The overwhelming narrative about the car market seems to be that no one will ever be able to afford a car again unless they’re heirs to the Hy-Vee supermarket fortune. That’s not quite true. Cars are expensive, and the cost of financing cars has gone up with interest rates, but the majority of buyers who trade in cars are sitting on a bit of a superpower.
A rising tide lifts all prices, and the value of trade-ins remains way higher than anyone would have guessed. And, unlike the rest of the market, the best-positioned individuals are normal-car people.
While The Morning Dump will be attacking one bit of conventional wisdom, I can’t help but tap the Decade of the Hybrid sign once more with the news that hybrids are outselling EVs in our most EV-happy state. It’s such a rush that even Audi, eventually, is getting in on the hybrid game.
That doesn’t mean all is doom and gloom in the EV space, either, as Rivian’s move into a lower price tier seems to be paying divid … seems to be aiding the company’s financial position.
The Average Value Of A Trade-In Is $13,330, And That’s Because Of Mainstream Cars
Yesterday, I wrote about how the wealthiest are driving the car market, and asked how people felt about the economy. The general sense seems to be that people are doing okay, but that the increase in the cost of everything hasn’t been matched for everyone in an increase in earnings or wealth. There was also a lot of discussion that reflects the K-shaped economy, where stock market highs don’t seem to benefit everyone.
It’s a common point of reference here that, during the semiconductor shortage, prices of both new and used cars shot up. What most buyers have realized is that, while those new car prices have stabilized, they haven’t exactly come down as inventory has increased. There are various reasons for this, including the introduction of tariffs and costs associated with the EV headfake, but the overall lesson is that prices that go up generally don’t come back down so easily.
While affordability is a serious issue, I do think that the popularity of higher-trim models and large three-row crossovers like the Toyota Grand Highlander has skewed the average transaction price, giving a somewhat misleading view of the market (this is why I prefer to look at The Keating Line as a price reference).
Approximately half of all new car purchases involve a trade-in, and this is where there’s some good news for car buyers. While new car prices have mostly stabilized, the value of trade-ins has continued to increase. According to this Edmunds report, buyers trading in vehicles have a record $13,300 in positive equity.
Because of the pandemic, wild values for used cars led to 83.6% of all trade-ins in Q1 2022 having positive equity. That’s no longer the case, though the market is still above historical norms with 69% of trade-ins above water. The power that buyers with trade-ins have is that the values have never retreated. Why? Edmunds explains:
A big part of the explanation is the timeframe when vehicles were bought — during the pandemic, when inventory was so tight that paying sticker price or above was a reality for many. Those cars depreciated, but used-vehicle demand stayed strong enough that values didn’t fall as far or as fast as they normally would have. Buyers who rode that out are now sitting on more equity than the math would have suggested a few years ago.
Even better, it’s not the high-end models that are driving this value. Luxury cars are still depreciating at mostly normal rates, whereas the most mainstream vehicles are the ones holding high values:
The most frequent and consistent winners in today’s market are owners trading in “normal” vehicles around 7 years old. Drivers who bought mass-market models around 2019 — and signed up for conventional 60-or-72-month financing — have largely cleared the depreciation curve. Because secondary-market values for reliable used vehicles remain historically elevated, these average owners are routinely walking onto dealer lots with about $13,000 in positive equity.
The list of the 20 most commonly traded-in vehicles with positive equity is basically a list of the most popular cars, albeit slightly shuffled (the CR-V tops the F-150 and Silverado 1500). If you’re trading in a roughly 2019 CR-V, you can expect to get $10,545.
This tracks with my experience. While I didn’t do a conventional trade-in (I bought my car from Galpin Honda in LA and shipped it across the country), I was surprised that my 2016 Forester was worth more than $10,000 when I sold it to a dealer back in 2024. Literally every time I go to get my CR-V serviced, they ask if I want to sell them back the car, and because I put the value of my Subaru towards a down payment, I already have positive equity.
Obviously, if you don’t have anything to trade-in, this doesn’t apply to you, but for a large chunk of buyers trading in normal cars and buying normal cars, there’s a real opportunity to reduce the amount that has to be financed.
