When used car shopping, it’s all about paying less. If you didn’t care about the amount of car you were getting for the money, you’d likely head to a new-car dealership.
Another way to lower the expense of buying a used car is to consider purchasing a retired rental car. These one-time rentals are regular additions to a used car dealership’s inventory, as rental car companies often sell them in bulk, saving them a lot on upfront inventory costs.
But not every used rental car is the same. Below, we’ll cover the pros and cons of buying a used rental car for sale and some red flags to look out for.
Pros of Buying Used Rental Cars for Sale
Your grandfather or dad might cringe at the thought of used rental cars for sale due to the negative stigma attached to them, but some buyers today see them as a viable route to getting a cheaper used vehicle. Let’s review some distinct advantages of buying used cars.
Bulk Savings Passed to You
When rental car companies offer their used inventory for sale, used car dealerships often have the opportunity to buy them in bulk. Buying a large number of used rental cars for sale at once will generally save the used car dealership a lot of money, which they can pass to you, the buyer.
Above-Average Condition
Another advantage to buying a used rental car is that they’re generally well-maintained. These cars are the lifeblood of rental car companies, so it’s in their best interest to stay on the recommended maintenance schedule to keep them on the road. If mechanical issues crop up, they fix them the right way to ensure they don’t break down again.
However, there is a caveat to this. If you’re buying from Joe’s Rent-A-Buggy down on the corner, you may run into some shady repairs and lacking maintenance. But if you're dealing with a large franchise, like Hertz, Enterprise, or Avis, you can rest assured they have strict guidelines for maintaining and repairing their inventory. There’s also generally copious documentation outlining its repair and maintenance history.
Plus, before a used car dealership purchases a used rental car for sale, they’ll inspect them to ensure they’re acceptable to offer to their buyers.
For example, Clutch buys used rental cars for sale. We run them through a rigorous 210-point inspection and search for any undisclosed damage. If our inspection turns up any issues that are beyond normal wear and tear, we simply won’t purchase the vehicle.
Massive Selection
Car rental companies tend to purchase a large number of common vehicles to ensure they have plenty of inventory for rental customers. These high stock levels trickle down to their sales departments, giving buyers more cars to choose from.
For example, if you're seeking a minivan in a specific colour or with a certain feature, there's a good chance there's a used rental car for sale that meets your needs.
Also, rental companies stock vehicles from all the major automakers, so whether you want a Hyundai, Nissan, Kia, Mazda, Chevrolet, or BMW, so it allows Clutch and other used car dealerships to offer buyers a wide range of vehicle options.
The Most Popular Trim Levels
Rental car companies buy their vehicles in bulk, meaning they have multiples of each vehicle. When Clutch purchases used rental cars for sale, we target mid-level trim vehicles that offer the most popular features and options customers want. This increases the vehicle’s long-term value and ensures you’re satisfied with your purchase for the long haul.
Reduced Depreciation
When you buy a new vehicle, it loses significant value in its first 1-2 years on the road. According to the Canadian Black Book, most cars depreciate by 30-40% in the first year.
When Clutch purchases a used rental car for sale, it’s no more than 1-2 years old and has under 50,000 km, meaning the vehicle has already taken its biggest dip in value before you buy it. This slower depreciation will continue through all your years of ownership, reducing the loss you take if you choose to sell it a few years down the road.
Cons of Buying Used Rental Cars for Sale
There are plenty of reasons to consider used rental cars for sale. However, there are also some legitimate concerns to keep in mind. Here’s a quick rundown of what those are.
Driving History
One great thing about buying a used car from a private party or dealership is you can pull a Carfax report and say with some certainty that the owners on the report did most of the driving. With a used rental car, that's not the case. There could have been hundreds of people who drove that vehicle.
Most of these drivers will treat a rental car with the same respect they do their own vehicles. However, some drivers see a rental car as an opportunity to drive aggressively, potentially causing excessive wear on the engine, transmission, suspension, brakes, and other components. To make matters worse, this added stress may not start causing issues until long after the limited warranty runs out.
Limited Features
Except for specialty rental cars, most rental companies fill their fleets with midrange trim levels. While these vehicles include many of the popular features buyers want, they may lack some of the more upscale niceties like a sunroof, leather interior, or premium audio system.
Forever Branded a Rental Car
If you buy a rental car, Carfax will always include that it was once registered as a rental car — even years later. If you decide to sell the vehicle at some point, this could turn off some buyers.
