Buying Advice

Hertz's liquidated assets may be the key to getting a good deal on a used car

Cars from mass market and luxury automaker are now up for grabs at low rates.

Photo courtesy of Infiniti Motors

Without Americans traveling for work and pleasure due to the COVID-19 pandemic, many businesses in the travel and auto industry are suffering. From airlines to automakers to dealerships and rental car services, the impact has been great.

As rental car companies look to remain solvent, CNN Business reports that industry experts expect rental car companies to unload 1.5 million cars from their U.S. fleets in the coming year. Hertz Global Holdings Inc., one of the nation's largest car-rental companies, filed for bankruptcy protection on May 20.

The company is selling its used cars at a steep discount according to the newest iSeeCars study. Analysis of over 20,000 used cars from model years 2017 to 2019 listed by Hertz Car Sales found that the company's vehicles can currently be found, on average, for $1,389 below market value, which is 43.3 percent more than the average discount for Hertz vehicles in April at $969.

Below are the best deals based on percent below market value.

No. 10. - Nissan Quest

2017 Nissan Quest

Photo courtesy of Nissan North America

Hertz has listed the car at an average price of $13,874. That amounts to an average savings of $1,810 because its price is 12 percent below market value.

No. 9 (tie) - Volkswagen Golf

2018 Volkswagen Golf

Photo courtesy of Volkswagen AG

The average Volkswagen Golf listed for sale is priced 12.3% below market value for a savings of $2,023. The Golf, on average, however, costs more than the Nissan Quest with its average price of $14,434.

No. 9 (tie) - Kia Forte

2019 Kia FortePhoto courtesy of Kia Motors

The Kia Forte is one of the cheapest models on this list, and a good car. It is listed on average for $10,851, which represents a savings of $2,023. That's 12.3 percent below market value.

No. 7 (tie) - Buck Cacada

2018 Buick Cascada

Photo courtesy of Buick

The Buck Cascada came and went from the U.S. market with America barely batting an eye. Still, it's a decent convertible (albeit with a dated infotainment system). Buyers will pay an average list price of $15,564 for one, which is a $2,241 savings over the usual price. That's 12.4 percent below market value.

No. 7 (tie) - Nissan Versa Note

2018 Nissan Versa Note

Photo courtesy of Nissan North America

The subcompact Nissan Versa Note is a good commuter hatchback. It's listed for just $9.533 on average representing a savings of $1,375 - 12.4 percent below market value.

No. 5 - Toyota Tundra

2018 Toyota Tundra

Photo courtesy of Toyota Motor Sales U.S.A., Inc.

The Tundra is the only truck on this list. Its average asking price is $31,383, which is 12.6 percent below market value. The average savings on the model is $4,714.

No. 4 - Infiniti QX50

2019 Infiniti QX50

Photo courtesy of Infiniti Motors

The Infiniti QX50 is a comfortable cruiser. Its average list price of $27,760 is one of the higher on the list, but that price represents a $4,145 average savings. The SUV is listed for an average of 12.7 percent below market value.

No. 3 - Mercedes-Benz A-Class

2019 Mercedes-Benz A-Class

Photo courtesy of Mercedes-Benz

Hertz has listed the Mercedes-Benz A-Class car for an average of $28.555. That's $4,252 an average savings of $4,252 representing 13 percent below market value.

No. 2 - Chevrolet Trax

2019 Chevrolet Trax

Photo courtesy of Chevrolet

The Chevrolet Trax fits the bill of what people most often think of when they think about a rental SUV. Current listings have the Trax with an average price of $11,196, an average savings of $1,714. That amount is 13.4 percent below market value.

No. 1 - BMW 7 Series

2017 BMW 7 Series

Photo courtesy of BMW

Donald Osborne is famous for, among other things, being teased by Jay Leno about how he cares more about percentage gained or lost on the value of a car rather than the dollars and cents side of the equation on Leno's popular TV show "Jay Leno's Garage".

