[CarGuy954]

I have been in the market to purchase a used BMW M340i and had some questions during my research. Recently I found two 2022's for sale with nearly identical mileage and packages. The retail price on these vehicles was around 51K. So I requested an appraisal from several dealers as if I were selling them so I can see what the trade values are. This would give me an idea was kind of margin there is so I can negotiate the retail price down. However, both those vehicles had a trade in of 39k (with no accidents & clean titles). This concerned me on how there can be a 35% increase over trade-in to retail. From an equity stand point this would be a really bad start. The dealerships I spoke with are not willing to go down very much if any. I am going to try this method on more used M340's to see if this high margin applies to all.

This leads to my question for those of you who have traded in recently are you getting a low trade in value in comparison to retail price. For those who have purchased used recently are you seeing the same margin over trade in and are dealers willing to negotiate down to a 10 to 15% margin over trade in.

With wholesales prices dropping at auctions and its inherent affect on trade in values, as well as its expected to continue throughtout the remainder of the year. To purchase a car with a 30 to 35% increase over trade in now would be bad, as the additional equity loss throughout the year could leave you really upside dopwn in just a couple of years. Unless you place a good down payment which you will just loose over time.

If anyone has any input on this or recommendations it would be much appreciated.

[335aw]

The car market is in an interesting time. Used values (trade in especially) are starting to tip and are going down in value. This is likely why it is so low to trade one in. With that said, prices have not fallen yet which is preeeeetttty weird. It will be an interesting few months

[tgrundke]

Those trade-in values are likely the residual values from lease *turn ins*. I know because I've ran the numbers for several months and researched this heavily between April - June when I bought my used '23 M340.

2022s are dicey because there was some really significant de-contenting due to supply chain issues; Notably, removal of things like the touch screen.

If you've got two '22s that I assume are sub-20,000 miles on them for $51k - I would consider that a very solid price.

If the dealership purchased the car between January - April, chances are they overpaid for the car and are very reluctant to drop the price. If the dealer brought the car onto their lot May - present, the price will likely be more aligned with where the market is. In other words: you've got very little room for negotiation.

I just did a little research: 2022 M340xi with 15,000 on the clock is ranging between $54,000 - $60,000 *retail* depending on packaging and condition.

Back in May and June 2021 M340xis with 20,000 - 27,000 were selling between $51 - $55k depending on how they were spec'd.

Assuming your 2022 is not de-contented and the mileage is around 15k, then $51k is about right for the market at the moment.

I would NOT expect significant price drops from here on out as the supply of M340s dropped significantly between 2020 - 2022, combined with a significant increase in the number of people who bought out their leases.

[CarGuy954]

So to be clear a lease turn in it will have significantly less trade in value? This gives a dealership a great margin as the retail value stays the same. Wow, what a nightware it would be when you go to trade in that purchase down the road though, you will be shocked at your value. I appreciate the info, that would explain one of the reasons not to purchase a lease trade in.

I am pretty sure they over paid slightly as alot of dealerships have been doing this. Regardless if they over paid I would never pay 30 to 35% over trade in, I would assume with the bank crisis going on, they would be reluctant to approve a loan like that anyways. However, if you place a good down payment the bank could care less about your equity loss down the road.

[tgrundke]

When you lease a car, the contract states the residual value of the car at the end of the term. One of the reasons why leases on luxury vehicles are so popular is due to their historical tendency to depreciate like rocks.

The market ultimately determines the value of the car. You may not want to pay 35% over what the dealership took the car in for, but if the market commands it, then you either wait it out, or, pay the market rate.

In a normal market, the residual would be close to the market value after, say, 3 years and 36,000 miles.

Due to COVID, the whole market became skewed. Hence, if you were used to turning in your $580/mo. lease after 3 years for a new one, that new lease is probably closer to $1,000/mo. As a result, a lot of people simply bought out the car for the residual value rather than pay the now market price for a similar vehicle.

You also can trade the car in or sell it, just like any other, and benefit that way: Residual is $39,000 but the market value is $49,000. $10,000 profit (or, equity toward new car).

That said, BMW and a lot of other manufacturers changed the lease rules during COVID, requiring that you *turn in* the lease to an authorized dealership versus *trading in* the car. Under those circumstances, there's no benefit to the customer.

[CarGuy954]

We will can see it in the market as the average car payment is over $700 per month in this country. However, the subprime market has been having an increase in repossesions and its now moving into non-prime/prime. The manufactures are making more profits selling less cars. It is dishearting to know that at any point manufacturers and dealers can decide they are entitled to higher profits. No one can compete with the NADA's lobbiest's and people could be paying on average $1000 per month.

Hopefully the supply and demand issue start get resolved.

I appreciate the insight on the market Tgrundke.

[tgrundke]

Originally Posted by CarGuy954

It is dishearting to know that at any point manufacturers and dealers can decide they are entitled to higher profits. No one can compete with the NADA's lobbiest's and people could be paying on average $1000 per month.

Hopefully the supply and demand issue start get resolved.

