Autoblog

Edmunds: Honda and Acura best brands for retaining value

Jeremy Korzeniewski — Thu, 19 Apr 2012 16:28:00 EST

Honda and Acura have had their fair share of issues over the last few years - from earthquakes, tsunamis and floods to important new models not being all that well received - but that hasn't stopped them from claiming top honors in Edmunds' 2012 Best Retained Value Awards.

According to Edmunds, on average, Honda vehicles are expected to retain 47.9 percent of their value after five years; Acura is just behind with 44.6 percent, taking the win in the luxury segment. In the mainstream category, Toyota and Mazda each got honorable mentions while Lexus and Cadillac to secondary honors in the luxury stakes.

Interestingly, despite not scoring the win in the mainstream class or even managing an honorable mention, Ford had the most individual wins in Edmunds' categories with five, beating Honda's four class victories. The vehicle expected to retain the most value after five years out of all classes is the Toyota Tacoma.

Want more? Click here for the full rundown from Edmunds.

Edmunds: Honda and Acura best brands for retaining value originally appeared on Autoblog on Thu, 19 Apr 2012 16:28:00 EST. Please see our terms for use of feeds.

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University study shows recalls have hardly hurt Toyota

Zach Bowman — Thu, 16 Feb 2012 13:31:00 EST

Filed under: Car Buying, Etc., Recalls, Safety, Toyota

If you think Toyota is still reeling from negative opinions stirred up by the company's rash of recalls in 2009, North Carolina State University has some news for you. According to a new study conducted by researchers at the institution, the recalls had "little to no impact" on how buyers see the Japanese automaker. Robert Hammond, an assistant professor of economics at NCSU, says the research specifically looked at the used car market to negate the impact of outside factors like incentives, marketing campaigns and models not associated with the recall to begin with.

The idea was that examining average prices of models affected by recalls associated with sudden acceleration would give researchers an idea of how willing buyers were to pay for the vehicles. Overall, used cars covered by the recall campaigns saw their price decline by a mere two percent. The figure is within the statistical margin of error for the study.

So, what's behind the slow in Toyota sales? Despite an abundance of fleet sales last month that saw the company's figures swell by 7.5 percent over January 2011, Toyota still fell well behind the industry average. With production back on track after last year's earthquake tragedy, the company may have some explaining to do. Hit the jump for the full press release.

Continue reading University study shows recalls have hardly hurt Toyota

University study shows recalls have hardly hurt Toyota originally appeared on Autoblog on Thu, 16 Feb 2012 13:31:00 EST. Please see our terms for use of feeds.

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Average age of car is record-setting 10.8 years old [w/poll]

Jeff Sabatini — Wed, 18 Jan 2012 13:30:00 EST

Filed under: Car Buying, Etc., Earnings/Financials

Americans are driving their vehicles longer, as the average age of vehicles has nearly hit 11 years, according to a new study by Polk. Blame a wretched economy and more reliable modern automobiles, but cars and trucks continue to stay on the road much longer than they did 15 years ago, when the average age was just 8.4 years.

According to a report in The Detroit News, there are other reasons for the change, including a decline in the number of miles driven last year and improved resistance to rust and corrosion. Regardless of the reason for the record-setting age of our American fleet, the news has the auto industry salivating at the prospect of boom times ahead. The National Automobile Dealers Association is predicting that new vehicle sales this year will hit 13.9 million.

"The economy, unemployment are still going to be stubborn, but there's so much pent-up demand I think the industry is going to have an awesome year," Toyota President and CEO Jim Lentz told the Detroit News.

How old is your ride? We know that Autoblog readers have more cars than the average consumer, so join our poll below by answering how old your daily driver is.

View Poll

Average age of car is record-setting 10.8 years old [w/poll] originally appeared on Autoblog on Wed, 18 Jan 2012 13:30:00 EST. Please see our terms for use of feeds.

