In the realm of purchasing pre-owned cars, potential buyers should be cautious as the current high demand has paved the way for sellers offering rebuilt vehicles without disclosing their full history, according to experts in the automotive industry.
Rebuilt vehicles are those that have undergone reconstruction following severe damage from incidents like collisions, hailstorms, or floods. Stuart Klein, vice president of collision programs at the Automotive Industries Association of Canada, explained that these vehicles were previously considered total losses by insurance companies due to the repair costs exceeding the vehicle’s pre-damaged value.
After being declared a write-off, a vehicle may end up being sold to salvage yards for parts or auctioned off to individuals who repair and resell them. While dealerships are obligated to reveal a car’s rebuilt status, private sellers on platforms such as Facebook Marketplace are not legally required to do so.
Nancy Shadlock, a resident of Calgary, unwittingly purchased a rebuilt 2010 Nissan Cube for $5,000 in 2021 when her family needed an additional vehicle. Despite its low mileage and attractive price, she only discovered its rebuilt status upon registration, leading to her feeling frustrated but opting not to confront the seller.
Regarding safety concerns, rebuilt vehicles, particularly newer models with advanced technology, require precise repairs due to intricate systems like blind-spot detectors, sensors, radars, and cameras. Improper repairs could lead to malfunctions in the vehicle’s assistive features, posing safety risks.
Insurance coverage for rebuilt vehicles varies among companies, with some offering limited coverage or requiring inspections and documentation before providing insurance. It is essential for drivers to disclose a vehicle’s rebuilt status to their insurance provider to ensure proper coverage.
Although the average cost of used vehicles in Canada has risen significantly in recent years, rebuilt cars generally sell for 10 to 30 percent less than equivalent pre-owned vehicles, according to industry estimates. The prevalence of rebuilt vehicles is on the rise, with reports indicating an increase in vehicles with rebuilt titles being sold.
Despite unintentionally purchasing a rebuilt car, Shadlock’s experience with her $5,000 Nissan Cube was positive, as it served her family well and retained its value over the years. Moving forward, she plans to utilize resources like CARFAX to check the history of potential purchases before making a decision.