Little did he know that he could save money by buying directly from the Japan car auctions!
Talking to dealers in various countries, I often hear a dealer boast “we bid live from our office”. What he is saying is that he is using the auctions homepage’s log in to purchase cars for himself or his customer.
I probably is a good sales pitch for the customer, being able to sit there and see his car being purchased before his eyes, but believe you me: that is dangerous without fluency in Japanese nor the bidding experience to understand the subtleties of what is going on during that 20 seconds while a car is purchased.
The goal of experienced bidding staff is to purchase your vehicle within the budget, and hopefully way below the budget, that our clients give us. This involves reading various colours of bidding lights that inform us of the number of bidders bidding on that car. That in turn tells us whether we should stop bidding and go into negotiation to purchase the car at a cheaper price. Further more, each auction has different styles of bidding computers. Putting it plainly, it is a skill that takes months to conquer.
Dangers from bidding from your own country through someone who has access to the auctions homepages, first of all, delay.
The internet is fast but basically the closer you are to the auctions in Japan, the more likely your speed will reflect the actual bidding speed in the auction. That is, if click your bid at 200,000yen in Japan, the auction will most probably receive that bid at the price of 200,000yen as the internet nodes in Japan are close. If you bid from another country, however, when you click at 200,000yen, the auction may receive your bid when the price has actually gone up to 230,000yen, and that could be over your budget. If you are the last bidder AND the car is “URIKIRI” (no reserve), you have no choice but to purchase the vehicle.
In New Zealand in the late 1980’s and 1990’s as the import duties for used cars coming into New Zealand decreased and finally disappeared (replaced by a 15% consumption tax), the number of cheap affordable used Japanese cars came flooding into the country. However, to go with this public appetite for cheap, affordable cars was a desire for low kms on the odometer. If you had a choice of a vehicle that had done 50,000kms to one that had done 150,000kms, all other factors being even, of course you would chose the vehicle that had done 50,000kms.
This put pressure on used car dealers in New Zealand to be competitive, without sacrificing profit or doing the hard work of trying to buy low km vehicles cheaply in Japan. The easiest short cut was to request the exporter to fix the odometers to what was then a popular odometer level. A friend dealer of mine joked that these vehicles arriving from Japan all had the same odometer readings and they must have been driven in “caravan” formation to get that! (During those days the workers of the Japanese export companies fixing the odometers were not very creative and fixed them all at the same numbers).
Then the whole happy facade came down due to a documentary done by a NZ undercover team, visiting a now infamous Japanese used car dealer. This was top TV news for the time when there were few channels to choose from. The public demanded blood (though still wanted their vehicle with low kms), and the government stepped in. The science of “odometer clocked” or “not clocked” was soon created and thousands of cars were impounded at New Zealand wharves. If a vehicle was deemed “clocked” the importer could re-export it or have it scrapped.
Suddenly, facing these consequences, NZ dealers and exporters turned “honest”, well at least into the NZ markets. Some exporters would have you sign in under “zone”, so that they could show real odometer readings to their NZ customers and “potential” odometer readings to other countries that haven’t demanded the need for honesty.
So what about now? Are there still vehicles out there that are being clocked? Well let’s rephrase the question: “Is it still profitable to clock a car?”. Yes, it always will be, so if there is away around the checks then these lemons will keep on flowing in.
Barriers to cars being clocked?
- If a car is sold in the Japan car auctions, there is an auction sheet coming with it. Demand to see the auction sheet, that is the best way to buy an untouched vehicle. Exporters do their odometer corrections after purchase. Some large companies buy directly from lease and rental companies. These cars odometers have not been registered in the Japanese Used Car Auction odometer check system and are open to abuse (and are abused). Only buy a vehicle with an auction sheet.
- Once you have purchased the vehicle, you can have it checked by one of those scientific companies.
- Buy from a reputable exporter. Some of the largest exporters are far from that (reputable). We at Provide Cars have never adjusted an vehicles kms in our 15 years of existence. Our long term clients know that.
