The Used Car Dealer
With annual sales of nearly $370 billion, the used automobile industry represents almost half of the U.S. auto retail market and is the largest retail segment of the economy. In 2005, about 44 million used cars were sold in the U.S., which is more than double that of the nearly 17 million new cars sold.
A used car, also known as a pre-owned vehicle and second hand car, is a vehicle that has previously had one or more owners. Used cars are sold through a variety of outlets, which include franchise and independent dealers, rental car companies, leasing companies, used car superstores and auctions. Some car retailers offer "no-haggle prices," and "certified" used cars as well as extended service plans or warranties. Individuals can also sell and purchase used cars through resources, such as newspaper and online classifieds.
Profit margins can be higher on used vehicles because they are somewhat less of a commodity.
The Federal Trade Commission's Used Car Rule requires dealers to post a Buyers Guide on every used car they offer for sale. The FTC's Used Car Rule gives consumers critical information about who will pay for repairs when something goes wrong, and that's key to avoiding consumer confusion and dissatisfaction.
You must post a Buyers Guide before you "offer" a used vehicle for sale. A vehicle is offered for sale when you display it for sale or let a customer inspect it for the purpose of buying it, even if the car is not fully prepared for delivery. This requirement also applies to used vehicles for sale on your lot through consignment, power of attorney or other agreement. At public auctions, dealers and the auction company must comply. The rule does not apply at auctions that are closed to consumers.
If you conduct a used car transaction in Spanish, you must post a Spanish language Buyers Guide on the vehicle before you display or offer it for sale.
The Buyers Guide must be posted prominently and conspicuously on or in a vehicle when a car is available for sale. This means it must be in plain view and both sides must be visible. You can hang the Guide from the rear-view mirror inside the car or on a side-view mirror outside the car. You also can place it under a windshield wiper. The Guide also can be attached to a side window. A Guide in a glove compartment, trunk or under the seat is not conspicuous because it is not in plain sight.
You may remove the Guide for a test drive, but you must replace it as soon as the test drive is over.
The Buyers Guide becomes a part of the sales contract and must tell:
- Whether the vehicle is being sold "as is" or with a warranty.
- What percentage of the repair costs a dealer will pay under the warranty.
- That spoken promises are difficult to enforce.
- To get all promises in writing.
- To keep the Buyers Guide for reference after the sale.
- The major mechanical and electrical systems on the car, including some of the major problems you should look out for.
- To ask to have the car inspected by an independent mechanic before you buy