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Tight used car supply has dealers looking in their own service bays

Jeff Sabatini — Tue, 13 Dec 2011 18:40:00 EST

Filed under: Car Buying

Used vehicle prices have been on a tear for over a year now, as slow new vehicle sales during the financial meltdown of 2009 have created a dearth of available used models today. Yet the sluggish economy means demand for used vehicles is high, so dealers are going to ever-increasing lengths to acquire inventory.

According to Ward's Auto, the latest tactic is buying vehicles from service customers. Dealers are appraising customer cars and trucks before they pay their repair bills, then offering to buy the vehicles rather than charge the owners for the service visit. Dealers are even giving service personnel incentives to bring in trades.

One dealer said his service areas have signs reading, "Before you pay your service bill, you might want to find out the value of your car."

Tight used car supply has dealers looking in their own service bays originally appeared on Autoblog on Tue, 13 Dec 2011 18:40:00 EST. Please see our terms for use of feeds.

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Canadians may soon be able to buy used cars from Mexico

Dan Roth — Fri, 30 Sep 2011 11:30:00 EST

Filed under: Car Buying, Etc., Government/Legal, Canada

Canada is opening its used car market to vehicles from Mexico to fulfill the obligations of the North American Free Trade Agreement (NAFTA). While vehicles 15 years old or older can already be imported to Canada, this move concerns late-model used vehicles. The only other country Canada accepts used vehicles under 15 years old from is the United States, and NAFTA stipulates that Canada should have already completed this bit of border opening by the end of 2010.

According to Canada's Sympatico Autos, there's not likely to be an immediate flood of Mexi-cars into the Great White North, however. Brian Osler, president of the North American Automobile Trade Association (NAATA) notes that when cars from the United States became available, "it took a long time for people to become aware that there was more than one buying channel." Not only that, but vehicles will still need to meet Canadian emissions and safety standards, and the program is being phased in, starting with vehicles 10 or more years old. Every two years, newer vehicles will be allowed until the restrictions sunset in 2019 for all NAFTA signatories.

Global pressure on the economy and tight used-car values are likely to keep a damper on a buying bonanaza, at least in the short term. U.S. vehicles are also cushier and long-established in Canada's used-car marketplace, though some Canadian dealers are already establishing supplier channels in Mexico, and some already buy vehicles from Mexico to send to Europe. One peek at the ravages of road salt on a vehicle, and the allure of a vehicle that's lived closer to the equator becomes clear, and that's likely to be one factor that spurs Canadian buyers to consider used vehicles originally from Mexico. Us? We'd be interested in some of the Mexican market's forbidden fruit.

Canadians may soon be able to buy used cars from Mexico originally appeared on Autoblog on Fri, 30 Sep 2011 11:30:00 EST. Please see our terms for use of feeds.

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Used cars commanding record prices, sometimes cheaper to buy new

Michael Harley — Fri, 12 Aug 2011 08:29:00 EST

Filed under: Car Buying, Earnings/Financials

Just a couple years after U.S. auto sales plunged to their lowest levels in decades, dealers are finding an industry-wide shortage of used vehicles. This lack of used inventory has driven up the price of scarce pre-owned vehicles on lots, sending more and more consumers into aggressively priced new vehicles. One economist says as many as 500,000 people who intend on purchasing used will instead take delivery on new vehicles by mid-2012.

This phenomenon wasn't completely unexpected. When production and sales slumped, many realized the steady supply of returned leased and fleet vehicles - which traditionally deliver late-model low-mileage inventory - would slow to a trickle down the road. The used vehicles are often reconditioned by dealers for sale with extended warranties, but special financing and automaker incentive packages usually don't apply. Parked next to new vehicles, with aggressive pricing and low interest rates, consumers are finding only a marginal jump in price (if any) will put the aroma of a freshly minted vehicle in their driveway.

The news is good for automakers such as BMW (new car sales up 13 percent), GM and Ford (both expecting a 10 percent boost). However, most Japanese automakers are still reeling after production losses earlier this year which won't allow them to stock lots and take full advantage of the unique situation. Industry experts, who are able to trend new and used vehicle sales, predict the used car market will remain strong for at least the next year or two.

