Trade-in
A vehicle a customer gives the dealer as part of the payment for another car, with its appraised value credited against the new purchase.
A trade-in lets a buyer put their current vehicle toward a purchase. The dealer appraises it, agrees on an allowance, and credits that amount against the deal, often reducing the taxable amount in the process. The trade then enters the dealer's inventory to be reconditioned and retailed or sent to wholesale. Accurate trade appraisal protects margin on both sides of the transaction.
Related terms
Consignment
A selling arrangement where a vehicle owner keeps title while a dealership markets and sells the car on their behalf, taking a fee or margin at closing instead of buying the car outright.
SalesWholesale vs Retail
Two price points for the same vehicle: wholesale is the trade or auction value between dealers, while retail is the higher price a consumer pays on the lot.