DUBAI Authorised car dealers have warned the public against buying or selling used cars without due diligence as the market for pre-owned vehicles in the UAE remains largely unorganised and unregulated.
Speaking to XPRESS following reports on how residents are being duped into selling cars for dud cheques, the dealers said such transactions are fraught with many lurking dangers, not just payment fraud.
Michel Ayat, CEO of Arabian Automobiles, authorised dealers of Nissan, Infiniti and Renault, said: “We estimate the used car market in the UAE is worth Dh11.2 billion. Annually, around 85,000 right hand drive cars are exported while 140,000 cars are sold in the domestic market. Of these 225,000 cars, only 25,000 are bought through authorised dealers. The remaining 200,000 get sold in the unorganised market whose dealers operate in Aweer, Sharjah and other areas.”
He said used cars bought in the unorganised market carry many risks. “These include lack of proper inspections or safety checks with authorised certifications; no assurance that the mileage is tampered with or the chassis not damaged or the air bag deployed; no guarantee that the car has been written off by an insurance company; lack of credible service history; no warranty; and given all these factors, the prospect of paying a higher interest rate to banks for financing.”
He said buying a used car from an authorised dealer, on the other hand, guarantees a certified pre-owned (CPO) vehicle with complete peace of mind. “We have 145 safety check points covering everything from transmission and engine health to the condition of interiors and exteriors. Only when all these checks are cleared does the car go for reconditioning. We also offer a warranty of up to 30,000 km or one year with 24/7 roadside assistance.”
K. Rajaram, CEO, Al Nabooda Automobiles, authorised dealers for Audi, Porsche and Volkswagen, said: “Customers in the UAE have one of the widest choices in the world when it comes to buying a car and their decision is usually driven first by price, then availability and lastly security. Our recommendation is to work with the authorised dealers as only they can provide an assurance when it comes to safety checks of the vehicle and by working with respected banks in the UAE, there is no issue in relation to financial fraud or bounced cheques.”
He said: “All pre-owned cars bought from Al Nabooda showrooms come with rigorous safety checks, certified payment plans, service options and after sales customer care.”
Simon O’Neill, general manager (pre-owned), Al Futtaim Motors, authorised dealers for Toyota and Lexus cars, said: “The number of points checked is not always a sign of the quality of the vehicle, as many manufacturers count inspection points in different ways. For example, inspection of all tyres is one check for us, but some pre-owned programmes count each tyre and so it is five points including the spare tyre. The most important aspect of an inspection is that it is carried out by trained technicians and genuine parts are used in the reconditioning process.” He said Lexus and Toyota pre-owned cars come with a 12-month unlimited mileage warranty.
Residents buying cars directly from owners who advertise online can also run into problems. As O’Neill explained: “Searching for your ideal car online is both convenient and time saving, but unless you are an expert you will always run the risk of buying a car that has had accident repairs or has mechanical issues. It is recommended that you have the vehicle fully inspected beforehand. This will cost you, but with Lexus and Toyota pre-owned programmes this is part of the service.”
He said Al Futtaim has opened a dedicated showroom for Lexus pre-owned on Shaikh Zayed Road while its Toyota and Lexus websites allow visitors to see the full range of used vehicles, down to the model, mileage and colour.
Ayat said residents prefer buying used cars over new ones because their aspirations of owning a premium model are met as prices are more affordable and they are value for money. But he debunks the myth that a pre-owned car in the unorganised sector is cheaper than the authorised market.
O’Neill agrees. “The price differential is a myth as the unorganised sector is often as expensive as the dealer and prices cannot be compared like-for-like as quality, warranty and peace of mind are lacking. However, if you were to compare like-for-like, the organised used car sector would not be any more expensive and may in fact be less, particularly with dealer warranty and service or maintenance offerings.”
He said: “Buyers should look for a full service history, ideally maintained at the dealership and at regular intervals as recommended by the manufacturer. They should make sure the car is free of any accident repairs, as well as correct reflection on the odometer of the true mileage of the vehicles.”
Risks of buying used cars from unauthorised sources
Lack of proper inspections or safety checks
No authorised certifications
Mileage could be tampered
Chasis could be damaged
Air bag could be deployed
No guarantee that the car has been written off by an insurance company
Lack of credible service history
Prospect of paying higher interest rate for bank financing
If you’ve made a purchase in the unorganised sector any way, get the vehicle checked for safety by an authorised dealer
YOUSPEAK: Have a story on selling/buying used cars? Tell us