Determining the true Car Values is a crucial step whether you’re diving into the new car market, exploring used vehicles, considering a trade-in, or even thinking about leasing. Knowing what your car is worth, or what a car you’re interested in should cost, puts you in a powerful position to negotiate effectively and make informed decisions. One of the most trusted resources for understanding these values is Edmunds, with their True Market Value® (TMV®), also known as Edmunds Suggested Price. Let’s delve into what car values really mean and how you can use tools like Edmunds TMV to your advantage.
What is Edmunds True Market Value (TMV) and Why Does It Matter for Car Values?
Edmunds True Market Value®, or Edmunds Suggested Price, is essentially Edmunds’ expert estimate of the average price cars are currently selling for in your local area. It’s based on real-world transaction data, meaning it reflects what other buyers are actually paying for vehicles, both new and used. This is incredibly valuable because the sticker price (MSRP) is just a suggestion, and invoice price (what the dealer pays) isn’t always transparent. TMV bridges this gap, giving you a realistic benchmark for fair car values.
Close-up of a digital interface displaying car invoice pricing information.
For those looking to trade in or sell their used vehicles, Edmunds TMV provides a specific trade-in value. This helps you understand the approximate amount you can expect to receive from a dealership, ensuring you’re informed about your car’s real car value in the current market.
Edmunds gathers data from a wide range of sources, including dealerships like CarMax (which has been the parent company of Edmunds since 2021). While CarMax’s data contributes to the TMV calculations, it’s important to note that CarMax does not influence how Edmunds calculates these values, ensuring objectivity and reliability in the provided car values.
How to Use Edmunds Suggested Price to Determine Fair Car Values
When you’re exploring vehicles on Edmunds, whether through their “build and price” tool or browsing inventory, you’ll encounter the Edmunds Suggested Price. Alongside this crucial figure, you’ll also often see the invoice price and the Manufacturer’s Suggested Retail Price (MSRP). These three numbers offer a comprehensive view of car values and pricing structures.
Getting accurate car values relies on providing precise details about the vehicle you are researching. This means carefully selecting the correct year, make, model, trim, and options. Incorrect details can lead to inaccurate TMV results, which could cause misunderstandings when you visit a dealership.
It’s also important to distinguish between new and used car appraisals. Used car values are determined using different factors and will be presented separately in Edmunds’ tools, reflecting the depreciation and market dynamics specific to used vehicles and their car values.
The Edmunds Suggested Price is a powerful tool because it reflects the fluctuating nature of the car market. Vehicle prices are not static; they change based on factors like supply, demand, and popularity. Knowing the TMV empowers you to approach negotiations with confidence, armed with the knowledge of what constitutes a reasonable offer based on current car values. You can even access TMV through the Edmunds app or mobile site, allowing you to check pricing directly from a dealership lot.
Factors Included in Edmunds Suggested Price: Decoding Car Values
For buyers aiming to purchase a vehicle, the Edmunds Suggested Price represents the recommended price to pay before taxes and fees. It’s derived from an extensive analysis of millions of data points, including:
- Supply and Demand: High demand and limited supply can push car values up, while lower demand and ample supply can bring them down.
- Incentives: Manufacturer incentives and rebates can affect the final price, and TMV considers these.
- Options: The specific options and features a vehicle has significantly impact its car value.
- Recent Transactions: TMV is heavily based on recent sales data from your local area, providing a real-time snapshot of car values.
It’s important to understand that TMV estimates the transaction price, not the final “out-the-door” cost. Therefore, it typically does not include:
- Manufacturer-to-consumer rebates (like cash rebates)
- Sales tax
- DMV fees
- Dealer documentation fees
These are usually applied after the transaction price is agreed upon. For a clearer picture of the final cost, it’s essential to factor in these additional fees and taxes after establishing a fair transaction price based on car values like TMV.