Well, nobody is "entitled" to higher profits - you extract them when the market allows it. Are you willing to give back the decades where there was an oversupply of vehicles and customers could get significant discounts? Not likely.

Manufacturers will likely end 2023 cutting production by 2.5 million units due to supply chain issues that persist. Since 2020 there have been over 10 million vehicles cut from production.

This isn't a lobbying situation - it's a supply and demand situation compounded by rising interest rates which have been artificially repressed for almost 20 years.

[Bnakegoblin]

If the m340i prices keep sliding down rest of this year I'd be able to grab one over a used 340i, problem is I do need to get a car in the next few months.

[BandwidthBandanna]

Originally Posted by tgrundke

2022s are dicey because there was some really significant de-contenting due to supply chain issues; Notably, removal of things like the touch screen.

If you've got two '22s that I assume are sub-20,000 miles on them for $51k - I would consider that a very solid price.

Assuming your 2022 is not de-contented and the mileage is around 15k, then $51k is about right for the market at the moment.

Thank you for this. I was unaware and actually eyeing a 2022 M340i thats used. I had no idea touchscreen is missing. I looked at the Options Info/Window Sticker and all I saw was "48Z Passenger Lumbar Delete -$175.00". I do not see anything else removed. Would you be able to point me of a list or something that shows what all to look out for on 22's? The 2022 im eyeing is priced at 57k at 11k miles and is optioned quite well. Im wanting it to come down a bit more but not sure it will.

EDIT:

I found these, please let me know if I am missing any other ones.

Touch screen (- $500 USD)
Wireless Charging (No Discount)
Digital Key(- $80)
Passenger Lumbar Support (- $175)

Thanks!

[dhock_holiday]

I would avoid the 2022, way too many cut features. Either try to find an earlier year or get an LCI

But if you can wait, I would hold off. The car market is correcting. Dealers will be back begging people to buy if Papa Powell keeps increasing interest rates.

[BandwidthBandanna]

Originally Posted by dhock_holiday

I would avoid the 2022, way too many cut features. Either try to find an earlier year or get an LCI

But if you can wait, I would hold off. The car market is correcting. Dealers will be back begging people to buy if Papa Powell keeps increasing interest rates.

I test drove a 2022 yesterday and really enjoyed the car. I checked the spec sheet on this particular 2022 and the only thing removed was passenger lumbar. The Portimao Blue with Shadowline made the car look so gorgeous in the sun. Unfortunately back to searching unless the price drops, again.

[tgrundke]

Originally Posted by BandwidthBandanna

I test drove a 2022 yesterday and really enjoyed the car. I checked the spec sheet on this particular 2022 and the only thing removed was passenger lumbar. The Portimao Blue with Shadowline made the car look so gorgeous in the sun. Unfortunately back to searching unless the price drops, again.

Not all of the 2022s were heavily de-contented, but a significant percentage were, so it's crucial to check the spec very closely.

[TTG]

tgrundke , All of your comments on this thread are 100% correct and I am in total agreement with you.

Its great to see accurate posts like yours.

MSRP on my M340 was around $66K
Residual was high 30s.... I want to say 38K
My payments were around $600 a month with nothing down.

Lease end (Sep 2022) dealer offered me close to $10k to turn the car in and they had some cars on their lot with higher miles, lower options than mine listed for high 50s.

Like you mentioned, if I were to lease the identical car with identical terms, my lease payments would of been doubled.

I just bought the car at a residual price and could not be happier.

[BandwidthBandanna]

Originally Posted by tgrundke

Not all of the 2022s were heavily de-contented, but a significant percentage were, so it's crucial to check the spec very closely.

Gotcha. I appreciate the help!

[335aw]

Originally Posted by tgrundke

Not all of the 2022s were heavily de-contented, but a significant percentage were, so it's crucial to check the spec very closely.

Are the 440s also de-contented? Gathering info on them and want to be prepared for anything that may be missing or substituted (like the touchscreens).

[Ransom17]

Experiencing the same thing shopping for a 21-23' m340i...expanded my search to 1K miles from where I'm located (Philly). Prices have come down a tiny bit but many dealers are still asking top dollar for these cars.

You can see the hurt when looking at private sellers...

[stoked335d]

I know this is for a 340ix but yesterday picked up a CPO ‘20 330ix with 6k miles for $33.5k premium pkg, remote start, wireless charger. The lowest asking price was $36.5 on the listing with a $39k original “Covid” sticker price. My initial offer was 32k. The sales manager came back with $35.5K. Walked out asap telling them going to drive to a different dealer to check out another car to leave a deposit when they called me back with $33.5k offer 10 min after I left.

I think the market is softening and there are deals to be had. Car repos are increasing and interest rates going up as well. You need to be firm and ready to walk out if price is high.

[tgrundke]

Originally Posted by stoked335d

I think the market is softening and there are deals to be had. Car repos are increasing and interest rates going up as well. You need to be firm and ready to walk out if price is high.

