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Home Buy And Sell CAR

Is It a Bad Sign If a Used Car Was Sold at Auction?

by Jamie Schmidt
August 23, 2022
in Buy And Sell CAR
0

As Jalopnik’s resident car buying expert and professional car shopper, I get emails. Lots of emails. I’ve decided to pick a few questions and try to help out. This week, we discuss used cars that were sold at an auction, price changes based on credit score, and the dilemma between a generous buyback or keeping the car you love. This is one of those common misconceptions that persist. Just because a car was sold at an auction does not mean it is problematic. In fact, the vast majority of used cars move through auctions at least once.

Is It a Bad Sign If a Used Car Was Sold at Auction? 1

There are several reasons why a dealer would have a car then send it to the auctions. Often, dealers will send out inexpensive cars to auctions rather than take up space on their lot that could have been occupied with a more attractive sale. Sometimes, good cars sit for a while, and rather than continue to pay for that car to be in the inventory, dealers will take their chances with an auction sale. Local markets and vehicle popularity have a lot to do with which cars will sell fast and which cars may move through the auction channels. In fact, many of your manufacturer-certified pre-owned cars have been sold at auction at some point in time.

I would not stress about a car being sold at auction once. That being said, if you see a car with several auction sales, that could be a red flag. I was recently shopping for a used M3, and there was a car in the Maryland area being sold at an independent used car lot that did not seem to be the most legit operation.

On the CarFax that M3 was taken in by two of the local BMW dealers then almost immediately tossed to the auctions and had three auction sales on the history. A well-sorted E92 M3 is a desirable car, but one that beat on will have a hard time finding the right buyer. Reading between the lines seemed like both BMW dealers found something troubling about the car and decided to cut it loose.

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