It can be hard to eliminate financial stress from your life, but choosing to go with a used car is one great way to minimize your debt. In the unfortunate case you got in a collision, having a used car can minimize costly repairs.

5 Benefits of Used Cars

When you set out to look for your dream car, you want one that has all the right features but doesn’t break the bank. Used car dealerships offer you myriad car choices, and they are your best bet for finding that perfect car. Here are five of the benefits of buying used cars.

The first and perhaps most obvious benefit of a used car is the lower price sticker. The steepest depreciation in value comes in the first two or three years of a car’s life. When you buy used, you profit from that depreciation, whereas an original car owner inevitably takes a serious financial hit on trade-in.

Used cars tend to come with lower down payments as well as lower prices. Furthermore, insurance and taxes on your used car will be less expensive, which means you have more money in your wallet at the end of the month.

If you want a car loaded with all the hottest tech, the latest safety features or the cleanest engine developments, you have plenty of options to choose from among cars made in the last two to four years. You can get a thoroughly modern car without the sticker shock or the drastic depreciation.

If you are operating on a tight budget, cars older than four years are probably the ones in your sights. Although buying an older used car may not leave you with Bluetooth compatibility, you will still have access to plenty of safety features in cars that date as far back as early 2000.

Last but not least, if your passion is classic cars, you have only one option. Used is the only way to go. There are plenty of other benefits to buying used cars. These cars give you the greatest bang for your buck and offer you the widest purchasing variety.

Find a Wise Purchase in Used Cars

A car can be an expensive purchase. Not only the initial purchase of the car, either. When you think about buying a car, you don’t think about all of the other fees that you will be paying. This is everything from registration fees to your insurance, inspection to minor repairs. When you take all of this into consideration, it may seem like a good idea to save money where you can. A great way to get the car you need without the financial stress is by exploring your options with used cars.

Dealing With Dealers

In order to know what you are dealing with, it is a smart move to find a dealer that you can trust. When you feel comfortable with your dealer, you will be able to feel confident in your purchase. Do a bit of research and see where your dealer stands when compared with others. Not only will this make you feel like a smart shopper, but you will know that you are getting a car that you can be proud of for years to come.

Make Your Pick

After you have found your dealer, it can be a great idea to explore the selection that is available on the lot. Even if you are not ready to purchase a car that day, it can be beneficial to see what awaits you. This will help you to explore your financial options while perusing the merchandise, allowing you to make the right choice for you. There are many models of used cars out there, so after you have spotted a vehicle that looks like the one for you, make sure to learn as much as you can about the exact make and model.

Used cars can be a great place to begin when you are looking for a car. When you do your research, you will easily find a dealer and a car that will make you happy.

The Best Time to Buy a Used Car

I like to say it is always the best time to buy a used car because I can always get you a good deal. However, I also have to admit that there are times when our inventory is a lot bigger, which means you get more choices and more chances to find the car that is perfect for you. Let me share this “insider’s” secret with you.

If you think about it, the first best time to buy is fairly obvious. It happens at the end of the year. Why is this a good time to buy? Well, it is the holiday season, so people are focusing on buying presents and not on buying cars. This means that our lot is full of great cars just waiting for buyers. In addition, we are still loaded with older inventory that we want to get rid of so we can move new models in, which again, gives you plenty of options. So there is a good reason why so many people give cars as presents this time of year. They know it is one of the best times to get a good deal and a great car.

The other best time to buy is when the new models come out. There are always people who are going to be trading in their used cars for the brand new models, which means our lot fills up with trade ins. These cars are often low mileage and gently used, which is another perk for you. You get top pick of a variety of different vehicles and some great deals on cars that are going to last you for years to come.

You can stop in and see me anytime, and I will always be able to help you find a great car, but if you are looking for the largest selection, then you should consider coming during the best time to buy periods. This will give you the chance to look over as many cars as you want to find the one that meets your needs.

Splurge on a Used Car

We know that when you buy a used car you are making a wise financial decision. Not only do you save money on the purchase price and avoid the lion’s share of depreciation costs, you also save on taxes, registration and insurance expenses. What to do with all of the extra money that buying used cars gets you? We believe that it makes sense to splurge on some extras.


Buying used, it is entirely possible that you can afford a car that has just a few thousand miles on it. You will still be getting a good deal, but you will also receive a vehicle that has many good years left in it. You will not have to worry too much about maintenance costs, as your used vehicle should go tens of thousands of miles before any non-routine maintenance is needed. Plus, our mechanics will have checked the car over to make sure it is in tip-top shape.


Another option is to splurge on a car that has the amenities you really desire. This could be a more powerful engine, a plush interior or extras such as an advanced entertainment system. Instead of buying a small sedan you may be able to afford a roomier SUV crossover or a cool-looking truck where you sit high in the cabin. You could get a car that will impress your friends and family. By getting a car that you really love, you will likely keep the car longer, resulting in more savings for you.


