CAMBRIDGE, Mass. — CarGurus issued a press release today announcing results of a study it conducted to track where consumers can get the best deals on a used car. City dealerships, the report concludes, offer better priced deals than stores located outside major metropolitan areas.
CarGurus analysts applied the company's car valuation models to compare prices on millions of used-car listings offered by dealerships in and outside major U.S. metro areas. Dealers within a 50-mile radius of a major city were found to offer better deals on their used-car inventory than dealerships located farther outside that metropolitan center in nearly all states studied.
"If you are looking for the best deal on a used car, head for the city," Langley Steinert, founder and CEO of CarGurus, told consumers in the company’s press release. "Our data shows that dealers located in populated metro areas tend to price their inventory more competitively than dealers located farther outside the city. For suburban car shoppers looking for savings, it's worth expanding your search to include city dealerships."
Here are highlights from the study:
• CarGurus analysts found used-car listings at city dealerships were priced an average of $345 less than at suburban/rural dealerships in the same state.
• In states with the highest populations (California, New York and Texas), prices at city dealerships were more than $500 less than at suburban/rural dealerships. Some of the best city savings were found in New Orleans ($770), Las Vegas ($641) and Atlanta ($606).
• Only two states studied bucked the city savings trend: Dealerships in Indiana and Arkansas suburban/rural area, on average, offered consumers better deals on used cars than dealerships within the major metro areas in these states.
For this study, CarGurus analyzed prices on used-car inventory offered at dealerships in and outside the top 50 U.S. metro areas to determine whether car prices at dealerships located in a major city center are typically higher, lower or the same as at dealerships located outside a city center.
"City dealerships" were defined as those dealerships located within a 50-mile radius of a major city center, while "Suburban/rural dealerships" were defined as dealerships in the same state that were located beyond the 50-mile radius of the major city center(s). Analysts compared the advertised price for each listing and the Instant Market Value for that specific car to determine the savings off market value, then calculated the average savings across all listings from city dealers compared to suburban/rural dealers to determine where dealers offered better deals.
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CarGurus' IMV (Instant Market Value) is based on an analysis of historic and current listings and factors specific details including make, model, trim, year, mileage, options and accident history.