1. 13% HST on used vehicle (zero value add), and that money does not contribute to market efficiency.
2. Wholesale-retail spread on my car was $1750, on $11,000 wholesale, about 15%. Paying retail should be considered fair.
3. Dealer wants $450 "admin" fee (I am not sure if I was the sole sucker paying it), another 5%
So 33% total just the way in, let's not count selling/trading-in.
Nowadays cars live longer and more mechanically sound, very likely to outlast needs. But due to these transactional costs, buyers must be damn careful in predicting the future needs, this leads to deadweight, inability to adapt to changing circumstances. Nothing we could do with the gang-bangers (the Government), unless it's private sales with "mutual understanding". So if there's a website that gathers high quality owner postings (those could have traded-in but chose not to), price, and verifies quality references (pictures/proofs on the standard x check points), I'd be getting Dealer Auction Pool quality for at least the same or lower prices. Oh BTW, dealers do sells car they don't have, sometimes they even share the car between locations. Also, dealers do not guarantee problems or quality. By dealers I mean the manufacturers.
It's very likely someone is both buying and selling, but it would be infrequent and the amount is quite large, so I am not sure if reputation can be tied to this. This is also where I think Kijiji is falling short of its potential.
Of course there are the same old synergistic revenues on "warranties", financing (look at CarFinco) or other add-ons.