The used car market comprises the vast majority of automobile sales each year.
Used car sales account for the majority of auto sales in the United States. According to the Bureau of Transportation Statistics, there were more than 41,000 used cars sold in the United States in 2007, as compared to just over 17,000 new car sales and leases.
As the used car market is competitive and aggressive, those seeking to sell their cars should research the best way to market the car, how to prepare the car for sale, and how to price the car.
Cars lose value over time because of wear and age. To determine the value of a car, prospective sellers should consult classified ads and dealers to determine the average price of the same or similar cars. While prospective sellers can research value themselves, there are also publications that collect information on average sale prices and provide estimates for how specific makes and models decline in price with age.
Kelly Blue Book maintains an extensive database of cars and their values over time, with notes on pricing and depreciation. Another popular source for pricing information is the NADA Guides, a series of publications based on market research, information from dealers, and repair history.
While publications like Kelly Blue Book and the NADA Guides provide a helpful price reference, the actual price of any used car will also depend on a number of other factors, such as after-market modifications to the vehicle, previous repairs, and accident history.
A reliable way to determine the value of a car is to take the vehicle to several used car dealers and ask them what they would pay for a direct sale. After determining a price range for the vehicle, the seller should set the price for the car slightly above the acceptable price and then lower the price as needed if there are no immediate offers.
A seller can substantially increase his or her profit from selling a used car by thoroughly cleaning the vehicle and fixing minor cosmetic problems that detract from the cars attractiveness. In some cases, investing $100 $200 in minor cosmetic repair can add several hundred dollars to the resale value of the car.
Experts recommend that owners clean and polish their car before advertising it for sale. Small chips in the paint can be touched up by hand and wax can also be applied manually to increase sales success. For owners who do not have the time to clean and repair their car for sale, there are body shops and other businesses that offer touch up services for a fee.
According to Consumer Reports, sellers should also attempt to clean the car's engine before selling it. Many buyers will want to inspect the engine and a clean engine helps to signify that the car has been well cared for.
Before placing an advertisement, the seller should collect information about the car, such as the model, year of manufacture, mileage, and repair history and keep it in a convenient location. When prospective buyers call or e-mail about the vehicle, it is helpful to be able to answer questions quickly and thoroughly.
The seller should also be aware of the local state laws regarding selling automobiles and transferring ownership. Depending on state regulations, the seller may need to provide a title, history of property tax payments, and other information before the sale is considered legitimate. If the seller is uncertain of state laws regarding vehicle sales, he or she can contact the state Department of Motor Vehicles.
There are third-party companies, like CARFAX Inc., that offer information on the history of a vehicle, including accident and repair history. Anytime a car is repaired or serviced, its Vehicle Identification Number (VIN) is recorded by the repair shop or dealer. These records, which include scheduled maintenance such as oil changes, make up a CARFAX report. Potential buyers may want to use an organization like CARFAX to investigate the history of a vehicle before deciding to complete the purchase. Sellers can obtain their own CARFAX report to show potential buyers when advertising their car, thereby increasing the marketability of the vehicle.
There are a variety of online services for those wishing to sell a used car. Online classified ads, like those offered by Craigslist.org, have become one of the most popular ways to buy and sell cars. There are also a variety of online vendors specializing in used car sales, like Autotrader.com. Online vendors allow sellers to advertise to potential buyers in their areas. Many online classified services are free, and some only collect payment if the seller manages to sell the vehicle.
For sellers who only wish to deal with buyers in the same area, using a local newspaper or other publication can be an effective way to market a used car. Advertisements in newspapers are often free and some include classified advertisements on companion websites. To increase success in selling the vehicle, the seller may also want to mount a sign in one of the cars windows advertising that the car is for sale and provide a phone number for potential buyers.