More California Buyers Are Opting For Hybrids Than EVs
Guess what? People like hybrids. You’ll be shocked to discover this is happening if you’re a regular reader of TMD. Just kidding. I write about it all the time. Maybe too much!
I’m not stopping anytime soon, and a report from the California New Car Dealers Association shows that, for the first half of 2026, hybrids (excluding PHEVs) outsold EVs by a large margin. The market share YTD through June is still primarily gasoline (57.6%), with hybrids (22.1%) and BEVs (15.9%) in second and third place.
“Californians are buying the vehicles that fit their budgets and the way they drive, and right now that means a lot of hybrids,” said Jessie Dosanjh, Owner of Stevens Creek Chevrolet and CNCDA Chairman.
“Every hybrid registered in this state came through a franchised dealership. When a customer needs to compare options, work out financing, and know the vehicle will be serviced for the next ten years, they come to their local dealer. We support any rebates or state incentives that help buyers and move the market forward,” said Dosanjh.
This doesn’t mean EVs are failing. Some of this is just the impact of having so many EV sales pulled forward in Q2 and Q3 by the expiration of the IRA tax credit. California also has a new program focused on first-time EV buyers, and that might help increase sales in the second half of the year. The Model Y also remains the best-selling vehicle in California, followed by the Camry and CR-V Hybrid.
Audi Will Do Hybrids Again, Sort Of, Eventually
It’s hard to remember, but Audi has sold a few plug-in hybrids over the years. Then the brand went full-in on EVs. Now it’s retreating, and Audi of America President Vito Paladino told Automotive News that hybrids are going to happen again:
“We will have hybrids in our lineup,” Paladino told Automotive News at the introduction of the new Q9 crossover here. “We’re looking at which segments, which models do we need to further extend the offering.”
Paladino didn’t specify which models Audi is targeting or which form of hybrid technology ― PHEVs or full hybrids ― are planned for the U.S.
That’s … something.
Rivian Earnings Were Better Than Forecast
David wrote the ultimate Rivian R2 review and came away mostly impressed. The introduction of the model appears to be paying off for Rivian, which saw better-than-expected returns in Q2.
Rivian Automotive Inc. reported better-than-expected earnings as it began deliveries of a new midsize sport-utility vehicle, a positive sign while the company contends with a weakened market for electric vehicles in the US.
The adjusted loss before interest, taxes, depreciation and amortization was $379 million in the second quarter, down from a $667 million loss a year ago, Rivian said Thursday in a statement. The latest figure was smaller than the $548 million deficit anticipated on average in estimates compiled by Bloomberg. Its revenue also topped estimates.
There’s still a lot of work to be done, but the company told Bloomberg TV that the conversion from deposits to purchases remains high.
What I’m Listening To While Writing TMD
Glen Hansard passed away this week after a crash on a motorbike. I think most of us know him (and his creative partner Marketa Irglova) from this song “Falling Slowly” from the surprise hit romance Once.
The Big Question
Have you ever traded in a car? How did it go?
Top graphic images: Honda; Edmunds
In 2020 I traded my 2012 CC in on a 2014 Sportwagen TDI. The CC had lost all compression on cylinder 1, and while I liked the car, I didn’t love it enough to put a new engine in it. I got something like $1,500 for it, not bad for something that had to be hauled away on a flatbed. Plus the Sportwagen was exactly the spec I wanted, red on the outside with a beige interior, a manual and only 34k miles. Plus the obligatory Dieselgate warranty. For $13,500, not a bad deal at the time.
What’s funny is I got a call from the dealership that bought my CC at auction. I forgot to clear my contacts from the infotainment system. They told me it was the cleanest, best maintained car they had ever bought at auction and hoped I could tell them what was wrong with it. So I did, they said they were gonna drop a new engine in it and sell it to their receptionist. Apparently she was thrilled that it was a manual.
Such a wholesome story with a great ending.
We traded a ’15 BMW X5 in on a new ’18 Acura MDX when the BMW’s warranty expired and its self-leveling rear suspension started sagging when parked for more than a couple of hours. We got more than we expected and rid ourselves of what was a problem child anyway. Since then, she traded me in for a newer model and the Acura in on a new Lincoln Aviator. She has since admitted she regrets the former but loves the Lincoln. We’ll see how both actions turn out in the long run, but I really don’t care anymore.