Used cars commanding record prices, sometimes cheaper to buy new originally appeared on Autoblog on Fri, 12 Aug 2011 08:29:00 EST. Please see our terms for use of feeds.

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Used car prices highest in 16 years, but might not stay that way

Chris Shunk — Fri, 27 May 2011 11:31:00 EST

Filed under: Car Buying, Earnings/Financials

If you're looking to purchase a used car or truck, you may have noticed that the prices have been a bit higher than you may have expected. Maybe the salesman in the used car lot isn't willing to dicker as much as you may have expected. According to USA Today, the reason for this phenomenon is that pre-owned vehicle prices are at a 16-year high.

The national paper claims that the average transaction price for a used vehicle is $11,660; up 30 percent since 2008. If that total still seems palatable, consider that four-year-old Honda Accord sedans are selling for $16,175, or about $373 per month with the typical four-year loan and five percent interest. While it's not the same as buying, USA Today notes that a brand-new Accord can lease for about $250 plus taxes, title and plates.

And while we're on the subject of leasing, the U.S. recession and the sharp decrease in leasing has helped cut down on the used vehicles available, further depleting stock while demand remains strong. The price hikes are also being felt at the auction houses, where prices have soared to levels not seen in over a decade. Owners are keeping their vehicles longer as well, as the typical vehicle is now 10.6 year old, up from 9.8 years in 2007.

But while the used vehicle market is strong, many feel that the trend can't last forever. Car buyers are leasing more now. 21 percent of all vehicles moved off of new car lots are being leased - up from 11 percent in 2009. That means more vehicles will become available once those leases run their course. Credit has loosened a bit as well, so potential new car buyers with less-than-perfect credit are now more likely to find themselves in a new vehicle.

Used car prices highest in 16 years, but might not stay that way originally appeared on Autoblog on Fri, 27 May 2011 11:31:00 EST. Please see our terms for use of feeds.

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Polk: People continuing to keep vehicles longer

Jeremy Korzeniewski — Fri, 05 Nov 2010 14:32:00 EST

Filed under: Car Buying

Consumers are keeping their automobiles for longer periods than ever before, according to a study performed by the survey gurus at R. L. Polk & Co. For anyone keeping track of such things, this news comes as little surprise - average length of ownership has been steadily increasing at an average rate of 3.7 percent annually.

Since the global economic meltdown and the devastating effect it had on the world's automakers in 2008, that average length of ownership has increased dramatically at a clip of more than 14 percent. The hard data shows that consumers are keeping their machines for 63.9 months on average, up 4.5 months from the same time last year.

Polk comes to a couple of conclusions from this data. First, the automotive aftermarket stands to benefit from older vehicles remaining on the road. Second, automakers have a big opportunity to get people buying more new cars to replace the rapidly aging vehicles currently in their driveways. Want more? Click past the break for the official press release.

[Source: R. L. Polk & Co. | Image: Justin Sullivan/Getty]

Continue reading Polk: People continuing to keep vehicles longer

Polk: People continuing to keep vehicles longer originally appeared on Autoblog on Fri, 05 Nov 2010 14:32:00 EST. Please see our terms for use of feeds.

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Mazda launches certified pre-owned program

Steven J. Ewing — Tue, 06 Jul 2010 08:59:00 EST

Filed under: Car Buying, Mazda

Quite a few automakers have had success with certified pre-owned used car programs, and now Mazda is jumping on board by offering a CPO plan of its own. After all, used vehicles that have passed a rigorous inspection are more attractive to potential buyers, even though certified cars commonly carry a heavier price tag than their non-inspected lot mates.

Mazda is offering its CPO program on all 2006 to 2010 model year vehicles with less than 60,000 miles. Depending on the auto's age, certified used cars will offer the remaining balance of Mazda's warranty, or will be sold with an additional 12-month/12,000-mile comprehensive warranty, as well as additional seven-year/100,000-mile powertrain coverage. What's more, Mazda offers roadside assistance on its CPO vehicles.

Expect the certified pre-owned program to make its way across the vast majority of Mazda dealers in the United States in the coming months. For the full details, hit the jump to read the release.