330 pricing was never as strong as 340 because there's a much greater supply of 330s out there.

[yukoncornelius]

Originally Posted by TTG

MSRP on my M340 was around $66K
Residual was high 30s.... I want to say 38K
My payments were around $600 a month with nothing down.

Lease end (Sep 2022) dealer offered me close to $10k to turn the car in and they had some cars on their lot with higher miles, lower options than mine listed for high 50s.

Like you mentioned, if I were to lease the identical car with identical terms, my lease payments would of been doubled.

I just bought the car at a residual price and could not be happier.

Sorry to quote your post from July but its interesting. I've owned alottt of cars, and am currently shopping a new m340 (hell I've been perpetually shopping them for 3 years).

Back in 2020 2021, discounts on m340's were nearly 10% off in some metro areas. Now, msrp is the deal, unless you have loyalty.

Meanwhile, back then, bmw probably juiced the residuals, and low mf = low lease payment.


I don't generally ever lease but I'm going to be fascinated to see what bmw does with demand dropping off a cliff. Their leases are absolutely terrible now because the rates are bad, plus they're not discounting their cars, and I feel like they still haven't artificially raised residuals on their leases (to lower the payment for customers). I've already seen m240's and m340's showing up at dealer lots, unspoken for, which even 4 months ago, essentially never happened. As much as I think the m340 is a brilliant car, I'm likely going to deny buying one for the x-teenth time, because it feels like a terribly overpriced purchase with rates and msrp. I think the dream is over for bmw and other manufacturers, and they gotta start giving big discounts in the coming months.

[Bc2005]

I bought my 2021 M340 in spring 2021 as a special order and they gave me 8% off MSRP, plus the BMW loyalty discount and military/USAA discount. I didn’t even need to haggle.

[K20C4]

Originally Posted by yukoncornelius

Sorry to quote your post from July but its interesting. I've owned alottt of cars, and am currently shopping a new m340 (hell I've been perpetually shopping them for 3 years).

Back in 2020 2021, discounts on m340's were nearly 10% off in some metro areas. Now, msrp is the deal, unless you have loyalty.

Meanwhile, back then, bmw probably juiced the residuals, and low mf = low lease payment.


I don't generally ever lease but I'm going to be fascinated to see what bmw does with demand dropping off a cliff. Their leases are absolutely terrible now because the rates are bad, plus they're not discounting their cars, and I feel like they still haven't artificially raised residuals on their leases (to lower the payment for customers). I've already seen m240's and m340's showing up at dealer lots, unspoken for, which even 4 months ago, essentially never happened. As much as I think the m340 is a brilliant car, I'm likely going to deny buying one for the x-teenth time, because it feels like a terribly overpriced purchase with rates and msrp. I think the dream is over for bmw and other manufacturers, and they gotta start giving big discounts in the coming months.

Depending on your area there are still deals to be had. I bought my M440 mid-September for 10% off. I could’ve gotten 15% off a different M440, but I didn’t like the spec. Had another dealership offering 10% off an M440, and a third offering 8% off an M440. The dealership that I purchased from was particularly desperate when I went in and intially offered $6k off an M4 Comp xDrive and $10k off an M4. If I could afford one of the M4’s I would’ve pulled the trigger, but unfortunately they were out of my price range at this time. This is my first BMW, so I didn’t already have a relationship with these dealerships and didn’t get any loyalty incentives. They also offered me $7k more on my trade then Mercedes was offering me.

[TTG]

Originally Posted by yukoncornelius

Sorry to quote your post from July but its interesting. I've owned alottt of cars, and am currently shopping a new m340 (hell I've been perpetually shopping them for 3 years).

Back in 2020 2021, discounts on m340's were nearly 10% off in some metro areas. Now, msrp is the deal, unless you have loyalty.

Meanwhile, back then, bmw probably juiced the residuals, and low mf = low lease payment.


I don't generally ever lease but I'm going to be fascinated to see what bmw does with demand dropping off a cliff. Their leases are absolutely terrible now because the rates are bad, plus they're not discounting their cars, and I feel like they still haven't artificially raised residuals on their leases (to lower the payment for customers). I've already seen m240's and m340's showing up at dealer lots, unspoken for, which even 4 months ago, essentially never happened. As much as I think the m340 is a brilliant car, I'm likely going to deny buying one for the x-teenth time, because it feels like a terribly overpriced purchase with rates and msrp. I think the dream is over for bmw and other manufacturers, and they gotta start giving big discounts in the coming months.

I completely agree with you.

If they want to sell more cars, they are going to have to start leaning forward as they have in the past.

Most of us in here are great examples of that. I have zero attachment to my current car and would of ordered another one if I were to get a similar lease deal. Because of that BMW did not sell another car and I just bought my lease.

There might still be some deals out there for cars that are sitting on dealers lots & etc but between the high interest rates (and money factors) and lack of general discounts most folks are still on the sidelines.

Another sad thing for me personally is that BMW is not offering anything that I am excited about as a daily driver........but thats another story.