User name checks out.
One of my favorites was a 2003 CR-V! I had no idea when I picked my username here that there are many people who have owned, or currently own, dozens more than I have. I went through a few used cars, every couple of years, but ever since I bought new a 1986 Accord, I tend to buy something I like and hang onto them for a long time. I had a 2001 Jetta TDI for nearly 17 years. I replaced it with a ’17 Accord V6 that will likely outlive me. And there’s nothing currently on the market that even tempts me.
I hear you. I bought my acura 11 years ago and have no plans to ever buy another.
Traded in the family Malibu that they didn’t need with over 220k miles when buying the Fiata. It was thoroughly clapped out, on a donut because a tire went flat the day before, and absolutely scrap yard bound, but they took $500 off the price sight unseen so no complaints from me.
So, for this to matter, one already needs to own a car worth something. Like you spawned from the Rockefellers.
My wife always trades her vehicles in and it seems like she gets fair value or above.It’s not worth the aggravation of dealing with weird people that don’t show up half the time.
I traded one car, my ’06 Mazda3 and I got more than I expected for it. I guess it was good that they barely looked at it.
I’ve seen a couple R2s now. First one that I noticed wasn’t an R1 was only because of the rear wing design. It wasn’t until then that I realized it also looked a bit smaller.
The only time I bought a car from a dealership, they only offered me $500 for my daily! Granted, it was a 16 year old Camry with 230,000 miles on it, but everything worked dammit! It even still got 30+ miles per gallon with ice cold AC in Texas and didn’t have any trouble codes. I gave it away to a friend in college that needed a car.
I’ve traded most of my cars, what am I going to do, sell them myself? I don’t think so. I did sell one to Carmax and my first car, a 78 cutlass, I wound up selling at auction for $500 which I was happy to get. I traded one vehicle right after I crashed it; pulled into the dealership with a smashed up front end and drove out in a new Passat. And I traded a worn Lexus ES with a non-functioning alternator for my used Sonata back in 2017. Both those cars were paid for, no debt. I accepted some low offers just to be done with them. More money than brains, perhaps. But I drove the Passat for 8 years and I’ve now had the Sonata going on 9 so it worked out ok.
Here’s a rarity, I suppose. I traded a no option daily driven ’93 Jeep Wrangler 2.5 4cyl w/ manual trans in on a new ’98 Subaru Outback and received almost exactly the original msrp for it. The Outback was $500 over invoice. There wasn’t even any haggling. In Santa Monica! I can’t explain it.
I keep trying to get a decent value for our 2013 Altima with 51k miles. I am starting to think everyone hates it with the fire of a thousand suns just like I do. Wife doesn’t mind it so I guess I should let it go.
I just want to get a low-buck Model Y with HW4, then re-badge it as a Ford Escape. But EV prices aren’t cratering as expected due to the much-discussed Iran War/Epstein diversion.
Everything sucks. Have a nice weekend.
Otherwise I donate cars to NPR. I sold one to Carmax.
Cars like that are kind of weird when it comes to value.It has low miles but it’s almost 14 years old plus the Altima CVT reliability scares a lot of people off.A few people at work have sold their older but clean cars to Carvana and were surprised with the offers they received.
My last trade-in was in 2004, a few months before I got married. I had purchased a white 1959 Cadillac at a farm auction that I wanted to use in the wedding, except it turned out to be a complete POS bondo-box with a rusted out floor. I knew it wasn’t great when I bought it, but didn’t realize just how bad it was until after the purchase and considering the guy had been asking $7,000 for the car, and I got it for $4500 I figured I didn’t get hurt too bad. That was before I had to start driving it regularly because my fiancé’s car decided to grenade itself and I gave her my ’94 Sedan deVille since she had a 45-minute commute.