[Source: Mazda]

Continue reading Mazda launches certified pre-owned program

Mazda launches certified pre-owned program originally appeared on Autoblog on Tue, 06 Jul 2010 08:59:00 EST. Please see our terms for use of feeds.

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KBB launches free iPhone app and Seller's Toolkit

Jonathon Ramsey — Sun, 18 Apr 2010 16:33:00 EST

Filed under: Car Buying

Although it will probably remain a stress-inducing experience, Kelley Blue Book has introduced a smartphone app and a Seller's Toolkit to make buying a car slightly less stress-inducing. The app ties your iPhone directly into the KBB database, so you can pull up the appropriate KBB values on the fly when that one-owner steal looks more like it's been stolen from five or six owners. It'll also clue you in to dealer locations and provide 360-degree views and reviews of any car you have questions about. It's a free download in the App Store.

On the other hand, if you're a seller who's trying to unload that one-owner steal, you'll want to take advantage of Kelley Blue Book's Seller's Toolkit. AutoTrader won't be happy to hear about it, but the KBB software helps you create a professional-looking listing for posting on Craigslist, Facebook, Twitter, or in your e-mail or blog. Check a few boxes and you've got a digital window sticker, Facebook application, widget, dynamic images and a direct link to your selling page.

On top of that, all of the tools provide quick links to KBB for buyers to research your car. The window sticker comes with a QR code that calls up KBB's LiveValue function, the LiveValue ID can respond via SMS, the widget is built to fit into Wordpress and Blogger, Direct Link provides a shortened URL for Twitter, or a potential buyer can even make a voice call to KBB to get more information. Like we said, it might not make things less stressful, but it could make everyone more informed, and that's got to be good for something.

Check out the galleries below for screenshots of the new iPhone app (we loaded it and poked around) and of the KBB Seller's Toolkit features.

Gallery: Kelley Blue Book iPhone App

Gallery: Kelley Blue Book Seller's Tool Kit screenshots

[Source: KBB]

KBB launches free iPhone app and Seller's Toolkit originally appeared on Autoblog on Sun, 18 Apr 2010 16:33:00 EST. Please see our terms for use of feeds.

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Video: Best used car classified ad ever?

Jonathon Ramsey — Fri, 26 Mar 2010 19:58:00 EST

Filed under: Car Buying, Wagon, Etc., Videos, BMW, Humor

Casey's 1994 BMW 530i wagon classified ad - Click above to watch video after the jump

If this isn't the very best used car ad ever, it is certainly up there - definitely the most inspired we have seen in a very long time.

Young Casey wants to move this 1994 BMW 530i Touring, and he's using a bit of Michael Ceraesque geekiness to do it. He's totally honest about its 194,218 miles, leaky sunroof and broken cigarette lighter, as well as its Ultimate Power and Extreme Sound. Except for that rear seat speaker. Follow the jump for a beautiful dose of entertainment. We do one question for Casey, though: um, what's that sign in the trunk about? Hat tip to Jon!

[Source: YouTube]

Continue reading Video: Best used car classified ad ever?

Video: Best used car classified ad ever? originally appeared on Autoblog on Fri, 26 Mar 2010 19:58:00 EST. Please see our terms for use of feeds.

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It's On Like Donkey Kong: Jilted Hyundai Genesis Coupe buyer jilted again, lawyers up

Jonny Lieberman — Mon, 25 Jan 2010 19:38:00 EST

Filed under: Car Buying, Coupe, Performance, Auctions, Hyundai, South Korea

This ended about how we predicted. You all no doubt remember McFly, the guy that won a legit eBay auction for a slightly used Hyundai Genesis Coupe 2.0T for $16,125. Problem was that the seller - Glenn Hyundai of Lexington, KY - felt the car was worth more ($19,700) and refused to sell it to McFly. They claim they set a reserve price (even though they didn't) and wouldn't budge. End of story, kind of.

