A friend asks about purchasing a new vehicle that they saw listed with one of the national car rental chains and is wondering why the price is so low in relation to other dealers and private sales. So, this is something that almost everyone goes through. You might get a notice from your bank or another organization that you deal with that your local car rental company is offering some used cars that you should take a look at. Is this a good deal and what should you look out for when judging if one of their cars is worth buying.
Now the first thing I want to hammer into your head is that whenever you are buying a car from anyone whether its a car dealer or a private sale or in this case a rental car company there is one thing that you need to get into your mind and not waiver from.
Never pay the asking price.
Just never do that and if they say they can’t come down or that they have 5 other people ready to buy the car then you walk away.
It might be a good deal but the thing is and especially when you are working with a company, they already know what the car is worth and they are pricing it high to turn a profit. Now its fair that someone might make a few dollars on a sale however when a car dealer or a company that deals in cars prices a vehicle lower than normal then that car is worth less than normal.
In our case our friend was looking to purchase a 2016 Volkswagen that retails used for $18k and the car rental company is asking $11k so that is about 40% off the retail price for a vehicle that is at this time 18 months old. That is a lot of money to take off considering that the vehicle has less than 30,000 miles on it.
How To Buy A Used Car From A Car Rental Agency
Now that you know that you should never pay what they are asking you need to understand why they dropped the price.
Looking up recalls on your vehicle is pretty easy today. Just put the make model and year in google and you will find a government website listing the recalls for the vehicle. Another thing you want to do is when you look at the vehicle you want to copy down the vin number and then call a dealer and have them tell you if the vehicle has been serviced for those recalls.
In the case of this vehicle there are a few major recalls that would require ripping the heads and intake off the engine due to fire hazards. At least that is what a google search returned. This work could possibly be done in a couple days or maybe a day depending on the work required but a car rental company can’t rent cars that have recalls for fire hazards or they would be putting the public at risk. In this case they might be dumping the cars because the delays for parts and service mean vehicles that are just sitting in their lots that they can’t rent. However we don’t know that.. if the vehicle was serviced for all the recalls then the reason for the 40% discount off normal retail is still a mystery to be found.
Because these cars are driven hard it is important that you inspect them well. The car rental company probably won’t be providing much if any type of guarantee on the vehicle so you have to see if you can get the manufacturer’s warranty transferred to you. If you are buying from a private seller they will transfer the warranty but from a car rental agency the dealer might leave you hanging out to dry to pay the full expense of any normally covered warranty problems.
Inspecting the vehicle is a good idea but you probably won’t be allowed to take it to a mechanic. If you have a friend that is a mechanic you could ask them to come with you but at the very least you want to bring a computer diagnostic scan tool with you. Also you want to drive that car a good distance of at least 25 miles in a variety of speeds and traffic and then test the computer. Let the car idle until it gets warm. See if you have any problems with horsepower when the car warms up. Make sure the car shifts through all the gears even if it is an automatic you want to drive it through all the gears.
Remember when someone is selling you a vehicle for 40% off normal retail there is a reason. Maybe its a variety of reasons such as the car is a base model or that there has been damage to the vehicle or that there are outstanding recalls. Whatever the reason is remember no company is going to list their inventory at 40% off just because they are nice guys. They can’t do that because they answer to executives that answer to stock holders and it is bad business. Whatever the reason is…. you can bet there is a reason.
Another thing to realize is that these companies have mechanics that are the best at keeping cars on the road. Not mechanics that can make hotrods or ones that can build monster trucks. Their job is to keep cars on the road and they do what it takes to make that happen. I am not going to go any farther with that but I think you get the idea.
When something looks too good such as a new car for 40% off retail then you better bet that its worth less than they are asking and if not then its up to them to explain why its such a great deal. Maybe its something as simple as the rental company getting rid of an entire line of cars because they no longer want to deal with that manufacturer. But then you have to ask why don’t they want to deal with them and do you want to deal with them.
Its up to you but do your work.