After a couple of weeks of dailying that beast I spotted a ’98 Eldorado for only $8900 at a local Ford dealership. It booked for around $15,000, but when I looked it over closely I figured it was probably an out-of-state title wash as some work had been done on the quarters and the previous owner was from Virginia, plus it had 100,000 miles. No matter, it looked and drove fine, quite nicely in fact.
So, I cruised into the lot in my clunky, bondo-encrusted ’59 flattop Caddy with it’s glasspacks announcing its presence and the interior carpet literally blowing up from the hole in the passenger-side floor. I asked what they’d give me towards the Eldorado and was laughed at, until one of the salesmen realized I was serious.
Into the cubicle. First offer on the trade: $2500. No dice. Sorry, can’t do any better. okay I’ll go. Oh, just a sec, let me double-check. Cup of coffee, stroll through the show-room, another cup of coffee, back to the cube. $3,000. Nope, gotta have $4,000. Okay, gotta check. Another coffee, another stroll. Can’t do $4K, just can’t. Okay, how about you knock $900 off of the Eldorado and I’ll ebay-list the ’59 after I get home tonight? Another coffee, another stroll.
Finally, the salesman came back after what I assume was a trip home for supper and said “well, I guess we’re done here”. I picked up my coat and let him know that was alright, it was a fun afternoon and maybe we could work something out the next time around. To which he replied “Oh no, no! They’re giving you the $4K. Another $4900 and the Eldorado is yours.”
I was so happy to rid of my classic shitbox, and after spending over seven hours at the dealer I got to cruise home in what was a really nice black Eldorado Touring Coupe which I’m pretty sure the dealer was also happy to get rid of. Ended up driving it to 190,000 with only basic recommended fluid-changes and a couple of driver-side window motors going out. After our daughter was born I sold it to a local couple who went on to drive it past 290,000 miles.
Turns out not all of the Northstars were Deathstars!
I’ve traded in quite a few cars over the years. Finding a private seller can be quite annoying, and Iowa lets you deduct the trade value from your new car’s sales tax.
I did really well on two of them.
I had purchased a 2017 Chevy SS during a 20% off sale, and traded it a year later on a GTI for exactly what I paid.
A few years later that GTI was traded on a 2020 Chevy Bolt EV. My concern over battery fires grew, so did used car prices thanks to the pandemic. I was able to trade that Bolt for roughly what I paid for it.
That Hy-Vee reference was both unexpected and hilarious. Unexpected because nobody outside of the Midwest should have heard of Hy-Vee, and hilarious because Hy-Vee has been an employee-owned store longer than most of us have been alive. So whatever “fortune” Hy-Vee represents is already owned by pretty common folk.
Thanks for the laugh!
That fortune is propped up by insane prices on grapes.
Our local grocery store sold to Hy Vee a few years ago and most prices went up. They even got digital prices tags so they can jack around the prices daily. Nothing like viewing the same product 2 days in a row, with a higher price, or a misleading “sale” claiming it’s $4 off to achieve yesterday’s normal price.
But for the quick supply runs before dinner, we still go there as it’s far closer than Aldi or Walmart.
It’s not just grapes. Hy-Vee manages to have relatively high prices on most items.
The funny part is they regularly advertise their competitors’ prices, even when those prices are the same or *cheaper* than their own!
I look at my neighborhood Hy-Vee (walking distance, even!) as a C-mart for groceries. Sure it’s convenient, it’s reasonably well-stocked, and I can grab the one or two things I need at the last moment, quickly. And I know I’ll likely pay dearly for that. I can’t even imagine dumping my grocery budget on a trip or two there. No, sir. Shopping at a c-mart may be cheaper…
Huh… it’s been a long-ass time since I’ve traded in a car. The last couple I sold private party as they were the sorts of cars that dealerships would try to screw you with a pathetic 1-2k trade offer when I was able to sell them for far more. A Hyundai Elantra Touring and a Suzuki SX4, solid cars that regular people would want but are basically kryptonite to dealers.
I did trade a very crummy Accent for the SX4, this is the only car I ever traded in. They basically took it for what I owed on it and that was fine by me at the time. The SX4 was a far superior car and I hadn’t really put much into the Accent.
The Audi is great looking, am I correct in assuming that means we don’t get it in the states?