See, the internet got a hold of the McFly's tale of woe, and few things excite people (us included) more than tales of bald-faced greed mixed with dishonest car dealers. Not surprisingly, the story took off like wildfire and Glenn Hyundai soon found itself inundated with phone calls, emails, faxes - you name it. The onslaught became so bad that Glenn Hyundai got in touch with McFly and told him that if he would call off his dogs (remove his forum posts, plead with Gencoupe.com forum members to stop harassing the dealership, somehow get Digg.com to do... exactly what we're not sure, etc.) they would presumably sell him a Genesis Coupe for $16,125.

Why do we say presumably? Because we never knew the details of the agreement McFly worked out with Glenn Hyundai. Or, as McFly puts it an updated post, "For the record I have not shared any part of the verbal agreement." Despite this agreement never being finalized, some felt that McFly's saga was over (while some nearly broke their hands patting themselves on the back). We ourselves were reluctant to think or declare anything until McFly had the Genesis Coupe in hand. Guess what?

No Genesis Coupe 2.0T for McFly. He's claiming that Glenn Hyundai has breached the "verbal agreement" he reached with them. He's refusing to give any details of said verbal agreement, but maintains that Glenn Hyundai owes him a Gen Coupe for $16,125. Also, McFly's retained a lawyer. Also-also, he's contacted Hyundai USA but received no response. We'll keep you updated. Thanks to Bora for the heads up!

[Source: Gencoupe.com]

It's On Like Donkey Kong: Jilted Hyundai Genesis Coupe buyer jilted again, lawyers up originally appeared on Autoblog on Mon, 25 Jan 2010 19:38:00 EST. Please see our terms for use of feeds.

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VIDEO: Ford press conference yields surprise $650 car announcement

Jonny Lieberman — Fri, 06 Nov 2009 12:20:00 EST

Filed under: Videos, Ford, Humor

Ford makes surprise $650 car announcement - click above image to watch the video

Between the hysteria of this week's SEMA Show and Chrysler's never-ending (and partially baffling) revelations yesterday, a shocking announcement by Ford Motor Company has been nearly drowned out. But rest assured, your Autoblog team never rests (even after huffing down 9,000 calories apiece at Vegas' Wynn Buffet!) and have tracked down this astounding piece of news. Ford has taken a long, hard look at the state of the American automotive scene and has decided to do the (almost) unthinkable - sell us a car for $650.

Now, there are no doubt naysayers amongst you that will point to a $650 Ford and cry, "Malarkey!" And with good reason. After all, under cutting the Tata Nano by a full $1,350 is no easy feat. However, times are tough. And with a nearly 10% national unemployment rate, a $650 car makes sound, economic sense. But don't take our word for it. Make the jump to watch Ford VP Daniel Grossman introduce Ford's new entry level car.

[Source: O-SPAN6]

Continue reading VIDEO: Ford press conference yields surprise $650 car announcement

VIDEO: Ford press conference yields surprise $650 car announcement originally appeared on Autoblog on Fri, 06 Nov 2009 12:20:00 EST. Please see our terms for use of feeds.

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REPORT: Cash-For-Clunkers dealers instructed to kill engines with sodium silicate

Jonathon Ramsey — Sun, 26 Jul 2009 09:58:00 EST

Filed under: Car Buying, Government/Legal, Earnings/Financials

According to Bloomberg, the National Highway Traffic Safety Administration got wind that some cars being turned in under Germany's Cash-For-Clunkers program were being certified as destroyed, but actually being resold. To prevent that scenario from repeating itself in the U.S., land of Honest Abe, dealers have apparently been instructed to fill the engines of trade-ins with sodium silicate and run them for seven minutes in order to permanently disable them.

Early reports from around the country indicate that Cash-For-Clunkers is having the intended effect, and the authorities want to make sure no one takes undue advantage by making money on the turned-in vehicles. Normally sodium silicate, often referred to as "liquid glass," is used to seal leaks in things like head gaskets, but in this case, it's used to seize an engine that could be well worth reselling. Dealer records will be reviewed by federal agents, and if the dealer is found not to have complied, the dealer will have to pay $15,000 per infraction.