Leveraging Edmunds Suggested Price in New Car Negotiations for Optimal Car Values
Now that you understand what Edmunds Suggested Price is and how it reflects car values, let’s explore how to use it effectively when negotiating for a new car:
-
Compare to Dealer Quotes: When you receive a price quote from a dealership, compare it to the Edmunds Suggested Price. This comparison immediately highlights whether the dealer’s initial offer is in line with current car values.
-
Counter Offers Confidently: If a dealer’s price is higher than the TMV, use the TMV as a point of negotiation. For example, if the dealer quotes $30,000 and the TMV is $28,000, you can say: “Based on my research, Edmunds suggests this car is selling for around $28,000. If you can match or beat that, we can make a deal.”
-
Offer the TMV for a Quick Deal: If you prefer a straightforward approach, you can offer to pay the Edmunds Suggested Price directly. Having a printout or screenshot of the TMV can strengthen your offer and show the salesperson you’re serious and informed about car values.
While TMV is a highly reliable indicator of car values, it’s not infallible. Market conditions can change rapidly, and sometimes data may be limited. In situations where TMV might not perfectly reflect the current market, it’s wise to gather additional “real-world” TMV data by getting price quotes from multiple dealerships (ideally three). This will give you a broader perspective on actual selling prices and refine your understanding of current car values.
Car Values and Leasing: Using TMV to Your Advantage
Although Edmunds doesn’t provide specific lease prices, the Edmunds Suggested Price is still a valuable tool when considering leasing. Lease payments are directly influenced by the car’s selling price, known as the “cap cost” in leasing terms. A lower selling price translates to lower monthly lease payments.
By determining the TMV of the car you want to lease, you can use this figure as the “cap cost” in Edmunds’ auto lease calculator. This allows you to estimate your monthly lease payments more accurately, ensuring you’re negotiating from a position of knowledge about underlying car values.
Appraising Used Car Values with Edmunds
Edmunds offers a dedicated appraisal tool to determine the value of used cars. This tool is essential when you’re planning to sell your car, trade it in, or buy a used car. It provides three key car values for used vehicles:
- Trade-in Value: The estimated value you’d receive when trading your car in at a dealership.
- Dealer Retail Price: The price you can expect to pay when buying a used car from a dealership.
- Private Party Price: The price you might expect to pay when buying from or selling to an individual.
When using the appraisal tool, accuracy is paramount. Be honest and precise about your car’s options and condition. Most used cars will fall into “clean” or “average” condition categories, and “outstanding” condition is rare. Accurate condition assessment is crucial for obtaining realistic car values.
Edmunds also provides market prices for certified pre-owned (CPO) cars. After entering your car’s details, CPO pricing information will be displayed, giving you a comprehensive view of car values across different used car categories. Remember that even these are average prices, and negotiation is still possible.
Key Car Buying Figures and Car Values: Staying Informed
During the car buying process, you’ll encounter various pricing terms like MSRP, sticker price, savings, and invoice price. Amidst this information overload, keeping the Edmunds Suggested Price (TMV) in mind is crucial. It acts as an anchor, helping you contextualize other figures and understand the true car values in the market. TMV provides a grounded perspective, ensuring you’re not swayed by inflated prices or misleading discounts.
Frequently Asked Questions about Car Values and Edmunds TMV
What exactly is Edmunds True Market Value (TMV)?
Edmunds True Market Value® (TMV®), also known as Edmunds Suggested Price, is a system designed to help you understand the average transaction price for new and used vehicles in your area. It shows you what other buyers are actually paying, so you can start negotiations with a realistic understanding of fair car values. For sellers, TMV helps estimate your vehicle’s trade-in value.
Does Edmunds TMV include all incentives and fees?
Edmunds TMV estimates the average transaction price but not the complete “out-the-door” cost. It does consider:
- Manufacturer-to-dealer incentives (dealer cash)
- Destination charges
- Advertising fees (if applicable)
However, it generally does not include:
- Manufacturer-to-consumer rebates (cash rebates)
- Sales tax
- License or registration fees
- Dealer documentation fees
These latter fees are typically applied after the transaction price is negotiated. TMV focuses on establishing the fair car value before these additional costs.
