By Andy Jensen on August 6, 2020 in life hacks
Rental cars are often the butt of jokes in sitcoms and buddy comedies, but they’re also the heroes of everyday business trips and vacations. Every year, hundreds of thousands of these vehicles hit the used car market. Does a former rental car make for a smoking deal, or should you not take that kind of risk? Keep reading to find out whether a used rental may be right for you.
Why Rental Car Companies Sell Their Cars
No one wants to go on a beautiful Hawaiian vacation and stay in a gorgeous 5-star hotel only to rent a hail-dented 2001 Chrysler PT Cruiser. If you’re paying to drive someone else’s ride, it needs to be visually perfect, have cutting edge technology, and drive like a new car. Even if perfectly maintained, a two-decade-old vehicle no longer looks and feels new, and rental customers would complain.
Rental companies don’t want people leaving 1-star reviews, so they regularly buy new vehicles and sell off the “old” inventory in as little as 13 months after purchase. Used rental cars are nearly new cars sold as used, meaning you have a considerable potential for savings when buying one.
Pros to Buying Used Rentals
While rental fleet sales only offer used cars, none of them are old. This nearly new status means they’re often still under the factory bumper-to-bumper warranty. And they have years and thousands of miles left on the powertrain warranty covering the engine and transmission. If a mechanical issue pops up a month after buying, you can take it to the dealership for covered service and let the pros handle it for free.
Another bonus of buying a used rental is that they’re meticulously cleaned and maintained. Every time a customer returns a car, maintenance techs look it over for damage caused by the previous renter and also to maintain a safe ride for the next customer. Mechanics do scheduled maintenance on time and fix minor repairs before they turn into a major issue. Like former police cars, former rentals should have a reputation of durability based on proper fleet maintenance.
Another huge plus to buying a used rental car is that the sales process tends to be less stressful than with most used vehicles. A Gallup survey declared car sales as the least trustworthy profession, with a whopping 8 percent of consumers having a high degree of trust in car dealers. Ouch. Rental purchases offer customers the chance to skip the high-pressure used car sales experience, while still scoring a deal on a used car.
But what if you change your mind? Buyer’s remorse happens, but it’s not as big a deal with rental cars because companies often let you test drive a car for three to seven days before finalizing the purchase. If you change your mind or discover an issue, you can bring it back for a full refund.
Cons to Buying Used Rentals
While rental cars have their advantages, they also tend to have higher mileage than other used cars. Drivers primarily use rental cars for vacations and road trips, so they pack on a lot of miles in a short amount of time. You can see this trend when you look at Enterprise’s car sales, where a one-year-old Ford Mustang GT often has more than 30,000 miles, and a few have above 40,000. Compare that to non-rental used car retailer Carvana, where the average last year model Mustang GT carries a more typical 10,000 miles.
Rentals also usually live a rough life. There’s an old saying that “Nothing is faster than a rental car,” because drivers treat the vehicles more casually than their own, drive recklessly, or even race in them. Since it’s not their responsibility, some renters smoke in the car, grind beach sand into the carpet, or let their Big Macs drip on the seats.
In addition to those concerns, rental vehicles tend to be the stripped-down base model or have few options. Car manufacturers add option packages as a great way to increase profit on things most car buyers want, but fleet buyers tend not to go for them. Avis only wants their Toyota Corollas to have automatic transmissions and orders the cheapest trim level to accommodate that. If you’re looking for a vehicle to get to work and back, rental companies have them. If you’re looking for a car with a manual transmission, 4G Wi-Fi, and semi-autonomous driving, you may have to spend some time searching.
Finally, while the low resale value helps you buy a lot of car for the money, it hurts when it’s your turn to sell. Potential buyers may try to low-ball you, and the perceived treatment of rental cars could give them one more argument to lower your price.
Tips on Buying a Used Rental Car
If you’re interested in buying a used rental car, Consumer Reports suggests starting with models with the most extended powertrain warranties, such as Hyundai and Kia. They also recommend choosing a vehicle with a high-reliability score, a clean vehicle history report, and the safety features you want.
Your best bet is to take the car to a trusted mechanic for a full inspection. Or take it to a dealership of the same brand and ask for an inspection they would perform if you were trading the vehicle in. You will pay around $100. But it’s a thorough inspection, and your peace of mind will be worth it.
Pull the vehicle history report. Like the inspection, it’s inexpensive and at worst it provides useful information. You may find an undisclosed repair on the report, which could help you negotiate a better price or extended warranty.
Check to see if the vehicle has any open recalls and whether the work has been performed. If not, it’s generally not a big deal as dealers fix recalled parts for free. However, the parts can be backordered in some situations, as in the massive Takata airbag recall, so be sure to research potential recalls on the model you’re looking at.
Last, make sure the vehicle has the safety features you want. Backup cameras have been standard equipment since 2018, but automatic emergency braking won’t be standard until 2022. If you want the latter, make sure to review the options list on the cars you’re interested in.
Buying a used rental car shouldn’t be any more stressful than buying any other car. If you’re willing to deal with a few more miles on the odometer, the stress-free buying experience and money savings could be worth it. Just be sure to do some thorough research before buying, and you’ll get a great deal on a used car with lots of miles left in it.