Used car managers like the cars they buy. Too often, they like them so much that they can’t wait to get them onto the front line, and that means no dealership employee takes the time to thoroughly inspect them. If that’s happening in your dealership, it’s a problem.
Most used car managers will argue that they review the vehicle history report or maybe even the title history for the vehicle. Since those show no problems, they see no reason to inspect a vehicle they wish to retail. However, that disregards the problems with vehicle history reports and title histories.
Vehicle history reports are unreliable. There are lots of reasons why a problem with a vehicle doesn’t show up on a vehicle history report. Perhaps the issue with the vehicle – damage or flooding for example – was not reported to an insurance company and was repaired by the owner at its own cost. Or perhaps the damage or flooding reported to the vehicle history report company is delayed in making it to the report. For many reasons, a clean vehicle history report does not mean that a vehicle has not had problems.
Title histories may also be misleading. The fact that a vehicle has never been titled in the name of an insurance company doesn’t mean that the car was never declared a total loss. Insurance companies have been known to simply “skip title” by arranging a purchase from the owner of a seriously damaged vehicle directly to a subsequent owner (it if has been fixed) or to someone who will fix it for resale (if it has not been repaired). An insurance company’s name sometimes never shows up on the title history of a totaled vehicle.
There are a number of reasons you must carefully inspect the used cars you sell at retail.
Floods. With the recent torrential rains and floods in various parts of the United States, there are many cars that have suffered flood damage. The fact that its flooding hasn’t yet appeared on a vehicle history report doesn’t mean the car you are buying isn’t a flood car. There are lots of organizations who can give you tips on what to look for in an inspection to determine whether you are buying a flood vehicle. However, you won’t see those if you don’t carefully inspect the vehicle.
Serious damage. Plaintiffs’ lawyers love to sue dealers over used vehicles that have suffered serious previous damage without disclosure of that to the buyer. Once again, you cannot depend on the vehicle history report or the title history. You can best protect yourself from a claim that a used vehicle suffered severe damage by inspecting it carefully, including putting it up on a lift to look at the undercarriage.
Odometer discrepancy. Generally, liability for an odometer discrepancy requires a sale of a vehicle and a knowing nondisclosure of mileage discrepancy. However, taking a car in with a clean mileage statement is not always the foolproof protection you think it is. Dealers have been sued when the apparent use on the vehicle does not match up with the odometer disclosure. A plaintiff’s lawyer will contend that a dealer who sold a car with a disclosure that it has 30,000 miles should have known that it was making a false representation when the wear patterns on pedals, seats and parts indicate the car has 90,000 miles.
In short, there are many reasons why you must inspect used vehicles before you put them on the lot at retail. Of course, it is important to know what is in the vehicle report and the title history so you should review each for every car that you retail. But it is just as important to inspect the car to make sure that there is no condition that should put you on notice of a serious problem.