(NAPSI)-Nearly 700,000 used cars were traded in and sent to be scrapped under the federal Car Allowance Rebate System, or "Cash for Clunkers." But how many of those autos actually made it to the scrap yard? Experts say it could pay for used car buyers to ask just that.
Some now warn that although it is illegal to resell any car traded in under the Cash for Clunkers program, many of the used cars that were supposedly scrapped may in fact be resold around the country.
Protecting Yourself
Fortunately, there are ways for car buyers to protect themselves. For instance, working with the National Highway Traffic Safety Administration (NHTSA), Carfax recently added the vehicle identification number (VIN) of every car included in the Cash for Clunkers program to its database.
The information is available for free at www.carfax.com/clunkers. After plugging in the 17-digit VIN, the free check alerts buyers and sellers to any vehicle that was supposed to be scrapped as part of the initiative. The company's vehicle history reports also include the clunker information in addition to other important facts about a car's past--facts that a seller may be unaware of or choose not to reveal. Carfax Reports can indicate if a car was in a flood, fire or wreck or if its odometer may have been illegally rolled back.
It's also smart for shoppers to give a car a visual inspection and have the car inspected by a trusted mechanic before they buy. A few things to look for:
•Make sure the seller's name and the vehicle identification number matches on all documents and the car itself.
•Be aware of malfunctioning air bag indicator lights. The light should turn on briefly when you start the engine and then turn off.
•Cracked wires or interior rust; cars that were once under water will rot from the inside out. Wet wires become brittle and metal bolts and brackets will start rusting when they dry out.
Learn More
For more information on the Cash for Clunkers program and guidelines, visit www.cars.gov. For more information on vehicle history reports, visit www.carfax.com.
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Showing posts with label used cars. Show all posts
Showing posts with label used cars. Show all posts
Saturday, December 12, 2009
Saturday, September 26, 2009
CarMax Advises How to Avoid Flood-Damaged Cars
TT Note: It's always good to review the tips on how not to purchase a flood damaged car. Thought this was a good reminder.
(BUSINESS WIRE)--In the wake of recent flooding, CarMax, Inc., (NYSE: KMX), the nation’s largest retailer of used cars, is advising consumers on how to avoid purchasing flood-damaged vehicles.
“Consumers should be aware that some businesses and individuals may try to sell salvaged and flood-damaged cars without revealing the vehicle history,” said Jason Day, Atlanta region vice president of purchasing for CarMax. “Flood-damaged cars that are not structurally or mechanically sound could be repaired, re-titled, and sold to unsuspecting buyers.”
CarMax’s purchasing team offers these ten tips for identifying a vehicle with possible flood damage. If any of these signs are identified, ask further questions to determine if flood damage occurred:
1) Check for a moldy smell inside the car and feel the carpet for dampness
2) Be suspicious of an older car with a brand new interior or carpeting
3) Check for rust under the brake or gas pedals
4) Look for dirt or rust under the dashboard and floor mats
5) Inspect the bolts and screws under the seats for evidence of rust
6) Check the undercarriage for excessive rust
7) Check inside the trunk under the carpet and in the spare tire well area for rust, dirt or sand
8) Look for corrosion, water marks, or a thin brown line on the exterior of the vehicle
9) Check to see if the electrical system works
10) Check the VIN number with AutoCheck or Carfax to see whether a flood claim has been filed or a salvage title has been issued on the vehicle
CarMax provides a free AutoCheck vehicle history report for every used vehicle. CarMax’s nationwide team of more than 800 car-buyers is trained to detect whether a car has flood damage or has been in a major accident. CarMax will not retail any car that has flood or frame damage or an odometer or title discrepancy.
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(BUSINESS WIRE)--In the wake of recent flooding, CarMax, Inc., (NYSE: KMX), the nation’s largest retailer of used cars, is advising consumers on how to avoid purchasing flood-damaged vehicles.
“Consumers should be aware that some businesses and individuals may try to sell salvaged and flood-damaged cars without revealing the vehicle history,” said Jason Day, Atlanta region vice president of purchasing for CarMax. “Flood-damaged cars that are not structurally or mechanically sound could be repaired, re-titled, and sold to unsuspecting buyers.”
