Supply shortages seem to have accelerated customer acceptance of higher mileage used cars. In 2012, a New York Times headline stated, “As Cars Are Kept Longer, 200,000 Is New 100,000.” Back then, the average car was about 11 years old, and was driven about 15,000 miles per year. That average age has ticked up to 12.2 years today. And the trend is expected to continue.
Of course, you know the value of acquiring quality used cars. Dealers have been putting higher-mileage units on their lots throughout the chip shortage. But as the mileage rises, so does the chance that a vehicle might suffer damage, or miss an oil change or two, or need the kinds of repairs that severely limit its resale value. And that’s where it pays to be careful.
Vehicle History is Key
Without vehicle history, it’s a bit of a shot in the dark. You can ask the owner for documentation, invest in inspections, or rely on intuition and experience. But with a CARFAX Vehicle History Report, you can rely on VIN-specific data, including unique accident and damage information. Dealers can quickly weed out cars with issues, and properly price those they want to keep.
CARFAX has the most data, and includes features such as accident and damage details. That kind of third-party transparency, from such a widely trusted brand, helps build confidence on both ends of the transaction.
One of the best sources of quality, high-mileage used cars is the trade-in. Often, the best higher mileage trade-ins come from customers buying a CPO vehicle from you. According to CARFAX expert Bob Grill, “when they’re true CPO units, they will attract four to six-year-old trade-ins.”
Due to the current demand, as well as the increasing reliability and longevity of modern vehicles, this vehicle age-range is optimum for many dealers. When the car’s history shows a good maintenance record, especially if it’s been serviced by your dealership, it’s likely a winner, even if it’s way over 100,000 miles.
Manheim, has seen significant growth in the number of dealers buying high-mileage vehicles. But auction prices have skyrocketed since the beginning of the COVID pandemic. As reported in Forbes, December 2021 dealer-only wholesale auction prices were up 48.1% over December 2019.
Not every high-mileage find will sell for a profit. Safety issues, such as bad brakes, or faulty airbags, can render a car unsellable for most dealers. Some dealers limit the mileage they’re willing to sell, while others look at the relative cost of reconditioning for their market. Either way, success at auction depends on preparation, discipline, and, of course, the best vehicle history information.
Private Party Purchases
Many dealers have expanded their search for pre-owned vehicles, beyond the trade-in and auction. Private sellers are now an important source for dealers seeking inventory of higher mileage used cars. They’re scouring their regions for high-mileage private-seller deals, finding them in:
- The service drive
- Social media platforms
- Searching classified ads
- Online search services
- Online buying services
As with any auction car, dealers buying from John Q. Public have to be prepared to make a quick, accurate assessment of condition and value. With higher-mileage cars, which are common in many of these situations, its especially important to have a VIN-specific Vehicle History Report on hand.
Once you’re negotiating and closing the deal, that report becomes a useful tool that can provide transparency from a third-party that both sides trust.
Selling a High Mileage Used Car
While customers are more accepting of higher mileage, they still want to trust that the vehicle will be reliable. They don’t want to buy anything with hidden “gotcha” issues, such as unreported accident damage or lapses in maintenance. And, in many cases, they want to know the vehicle’s “auto-biography.” That’s why sharing a detailed vehicle history report is essential.
When you hand a buyer a CARFAX Vehicle History Report, they can review the vehicle’s entire past, including maintenance, ownership, accidents (and severity), types of use, and much more. Taken together, that adds up to a story the buyer can feel comfortable with, all coming from a trusted third party. And that buyer confidence leads to quicker sales, lower costs, and higher profits, even on cars that once might have been considered ready for the scrap heap.
To learn more about how CARFAX can assist you in acquiring high-mileage used vehicles, contact us.
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