[Source: Bloomberg via Boston.com | Image - Dave7 under CC2.0]

REPORT: Cash-For-Clunkers dealers instructed to kill engines with sodium silicate originally appeared on Autoblog on Sun, 26 Jul 2009 09:58:00 EST. Please see our terms for use of feeds.

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Consumer Reports lists clunkers to cash in on

Sam Abuelsamid — Tue, 16 Jun 2009 16:27:00 EST

Filed under: Car Buying, Government/Legal

With Congress on the verge of passing some kind of 'cash-for-clunkers' legislation, it's time to take a look at what cars are worth trading in for the scrappage credit and what models would be better to sell by other means. The good folks at Consumer Reports have come to the rescue. Obviously, a car that has a retail value greater than the corresponding rebate is not worth trading in unless you just can't be bothered to stick a For Sale sign in the window. The CR staff has examined the prices and concluded that pre-1993-94 Cadillac DeVilles, Eldorados and Sevilles are all solid candidates.

One surprise car on their list is the 2001 Lincoln LS V8. The LS was a well-regarded (if blandly styled) sedan in its time. Those looking for a good handling rear-drive alternative to a BMW 5-series would do well to consider one of these at their bargain basement used pricing, and we'd hate to see a good one sent to the crusher.

Perhaps unsurprisingly, CR's truck list is quite a bit longer than their car list, and it includes such winners as the pre-1996 Ford Aerostar and Isuzu Rodeo. Check out the whole list of clunkers-to-vouchers over at CR. Thanks to Richard for the tip!

[Source: Consumer Reports]

Consumer Reports lists clunkers to cash in on originally appeared on Autoblog on Tue, 16 Jun 2009 16:27:00 EST. Please see our terms for use of feeds.

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Autoline on Autoblog with John McElroy

John McElroy — Fri, 22 May 2009 09:29:00 EST

Filed under: Car Buying, Autoline on Autoblog

BOOM TIMES COMING IN THE USED CAR MARKET

The future looks so bright for the used car market that I'm almost tempted to try and get into that business myself. Even though car dealers are going through tough times trying to sell new vehicles, they are going to more than make up for that on their used car lots.

The reason I'm so bullish on the used car business is that we're facing a looming shortage of good used cars. First off, the new car market has fallen by roughly 7 million units since its peak two years ago. That translates into 7 million fewer trade-ins available in the used car market. And the story gets even more interesting when you start to dig down into those numbers.

Follow the jump to keep reading...

____________________________________________________________________________________

John McElroy is host of the TV program "Autoline Detroit" and daily web video "Autoline Daily". Every week he brings his unique insights as an auto industry insider to Autoblog readers.
____________________________________________________________________________________

Continue reading Autoline on Autoblog with John McElroy

Autoline on Autoblog with John McElroy originally appeared on Autoblog on Fri, 22 May 2009 09:29:00 EST. Please see our terms for use of feeds.

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Some used cars going for more than new ones

Jeremy Korzeniewski — Fri, 20 Mar 2009 16:58:00 EST

Filed under: Car Buying

The lagging sales of new vehicles has been well documented, forcing retailers and manufacturers to offer some pretty amazing deals just to move their metal. Sometimes, the price of a brand new car is so good that it doesn't make sense to purchase a used vehicle.

In fact, some new cars are actually priced lower than their previously-loved siblings. One specific example is the 2009 Honda Accord, which, according to Edmunds, is selling for about $80 less than the average asking price for a certified 2008 model. Of course, Hondas are known for holding their value, so better used vehicle deals may be found elsewhere.

Further, interest rates on loans for new cars are generally lower than for used cars, which means the monthly payments may actually be lower for a zero-mile vehicle that costs the same as one that's been around the block a few times. Automakers hope these facts help spur a recovery in new car sales, and for their sake, so do we.

[Source: Detroit Free Press | Photo: David Gallagher]

Some used cars going for more than new ones originally appeared on Autoblog on Fri, 20 Mar 2009 16:58:00 EST. Please see our terms for use of feeds.

