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This Is Where Rental Cars Go When They’ve Retired

Reader's Digest logo Reader's Digest 3/26/2020 Madeline Wahl
a car parked in a parking lot © Valery Yurasov/Getty Images  

On the road again

If you've ever been on vacation in a new city or have gone on a trip for business, you've most likely had to go through the process of renting a car. Remember, once you've picked your rental car up from the lot, make sure you take detailed photos of your rental car to avoid being charged for any damages that were on the car prior to when you picked it up. After driving around town sight-seeing and doing what you need to do, it's time to return the car. Once you've relinquished the keys and gone back to your daily life, have you ever wondered what happens to rental cars when they're no longer being rented? Like other public outlets, this is why you should never charge your phone in a rental car.

What happens to retired rental cars? 

Normally, you return your car rental and then it is rented out again. But what happens if that's not the case? "Some rental cars are returned to the manufacturer because they were essentially leased to the rental car company," Thomas Lee, automotive analyst at iSeeCars, tells Reader's Digest. "Others, if they're too old or not in great shape, are sent to wholesale auctions or sold as salvage or for parts. Finally, rental cars in good working condition are sold directly to consumers." Along with wondering what happens to retired rental cars, this is what happens to all of the cars that never get sold at car dealerships.

Why buy a rental car?

a man talking on a cell phone © Ridofranz/Getty Images

If you're looking to make a budget-conscious investment, a rental car might be a good option. After all, the value of a new car depreciates at a much faster rate than buying a used car. "Rental cars sold directly to consumers tend to be well-maintained and the rental company keeps a history of the maintenance schedule," says Lee. "Rental cars also tend to have less physical damage because renters are responsible for any damage to the car. These cars tend to come from more recent model years, and their pricing may also be lower than other comparable used cars. Because the rental company is trying to refresh its fleet rather than make a profit, they may be more likely to offer a competitive price." This is the best time of the week to buy a car.

Research

It's best to do your own research on any car you buy, whether it be a rental, used, or brand new. "Be forewarned that some of them have not been updated for technical service bulletins or recalls, that is your responsibility," Lauren Fix, a sector analyst for automotive and trends for The Car Coach, tells Reader's Digest. "Also note that if they had been an accident you may not know that, it’s best to have these vehicles inspected by a local mechanic who will charge for that service. But you can get a good value."

Buying a car is a big decision and one that shouldn't be made lightly. "However, although the cars may be newer, they will likely have more mileage and wear and tear than other cars from the same model year," Lee adds. "The rental car for sale may have had many renters, which increases the total mileage, and some of those renters may be more aggressive drivers, which means rougher handling of the car." It's important to know as much about the rental car as possible before purchasing, Lee notes. Make sure you know that there are some cars you should—and shouldn't buy used.

Hertz, a major rental car company, even offers a Rent2Buy program. It "allows customers to rent one of our used rental cars for a three-day test rental at a low rental rate," according to its site. Selling cars is a win-win for both rental car companies and consumers, according to Avis. Selling cars allows Avis and other rental car companies to create space in their selection for newer models, and the "older" rental cars then become available to the public. "You get to take home a nearly new car; we get to rotate our fleet and offer rental customers a premium driving experience," Avis' website states. Make sure you know these 18 things rental car companies won't tell you.

What if a retired rental car isn't purchased?

There are a few other options for unloved rental cars, as mentioned above. Sometimes manufacturers give cars to rental car companies, called "program cars," with the underlying agreement that manufacturers will repurchase the cars, according to Slate. For rental cars that aren't in great shape, they're sold at wholesale auctions. The last option for rental cars that have retired in terrible shape is to be sold for parts. Next, make sure you know the ways you're wasting money on your car.



The post This Is Where Rental Cars Go When They’ve Retired appeared first on Reader's Digest.

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