Automotive

When dealers wholesale a used car...

  • Last Updated:
  • Feb 12th, 2021 6:06 pm
[OP]
Jr. Member
Jan 20, 2003
160 posts
33 upvotes
Toronto

When dealers wholesale a used car...

How often to dealers sell used cars to wholesalers? What kind of "discount" will dealers give to unload the car?

I was just speaking with a dealer about a vehicle I was interested in. It had been sitting on the lot for a while by the time I called, and I was tole that it had just been tentatively sold to a wholesaler.
In the even that the car magically becomes available again, what do you think the % difference might be between the retail and what they might have cashed out for?
9 replies
Sr. Member
Nov 6, 2013
637 posts
403 upvotes
Pretty rare that a retail car would go to wholesale. In my experience, dealers have a couple wholesalers that they mainly work with. They swing by and see what fresh trade-ins are there that will be going to Adesa (or similar) auction and buy it before then.

If a dealer doesn't want to retail a car, the wholesaler buys it, if the wholesaler doesn't want it it goes to auction.
Deal Addict
Apr 10, 2002
2114 posts
545 upvotes
Central Ontario
IMO, when you were told it was "tentatively sold", the dealer was attempting to get you to make an offer. They'd make more from a retail sale than a sale to a wholesaler.
[OP]
Jr. Member
Jan 20, 2003
160 posts
33 upvotes
Toronto
primetimey wrote: Pretty rare that a retail car would go to wholesale. In my experience, dealers have a couple wholesalers that they mainly work with. They swing by and see what fresh trade-ins are there that will be going to Adesa (or similar) auction and buy it before then.

If a dealer doesn't want to retail a car, the wholesaler buys it, if the wholesaler doesn't want it it goes to auction.
That was always my understanding. But apparently not.
Deal Addict
Apr 10, 2002
2114 posts
545 upvotes
Central Ontario
primetimey wrote: Pretty rare that a retail car would go to wholesale.
Off-brand (for a branded dealership) and/or older (>3-4 years) will almost always go directly to the wholesaler, depending on the dealership and car, of course.
Deal Addict
User avatar
May 18, 2002
3676 posts
832 upvotes
Brampton
It depends on the quality tier of the vehicle. The best are sold off the lot after reconditioning, others are passed on.
These days most major brand dealers are part of larger groups. If a vehicle is deemed not worthy of resale on the lot they often have a used car dealership managed under the same group to sell the second tier vehicles.
After that, I wouldnt advise buying third tier, they are usually too high in mileage, have accidents on record, modified or some other strike against it.
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Jr. Member
Jan 28, 2015
150 posts
23 upvotes
Mississauga
How would you even find the car if it does magically appear on sale again?

Our dealer has a list of cars that go wholesale for sure meaning we don't list it for retail at all and then there is a time we sell anything that has been sitting on the lot too long to wholesale aswell.
Deal Addict
Apr 10, 2002
2114 posts
545 upvotes
Central Ontario
AMAZIN wrote: How would you even find the car if it does magically appear on sale again?
Unless OP has an "in" somewhere in the chain, there's no telling where a car sent to a wholesaler will end up, especially if it goes to auction.
Deal Addict
User avatar
Apr 22, 2009
1195 posts
437 upvotes
Scarborough
There is a dealer network called TradeRev..., cars are often listed there and "wholesaled" to the highest bidder.

Usually not too far off from the listing price of the car, unless the car was grossly overpriced.
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[OP]
Jr. Member
Jan 20, 2003
160 posts
33 upvotes
Toronto
STCman wrote: There is a dealer network called TradeRev..., cars are often listed there and "wholesaled" to the highest bidder.

Usually not too far off from the listing price of the car, unless the car was grossly overpriced.
Very interesting. I suspect this is where it ended up. It was priced pretty high for a while on the lot (on-brand) and then was reduced significantly.
It's too bad - I probably would have bought it for close to the listing price but unfortunately I didn't see it in time.

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