The Story of AA Auto Bay - How to make money off cars

posted Sep 18, 2009, 10:21 PM by Quentin Ballard Tremeer   [ updated Jan 8, 2010, 2:23 AM ]

For those of you hanging here to find out how to make money off cars……

 Step one.. Get the money to buy the cheap cars on auction…… i.e. sell my current vehicle……. I registered with AA Autobay two weeks ago, made the appointment to go to my nearest inspection facility, spoke to the dealer principle who showed me what the trade and retail prices on my vehicle are currently, filled in the forms and  stood out the way when he took the photo. Two working days later my car was on the website. It is on the second page of similar cars and therefore seems well priced. It is not top of the range though so this may be a downfall.

I have a couple of reservations though. On asking the dealer principle of the AA affiliated dealership if a buyer could trade a car in on my vehicle, even though it was a private sale he said that it depended what car it was and that they MAY buy it off the person. No mention of finding cover for the buyer……… the other thing I read about but forgot to factor into my pricing was the buyers commission (2.5% or R2500 whichever is bigger – before VAT). That means effectively that you have to price your vehicle R3500 below what everyone on Autotrader is selling theirs for or else you would have out-priced yourself. In effect, as the seller, you end up paying double commission the i.e. R7k for cars less than R100k.

So there you have it. This week I will be thinking about whether to drop my price R3500 or if it would be better to go to a second hand car dealer and negotiate a fee with him to sell my car for me…… not too sure if this covers the risks associated with selling ones car privately like AA Autobay does….. they guarantee the car to the buyer and guarantee the money to the seller….. and put their dealers in harms way of being involved in a hijacking if the person coming to “test drive” actually is coming to ………… drive away without paying……… what I have learned in the last two weeks is that it seems to all be about managing risk vs. reward….. like so many things in life…………

 

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