Whatever you buy, rest assured that our customer service department will help you each step of the way. We will assist you in getting a great deal on financing, if needed, and we can maintain your vehicle for many years. We have a full-service maintenance department that handles everything from oil changes to major engine work. Used cars are a great way to get more car for your dollar.

Looking for Deals at the Dealership

If you are thinking about buying a used car, there are many options available to you. One of the biggest assets to purchasing a used car besides money is time. If your current car is costing you a fortune in repairs or is no longer operational, you most likely will need to find a car quickly. However, if your current car is running well and you’re just looking to make a change, the more time you have to make a decision the more satisfied you will be when you are finally behind the wheel. When looking at a plethora of used cars, you need to decide what make and model you want to drive. When you select a car dealership, make sure you have a list of questions regarding the car you want.


Negotiate a Quality Test Drive


If you’re on the fence about used cars, one way to see if a used car is a good fit for you is to take a long test drive. You might be able to negotiate a test drive for several hours. It’s important to be able to drive the car on all types of road surfaces. For example, a car might perform well at high speeds, but does it perform well in stop-and-go traffic? If possible, it is always good to drive a used car in different types of climates. If you promise to keep the millage to a certain number and return the car with a full tank of gas, the dealer might allow you to take the car on an extended test drive.


See if the Deal Can Be Sweetened With Extra Equipment


When seeking out an older used car, it doesn’t hurt to ask for extra equipment. If the car is in sight of hitting the 100,000-mile mark, see if the dealer will install a new timing belt. If the tires appear to be worn, ask if the tires could be replaced before you buy it. Getting the most out of your initial purchase will benefit you in the long run.

Common Mistakes Made When Purchasing a Used Car

It’s true; there are risks involved in purchasing a used vehicle. If you’ve decided to look into used cars for sale, then there are a number of poor judgment calls you should avoid. Below are some of the most common mistakes people make when preparing to buy a used vehicle.


Focusing on the “Good Deal” Rather than the Vehicle


Just because it’s a low price doesn’t mean that the vehicle is right for you. While it may look like an attractive deal, it’s still important to know everything necessary about the vehicle you’re buying so that you are less likely to end up with a lemon. Always remember that a person can go broke making good deals, so don’t be afraid to make sure the purchase is worth what you’re paying.


Negotiating the Monthly Payment


When negotiating the price of a used vehicle, it’s important not to focus too much on the monthly payment. Consider the full vehicle price, trade-in costs and leasing options all separately and negotiate them as such. This way, the seller should have a harder time overcharging you in the long run, simply because the monthly payment looks appealing.


Opting Out of the Test Drive


It would be a wise move not to skip the test drive. It is a crucial part of shopping for used cars. The test drive can provide the opportunity for you to become aware of any serious problems with the vehicle. It can also give you the chance to get the feel for the car and learn whether it is going to meet your needs.


Neglecting to Research Your Own Car’s Value


If you’re trading in, then it is imperative to be aware of exactly what your current vehicle is worth to the dealer, with depreciation and all factored in. If you’ve done this research and stick to your numbers, you have a better chance of obtaining the amount of money your car is worth.


Buying used cars can be a scary thing. The above suggestions should help you steer clear of common mistakes made by used car shoppers.

Questions to Ask Yourself Prior to Shopping for Used Cars

When shopping for used cars, we know that the questions you ask us, as the dealer, are not nearly as important as the questions you ask yourself prior to you coming in. here are some of those essential questions that every potential car buyer should ask before entering our dealership doors.


What’s My Budget?


The first and most important question you must answer honestly for yourself is “What’s my budget?” This one simple question will actually answer a lot of other questions for you. For example, if you have a smaller budget, the latest and greatest sports car probably won’t work for you. Identify your ongoing expenses and the things that are important to your lifestyle and figure out how much you could spend on a vehicle and still fit within those constraints.


What Do I Need A Car For?


Are you looking for a commuter car that’s easy on gas mileage, or are you carpooling kids and need a vehicle with extra seating? You might really love one car but realize that it won’t fit your lifestyle. A large SUV is not going to make as great a commuter car as a compact car or smaller sedan will.


What Are My Must-Have Items?


In every car, there are some things that you must have and some things that you might want but would be willing to sacrifice for the right automobile. These must-haves will look different for everyone, so sit down and write out a list, being realistic about what you need and what you could possibly do without.


Finding the best used cars for your lifestyle and budget essentially boils down to asking yourself the right questions before going shopping. Keeping these questions in mind will help you avoid getting into a car that is not a good fit for you and will ensure you drive off the lot in the car that you love.