Finding a good used car

Apr 17, 2007

Special to the Star

Both Sorbara and the Edge have a penchant for used BMWs. While some buy their vehicles second-hand out of necessity, people such as Sorbara and the Edge choose to buy used, knowing that a previously owned vehicle can provide all the functionality of a new car but without the punitive high costs.

DesRosiers Automotive Consultants of Richmond Hill discovered that the cost of operating a $25,000 compact car, bought new, is more than 40 cents per kilometre in the first year, but declines to around 25 cents per kilometre in subsequent years. A top-of-the-line Honda Civic LX-G sedan is typical car in that price range.

The initial high cost of ownership is largely due to the depreciation hit every new-vehicle owner takes when they drive out of the dealership.

Domestic products by General Motors, Ford and DaimlerChrysler usually depreciate faster than import vehicles - but there are exceptions, especially if you're shopping for a full-size diesel pickup truck.

On the flip side, it often makes sense to buy one of the new popular "imports" such as the Ontario-built Toyota Corolla rather than pay the ridiculously high premiums they command as a one- or two-year-old used car.

Avoiding the depreciation cost associated with most new vehicles isn't the only tangible benefit of buying a used car.

The dollar savings include:

fewer acquisition costs: no pre-delivery inspection and freight charges, no air conditioning or fuel taxes, and if you buy privately, no federal GST;

a lower purchase price translates into more affordable financing costs.

the price of insurance - an increasingly important factor for many motorists - is cheaper for an older vehicle.

For used-vehicle buyers who worry about not getting the benefits of a new-car warranty, there are options.

"Certified" used-car programs offered by manufacturers and their dealers typically provide a comprehensive one-year warranty on late models. This service costs more. Dealer-certified pre-owned vehicles are priced higher because they're judged to be the cream of the auto crop, and have been somewhat reconditioned.

Buyers of virtually any car can get an aftermarket warranty for an extra charge - but take the time to learn exactly which components are covered.

Warrantied or not, today's cars have benefited from steadily improving product quality.

In a comparison of owner complaints logged with Consumer Reports in 1980 compared to 2000, the magazine discovered the number of problems reported per 100 vehicles has declined dramatically.

That's not to say buying used is entirely risk-free. There's an unwritten law of nature that states, like snowflakes, no two used cars are alike.

Two seemingly identical 2001 Chevrolet Ventures can be vastly different: one may be a low-mileage cream puff whose one owner never missed an oil change, while the other has experienced numerous owners, a collision and spotty maintenance. Guess which one is more likely to provide several more years of headache-free ownership?

Regardless of where you shop for your used vehicle - a new-car dealer, used-car lot or private sale - having the Used Vehicle Information Package (UVIP) for the prospective car is advantageous.

The Ontario government printout reveals the average wholesale and retail value of the model, everyone who's owned it previously in the province, whether it has been branded in Ontario (written off by an insurance company after a collision) and any liens against the vehicle.

Dealers aren't required to supply the printout, but if you're about to part with $5,000 or more for a car, it's worth the $20 investment to learn all you can. Ask the dealer for the VIN, which is all you need to purchase the data on your own.

The UVIP can be a useful bargaining tool, allowing you to negotiate a lower price.

New-car dealers are the best source for late-model used cars, since they have first dibs on lease returns and trade-ins. New-car dealers are picky, and tend to send anything dubious to a wholesaler or to auction.

Used-car lots run the gamut from marble-tiled showrooms to rental trailers on gravel lots. Like new-car dealers, they can offer a wide range of services, from financing to reconditioning to extended warranties. You can also choose to buy "as-is" vehicles; that is, without the ministry safety inspection.

However, don't buy a vehicle without a recent Drive Clean emissions report. In a way, it provides a minimal mechanical fitness report.

A "pass" within the past year indicates the engine is running reasonably clean, which means it's not badly out of tune or burning copious amounts of oil (a sign of worn piston rings or valves).

The private sale is still an appealing - if less common - way of buying used.

There's something to be said for meeting the owner at home, examining the vehicle and asking about the maintenance regimen (ask to see the repair bills). And there's no GST to pay when you transfer ownership.

Curbsiders - unregistered dealers who sell multiple vehicles from their home - are fairly easy to spot (lots of cars, tools and oil stains on their driveway), and if they can produce a UVIP, it will likely show the vehicle has been in their possession only a short time. Walk away.

Unless you're shopping for an Aston Martin, there are numerous examples of the same car you want elsewhere in Toronto's vast used-car marketplace. The key to a happy used-car purchase is patience.

Research the model you want, learn its going value and how much it will cost to insure. When you find the exact one, acquire the UVIP and any available repair records. As the final step, have the vehicle inspected by a mechanic you trust. Do it right and it's time - and money - well spent.