CarMax’s purchasing team offers these ten tips for identifying a vehicle with possible flood damage. If any of these signs are identified, ask further questions to determine if flood damage occurred:
1) Check for a moldy smell inside the car and feel the carpet for dampness
2) Be suspicious of an older car with a brand new interior or carpeting
3) Check for rust under the brake or gas pedals
4) Look for dirt or rust under the dashboard and floor mats
5) Inspect the bolts and screws under the seats for evidence of rust
6) Check the undercarriage for excessive rust
7) Check inside the trunk under the carpet and in the spare tire well area for rust, dirt or sand
8) Look for corrosion, water marks, or a thin brown line on the exterior of the vehicle
9) Check to see if the electrical system works
10) Check the VIN number with AutoCheck or Carfax to see whether a flood claim has been filed or a salvage title has been issued on the vehicle
CarMax provides a free AutoCheck vehicle history report for every used vehicle. CarMax’s nationwide team of more than 800 car-buyers is trained to detect whether a car has flood damage or has been in a major accident. CarMax will not retail any car that has flood or frame damage or an odometer or title discrepancy.
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Thursday, August 06, 2009
Cash for Clunkers to Cause Used-Car-Value Bubble
TT Note: The Cash for Clunkers program has been interesting to watch. It would appear to have its own legacy in the works. First, if a consumer clicks on the cars.gov site, the consumer has to agree the government now owns and has access to the consumer's computer. This even allows your (yes, our loving) government to give your information to any foreign government. Well, that in itself was enough to encourage me not to participate.
In addition, lots of motors that would have been used for parts are mandated to be destroyed by the dealer. So, those parts are now gone. Where's all the incentives from the car manufacturers? It seems like they were better before the taxpayers had to choke up the change for this cash for clunker program.
Has anyone even examined the CO2 emissions from all the destruction of these no-longer-deemed-useful vehicles? Has anyone heard the horror stories from dealers who are wondering how much they will have to absorb since the paperwork is horrendous and some of the vehicles being traded in didn't fit the government's rules?
Now, here is another piece of the growing legacy of the program.
/PRNewswire/ -- Kelley Blue Book, www.kbb.com, the leading provider of new car and used car information, today reveals possible effects of the Cash for Clunkers program on the used-car industry as reported in the company's August 2009 Blue Book Market Report. As dealers and consumers continue to take advantage of this program, Kelley Blue Book analysts forecast a likely bubble in used-car values, which could deflate as the Cash for Clunkers program comes to a close.
With $1 billion spent and more than 250,000 new vehicles sold, the success of the Cash for Clunkers program cannot be argued. With more than 250,000 vehicles leaving the used-vehicle supply, this equates to a 1.6 percent reduction in the overall supply of used vehicles (based upon sales of 16 million used vehicles in 2008). When the Senate signs off on an additional $2 billion funding for the Cash for Clunkers program later today, it could equate to an additional 500,000 used cars being removed from the overall used-vehicle supply, which is a 4.7 percent overall reduction in supply this year alone. With a total of 750,000 vehicles being removed from the marketplace, dealers are stocking up on used inventory in anticipation of low supply and high demand. This scenario is driving used-car prices up significantly in the short term, causing a bubble in values that will seriously impact used-vehicle values when the Cash for Clunkers program ends.
"Dealerships have reported increased foot traffic, creating a false sense of automotive market recovery," said Alec Gutierrez, senior analyst of vehicle valuation for Kelley Blue Book. "As a result, dealers are going to auction to restock inventory, driving up used-car values. However, the effect of a supply reduction of this magnitude could have an immense impact on these values in the short-term, exacerbating the already-limited supply at auction. If this bubble comes to pass, dealerships will end up with excess inventory of both new and used vehicles and be forced to offer deep discounts to remove surplus inventory, driving values down. Ultimately, there will be the possibility of a severe contraction in auto sales as soon as the Cash for Clunkers program runs out of funding."
