And the major auction companies provide prospective bidders with detailed information about their offerings. It is legal to sell a vehicle with a “salvage” or “junk” title - as long as the damage is disclosed. The 2020 collapse of the rental car market during the early part of the pandemic, major production issues in the new automobile arena and droves of buyers flush with stimulus checks turned the used car economy upside down, leading to inventory shortages that sent prices soaring.Īlthough the business has stabilized in recent months - prices started to drop around last fall - a deluge of formerly flooded autos could be a welcome occurrence for dealers who endured scant inventory in recent years. Used car prices soared during the first two-plus years of the COVID-19 pandemic, as a once-in-a-generation set of circumstances turbocharged the business. The introduction of thousands of additional vehicles into California’s used car marketplace would be yet another twist during a strange stretch for the industry. “To be perfectly honest with you,” he said, “I don’t buy flood vehicles.” A twist for the used car market He’s president of salvage-parts data software company BidCall, which is headquartered in Seguin, Texas, and he also deals used parts. There’s also competition from bidders with overseas interests who will often pay more than he’s willing to bid. “I’ll buy a few, I’m sure - but I stay away from a lot,” he said, explaining that it can be difficult to tell the extent of damage before bidding. But he does not plan to be a major bidder. Potiker is one such businessman, and he expects to see the flooded cars popping up at auctions in about a month. And others will be bought by dismantling operations that will strip the vehicles for parts and resell their usable remnants. There are those that will be purchased by private-party buyers, who are able to bid at certain auctions. Some will be purchased by dealers who will recondition them and sell them as used cars. Many cars will be acquired at auction by entrepreneurs and shipped overseas, where they could be resold. “Cosmetically these cars might look great, but if you don’t know what to look for, it’s nearly impossible to tell they are literally rotting from the inside out.”īefore the hurricane, Carfax estimated that in 2022 there were about 400,000 vehicles on the road with flood damage in their history, Voss said in a statement to The Times.Īn eclectic group of buyers are likely to compete for vehicles damaged in California’s January storms. “We are seeing these flooded cars show up all around the country, putting unsuspecting buyers at risk,” Emilie Voss, a spokeswoman for Carfax, said in a statement in October. The company also estimated that flooding brought on by the hurricane may have damaged as many as 358,000 vehicles. “And there’s the vehicle physically deteriorating over time.”įollowing Hurricane Ian’s devastating assault on Florida and neighboring states in September, Carfax, the vehicle data firm, warned consumers of the risks of buying used cars with water damage. Technology systems prevent you from getting into an accident, and now you are in more danger,” he said. “Number one, your electrical system: you’ve got so much electronics on a car, now more so than ever. And that matters, because cars that have suffered water damage could be perilously unsafe, both physically and technologically, even if they don’t look that way, said Drury, director of insights for Edmunds. Then, a large number will be unloaded at auctions conducted by companies such as Copart and Insurance Auto Auctions, based in Dallas and Westchester, Ill., respectively.Ī host of bidders will compete for the drowned derelicts - some of whom may have less than honest intentions for the reselling of the rides. These cars will be retitled via the California Department of Motor Vehicles with “salvage,” or “junk” designations, which alert consumers to their past damage or other issues. Many flooded vehicles will be totaled by insurance companies - this is generally done when the cost of the necessary repair work is equal to or more than the value of the vehicle.
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