Are there any vehicles Edmunds cannot appraise for car values?
Yes, Edmunds cannot provide appraisals for:
- Model years prior to 1990
- Exotic vehicles
- RVs, motor homes, commercial trucks, tractors, or trailers
- Motorcycles or ATVs
- Vehicles with salvage titles
- Demo vehicles
- Non-U.S. vehicles
- Customized vehicles or those with aftermarket accessories
These exclusions are due to data limitations or the unique nature of these vehicle types, making it difficult to determine accurate and reliable car values.
Does Edmunds TMV account for regional market differences in car values?
Yes, Edmunds Suggested Prices reflect varying market conditions across the country. Factors like regional marketing fees are considered and factored into the overall suggested price, even if not explicitly listed as separate items. This ensures that TMV provides geographically relevant car values.
Where does Edmunds get its data for determining car values?
Data is gathered weekly from the dealer management systems of a vast network of dealerships (around 5,000) across the U.S., representing approximately 25% of all U.S. dealerships. CarMax is among the data providers, but their influence is limited to data contribution, not the calculation methodology, preserving the objectivity of car values provided.
How is dealership data protected when shared with Edmunds for car value calculations?
Edmunds uses a contracted vendor to extract only the specific data dealerships have authorized for sharing. This data is securely transmitted electronically to Edmunds, ensuring data privacy and security in the process of determining car values.
Why is transaction data so important for determining car values?
Transaction data is crucial for establishing accurate Edmunds Suggested Prices and appraisal values. More data leads to greater accuracy in TMV pricing. The aim is to reflect the most commonly paid price in the market, ensuring both fair profits for dealers and fair deals for consumers, based on real-world car values.
What specific factors are included in Edmunds Suggested Price for new car values?
For new vehicles, Edmunds Suggested Price incorporates:
- National base price
- Destination charges
- Regional adjustments
- Color adjustments
- Optional equipment costs
- Applicable incentives
These elements are combined to calculate a comprehensive Edmunds Suggested Price, reflecting the various components that contribute to new car values.
How does invoice price relate to car values and TMV?
Invoice price (dealer cost) is the price on the manufacturer’s invoice to the dealer. While important, it’s not the sole determinant of car values. The actual selling price often falls between the MSRP and invoice price. Edmunds Suggested Price (TMV) is valuable because it reflects what consumers are actually paying, revealing a fairer market price compared to just focusing on invoice price. Invoice price itself doesn’t include all dealer discounts or consumer rebates, making TMV a more holistic measure of car values.
How can I find invoice pricing on Edmunds to compare against car values?
To find invoice pricing on Edmunds:
- Search for your desired car Make/Model.
- Go to the overview page and click “Build & price.”
- Configure your vehicle; invoice pricing will be shown in the results graph alongside other car values and pricing information.
Does Edmunds TMV include taxes and fees in car values?
No, Edmunds TMV does not include taxes or fees because these vary based on buyer location, dealership doc fees, and local taxes. TMV focuses on the vehicle’s transaction price before these variable costs are added, providing a consistent baseline for understanding car values.
Does Edmunds provide pricing for modified vehicles and their car values?
No, Edmunds does not provide pricing for vehicles modified with aftermarket parts. Aftermarket parts vary greatly in cost and quality, making it unreliable to assess their impact on car values. Modifications might even decrease trade-in value as dealers often prefer to return vehicles to their original condition before resale. Selling modified vehicles privately or reverting them to stock condition might be better options for maximizing returns on aftermarket investments and understanding accurate car values.
Does True Market Value (TMV) include dealer-installed options when determining car values?
True Market Value (TMV) pricing includes only factory-installed options. Dealer-installed options and accessories are excluded due to their variability and lack of reliable data for valuation. This ensures consistency and accuracy in reflecting core car values.
