What is the “change-over” in a car deal? 

When one buys a new car and trades-in their old car, the term change-over (or change over) is relevant to the value of the deal in real terms.

e.g. the new car costs $20,000 drive away and your trade-in value is $10,000 = $10,000 change-over

Understanding your change-over value enables you to compare all the deals that have been proposed by car dealers on an ‘apples for apples’ basis.

How to think about change-over when buying a new car 

The most commonly employed tool by motor dealers is the modulation of values on either side of the new car buying equation to maximise their position (not yours): your new car drive away price or your trade-in vehicles. This allows them to fend off competitive bids on either end of the deal from other dealers so as to convince the buyer that their deal is the most promising. However, to pass judgement on a value proposition by taking into consideration only one side is like judging a burger solely on the bun – i.e. it just doesn’t make any sense.

New car buyers that trade-in cars must understand that they are in fact engaging in two transactions at the one time: 1. buying a new car; 2. trade-in.

Thus, it is paramount to understand the change-over price for your new car so as not to make a financial faux pas.

The online community is also highly supportive of this view in judging new car deals; you can read all about change-over concepts on Choice.com.au, whirlpool, CarAdvice and NRMA etc.

In conclusion, when you seek prices from dealers for your new car and you intend to trade-in your old, make sure you always think in terms of change-over, otherwise, you may end up losing out overall.