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    Our Accurate Cars Blog is here to inform our customers about our Honda and Acura Used Car business and our Honda and Acura Car Repair business. This is where any visitor to the Accurate Blog can ask questions and respond to any Blog entry. Thank you for visiting and we look forward to hearing from you.
08
Nov

Short Supply of Good Quality Used Cars Under $15,000

Over 30 years,  I have worked in the car industry as a technician and specifically on the Honda and Acura brand, starting in Dec. 1991. In 2004, I also started selling used cars. Used car supply has never been lower. In any business; short supply and high demand always will result in inflated prices. Currently, finding a late model used car for under $15,000 is very difficult. So what has caused the ‘slump’ in available used cars in the retail used car market?

In the past 12 years; many events influenced the used car market. To name a few:

  • Really high fuel prices across the entire U.S. starting in  2005 , which began in the aftermath of  Hurricane Katrina. The price of a barrel of crude oil, on the world market was ‘through the roof’ and more importantly; the limited oil refineries in operation in the U.S. could not ‘keep up’ with fuel volume demand. Very high gas prices resulted and  many car manufacturers pushed back from their production numbers – particularly in the SUV, truck and van market. While fuel prices did finally stabilize around 2013; the used car market is a ‘pipeline’ and dramatic events can influence it for may years, based on year-to-year new vehicle production numbers.
  • GM and Chrysler going bankrupt in 2008 – These factories were dormant for several months and resulted in a drop in the average number of new vehicle units produced from earlier production years. Even after the U.S. tax payers ‘bailed out’ these 2 failed companies; their vehicle production numbers were lower for the next several years because of economic concerns – again involving the probability that the average consumer’s disposable income (if any)  would not be utilized  in a new car purchase.
  • Cash for Clunkers program – Which was absolutely stupid. No individual, family, or nation has ever become more wealthy by destroying something that could still be utilized for the purpose it was manufactured for.  Cash for clunkers used the U.S. taxpayer to incentivize low income buyers to purchase new cars – of which many of those new cars would be repossessed within 18 months of initial purchase. These repossessed cars would then be cycled into the used car market, which would result in dramatic new car depreciation.
  • Major weather events – Specifically flooding that resulted from hurricanes totaled-out millions of automobiles. People that lived in those areas had great financial loss. If their home was damaged and their car totaled out due to flooding; the average consumer would replace their destroyed car with a used car, not a brand new, expensive car.

The events listed above ‘pulled’ heavily on the used car market inventory. ‘Short supply’ and high demand results in inflated prices.

Used car prices go up, then new car prices go even higher.  Today, it is total insanity what the average consumer will pay for a ‘stinking’  new car! And how long they may be making payments on that new car – 72 months and even 84 months is not uncommon..

Accurate Automotive started selling Honda and Acura used cars in 2004. It became obvious that there was a dramatic price gap between ‘old junk’ and off lease / 2 to 3 years old.

Specifically, there were $2000 cars, then a major void of basically nothing, then $18,000 to $30,000 priced used cars. The price gap for Honda and Acura used cars, where the average consumer felt comfortable was in the $6000 to $15,000 price range.

It wasn’t that a used Honda or Acura couldn’t be found in the $6,000 to $15,000 price range. It was the appallingly poor condition of what the average used car, in that price range represented.

For this reason, Accurate Automotive ‘pulled back’ on off lease cars and started reconditioning Honda and Acura used cars, like no one else can or will do.

Today, our process of re-conditioning Honda and Acura used cars is very slow but extremely dedicated to quality and intricate details. Our reconditioning process starts with taking care of the mechanical needs and yes, Honda and Acura cars break down too. Then, we take care of the maintenance needs. Then, many times the Honda or Acura vehicle is disassembled (using Documentation from Honda’s Service Express website – which we have to pay an annual subscription to use) and painted with multi-stage PPG paints, in our own paint booth, with our own painter.

Following this blog post; there will be additional posts of Honda and Acura vehicles that are being reconditioned through the Accurate Automotive infrastructure. The photos below of this 2012 Honda Pilot Touring span 33 days for reconditioning.

 

 

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