I’ve traded in several cars over the years. Most of the time to get some kind of token $1000 payment to rid of a problem car I no longer wanted and maybe a loyalty bonus. I would come out ok. I always negotiate with no trade then throw a trade on if I have something I want to get rid of. Have to make the fat man on the podium choke on his Chicken nuggets. I recently was able to straight trade a 4 year old Forester for a 3 years old extremely low mileage lease return Solterra. If I had done it when I wanted to I probably could have gotten more cash too. But it took some convincing.
I got my aunt a deal on a Kia soul in 2020 and for the longest time the dealer was offering her more then she paid for it. Very strange times.
If you look at real estate over then last 25 years you see that too. Cheaper houses generally appreciate more. Once you get over the $1m newer builds especially in most markets they just sort of sit there. Maybe over 25 years a $1.1m will go to $1.2m. You could see that in even high income high demand areas during the crazy hot times. They don’t loose but appreciate like the cheaper houses just down the street from them. In extreme cases the house that was bought for $300k around the same time was selling for $800k. Fairly regular occurrence the $400k to $500k house bought at the same time was selling for $800k to $900k.
We saw that in cars. The cheaper ones appreciated where the more expensive ones just sat or did there standard depreciation. With houses it seems sort of obvious that most people even if they can technically afford it and are almost paying it are afraid of $1m house and the super jumbo loan with it. There is probably a number there for a new car. I’m not sure what it is. Maybe $100k? Often the people that payed $800k for a $300k house had two $60k to $70k cars sitting out front. Where the people who paid the $1.2m for the $1.1m house you were likey to see anything outfront.
That is not a reference I expected out of an east coast writer. Did Mercedes take you on a field trip to Hy-Vee when you were visiting or something? 😉
Car dealers vs. Tesla. Whoever wins, we lose.
TBQ:
I’ve traded 3 times, sort of. The first time worked out really well, I ended up getting on the high end of what I wanted, courtesy of an insurance claim on some minor hail damage I had never bothered to get fixed. The negotiation felt super shady, but it worked out.
The second time I “traded” and then they sold it to my brother for the same amount. No negotiation needed, only negative was they were dicks to my brother when he went to pick it up. I mean, I get that you’re making no money on the transaction at that point, but he’s my brother and I’m a potential repeat customer. Did you think I wouldn’t find out?
The third time I actually didn’t trade at all, I just sold it outright because I’d already replaced it and planned to sell it privately. I’ve told the story numerous times in other comments, but the truck wouldn’t stay running properly long enough for me to sell it, and after 6 months and an estimated 5 figures of repairs I just wanted it gone. I probably could have gotten another grand or two out of it if I’d held out to sell it myself, but I offloaded the hassle and risk of yet another major component failure to someone else and that was totally worth it. No longer waking up at 4 AM stressing about the latest broken part is nearly priceless.
Hardibro is from Texas. Maybe they have Hy Vees there?
The only one I’ve been to was during a visit to BFE, Iowa.
Yes, I usually buy new, keep it ~10 yrs, and trade in. I treat the value of the trade as part of the deal and negotiations. If you give me a lower price on the new car but also less on the trade, I’ll show you the trade offer somewhere else and improve the deal, if your price is high but your trade value is good I’ll show you someone else’s price.
In many states the value of the trade also reduces the value that’s subject to sales tax, so while I might be a few hundred short of what I could get on the private market, at least some of that is made up for sales tax savings and the rest in my own valuable(ish) time.
Hey, I’m a first time buyer.
Hey, I’m a Californian.
Hey, it’s the second half of the year.
Hey, I just bought an EV.
GIMME some money!
(Checks internet…)
Crap! I needed to wait a few more weeks!
