Flood damaged cars to hit the second hand market
After the massive rains and flooding in southern China earlier this month and in April, it is expected that thousands of flood damaged cars are about to hit the second hand market.
China’s second hand car market is still very much in its infancy and has not yet learned to crawl, walk, or even make odd sounds. There are no Chinese Parkers Guides to dictate second hand values, which generally means that second hand residuals remain on par with new car pricing.
Dongying City in the center of Guangdong province has over 5000 cars that were affected by flood waters, and with owners ready to sell them on or trade them for new cars, the automotive market is about to be flooded with flooded cars.
Dongying second hand car companies are not eager to take on the water damaged cars, claiming that once a car has been through a flood, then it has hard to sell them on without substantial discounts. Online media and other media are advocating that owners wait a while before selling their cars or trading them in to gain better prices.
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Flood damaged cars may be reconditioned and moved to other provinces where they will be sold to unsuspecting buyers. China’s industry is also not sophisticated enough yet to provide consumers with car history reports that would help them avoid this skam. Many will get burnt in the meantime.
Flood-damaged cars are difficult to sell for a reason. Buyer beware!