With New Car Sales Down, Dealers Seeing Uptick In Used Vehicle Sales
The decline in new vehicle sales has been widely reported, but Americans’ need for automobiles has not eroded. When vehicles require replacement, many are looking to used vehicle dealers.
Franchised dealers were forecasted to close March with a 4.2 percent improvement in used vehicle sales, while independent dealers were predicted to see a 1.1 percent climb, according to CNW Market Research. Overall, CNW anticipates consumers will purchase 40 million used vehicles by the end of the year.
“A combination of slumping new vehicle sales and longer terms on new-vehicle loans has resulted in fewer late-model trade-ins to supply used vehicle dealers; however, it’s possible to still find a used vehicle capable of delivering thousands of trouble-free miles—if you’re willing to invest the time,” commented Ragina C. Averella, Manager of Public & Government Affairs at AAA Mid-Atlantic.
AAA offers these steps to take the gamble out of used vehicle buying:
· Decide what kind of vehicle you need. Ask yourself several questions to evaluate all aspects of your lifestyle, such as: How large is your family now and might it be in the near future? How long is your commute? Will you need to tow a boat or use it for other recreational purposes? Do you travel with pets? Do you want a more environmentally-friendly vehicle?
When considering fuel economy, keep in mind that prices have fluctuated greatly in the past year and likely will not remain at current levels throughout the ownership of the vehicle.
· Talk to owners of similar vehicles. Most owners will share their experiences about their vehicles. Ask about maintenance, major and minor problems and gas mileage. Many online forums are dedicated to specific makes and models and can be a good resource for owner feedback.
· Determine what you can afford and secure financing in advance. Do not wait until you’re at a dealer to think about financing. Due to the financial crunch, many dealers are having difficulty providing financing for buyers—even if they are well qualified. And if you are approved, it might not be the best rate. Research financing options before you go to buy.
· Get familiar with current pricing. Check the used vehicle ads in the classified section of your newspaper, used vehicle advertising specialty publications and online services, such as AAA.com. These ads will give you some idea of current retail prices. New vehicle dealerships are another good place to compare prices on used vehicles, but remember dealer prices are usually higher than those in classified ads.
· Determine if you want to purchase a vehicle from a private owner or a dealer. While you might be able to negotiate a lower price from a private owner, the vehicle usually does not come with a guarantee that many dealers offer.
If you’re buying the vehicle from a dealer, read the contract carefully. If there are problems that need to be corrected, make sure the dealer takes care of them before you drive away. Read everything before you sign, ask questions if you do not understand something and keep a copy of the contract. Check out the company at www.bbb.org before you go shopping.
In a private sale, check that the seller is, in fact, the registered owner of the vehicle. Make sure you get the vehicle’s title and a bill of sale. Remember, most private party sales are “as is.”
Occasionally, you may be able to buy a vehicle from someone within your family or a friend. This can result in a good buy, but it also can be a later source of friction if the vehicle turns out to have problems.
· Get a CARFAX Vehicle History Report. History reports can potentially reveal if the vehicle has hidden problems such as involvement in a major accident, flood or fire damage or odometer fraud. It also can provide background on if it was previously used as a rental, taxi or fleet vehicle. Some dealerships will provide a history report or you can perform a search on your own. AAA members can purchase CARFAX Vehicle History Reports online at AAA.com/auto.
· Always take a road test. Make sure the test is more than just a drive around the block. Check how the vehicle handles at highway speeds and in stop-and-go traffic.
· Have a mechanic check it out. You likely will have to pay a fee to have the vehicle inspected; however it’s worth the money to catch looming mechanical problems in advance. You can find trustworthy auto repair facilities at www.bbb.org .
· Shop around. Don’t be so enamored with a particular model that good judgment falls by the wayside. The first one you see may not be the best deal.