Buying a Used Rental Car

What are the difficulties in the car rental industry going to mean to the used car market?

As Hertz filed for bankruptcy in May of 2020 it sent shockwaves through both the rental car industry, and now the used car industry. While the bankruptcy is not settled, and there are still plans to rebuild, there is no doubt that the situation with Hertz Rent-a-Car has already had effects in both markets

If Hertz indeed is required to liquidate their fleet, estimates are that about 500,000 of their used cars would immediately flood the rental car market. Because the situation is not solely a Hertz situation, industry experts expect as many as 2 million cars from US rental fleets in the coming months.

In a given year, Americans buy nearly 40 million used cars. So adding a couple million wouldn't seem to be a tidal wave of change.

But rental cars are a specific segment of used cars, in that they are recent models in good repair and these are coming up for sale all at once.

If that all sounds like a negative, it is-- for the economy in general. But for the individual consumer or car buyer (or even car renter) it's a buyer's market.

Should you buy a used rental car? Conventional wisdom is generally in the negative. Rental cars in general are restricted to the lower trim levels, and are driven by people who drive them hard. And they often have higher miles than cars owned by individuals.

But whether you think rental cars in general are a good purchase or not, this is a particularly good situation for the car buyer. Hertz already offers no-haggle price, and reports are that many of the prices are already significantly lower then cars sold on sites like AutoTrader.

And rental cars in general are already cheaper than a comparable car elsewhere. So it's an improvement on an already good situation for the buyer.

Rental cars are maintained regularly, with strict service schedules to keep them running and on the road. This is obviously not the case with individual sellers. A car being sold by rental car company is like having service records back to when it was new.

Many rental car company also offer the ability to rent a prospective purchase at a discounted rate for a few days before deciding whether to buy as well.

As with any car, you should and can get a Carfax, or any kind of vehicle history report. But for the most part, being owned by a rental company is a good thing for a car.

A sudden unloading of such a large number of rental cars also means that there are multiple of the same cars being sold at the same time, giving you the ability to find the nicest of a particular model.

For example Hertz recently put more than 20 identical yellow 2019 Corvettes for sale. Aside from being steeply discounted, this also gives a prospective purchaser the ability to look at more than just one particular car to find the one that was the best taken care of.

On top of all this, rental car companies' desperation means that many of the cars being sold would not have been sold, under normal circumstances, for another year or more. So there are indeed cars currently being sold by rental car companies with far less wear then what you would normally find.

Whatever you think of buying used rental cars, the current situation makes it imperative for the smart buyer to at least investigate the used rental car purchase options.

Rental car companies generally maintain a good and current inventory online so it's very easy to look for what you're looking for

We all hope things will turn around for the economy and the rental car industry, but in the meantime, if you are looking for a car and you would consider a used rental car, now is a particularly good time to consider one.

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