A square deal?

Are auctions a great way of getting vehicles at substantial savings, or would it be better to stay away?

Miami-based STT Logistics Group highlights that auction houses can make the selection process, as well as the actual purchase of second-hand trucks and trailers, a lot easier: “Whether you are looking forward to adding new trucks to your fleet or you simply want to buy one for your trucking business, it seems reasonable to look for good deals that can help you save a lot of cash. Buying cheaply and saving money is one of the reasons why a lot of people often choose to buy trucks from a truck auction, whether in person or at an online live auction.”

The company adds that careful research is key, in order to collect as much information as possible on your potential investment before you make your bid. “No matter if this is the first, second, or hundredth auction that you have been to in person or online, it is imperative that you always conduct preliminary research on each big-ticket item that your small business or large company will need!”

STT Logistics says that first and foremost, you should focus on the vehicle’s value. “At a truck and equipment auction, you want to find the best piece of equipment, but make sure to stay within your budget. It is important to research its value online and understand its maintenance history as well. A truck that sells for less than its worth, with a history of high maintenance needed, might not be the truck for you.

“For those who are able to visit the equipment in person, bring a trusted mechanic, co-worker, or friend who can inspect the truck’s engine, axle, cab, and brake pads. These are the larger and more expensive repairs that come with the truck; if the axle is on the verge of breaking before going back on the road, make sure you add that to the auction budget.”

The company adds that it is important to set your bidding limit and learn how to make your bids quickly and clearly if you want to succeed, but also notes that truck auctions are not all about bidding as fast as you can. “You also have to consider the price changes and other factors that may surface during the bidding process. At an online auction, clicking on the bidding button means that you will not be able to cancel your bid unless other bidders outbid you.”

Arrive Alive, meanwhile, warns that buying a used vehicle is always a risk and should be done with caution. “In South Africa, the rights of the consumer are protected through legislation aptly named the Consumer Protection Act,” it says. “The first step for any vehicle buyer would be to ensure that the auction centre is compliant with the Consumer Protection Act.”

This Act requires the auction centre to fulfil certain obligations, including:

• Displaying any faults of the vehicle in writing for the public to view. Even faults like a noisy engine should be displayed to the public.
• Prohibiting an auctioneer from knowingly misrepresenting the value, composition, structure, character, quality, or manufacture of the goods put up for sale at an auction.
• Affording consumers a reasonable period of time and the opportunity to inspect the goods on offer before the commencement of an auction.

The road safety portal notes that the best advice is to always have a “buyer beware” attitude and to question everything. “Do not rely on verbal promises and don’t trust sales talk! Always question why a vehicle is sold at auction and whether it is not the last place to sell trucks that cannot be sold elsewhere.”

Arrive Alive highlights the following factors to be cautious of when buying pre-owned vehicles at an auction:

SOLD “AS IS”

• Keep in mind that the vehicle is sold “as is” – what you see is what you get.
• You cannot take the vehicle from the auction site to be inspected by a mechanic elsewhere.
• Unlike when you buy from a licensed dealership, there are no warranties, cooling-off periods, or guarantees.
• Even with some legislative protection, there is not much of a safety net.

HIDDEN COSTS

• There may be hidden costs you are not aware of.
• Ensure that you confirm any potential transaction processing fees before you start bidding.
• Hidden costs may include an auctioneer’s commission and fees for obtaining registration papers.
• Be prepared for the costs of a roadworthy test and any necessary expenses to get the vehicle into a roadworthy condition.
  
  

FRAUDSTERS AND DISHONESTY

• You need to be alert to possible dishonest sellers, buyers, and even facilitators.
• Keep in mind that odometers can lie and not all vehicle owners are as trustworthy as we would like to believe.
• Stay alert to “ghost bidding”, “vendor bidding”, and other methods that may be used to drive prices higher.

Despite these challenges, Arrive Alive does note that auctions have become an enticing alternative to the purchase of vehicles through private sellers and dealerships. “In the current challenging economic environment, auctions offer the opportunity for informed buyers with an appetite for the chase to use their skills to make a decent saving when buying their wheels.”