Trying to decide if it makes sense to trade my 2017 RAM 1500 for a 2016 Toyota Prius 4

Submitted by shortwave_cranium t3_yiow1r in personalfinance

Roughly 2 years ago my wife and I bought a 2017 RAM 1500 from CarMax for 35k. We were living in a travel trailer and touring the country full-time, so purchasing a small compact car wasn't an option. Recently we've moved into an apartment and would like something more fuel efficient since we're no longer towing. We still owe 15k on the RAM and a used 2016 Prius 4 at CarMax is about 25k. CarMax will give us about 23k for the RAM on trade-in, which seems like a pretty big loss in 2 years. On trade-in alone, our loan would jump from 15k to 19k (4k increase). Gas calculators show that we could save about 2k/year on gas.

EDIT/UPDATE: Thank you for the feedback. I think we're going to focus on paying off the truck in the next 6 months, so we can sell it privately with more ease. Then we'll switch to a Prius.

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Liquidretro t1_iujqwus wrote

You would sure gain overall reliability and fuel efficiency by moving to a Prius.

Have you looked up how the dealers offer is in terms of where the market actually is?

Unless the truck has damage, or a ton more miles I would expect it to have depreciated less given how hot the truck market has been. That's all assuming you got a decent deal in the first place. With the pandemic causing auto market sagas you may have overpaid and that's the reason here.

Are you using https://www.fueleconomy.gov/feg/Find.do?action=sbsSelect to do the fuel savings calculations?

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shortwave_cranium OP t1_iujsi3x wrote

We put about 25k miles on the truck. No damage. It's currently has 57k miles on the odometer (Prius has 33k). Perhaps we could get 5-7k more selling the truck privately. Not sure I want the headache of selling privately though. My research suggests that CarMax is well known for giving the best trade-in value amongst dealerships.

I used a few fuel calculators, but not that one. Thanks for the link. According to fueleconomy.gov we'd save 2.7k a year in fuel which puts me closer to pulling the trigger if that's correct.

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Liquidretro t1_iujtlys wrote

I mean I guess if the convenience is worth $5-7k for you, or you can't be bothered to get some other offers from dealers or online places go for it. I think CarMax is lowballing you on the value of the Ram.

That's enough of a difference that I would be willing to work for it a bit on my own first before taking such a bath financially in the trade. I mean that's 2 years of fuel you planned to save down the drain on day 1.

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SpiritualQuokka t1_iujqdn7 wrote

You should shop around to other dealers and see what you could get for the truck private party so that you know you are selling it for the best price. Similarly, shop around for your next vehicle, and consider other makes/models that meet your needs to ensure you're getting a good value on the vehicle you purchase.

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shortwave_cranium OP t1_iujtojb wrote

We could definitely get more selling private, but I was hoping to avoid the headache. Might have to just do it though.

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uh-okay-I-guess t1_iujqljz wrote

Well, it presumably makes sense to spend $4000 to save $2000/year, as long as you keep the new car for more than two years. Keep it for even 3 years and it's a better rate of return than you'll get anywhere else.

Now, I don't know if doing a trade with CarMax is the optimal way to do this deal. Maybe there's a better way. But it does seem to make sense.

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ze55 t1_iujrluu wrote

For your 2017 Ram.

Can you give more information on it? Is it gas/diesel, 2wd/4wd, regular/extended/quad cab and miles?

Checked on wholesale car auction and the 2017 rams are selling from $4k for 2wd reg cab with 300k miles on them to $30K+ for the low miles crew cab.

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shortwave_cranium OP t1_iujte3t wrote

Lone Star Silver 4x2 Crew Cab 5'7" Box

Mileage: 57,200

Gas

No damage

Tow package

MFR Model Code DS1H98

Body TypeShort Bed

Pass Doors 4

BodyCrew Cab Pickup - Short Bed

DrivetrainRear Wheel Drive

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