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Gray
Market Cars
From
the late '70s to the early '90s, a good many people
imported BMWs and Mercedes directly from Germany. Because
of the exchange rate, you could get these cars from
over there cheaper than you could in the US. Unfortunately,
these gray market cars, as they were dubbed, didn't
have the type of bumpers we have here, so they weren't
as safe. They also didn't have the same type of parts
that are universally used. As a result, it was a harder
to get replacement parts for these cars.
Consequently,
these gray market cars brought a whole lot less in re-sale
value than cars sold through dealerships in the US.
Everything you'd save on the front end you'd lose on
the back end. In fact, you'd probably lose more percentage-wise
on gray market cars than on the same makes and models
bought from dealerships in America.
This
trend has now started again. Most dealers are not getting
involved, because they realize what mistakes were made
in the past. However, a few brokers and so-called car
or automobile "advisors" have been going to
Canada to buy Jeep, Chrysler, some Ford, and some Chevrolet
products and bring them to the US for re-sale. These
people are able to make more money on these cars than
what they would normally make if they sold cars for
dealers here, plus show the customer some savings as
well.
However,
to bring these cars into the country, the odometers
must be replaced. When you replace an odometer, the
last number is a different color than the rest of the
numbers in the secondary odometer. When a dealer sees
this, he realizes that the odometer has been replaced
and, consequently, labels that vehicle as an "unknown
mileage vehicle." Even if you have a statement
verifying low original mileage, the vehicle is still
labeled as an unknown mileage vehicle. Such cars bring
in way, way less money when you go to trade them than
do vehicles that have true mileage.
Gray
market cars haven't been good in the past; they won't
be good in the future. Beware of what you buy. You may
lose a lot more in the end.
Do
you have a topic you'd like to see covered in this column?
How about a question you'd like to have answered here?
Simply email it to me at mail@FrankPriceCompany.com
and look for it to appear in an upcoming column!
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