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As new vehicles sales fall, used car prices go up

Dan Roth — Sun, 08 Mar 2009 15:05:00 EST

Filed under: Car Buying, Trends, Etc.

The cynic in you might think that a rise in the price of used vehicles, just as new car sales are cratering worse than anyone can remember, is a not-so-transparent ploy to overcharge buyers. It turns out to be more a case of supply versus demand. Wholesale used car prices are bumping up as a result of sagging new car sales, according to auto auction company Manheim. Two-thirds of new car sales have a trade-in attached, which creates a supply stream of pre-owned vehicles to recycle onto dealer lots. With sales so far down, trades are harder to come by, so those cars that are available are fought over more fiercely. The wholesale price rise indicates that dealers are duking it out harder at auctions, more than saying anything about prices consumers are paying. It's our suspicion, looking at how long everyone's inventory is sitting around, that anyone able to buy right now can virtually write their own deal.

[Source: Auto News - Sub Req.]

As new vehicles sales fall, used car prices go up originally appeared on Autoblog on Sun, 08 Mar 2009 15:05:00 EST. Please see our terms for use of feeds.

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New car customers stuck with old loans when dealers don't pay off the trade-in

Jonathon Ramsey — Tue, 03 Feb 2009 08:01:00 EST

Filed under: Car Buying, Carsumer Advocacy

Many consumers who buy a new car still owe money on the car they're trading in. The situation is usually handled by the dealer agreeing to pay off the old loan, the cost of which might be folded into the new car price. No problem a year ago, but it's a bigger issue now. With 5,000 dealers closing their doors last year, some of those old loans aren't getting paid off. Consumers who bought new cars are finding out they're still on the hook for the old car loans, and in some cases, if another consumer has already bought the trade-in from the dealer, the bank will repossess it.

Complaints about such practices are rising, but there isn't much a buyer can do: if the dealer has gone bankrupt, mere scraps are rewarded to most folks in the scrum of creditors. Most states have insurance bonds against these kinds of losses, but they might pay as little as $5,000, which is barely enough to cover one default.

Ohio, Virginia, and West Virginia have restitution funds. California -- exceptionally victimized by the practice because of the number of cars sold in the state -- is creating one that will be fed by a $1 fee on every car sold, but it isn't operational yet. In the meantime, used car buyers should ask to see the car's title to ensure it's clear. And for all buyers, in good times and especially in bad, caveat emptor.

[Source: MSNBC]

New car customers stuck with old loans when dealers don't pay off the trade-in originally appeared on Autoblog on Tue, 03 Feb 2009 08:01:00 EST. Please see our terms for use of feeds.

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Germany's turn: scrap your used car, get a bonus to buy a new one

Jonathon Ramsey — Wed, 28 Jan 2009 07:33:00 EST

Filed under: Car Buying, Europe, Government/Legal

Last month China proposed a plan to offer consumers a cash incentive to scrap their cars and buy new ones. Germany is the latest country looking at the same option, with a law that aims to give €2,500 to people getting rid of cars that are at least nine years old and buying new ones.

China may want to watch what happens in Germany: so far, interest in the program looks like it could exceed the available funds. The German government set aside €1.5 billion for reimbursements, which is enough to reward 600,000 people. But in just two days, the office that will look after the program got 420,000 phone calls. One German market research firm put the potential number of takers at 1.2 million.

If the measure passes into law as is, then early birds would get the incentive worm. The €1.5 billion is coming out of a €50 billion German stimulus plan, aimed at reviving the automotive, transport, and education sectors, and it wouldn't seem out of the question for them to double the allotted funds to allow all to participate. Although no one knows how much the program would help German automakers -- people might scrap their cars and buy Fords -- it would put money back into the economy and get cleaner cars on the roads to boot. Hat tip to Gregg!

[Source: Der Spiegel | Photo: Ms. Martin]

Germany's turn: scrap your used car, get a bonus to buy a new one originally appeared on Autoblog on Wed, 28 Jan 2009 07:33:00 EST. Please see our terms for use of feeds.

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