Tips for Buying a Rental Car: What To Look Out For
Think a rental car may be a good option for your next used car? Before you dive into buying a used rental car, here are a few red flags to keep an eye out for when shopping.
Higher-Than-Average Kilometres
According to Natural Resources Canada, the average Canadian driver puts about 15,200 kilometres on their vehicle per year. Rental vehicles tend to get loaded up with mileage quickly, so look out for rental cars with double or even triple the average kilometres per year.
High kilometres can impact the vehicle's value as it ages and accumulates more kilometers. This may also mean it saw significant use as a rental car, potentially leading to even more wear and tear. At Clutch, we only purchase used rental cars with less than 50,000 km, so you can feel secure knowing it was driven within a reasonable range.
Mismatched Tires
A used vehicle with mismatched tire brands is nothing alarming — this often happens when one tire has an issue and the owner can't match the exact brand. However, if there is a severe mismatch, this is a sign of shoddy maintenance or someone trying to get the cheapest new tire possible.
A severe mismatch would be if the vehicle has three all-season tires and one winter tire or one tire with a different size than the rest. Also, be on the lookout for one tire with nearly full tread paired with three nearly worn-out tires. These red flags require a more in-depth look into the vehicle's maintenance history for additional red flags.
Telltale Signs It Was a Rental Car
When a company puts its used rental cars for sale, it should recondition them, leaving no evidence it was ever a rental.
This reconditioning includes removing any logos tying it back to the rental company and the various warning and “no smoking” stickers inside. When they remove these stickers, there should be no remaining residue or evidence the stickers were there.
If the stickers or logos are still present or the residue shows, ask if the dealership can remove them before completing your purchase. If the dealer can’t remove them, this could severely impact the car’s future value.
Excessive Interior Wear
Another place rental cars see a lot of wear is in the cabin. Inspect all the key touch points — the seats, steering wheel, dashboard, door handles, gear shifter, etc. — for signs of excessive wear that may impact its long-terms value.
It’s also a good idea to check that all the components function correctly, including seat adjusters, glove box door, seatbelts, horn, and more.
Other Wear and Tear
When considering a used rental car, remember that it's not just the mechanical bits that endure a lot of wear and tear. Renters repeatedly poke, prod, and twist the radio, climate control, hood release, and other buttons and knobs, potentially leading to premature wear.
During the test drive, make sure to turn, press, and pull every knob, button, and lever in the vehicle to ensure everything works as expected. If you find something's not working, ask the salesperson if the company will fix the issue or reduce the price to compensate. If not, you'll want to look into a different used rental car.
Undisclosed Damage and Flaws
Some rental companies may fail to disclose all the damage on a used rental car for sale if they performed repairs in-house. When viewing the vehicle, keep a keen eye out for undisclosed damage.
Some commonly overlook damages and flaws include:
- Cracked or chipped headlight and taillight lenses
- Resting water inside headlight and taillight assemblies
- Rocker panel rust or damage
- Missing under-car skid plates and covers
- Fine scratches and dents
- Hidden frame damage
- Slightly mismatched paint
Fluids
As with any used car, always check a used rental car's fluids before buying it. They should be within the specified range and clean. If the fluids are severely dirty or low, this could be a sign of shoddy maintenance.
Get an Inspection
Before deciding to buy a used rental car, take it to an ASE-certified mechanic for a full inspection.
A mechanic can put the vehicle on a lift and check the undercarriage for evidence of abuse or excessive wear. They can also analyze other components to determine what maintenance it may need soon or if significant repairs are imminent.
If a mechanic gives the vehicle a clean bill of health, this isn't a guarantee it'll be free of issues, but it offers some security.
Skip the Used Rental Car Roulette With Clutch
For a great deal on a quality used car without the stressful used car dealership buying experience, head to Clutch, Canada's first online car-buying experience.
At Clutch, we not only have a wide range of high-quality used cars, but we remove the pressure by letting you complete the shopping and buying process from home. We also offer a no-risk money-back guarantee that entitles you to a full refund if you don't love your Clutch vehicle in the first seven days.
All our preowned vehicles go through a 210-point inspection to ensure they're top notch and have no undisclosed damage, and online purchases include a 90-day or 6,000-km warranty. If you need financing, we can help there too. Just fill out our online financing application for quick approval.
Got a vehicle to trade in? Clutch can help you there as well. With our online trade estimator, you’ll get an instant estimate for your vehicle. After receiving your offer, you'll then submit several pictures of your car, and we'll send you an official offer.
