A used car, also known as a pre-owned vehicle and second hand car, is a vehicle that has previously had one or more owners. Used cars are sold through a variety of outlets, which include franchise and independent dealers, rental car companies, leasing companies, and used car superstores. Some car retailers offer "no-haggle prices," and "certified" used cars, and extended service plans or warranties. Individuals can also sell and purchase used cars through resources, such as newspaper and online classifieds.
Used car industry
With annual sales of nearly $370 billion, the used vehicle industry represents almost half of the U.S. auto retail market and is the largest retail segment of the economy. In 2005, about 44 million used cars were sold in the U.S., which is more than double that of the nearly 17 million new cars sold. [1]
The used vehicle market is substantially larger than other large retail sectors, such as the school and office products market ($206 billion in estimated annual sales) and the home improvement market ($291 billion in estimated annual sales).
Used vehicle retailer
The Federal Trade Commission recommends that consumers consider a car retailer’s reputation when deciding where to purchase a used car. Get recommendations from friends, relatives and co-workers, or contact your local consumer protection agency to obtain information about reputable car dealers or retailers.
Consumers can also ask for a reputable automobile salesman. Successful salespersons will help find a suitable car for a customer for a good price. From a career standpoint, margins can be higher on used vehicles because they are somewhat less of a commodity, though facilities in new car dealers are typically the newest.
The Federal Trade Commission's Used Car Rule requires dealers to post a Buyers Guide in every used car they offer for sale.[2] The Buyers Guide must tell you:
- whether the vehicle is being sold "as is" or with a warranty;
- what percentage of the repair costs a dealer will pay under the warranty;
- that spoken promises are difficult to enforce;
- to get all promises in writing;
- to keep the Buyers Guide for reference after the sale;
- the major mechanical and electrical systems on the car, including some of the major problems you should look out for; and
- to ask to have the car inspected by an independent mechanic before you buy.
Used cars may be bought from many different outlets
- New car dealer. They may have obtained some cars at a very low trade-in price.
- Used car dealer
- Private party
- Auction
- Rental car dealers
- Online Used Car Resources
Used vehicle history reports
An estimated 34-percent of consumers are buying vehicle history reports for used cars more frequently, partially in reaction to the number of vehicles that may have been damaged by flooding during hurricanes. About 30-percent of manufacturer franchise dealers provide vehicle history reports to customers at no additional cost. In addition, some car retailers, such as CarMax and online car classified advertisers, such as AutoTrader.com offer vehicle history reports for their inventory at no charge to customers. Consumers can also purchase vehicle history reports online through companies like AutoCheck and Carfax.com. [3]
Researching, selecting and purchasing used cars online
Consumers are increasingly researching, selecting and purchasing used vehicles online. Nearly a quarter of used-auto shoppers (22-percent) bought a vehicle found online, meaning that they selected the car online but then had to meet with the dealer or seller in person to finalize paperwork and pick up the car. [3]
Informative Used Car Links
- Kelley Blue Book
- Carfax.com
- Edmunds.com
- NadaGuides.com
- Motortrend.com
- Automotive.com
- Online Used Cars