Toyota Dealer Pays More for Used Prius Than It Was Worth New to Fulfill Consumer Demand
Is the Prius really so valuable? A Toyota dealership recently announced it bought one of these used models back from a customer after more than a year for $1,500 more than it was originally sold for. Is this the result of high gas prices, the impact of the Japanese quake on supplies or what?
The supply level of new Toyota Prius models has wallowed in the 10-day range for the last two months, according to National Automobile Dealers Association chief economist Paul Taylor. He now says supply has probably fallen to four or five days.
But who would have imagined that on the other side of the industry — the used-car market — that a one-year-old Prius would fetch a higher trade-in price than the amount for which it was sold?
Earl Stewart Toyota knows all too well what a bevy of economic influences has done to the value of a used Prius. About 15 months ago, the North Palm Beach, Fla., dealer sold a used 2010 Prius with 8,700 miles for $20,500.
The consumers who bought it — Jupiter, Fla.’s Greg and Louise Candea — sold it back to the same dealership. The price this time around? $22,000.
In other words, the Candeas made a $1,500 profit on a vehicle they had driven more than 26,000 miles.
While he couldn’t recall any other examples of dealers experiencing the same thing, Kelley Blue Book’s Alec Gutierrez did note that Prius values are “significantly higher” than they were a year ago.
In some cases, dealers are paying $3,000 to $4,000 more at auction than they were a year ago, he told Auto Remarketing on Wednesday.
However, while Prius values are still stronger than year-ago levels, there has been some drop-off in the last four to six weeks as gas prices have moderated, Gutierrez shared.
In fact, KBB has brought down the value of the 2010 Toyota Prius by $2,000 in that time frame.
Gutierrez emphasized that “prices are still up year-over-year, but a lot of that premium is starting to dissolve,” and he expects it will continue to do so.
And finally, there are also rumors circulating that Toyota could be in the process of shipping quite a few of these Prius models to the U.S. Apparently, a release was inadvertently issued on PR Newswire and then quickly killed after Toyota public relations received questions. But, according to reports, the photo accompanying the release showed quite a few models arriving on U.S. shores. So far, Toyota has made no public comment. Management could be saving this news to give to its dealers itself.