Be careful what you buy or sell
 | Keith Crain is editor-in-chief of Automotive News. |
Reprints
Print
Respond
Sandy, the storm that devastated the East Coast, was particularly destructive to new- and used-car dealerships, destroying or severely damaging many thousands of vehicles.
State and federal laws exist to protect retail businesses from unwittingly selling vehicles written off after the storm.
But thousands of new and used vehicles that were damaged will somehow still slip through the cracks, be repaired and eventually sold to unsuspecting dealers and customers across the nation.
The farther retailers are from the East Coast, the less concerned they will be about the potential problem of flood-damaged and repaired vehicles. And that is the biggest problem: Car dealers and auctions on the West Coast may not be thinking about flood damage even though that's where Sandy-ravaged vehicles likely will show up.
New-car dealers will have to be particularly cautious about those "cream puffs" offered for below market prices because they probably are what they seem -- too good to be true and perhaps flood-damaged goods.
Salvage titles are pretty good protection against the vast majority of damaged vehicles. But in the case of vehicles not covered by insurance, some owners could be tempted to get rid of them to someone hoping to make a fast buck.
Almost all the ailments that affect damaged vehicles have been solved over the past couple of decades. The auction industry has done a remarkable job policing the vehicles that show up at their lots and in their lanes. But there are still plenty of unscrupulous folks who are more than happy to take advantage of gullible consumers and dealers.
Before it's all sorted out, the aftermath of Sandy will be felt in the car business for many months.
The farther you are from Sandy's devastation, the more likely you will be to have some damaged vehicles show up in your market.
This is a classic case of "let the buyer beware."
You can reach Keith Crain at kcrain@crain.com.
