Last week Todd Caputo had a customer who wanted to get rid of a 2009 Toyota Camry with 10,000 miles. The customer's wife refused to drive it because it was part of Toyota Motor Sales U.S.A. Inc.'s massive recall.
Caputo, a Chittenango, N.Y., Chevrolet dealer who also owns two stand-alone used-car dealerships, offered the man $12,000 toward the purchase of a 2009 Hyundai Sonata with 5,000 miles on it.
The customer owed about $20,000 on the Camry -- meaning an $8,000 hit -- but he agreed to the deal in order to get rid of the Camry, Caputo says.
"I negotiate with people and tell them [the cars] are worth less because of the recall -- some people don't want them," Caputo says.
The Camry case shows how far some owners are willing to go to get out of their recalled Toyotas. Some dealers, in turn, are being cautious in taking recalled Toyotas as trade-ins.
The vehicles have to be parked until they can be repaired by a Toyota dealership. Non-Toyota dealers have to wait as Toyota dealers repair their customers' vehicles and the unsold ones on their lots first.
When Toyota suspended sales of the recalled vehicles, Kelley Blue Book, NADA Used Car Guide and other guide book companies trimmed the vehicles' resale values. Now some of those repaired vehicles are for sale at dealerships and at auctions.
Ricky Beggs, managing editor at Black Book, says the prices of those repaired vehicles are performing in line with the rest of the market at wholesale auctions.
"There is plenty of attendance and activity in those lanes," says Beggs of the repaired Toyotas. "Dealers aren't running from them."
Howard Moss, general manager of Bill Seidle Imports of Davie, in Davie, Fla., said he took a loaded 2008 Toyota Tacoma pickup as a trade-in last week for a new 2010 Mitsubishi vehicle that he would not identify. Moss gave the customer $17,000 for the Tacoma, $2,000 less than he would have given prior to the recall.
The customer traded the truck because of an addition to his family, Moss said. He said the customer expected the value to be lower because of the recall, adding: "At the end, we shook hands and made a car sale."
David Wilson Jr., vice president of Preston Auto Group in Preston, Md., says his group, which sells Ford, Lincoln, Mercury, Hyundai, Mazda, Suzuki and Nissan, has taken several recalled Camrys in trade, mostly from people seeking to buy Ford Tauruses and Fusions and Hyundai Sonotas.
Wilson gets prices from several wholesalers and knows what they will pay for a vehicle when he sets the trade value. He said wholesalers are typically paying about $1,500 to $2,000 less than what they would have paid prior to the sales suspension.
He immediately sells the trade-in to a wholesaler based on that preset price. Says Wilson: "We're not waiting to see where the market is going."