In the wake of the coronavirus, many companies have begun to struggle financially, and with people not driving nearly as much or even searching for new or rental vehicles the same way, the auto industry has taken a hit. Hertz recently announced that it is filing for bankruptcy.
“Rental car companies do about two-thirds of their business at airport locations, and as you probably know, air travel is down, way down. So far this year it’s down about 94 percent,” said FGCU economist Victor Claar.
While that may mean trouble for the company, it also means good deals for consumers. “It varies a little bit from company to company, but a typical car rental business will only keep a model around for two or three years and then sell it into the used car market. So for many of those cars, we’re coming close to that point anyway, things just accelerated that,” Claar said.
What happens when anyone has too many things and not enough money? They sell. “Rental car companies don’t have a lot of cash flow right now and they’re doing what you and I do when we’re short on cash: They’re selling things they currently have in order to make a little bit of cash to pay the bills,” Claar said.
Claar wants consumers to think of a yard sale, but on vehicles. “If you want to move the stuff at your garage sale on a Saturday morning, you price it to sell, and in fact, the later in the day it gets on that Saturday, the quicker you are to lower prices and I think Hertz just might be a little more motivated.”
Needless to say, it’s the perfect time for consumers, especially those who traditionally might not be able to afford a new car, to start shopping. “It’s gonna be a great time for used car buyers because there’s gonna be a flood of cars that move into the market,” Claar said.
But if you’re not someone who knows a whole lot about cars, what do you look for in a used one?
Pam Oakes, fourth-generation mechanic and used car expert, said, “I recommend that everyone, everyone, have their vehicles checked out by an ASC Blue Seal shop before purchase.”
Oakes wants consumers to understand that what you see isn’t always what you get with used cars. “They need to be cautious because although it may look pretty on the outside, you don’t know what’s going on underneath the hood,” she said.
Let a professional check out your potential car because they may notice something you wouldn’t. Oakes reminds people that “it’s really good to have a professional set of eyes take a look at the vehicle because remember, this is an investment.”
That last part might be the most important lesson here. Cars are an investment, so Oakes said it’s perfectly fine to take your time and really look into what it is you’re about to purchase. “Go to the grocery store, go to the interstate for a hundred miles or so, see how you fit in the vehicle because you’re going to have it for a while. The purchase isn’t meant to be taken lightly,” she said.
The Hertz location in Bonita Springs has about 1,100 cars listed for sale currently or through their Hertz Rent2Buy Program. There are plenty of offers on the Hertz website as well.