The BMW 7 Series is a classic example of the type of car Osborne would appreciate while Leno would roll his eyes. It is listed for an average price of $42,680 - easily the highest number on this list. However, that cost represents an average savings of $6,877, making the car 13.7 percent below market value.


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The 2023 Crosstrek starts at $23,645.

Subaru

Subaru is one of the best at listening to its customers' needs, and the Crosstrek is a great example of that mindset. It's a useful vehicle with plenty of interior space and enough ground clearance to take its passengers well of the beaten path. Today, Subaru announced pricing for the 2023 Crosstrek and Crosstrek Hybrid. The duo will go on sale this summer.

Subaru CrosstrekThe Crosstrek's cabin is adventure-ready and packed with great tech. Subaru

The standard Crosstrek starts at $23,645 before destination and the Crosstrek Hybrid starts at $36,845. Five trims are available for the standard model, including Base, Premium, a new Special Edition, Sport, and Limited. The Hybrid comes in a single trim level. All Crosstrek variants get all-wheel drive with active torque vectoring and 8.7 inches of ground clearance.

The Base, Premium, and Special Edition trims come with a 2.0-liter four-cylinder engine that produces 152 horsepower. The Sport and Limited trims get a 2.5-liter four-cylinder making 182 horsepower. Most models come with a continuously variable transmission, but the Base and Premium trims come standard with a six-speed manual gearbox. The Crosstrek Hybrid comes with a 2.0-liter four-cylinder paired with two electric motors. The plug-in system can deliver 17 miles of electric range.

Subaru CrosstrekThe Crosstrek delivers 8.7 inches of ground clearance.Subaru

True to Subaru form, the Crosstrek comes with a full suite of advanced driver aids, including automatic emergency braking, lane keep assist, lane departure alerts, adaptive cruise, and more. These features are only available for CVT-equipped models. The Limited trim and the Crosstrek Hybrid add automatic high beams, reverse automatic braking, blind spot monitoring, and rear cross-traffic alerts.

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The majority of new car buyers paid a markup in January 2022.

VW

It's no secret that new car prices are climbing every year, as new technology and features make their way into even the most basic models. The issue is compounded by massive supply chain issues that have caused vehicle shortages for nearly every major automaker. Some dealers are taking advantage of record low inventory levels by marking up prices, and unfortunately, the problem isn't limited to a handful of bad apples. In analyzing recent sale price data, automotive publication Edmunds found that buyers paid a markup in a whopping 82.2 percent of all new vehicle purchases in January 2022, compared to just 2.8 percent a year before. Overall, the average transaction price rose to $728 above MSRP for new car purchases.


Tesla factoryTesla is looking to expand production in the U.S. beyond the confines of its Fremont factory. Photo courtesy of Tesla Motors

Cadillac buyers saw the largest markups, to the tune of $4,048 on average in January. Land Rover and Kia weren't much better, with average markups of $2,565 and $2,289, respectively. On the other end of the spectrum, Alfa Romeo buyers got discounts that averaged $3,421, while people who bought Volvo or Lincoln vehicles got smaller discounts of $869 and $510, respectively.

Some automakers have taken a stand against dealer markups and the general lack of transparency seen in pricing across the board. Ford and General Motors have been vocal in recent months, threatening to withhold inventory from dealers found to be slapping markups on new vehicles. As Edmunds notes, both automakers have important vehicle launches on the horizon that neither can afford to flub, and inconsistent pricing or markups is a good way to alienate new customers out of the gate.


Cadillac EscaladeCadillac buyers paid the largest markups of any brand. Photo courtesy of Cadillac

If you're thinking of shopping for a new car, the best way to avoid paying a markup is to wait. The pandemic and ongoing supply chain issues have thrown kinks into every automaker's operations that will take time to iron out. That said, it's clear that some brands are committed to having no funny business when it comes to dealerships' pricing and communication. It's possible to get a vehicle at MSRP, or even below in some cases, so if you're in a position that requires you to buy a new car, shop around to get the best deal.

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