Flood and Salvage Vehicles on the Road Again
• 2.5 million vehicles are totaled each year (Accident & Flood damage). "Consumer Reports"
• 1 in 15 cars on the road today have been rebuilt from the junk yard. "ABC News 20/20"
• Each year there are over 400,000 vehicles that are "Totaled", sold for salvage, and are now back on the road again.
• One third of the totaled vehicles on the road today will have no documentation to show that the vehicle was once declared as salvage.
One of the big concerns for used car buyers is the way the used car industry recycles vehicles that have been totaled back onto the used car lots. These once salvaged vehicles create a financial and safety risk for the general public.
CBS News' 60 Minutes estimates that 1 in 15 vehicles on the road today have been created from salvage.
There are many ways that salvage vehicles return to the road. Here is just one example.
A vehicle is declared a total loss by an insurance company, either by collision damage, fire, flood, theft recovery, etc. A total loss means the vehicle can not cost-effectively be repaired to mechanical and/or structural safety standards, and should be cannibalized for parts only. The title is then normally surrendered back to the State, and the State would issue a salvage certificate. The salvage wreck is then sold to a salvage yard or through a salvage auction.
However, unethical repair shops and dealers can buy these salvage vehicles. They will either try to repair these totaled vehicles or they will cut off or "Clip" the good sections off and reassemble these sections to create a another vehicle
Many of these salvage vehicles will only have the cosmetic parts fixed leaving structural components still damaged and not repaired. While these cars may look good with a fresh coat of paint, they are structurally and mechanically unsound and worth only a fraction of the book value. Once again, these repaired vehicles were declared "Totaled".
Today's cars are built using robots to make precise welds. These welds are made in a enclosed environment on perfectly formed metal to create a structural cage designed to protect the passengers. When a vehicle is in an accident, the structural components absorb the energy of an collision by crumpling and deforming the frame to protect the passenger compartment.
Once these repair shops have cosmetically repaired these salvaged vehicles (and get them to roll down the street in a straight line), they are ready to be sold in the used car market. But what about the title?
A car rebuilt from salvage should have the designation of "Recondition" or "Rebuilt" on its title. "Reconditioned" or "Rebuilt" means the vehicle was rebuilt from salvage. However, these titles can be "Washed" or "Cleaned" by simply transferring the title back and forth to another state which does not include "Recondition" or other discrepancies on their titles
Once these vehicles have a "Clean" title, it is easy to get them to the auctions or sell them directly to the public. These once salvage vehicles can end up at reputable dealerships. Also, there are many used car dealers, wholesalers, auctions, and curbstoners that will sell vehicles that have questionable histories. The incentive is profit. Dealers and individuals can make twice the profit on selling a used car rebuilt from salvage versus a normal used car in good condition. Ultimately, the general public will purchase, finance, and drive these vehicles not knowing that they once were totaled.
Recondition vehicles are not recommended for purchase. These cars may have chronic mechanical problems and there is no way to determine if the vehicle is structurally sound. In a minor collision, the car's frame is likely not to protect the passengers. Rebuilt wrecks are not subject to federal safety standards.
Totaled vehicles from flood damage may not have any structural problems. However, these cars will have chronic electrical, mechanical, and rust problems that will greatly decrease the value of the vehicle.
Before purchasing a used vehicle, you need to determine if the vehicle was ever in an accident or flood, the extent of the damage, and the quality of repairs. The only way to determine the vehicle's true condition is by a professional mechanical, electrical, and frame inspection.
The #1 reason vehicles with existing problems are purchased is the buyers' inability to determine the current condition before purchase.
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