7.01.2008

Selling & Buying Accident Cars in Japanese used car auction(3)

Hi, there. This is JPC’s Newsletters #13.

Again, I am going to continue to talk about cars which are involved in an accident (but this time about repaired cars, not about damaged cars sold on a “as is where is” basis) and how to buy them at auction.

First of all, the benefit of buying damaged cars is the cost, of course. Even when they are repaired perfectly, you can buy damaged cars about 10% cheaper than other second-hand cars. Sometimes the price of damaged expensive cars like the latest Mercedes Benz, BMW, Audi and Lexus, can be dropped by more than 10%. This is because they are recent models and there is not much demand in the market. People who buy these expensive cars are rich and middle-aged or older. They are the people who do not have a positive opinion of damaged cars and value the quality and conditions of the cars as much as the price. Not many of them jump at damaged models just because they are cheaper. Damaged late model expensive cars are not popular and it is not easy to sell them on; so you can get a big discount because of the difference in the supply & demand. However, I can only say this for right-hand drive models. The price of left-hand models does not seem to be reduced as much even when they are damaged in an accident. This could be because there are quite a few overseas buyers who do not mind them once they are fixed, which stops the price going down.

On the other hand, some Japanese cars do not seem to lose value dramatically like those expensive latest imports even after they are involved in an accident if they are sport cars such as Skyline, Silvia, Supra and RX-7. Different from cars whose target is rich middle-aged, these cars are made for young people. They tend to connect the quality with the price, but sometimes put priority on the price. Young people have a limited budget and the cheaper cars attract more people. Also, these cars are designed for speed performance, more than half of them on the market or at auction are involved in an accident. Therefore, damaged cars are the norm and especially when cars are old, it usually means that they have been in one or two accidents.

How about safety? Is it really safe to buy such a car? Sometimes customers with a low budget ask us to buy cars that were damaged in an accident but have been fixed properly. We say to them honestly: we cannot 100% guarantee if they were fixed properly at this stage because it is something you have to find out after you buy them. It needs time. This might sound harsh but is a reality.

Cars are made of many parts. When they are damaged, we try fixing them by pulling, pushing, banging, patting, etc. to make them look similar to the original condition. Unlike human bones which can be broken but get fixed naturally, cars never fully get back to the original state. So even if they look fine for now, no one can tell if they are going to be fine after a couple of years.

However, the repair skills are improving every day and depending on the damaged site, you can minimise the future risk. For example, repairs in the rear parts of cars do not affect directly driving performance, so you can feel relatively at ease when you buy one; but if cars have repairs on the front, you take more risk in buying one because it might directly affect its performance. Especially when 3 front parts (bonnet and both side fenders) in the front have been replaced, it means the car had a head-on crash and this can be the biggest impact you could think of, when you have an accident. Things like this reflect in the bidding prices. Cars with damage in the front are sold cheaper than the ones with damage in the rear. Check these auction slips of Civic Type Rs.

Although we cannot simply compare them because of the 1 year difference in the manufacture dates, the left one with 3 repair histories and the right one with a repair history at the back get this much difference in their selling prices. Actually, when a car has 3 parts repaired in the front, inspectors might doubt the seller’s driving skills and tend to look for more faults, making the car look worse.

From my experience, I cannot always generalize this, but I say that you can buy a damaged car if they only have repairs in the rear or 1 repair in the fender panel if it is in the front and you have no problem in the steering from visual observation; it might be worthwhile to take it into consideration, depending on the price.

I have more things to talk about on damaged cars. To be continued…


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★ JPCTRADE Home page : http://jpctrade.com/
★ JPCTRADE Blog : http://jpctrade.blogspot.com/

(Editor)
JPC TRADE CO.,LTD.
Kato building 4F, 1-1-2 Furuishiba, Koto-ku, Tokyo
Japan Used Motor Vehicle Exporters Association (JUMVEA)
TEL : +81-3-5245-7731
FAX : +81-3-3643-4955

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