Dealer "certified" cars...

Seems likely to me that a number of a2k readers might profit from understanding this one....

This is the second time I've seen this one amongst people I associate with at work and it's definitely counter-intuitive unless you take the time to analyze the situation. In the most recent case an associate bought a "certified" used car from a D.C. area Toyota dealership a year and a half or so ago, a Corolla which he paid around 13K for with around 30K miles on it, and for that much money he had an absolute right to think that the car was nearly new.

Nonetheless, his contract over and headed back across the blue waters, and the car now with around 47K miles on it, he goes to sell the car to Carmax and they tell him they can't give any more than about 5500 for it since it's been in a wreck and had damage to both doors, the roof, and the front sufficient to require a radiator being replaced aside from body work and they couldn't do anything more than wholesale it i.e. they could not sell at as one of their own "certified" used cars.

In other words, between CarMax and a Toyota dealer, the word "certified" clearly means more at CarMax. The only thing which was "certified" in this case was the fact that at least one D.C. area Toyota dealer is an asshole.

A relative who buys and sells cars for a living told us that the CarMax offer was low but not by much, i.e. that the car could be sold at one of the auctions for around 7K after a bit more body work and detailing and that he could offer around 6 for it, but that was all.

The snake's analysis:

People in the auto trade claim that the internet is ruining the new car business and that there's very little profit in selling new cars any more; everybody can find out all the basic prices with little effort. That says that dealers will be trying to make up the slack on used cars and are often trying too hard to make deals, including offering too much on used cars, and then in some cases at least selling some of those bad trades as certified cars.

Something like CarMax of course has no new car business and comes closer to being able to conduct its business in used cars in a rational manner.

Particularly in the cases of Hondas and Toyotas as I see it it makes no sense at all to try to buy "nearly new" ones. Either buy a new one or buy one which is 10 or 12 years old with 100K miles on it and indications that it was cared for. With any car at all, A Honda or Toyota with 100K miles on it is basically just broken in.