How to Buy a Used Car

Presented by Hanjing Tian

Sponsored by CSSA, Lehigh

•11/19/2004

Objectives

• Introduce the basic knowledge of car and American automobile industry.

• Teach you how to buy a used car in 6 steps

• Clarify two popular misunderstandings on Janpanese car

There is no safety car, but safety driver

Safety features:

ABS (anti-lock braking) system, front airbag and side airbag, 4-wheel disc brake, brake-assistant, alloy wheel, traction control, stability control, All-wheel drive

Vehicle Manufacturers Charts

http://www.autoindustry.co.uk/Source: OICA.net

Who Owns Who?

Companies or Manufacturers Brands

GM

Cadillac, Buick, Chevrolet, GMC, Hummer, Pontiac

Saturn, Hyundai, Kia, Isuzu, Subaru, Suzuki, Saab

Ford Lincoln, Ford, Mercury, Mazda, Volvo, Jaguar

Daimler-Chrysler Mercedes-Benz, Chrysler, Dodge, Jeep

TOYOTA LEXUS,TOYOTA,SCION

Honda ACURA,HONDA

Renault Infinite, Nissan

Volkswagen Audi, Volkswagen

Modern Auto industry is Highly Inter-cooperated

•98% total parts of TOYOTA CAMRY were made in American, while only 65% total parts of Chrysler PT Cruiser were made in American.

•Ford focus shares the same platform with Volvo S40 and new Saab 9-2 share the same platform with Subaru impreza

•The platform of TOYOTA CAMRY were used in Highlander and LEXUS IS300, while the platform of HONDA CIVIC were used in CRV

•The same car was labeled as different company and under different brand Ford Taurus = Mercury sable Chevelot Prizm = Toyota corolla (before 1997)

Ford escort = Mazda protégé (before 2002)Chevelot cavalier = Pontiac sunfirePontiac vibe = Toyota matrix

The Structure of Modern Car

Internal-Combustion Engine(the heart of a car)

Displacement: 1.7L-2.5L 2.7L-4.3L (for V6)Stability:MPG:Price:Comfort ability:

Subaru Porsche

Biggerbetter

Automatic Transmission System(the kneel of a car)

If anything is wrong here, please prepare at least $1000.00

Brakes and tires(the foot of a car)

This is only part which can KILL you, so take care!!!! Check the brake thickness and tire pressure FRENQUENTLY.

ABS system can stop your car under bad weather condition.

All-season tires are MUST in the winter of Lehigh valley.

Other Important Function Systems

Chassis and suspension: the bone of a car

FWD, RWD, AWD, 4X4

Fuel system: the food and digestion of a car, oil tank, fuel pump, exhaust converter and muffler

Electric system: the brain of a car system-controlling computer, generator, battery, lights and electric wires and parts

Cooling system: the skin of a car radiators, A/C, fan

Air system: the lung of a car air filter, air pump (turbo engine only)

Classes of car: Shape

1. Passenger car

2. SUV

such as Pontiac vibe/Ford escape/ Toyota RAV4/Honda CRV

3. Minivan

such as Chrysler town & country, Toyota sienna and Honda odyssey

compact midsize full sizeGM cavalier/sunfire malibu/centry impalaFORD escort/focus taurus/sable crown victoriaTOYOTA corrola camry avalonHonda civic accord xNissan sentra altima maxima

Three Approaches to Buy Your First Car

• Cheap guy: <$2000 for one-two years

To study driving and repairing ability, worry about the car-stalked, junk this car and buy a new car later

• Middle way: $3000-6000 for three-five years

Still need to study repairing ability, worry a little about car-stalked, sell this car cheaply and buy a new car after graduation

• Enjoying life: $8000-11000 for four-five years

(Hyundai Accent or Elantra, Chevy Aveo) Under-warranty and worry-free, sell this car after graduation at

about $4000-5000

The Advantage of Buying a Used Car

• For newcomer, limited budget and poor credit record make it nearly impossible to afford a new car.

• The supply of used cars has increased due to heavy incentives and the number of two and three-year-old lease cars available in recent years.

Disadvantages of Used Cars

• Some used cars have serious hidden defects with limited or no warranty coverage

• It is sometimes difficult to determine whether the car was maintained properly by its previous owner

• The used car may not have all the desirable safety or technical features of a new car

• the selection of models, equipment, and colors may be limited

Step 1: Do your homework as much as possible

• How much can you afford? • What type of vehicle do you want? Sedan, wagon, SUV and minivan

• When will you buy?• Questions and negotiations: newcomers are not good at speak car-

related term in English

Step 2. Where to get car-buying information

• Website:

www.lehigh.edu/for sales www.cars.com, www.edmunds.com

• Paper media Morning call and other local papers

Free brochure in most food market, such as wawa, Giant

• Private sales: graduate students and staffs

• Dealers and rental car companies

Step 3. Pricing a Used Car from

www.kbb.com • Kelley Blue Book Private Party Value

The value of a used vehicle in a transaction between two consumers.

• Kelley Blue Book Trade-In Value

The value you may expect to be offered by a dealer when trading in your own used vehicle.

Step 4. Understanding car history

• Where is VIN: (vehicle identification number)

It is commonly under the windshield of driver’s side “1” for U.S. “2” for Canada, “3” for Mexico, “J” for Japan

• Checking the car history from www.carfax.com, (free in dealer’s shop)

• Production company, place and date• Owners sequence and deal time• Collision and flooding information

It just tell you what has happened, but can not tell you what has not happened

Step 5. Mechanical check

• From car-repairing shop: $50.00 each

good boys: Strauss, AutoZone

bad boys: Pepboys, Firestone

• Asking your friends to help you

Respect their opinions and Do not complain later

• Buying the car under warranties from dealers or manufacturers.

Step 6. Transfer Legal Documents and Car Insurance

AAA East Bethlehem office 1520 Stefko Blvd,Bethlehem, PA 18017 Tel: 610-867-7502 Office closed in Saturday afternoon and Sunday

Purchasing car insurance Car insurance is based on the owner, not car, so take care of your

PERSONAL car.

Title and license plate transfer process

Tax payment

Join AAA Free roadside assistance, free map and guidebook

Most Japanese Cars get high score in crash test, but not in real world accident

www.iihs.org

Higher Resale Values or Lower Original Price

2002 2000 1998 1996 1994 1992 19900.0

0.2

0.4

0.6

0.8

1.0

Ford Taurus

Toyota camry

all data from cars.com

depr

icat

ion

rate

year

2002 2000 1998 1996 1994 1992 1990 1988 19860

2000

4000

6000

8000

10000

12000

14000

16000

TOYOTA CAMRYoutdoor price $183002.4L I4

Ford Taurusoutdoor Price: $172003.0LV6

Ab

solu

te d

epri

cati

on

val

ue

(U.S

.Do

llar)

Year

Toyota Camry has almost same deprecation rate as Ford Taurus in first 6 years.Toyota Camry cost you more in first 10 years than Ford Taurus.

Conclusion

• Modern car is very complex and sophisticated industrial product

• CSSA recommend any safety features which you can afford

• CSSA recommend your fair-eyes on Japanese car and American car.

• Car-buying process is difficult and boring, but you’ll definitely enjoy your results