In my area the Grand Am's have filled the lots right now, sold at about 25k miles with another year and 11k miles on the warranty there are many rentals that dealers are trying to sell. It makes sense that the resale value of these cars are low as people seem to buy one of these without knowing it was a rental car beforehand or not realizing the treatment rentals go through rather than buying either a new one at full price or one with higher mileage or older age at the same price. I saw a dealership selling six 2004 Grand Am rentals at the same prices that the 2002's with 20k more miles were selling for. When I sold mine it made it more difficult.
In my mind there are different categories that people have when buying a car:
1. Brand new for those who want that dealer fresh, nobody touched it but the factory and me feeling and the sense that no other owner was there to mess things up.
2. The used car with about a year's worth of warranty left on it(which is what most rental companies shoot for).
3. The car that is still the current generation but has been out of warranty for awhile and the owner plans to drive it for awhile and its about 5 years old and about 75k miles. So basically the buyer is getting a newish car but doesn't want to get anything that's been around for a long time.
4. The older car, generally a few generations behind, it's now selling for around 1/4 or less of it's original value and has mileage getting on the high side, the body and interior might not be as great as it was and/or it might have some problems but be in good enough shape to either fix those problems or just keep driving as it is.
5. The car that is generally perceived as a junker. Might be getting some rust holes, mileage is high, possibly about 150,000 miles and ten years or more, enough for some people to turn away because of the style of the vehicle. It could have a major problem that needs to be fixed but might not. Value has now reached low levels because people don't want to be driving a high mileage car or something that people will think looks bad.
My generalities - Your opinion probably will vary, *flame suit on*
1. The new car buyers are often people who want the best and won't settle for less or possibly have had problems in the past with a used car or two or just want their car to look the best for as long as possible, such as with people who buy a new car and drive it until it rusts out or is completely broken down.
2. The used car still within warranty type is generally from those who don't need brand new and want to save a great deal of money by buying something that has had a little use and a few minor imperfections to the paint or body are nothing for them to worry about. Value conscious customers who want something that is new generally choose one of these vehicles because it will save them a great deal of money and they are still protected with a warranty.
3. The newish out of warranty but still current or 'just was' current car model buyers are those who don't worry about the warranty and want a nice car that they can continue to drive for quite some time and not have to deal with major issues. These cars can be a very good deal for people who want something that doesn't start look old and won't look old for at least until another generation or two of cars passes by depending on the model.
4. The 1/4 or less resale value buyer is generally looking for a car that is cheap but not something that is about to fall apart or leave them stranded on the side of the road. Some of these cars can be fully loaded and be a very good deal or be very basic but still be an excellent car. Many people buy luxury cars in this category as they are still better than some group 3 vehicles and these keep their resale value as there is still going to be a higher demand for them as they are a nicer car in whatever way made them cost more than other cars when they originally were sold new. Many people buy these vehicles because they realize that the vehicle that they are buying has been reliable and they are confident that they can drive it for many more miles and possibly quite a few more years yet others perceive these differently.
5. The 'junker/beater' category of buyers is not always the bad cars and certain buyers know this well. For some people $1000 car is much better than paying more and even if there is a risk of the vehicle breaking down this wouldn't bother them or they would be able to deal with such an issue if it happened. People usually buy these cars with problems whether minor or major problems if they are great with fixing cars. It could be an engine replacement or collision damage and might just need a little bit of help to get going again. The problem could be rust where people won't buy the vehicle because they consider it an eyesore. Sometimes these vehicles don't have any problems but are being sold at a low price because the seller might think that 100k or 150k miles is the point where reliability dives horribly and they want the car off their hands before something bad happens. It could be possible that the mileage is up at 200k or more and the buyer has seen the vehicles get higher than that and wants to continue to drive it until it's dead and is getting a great deal because it's in good condition otherwise and is confident that either problems won't happen or that they can be fixed along the way.
I used to consider myself a group 2 buyer and my last car was in the warranty car category when I bought it but now I am in the group 4 or group 5 category. I will buy an old car as long as I am confident that I could get a few years out of it. My school of thought changed to this category as I was thinking that lower insurance rates would be very nice and if a very expensive repair came along with a cheap group 4 car or a group 5 car I could just pass it off to a junkyard. Not to mention that if a collision happened I could just get a different car. I've never really cared much about aesthetics and I have gained more knowledge and resources in finding reliable vehicles that come at a great value.
When I had sold my car at 56k miles/4 years it was hard to sell because it is an inbetween category because it lost the buyers who wanted a warranty and the buyers who want a newish car without a warranty generally want to pay much less than a car with a warranty. I had originally planned to keep it longer but then I changed my mind on a few things when it came to driving. I wanted better fuel economy, I realized from others including a family member that has the same vehicle that had thousands put into it for repair and the fact that I was noticing the intake gasket seeping a little externally. I also wanted a smaller car and more fuel efficient car which also had just became more important at the time as I was going to be commuting farther to work and my driving would become around 25k miles a year when it was about 12k miles a year before. I didn't want to drive a car that would be depreciating like a rock as I piled miles on it. That is why I am a group 4/5 car buyer.
A little more on topic:
My opinion is that if these rental companies allowed their warranties to expire that they would either have to wait for their cars to get deep into the group 3 or even step into the 4 category to maintain their profit level, but people wouldn't rent cars that old so that would be the catch unless it's a 'discount' rental place or discounted model at a nicer place. They shouldn't be selling them at 5-7k, at least in my opinion, as they lose so much value with this practice. I've seen dealer demos and dealer service loaners with that kind of mileage but I just don't see any reason that they would have more than a few with that kind of mileage for those reasons.
I'm sorry this became much longer than I had originally thought it would be.
