CHATTANOOGA, Tenn. — Although a used car looks great and the price is right, today's shoppers know they must do their homework. • A vehicle history report provides important insight on a car's potential hidden problems, such as whether it has been in a wreck or possibly sustained flood damage.
Two major Internet competitors — Carfax and Experian Automotive's AutoCheck — provide such reports, both directly to shoppers and in many cases through sellers and dealers who pay for the reports.
A vehicle history from Carfax.com costs $34.99, and a report from AutoCheck.com costs $29.99.
The reports are a security blanket for one of the major purchases in a consumer's life. Consider that the potential pitfalls are numerous. Flooding alone can damage the motor, the car's computer and electrical systems and brake and air bag systems. A vehicle history can also help detect if the odometer was rolled back and alert you to whether the car is still subject to a manufacturer's repair recall, or possibly has a neglected lien in its past.
The reports are based on accessible records, such as data from state motor vehicle departments and vehicle auctions. If something on record is missed, some cars are eligible for buyback protection but costs vary.
Sixty-three percent of consumers who bought 2004-2009 model used cars relied on the Internet for shopping help in some way, such as buying vehicle histories and comparing prices, according to a 2009 J.D. Power & Associates report.
"They can compare how much they should be paying for a vehicle, how much room they have for negotiation with the dealer and how far they have to travel to get the specific vehicle they want," said Arianne Walker, a spokeswoman for the market research company.
Like other used-car dealers that have a paved corner lot full of shiny cars and work with customers online, Jerry Roden of Roden Motor Co. in Chattanooga, Tenn., said Carfax "is one of our most important selling tools."
Roden and his brother, Steve, own and operate the dealership and rely on their reputation after more than three decades in the business.
"Half of our business, we've already sold before," Roden said, referring to repeat customers.
The dealership has a website and provides vehicle history reports. Roden said a customer who bought a truck recently said afterward that "the reason he bought it was because we offered him the Carfax before he even asked for it."
Carfax spokesman Christopher Basso said the Carfax reports can be obtained at no cost to shoppers from among about 28,000 dealers who are members of its vehicle history service that started in 1986.
James Maguire, senior director of marketing for Experian Automotive, said "titles don't always provide the clearest picture."
Maguire advises shoppers that it is always good to have a car inspected by a licensed mechanic or third party. There are plenty of instances that are not reported in public records.
On a personal note, when shopping for a used car in June, I used the vehicle identification number for a 2009 Hyundai Elantra Touring hatchback to obtain reports from Carfax and AutoCheck. Both reports showed the car had one previous owner in Florida. The reports largely provided the same information, showing no accidents or problems that otherwise could be hidden in a long-distance purchase in Tennessee through an Alabama dealer. I verbally committed to the purchase without seeing the car and went through with the deal.
After record Tennessee flooding in May that claimed lives and caused $2 billion in damage to the Nashville area alone, one month later state officials received about 8,500 applications for salvaged vehicles — about 1,500 more than usual. Revenue Department spokeswoman Sara Jo Houghland said in an e-mail statement flood-damaged vehicles were likely the "major contributing factor."
State officials warn about "scam artists" possibly trying to sell flood-damaged cars.
Christopher Garrett, a Department of Commerce and Insurance spokesman, said he can't "characterize the honesty or untrustworthiness of people" who may or may not report flood damage. He said the department has been encouraging consumers to get the electronic history of the vehicle and to have it checked by a trusted mechanic.
If any dealership doesn't want to afford that kind of allowance, Garrett said, "We encourage consumers to take their business elsewhere."