I have traded in a few cars, mainly to avoid the hassle of trying to sell on my own. Most recently was our CX9 for the Pilot. The initial offer was so low ($16,500) I laughed and told the salesman he couldn’t be serious and were done here I will just sell it to Carvana who offered ($21,250). The Honda dealer matched that offer and off we went in the new Pilot. The best one was when I Traded in my MK7 GTI during the pandemic. The dealer sold me a new Civic Si at MSRP, when local dealers were asking $5000-7500 adm on them, plus gave me my asking price for the GTI ($500 less than current market value)
I’ve traded in one car, a Mazda Protege5 that I had replaced the gauge cluster on due to inop speedo. Naturally, the replacement cluster had wildly different mileage (like, 60k less than when I bought the car 6 years ago) so I got $500 and say my farewells. Maybe I coulda gotten $900 on the private market, but the AC was having issues and in Florida that is a death sentence. Worth it to not deal with your typical cheap car lookers (sorry fellow Autopians, you know it’s true).
Taking a trade-in value of $800 for a clean ’96 XJ Cherokee w/ 5mt and under 100k miles in 2007 was one of the stupidest financial decision of my life-though so was co-buying the new car that it was traded towards with my ex, c’est la vie eh?
I got less than $2000 on trade for my 97 XJ with a nearly new engine in 06, which would hurt a lot more today if I didn’t still have the LJ I traded it for. Absolutely wild to see what they go for now (both, really).
Awesome you still have the LJ! And I think I paid $4300 for my XJ with like 65k+ miles on the clock around 2003 or 2004, that same money will barely get you a semi clean 200k mileage copy now. Of course before that I had a clean (though it had a weird ongoing problem w eating starters) with rusty rear fenders ‘73 Chevy blazer I sold for like $800; with some rust repair and maybe a paint job be worth like $15-$20k now ????♂️
No trade in story, but thankful for Glen Hansard.
Took our teen age kids to NYC years ago, let them choose one show apiece. Daughter chose Lion King so wife went with her. Son thankfully chose Once. We had tickets on the second row, and they had audience members come up on stage at the beginning to be part of the pub scene. He and I went up and it was great. Later, in a HS play, he listed in his bio “a Broadway appearance in the ensemble of “Once.” Drama teacher thought it hilarious. He later learned to play and sing “Once” to impress his girlfriend, who is now his wife. Also, “The Commitments” is a great movie. RIP Glen.
Usually, when we’re trading a car in, it’s because we’ve discovered that it has pending future issue that will require a lot of $$ to correct and we don’t want to put anymore dough in a car with that age/high miles on it. That’s the whole reason we’re looking for a newer car.
Also, we wouldn’t want to sell it to ‘someone we know’.
I even felt a little bad trading in my truck in a similar situation, because unless they parted it out (which they definitely wouldn’t have) some poor schlub was going to inherit the parade of failures that prompted me to sell it.
I told myself that maybe I had experienced the last major failure and the new owner was going to have years of trouble-free use, but if I really believed that I would have kept it. 😉
Typically, our trade in’s are going straight to the dealer auctions, where it’s buyers beware, not their pre-owned lot, unless it’s the very ‘back row’. We don’t usually give up nice, newer, low mile cars, although, I did recently trade in my really nice Ford Escape. It did have the new replacement engine due to ‘coolant intrusion’, but every blue moon the trans does odd things. Did several ‘drain and fills’. Dealer says its fine.
I’ve always had at least one Ford in the stable, but I’m done with Ford until they can figure out how to make long life transmissions. Previous had Ford Freestyle (great car except bad CVT), Couple of Ford Windstar’s…also bad trans.
This is where we might be heading with our Forester. It’s on transmission #2 (replacement was covered) but this one is already sort of a POS. We probably need to part with it at some point soon before it fucks us.
I know a Subaru tech and he always tells me that he would lease a Subaru but never buy one.A mechanic I used to work with told me he loved Subaru.Not because they were good but because he made so much money off them.
Carvana and Vroom (RIP, I may have helped this along) are my favored dumping grounds for those kinds of cars.
If “Normal-Car Buyers Have A Lot Of Power” you would think that there would be more normal-cars for sale.
Have you ever traded in a car? How did it go? I have never traded in a car, assuming you are talking about car dealer shenanigans, not my dating life. Trade-ins at dealers never made any sense financially to me. I can’t even think of any friends or family who do the trade-in thing. We all tend to keep cars until that have no resale value outside of some cars that eventually accrue collectible value.
Lots of trading and negotiations of exchanges of value while in a car though.