Is It Possible to Purchase a Brand New Car That Is an Older Model (5 Years or Older)?

Can you buy a brand new car that is literally 5 years old or even older? The answer to this question is both yes and no, depending on the context and specific circumstances.

Dealer Incentives and Storage

One of the ways to potentially acquire a brand new car that is 5 years old or even older is if a dealer or a private owner has kept a car in storage for a prolonged period. While this is highly improbable, there are rare instances where a car is not sold within the first few years, leading to extended storage.

For example, some dealers have a preference for holding onto older limited edition models, like the classic Corvette. I recall one dealer in my area who had an older Corvette in their showroom for decades without ever driving it. Such cars could sometimes hold significant sentimental value, but they may not be sold to individual buyers unless the right price is offered.

In the case of private parties, collectors might buy and store a car as a collector item, planning to sell it at a later date. This strategy is common for enthusiasts who want to maintain the car in excellent condition for future buyers or for restoration purposes.

Importing Older Models

When a model ceases production, the rights to the car may be sold to a subsidiary in another country. This happened with the Volkswagen Beetle in 1978, where the production rights were transferred to Brazil. The Beetle continued being built in Brazil until 1986 and then in Mexico until 2003. These models could be imported into the US, although shipping taxes and emissions compliance are critical factors to consider.

Dealer Inventory Management

From a dealer’s perspective, holding onto a brand new car indefinitely is uncommon due to financial reasons. Dealerships incur inventory taxes and dealer finance fees, which can be significant if a car is not sold promptly. Furthermore, dealers usually do not own the cars on their lot; they are typically financed by a finance company until sold. Dealerships are contracted to sell the cars, and they have incentives to move stock quickly to minimize holding costs and maximize profits.

There are rare exceptions. For instance, a car dealer in Memphis, TN, had a brand new 1980 or 1981 Corvette that never sold. It became an iconic piece in the dealership, initially listed for an extremely high price. Eventually, it was sold after the dealership owner lowered the price. This car technically remained new, but the dealer floor plan and inventory costs would make such a scenario extremely unlikely.

Factory Warranty and Implications

The factory warranty is another important factor to consider. Any car that has not been sold to a customer after the manufacturer sells it to the dealer is typically titled as ‘new’. While it is possible for a car to not be sold for a few years, it is highly improbable that a dealer will keep a car unsold for 5 years or more, as they will lower the price significantly to offload the inventory.

Strangers purchasing such an older car being sold as 'new' should be highly suspicious. The manufacturer's warranty would likely be nullified, and the car would likely be sold as 'open-box' or ' demos,' where the original owner has driven a limited amount but the car's condition is still close to new. This warranty issue underscores the importance of due diligence and thorough research before making such a purchase.

Conclusion

In conclusion, while it is possible to purchase a brand new car that is 5 years old or even older, the probability is relatively low due to dealer and manufacturer policies. However, rare exceptions do exist, making it a feasible, albeit uncommon, scenario.