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Frugal Shopper: Does It Make Sense To Buy A Used Rental Car?

By Bengt Halvorson
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11 4,550 views May 21, 2010

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If you're thinking about a late-model used car instead of a new one, the used cars on offer by major rental companies can be tempting. From a price standpoint, you're getting a nearly new vehicle that's been regularly checked over and maintained, for a bit less than a comparable used car would cost at the dealership.

But for a number of reasons, used rental cars aren't the great deals they used to be.

In the past, when few if any certified pre-owned (CPO) programs existed, it was your chance to get a late-model used car that had been properly maintained and, generally, taken good care of. Automakers were building as many vehicles as rental fleets could handle, and then some, and dumping them at a massive discount to renters. But recently, with automakers realizing that strategy isn't good business, and rental companies cutting costs, they're keeping vehicles in the fleet much longer and renting them out more frequently. Today it's not at all uncommon to see a rental car with 30,000 or even 40,000 miles, whereas a decade ago the vast majority of rentals had less than 15,000 miles.

"At this point, unless it's a really good deal, I wouldn't recommend it," says Charlie Vogelheim, executive editor of IntelliChoice. Vogelheim says that, anecdotally, when customers are in a vehicle that's not in as good condition, they're not going to treat it as well. And with many of today's rentals looking quite weary, it's a slippery slope.

Beware of title flags

Also of concern is the branded title flag that rental cars get in some states, which can knock thousands of dollars off the value if you plan to resell the vehicle within a year or two or make the vehicle tougher to sell over the long term. If you're going to keep a vehicle for a long time, rental cars are still a really good deal, according to Vogelheim, but you lose a lot of value right away.






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Comments (11)

  1. By autoking Posted: 5/21/2010 3:27pm PDT

    this is hugely helpful. still think there are some good deals to be had out there with the rental car companies. but what was once a pretty clear no brainer is now a bit questionable. will be curious to see if the cycle-of-life repeats itself in 2-3 years as OEs ramp up production and start selling more and more with the fleet buyers - then the rental car providers may start to look good again.
     
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  2. By autoviz Posted: 5/21/2010 3:32pm PDT

    I will keep away from used rental cars no matter what.
     
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  3. By Allan Posted: 5/21/2010 3:46pm PDT

    How many of you have bumped against a curb or gone off-roading in a rental car? 'Nuff said!
     
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  4. By BruceMCar Posted: 5/21/2010 4:23pm PDT

    Isn't 'drive it like you rented it' synonymous with 'drive it like you stole it?' Although flogging a PT Cruiser is a bit desperate.
     
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  5. By George Falcon Posted: 5/23/2010 2:01am PDT

    Interesting article with good points, but at the end of the day it is all a matter of demand and supply and these points should find their way into the buying price of these cars.
     
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  6. By Tonsure Posted: 5/23/2010 6:00am PDT

    Great and very useful article. Had no idea that some states have title flags, for instance. But I'd still just stay entirely away from any used rental car, 'cause I know how *I* drive them. Especially "in a hurry on unfamiliar roads" like you say. Hadn't thought about the Enterprise exception, though, that's worth chewing over. Thanks for posting this.
     
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  7. By  Marianne Posted: 5/24/2010 6:55am PDT

    Hi everyone. I work at Enterprise Car Sales and wanted to confirm that we do indeed certify all of our vehicles before we sell them. Each vehicle must pass a 109-point inspection by an ASE-Certified technician. We also offer a free CARFAX Vehicle History report on each vehicle. And, to be sure you are completely satisfied, we offer a 7-Day Repurchase Agreement which means you can return the vehicle within 7 days or 1000 miles and either pick out another vehicle or we'll take the original vehicle back minus a $200 cleaning and documentation fee. If you're in the market for a used car, please consider shopping us. We have over 140 locations nationwide. http://www.enterprisecarsales.com.
     
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  8. fb_100000755821115 avatar Mego Rider Posted: 5/24/2010 12:10pm PDT

    I just rented a car from Enterprise, and I was painstakingly careful to not ding or dent it. I think I treat rental cars better than my own!
     
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  9. bengt avatar Bengt Halvorson Posted: 5/28/2010 10:29am PDT

    Thanks, Marianne, for the ad. To other readers, I should caution not to shop for any vehicle (including rental cars or certified pre-owned (CPO) by the number of inspection points. 'Inspect tire tread' might be one point to one company but four points to another. In general, the inspections that rental cars get aren't always on the same caliber as the model-specific ones (some of them preemptively replacing wearables) that you'd get with certified pre-owned used-car (CPO) programs.
     
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  10. By Al Posted: 5/29/2010 8:11pm PDT

    10 years ago I bought a Certified Pre Owned Lexus LS400 with the "Lexus CPO warranty" with all the touted (and bogus) "inspections".
    While car looked perfect, it had severe drivetrain vibrations over 60mph and neither Lexus nor the dealer were interested. I had second and third inspections and each suggested that the vehicle had been severely rear-ended and the prop-shaft and diff were not aligned properly. It was obvious that the vehicle had not been inspected as described by the Lexus CPO program. I was considering suing the dealer and Lexus for misrepresenting the condition of the vehicle, but I traded it for a new vehicle.
    The CPO warranties are worth nothing. I'd rather by a cheaper new car than a CPO used car, and will never buy a used car again unless I personally know its history.
     
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  11. By Kevin Posted: 1/9/2011 12:00pm PST

    AH crud! I don't know what to do! I have a limited budget and really don't want to finance because of interest payments and depreciation on new car purchases. So, this column and comments posted here give me the chills. I need a newer car and I drive them into the dirt, so the next one I buy is for the long-term. UGH!
    I know. I'm a cheap skate! ;-D
     
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