Should You Buy a Program Car at the Auto Dealer Auction?

By Mike Richards Posted: 09/18/2017

If you’ve never seen a “program car” listed an an auto dealer auction before, you may have no idea what that means the first time you come across one. Program car is the FTC’s name for a rental car, and more and more of these are hitting auto dealer auctions all the time. Buying rental cars can be tricky, but at the end of the day, they are really just like any other used vehicle that has had a lot of owners. Here are a few slight differences.

Cosmetically Better

Rental cars are usually in better shape cosmetically, because the rental company wanted to be able to rent it out when they had it. Even if the car has a lot of miles and gets awful gas mileage, it will likely still look pretty nice on the inside. Rental companies only tend to keep vehicles in service for about 18 months, so the clean interior isn’t much of a surprise. However, be aware of tricky methods that rental companies use to cover damage, like new floor mats covering burns or water damage.

Accident Records

Rental cars should definitely be checked out before you buy one from an auto dealer auction. The accident report may not be from the same services you are used to using, however. Rental companies carry the insurance on the car, not the driver, so if no damage was ever reported by the company to the insurance, it may not even be listed. It’s best to have rental cars inspected by a mechanic if you can.

Forget the Incentives

Rental car companies have a lot of motivation to sell at auto dealer auctions. They have a whole new fleet coming in every 18 months, and that means a lot of scrambling to retire high-mileage vehicles. They often add on extras like a powertrain warranty, a year of AAA, or a free vehicle history report. But keep in mind that these extras don’t mean much for you if the car is a lemon, and the company may be trying to sneak a higher price by you with all of the extras. For example, many retired rental cars are listed nearly $2,000 above the Blue Book value of the same car in the same condition, and only a bare $500 below the price for a brand new model of the same car. You may as well get the new one and get even better add-ons.

Are Program Cars Worth It?

Just like any other car at an auto dealer auction, program cars or rental cars can be worth it – or not. You have to know the value of the car in its current condition and judge for yourself whether or not the vehicle is a good deal. If nothing else, you know that buying a rental car from an online auto dealer auction means that it will look great inside.