According to a Kelley Blue Book Market Intelligence study on the Cash for Clunkers program, 1-in-10 new-vehicle shoppers said they are likely to purchase sooner as a result of the government-sponsored program. In addition, 45 percent of consumers likely to participate in the program own a sedan, followed by SUV and crossover owners at 25 percent. Among that group, 37 percent plan to trade in their clunker for a sedan and 28 percent plan to buy an SUV or crossover. The top brands being considered among study participants are Toyota, Ford, Honda and Chevrolet.
This Kelley Blue Book Market Intelligence study was fielded to 517 in-market new-car shoppers on Kelley Blue Book's kbb.com from July 10-17, 2009.
Kelley Blue Book's vehicle valuation department is keeping a close eye on values as the program continues and an influx of additional funds is added to the program by the federal government.
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In addition, lots of motors that would have been used for parts are mandated to be destroyed by the dealer. So, those parts are now gone. Where's all the incentives from the car manufacturers? It seems like they were better before the taxpayers had to choke up the change for this cash for clunker program.
Has anyone even examined the CO2 emissions from all the destruction of these no-longer-deemed-useful vehicles? Has anyone heard the horror stories from dealers who are wondering how much they will have to absorb since the paperwork is horrendous and some of the vehicles being traded in didn't fit the government's rules?
Now, here is another piece of the growing legacy of the program.
/PRNewswire/ -- Kelley Blue Book, www.kbb.com, the leading provider of new car and used car information, today reveals possible effects of the Cash for Clunkers program on the used-car industry as reported in the company's August 2009 Blue Book Market Report. As dealers and consumers continue to take advantage of this program, Kelley Blue Book analysts forecast a likely bubble in used-car values, which could deflate as the Cash for Clunkers program comes to a close.
With $1 billion spent and more than 250,000 new vehicles sold, the success of the Cash for Clunkers program cannot be argued. With more than 250,000 vehicles leaving the used-vehicle supply, this equates to a 1.6 percent reduction in the overall supply of used vehicles (based upon sales of 16 million used vehicles in 2008). When the Senate signs off on an additional $2 billion funding for the Cash for Clunkers program later today, it could equate to an additional 500,000 used cars being removed from the overall used-vehicle supply, which is a 4.7 percent overall reduction in supply this year alone. With a total of 750,000 vehicles being removed from the marketplace, dealers are stocking up on used inventory in anticipation of low supply and high demand. This scenario is driving used-car prices up significantly in the short term, causing a bubble in values that will seriously impact used-vehicle values when the Cash for Clunkers program ends.
"Dealerships have reported increased foot traffic, creating a false sense of automotive market recovery," said Alec Gutierrez, senior analyst of vehicle valuation for Kelley Blue Book. "As a result, dealers are going to auction to restock inventory, driving up used-car values. However, the effect of a supply reduction of this magnitude could have an immense impact on these values in the short-term, exacerbating the already-limited supply at auction. If this bubble comes to pass, dealerships will end up with excess inventory of both new and used vehicles and be forced to offer deep discounts to remove surplus inventory, driving values down. Ultimately, there will be the possibility of a severe contraction in auto sales as soon as the Cash for Clunkers program runs out of funding."
According to a Kelley Blue Book Market Intelligence study on the Cash for Clunkers program, 1-in-10 new-vehicle shoppers said they are likely to purchase sooner as a result of the government-sponsored program. In addition, 45 percent of consumers likely to participate in the program own a sedan, followed by SUV and crossover owners at 25 percent. Among that group, 37 percent plan to trade in their clunker for a sedan and 28 percent plan to buy an SUV or crossover. The top brands being considered among study participants are Toyota, Ford, Honda and Chevrolet.
This Kelley Blue Book Market Intelligence study was fielded to 517 in-market new-car shoppers on Kelley Blue Book's kbb.com from July 10-17, 2009.
Kelley Blue Book's vehicle valuation department is keeping a close eye on values as the program continues and an influx of additional funds is added to the program by the federal government.
-----
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