Provide Cars, we provide you with the largest selection of vehicles available from 115 car auctions in Japan each week.
Lets compare the two most popular models selling on the market right now. The Toyota Prius versus the Honda Insight:
|Front tyre width (mm)||1525||1490|
|Rear tyre width (mm)||1520||1475|
|Length inside (mm)||1905||1935|
|Width inside (mm)||1470||1430|
|Height inside (mm)||1225||1150|
|U turn radius (m)||5.2||5.0|
|Engine size (cc)||1797||1339|
|Power train||Straight 4 cylinder DOHC + motor||Straight 4 cylinder SOHC + motor|
|Engine power (kw(ps)/rpm)||73 (99)/5200||65(88)/5800|
|Torque ((N.m(kg-m)/rpm)||142 (14.5)||121 (12.3)/4500|
|Fuel tank (L)||45||40|
|Electric motor output (kW(ps))||60 (82)||10 (14)/1500|
|Electric motor torque (N.m(kg-m))||207 (21.1)||78 (8.0)/1000|
|Battery type||Nickel-Metal Hydride||Nickel-Metal Hydride|
|Battery output (after 3 hours of use Ah)||6.5||5.75|
|10.15 mode kilometers per liter||38||30|
|JC08 mode kilometers per liter||32.6||26|
|Steering system||Rack and pinion||Rack and pinion|
|Suspension (rear)||Torsion beam||Torsion beam|
|Brakes (front)||Ventilated disk||Disk|
|Tyre size||185/65 R15||175/65 R15|
|Wheel||15X6J AW||steel wheel|
|Airbags||Driver and passenger and driver side and curtain||Driver and passenger|
|ABS||EBD ABS and brake assist||EBD ABS and brake assist|
|Slip control system||S-VSC||optional|
|Headlights||Projector Halogen||Projector Halogen|
|Door mirror||Side indicator lamps||not even an option|
|Smart key system||Drivers side only||Option|
Narrow Japanese roads are a reason for a lot of scratches, especially on drivers side mirrors. Try squeezing two cars down one of these roads. And America complains that the Japanese don’t buy enough of their large, wide vehicles!
Will it be a Toyota Prius?
Or maybe a Subaru XV (pronounced with the letters X and V, not 15)
What are the issues around those batteries and when do they need to be replaced? That would be my biggest worry.
With a bit of research: there are many hybrid taxis in New York with over 150,000 miles on their clocks that are still going strong. In kilometer equivalents that is 241405 kms. Wow! Not bad. But one day, you know, you will get to the 250,000 kms mark and those batteries have to be changed! What’s it gonna cost?
A bit more research again, for a set of batteries for a Toyota Prius 2003 to 2008 model range:
$3,649 minus $1,350 “core credit”. What “core credit” means is Toyota is recycling your battery (and probably making a good profit on it too). That cuts the cost to $2300 US dollars for a new battery that will last another 250,000 kms.
Beginning to convince myself to replace my present gas guzzler to hybrid!
In Japan the main car dealers such as Toyota, Honda and Nissan only sell new cars. Used and new cars are usually not displayed on the same yard. When you trade your car in for a new one it is unlikely to stay on that dealers yard long.
Most car manufacturers have their own auctions (TAA auctions, Nissan auctions) or they have deals with the big auction companies, USS Auctions for example. USS auctions, the biggest auction group in Japan owns a company called Gulliver which is the largest trade in house in Japan. The USS auction group also produces a book of previous car sales that dealers carefully devour before setting the sell prices in the auctions. This lists every car sold in the USS auction over that last month.
Many other auctions provide used data so buyers and sellers will have an idea of potential sale price of a vehicle they are buying or selling. Used car pricing is very accurate due to the large number of vehicles going through the auctions every month.
So, when you bid on a vehicle in the auctions, expect it to sell at comparable prices in recent months. Both the sellers and competitor buyers are all looking at previous auction selling history.