Martin Saarinen
Future tech will allow used car buyers greater insight into potential purchases
BACK in 1970, the Nobelprize-winning economist George Akerlof highlighted how used car buyers are always on the back foot due to an “information asymmetry” with the seller.
In short, the seller of a faulty ‘lemon’ car is able to charge a higher than justified price for it – because charging a low, but fair price would tip the buyer off about the potential problems – and it’s up to the buyers to avoid this minefield.
However, technology may soon bring buyers to a level playing field. Tech and tyre company Continental is working on an advanced version of current ‘black box’ technology that allows vehicle rental companies to track their cars via dozens of different sensors – such as how fast people accelerate, if components are experiencing advanced wear and tear, and even whether a part shows signs of failure in the future.
When it comes time for the rental companies to sell their cars they can prove to buyers that the vehicle, despite being a hire car, is in good condition with no imminent faults. And Continental points out that this tech isn’t just for the rental market. It’s something the company says could find its way to the used market as cars become more connected.
This means that in the future, used car buyers could track the entire ownership cycle of a car with their computer or phone and see from the car’s own data whether its engine is in good nick, whether the clutch needs replacing and if the electrics have ever thrown tantrums. Knowledge is power and it’s about time the car buying public got their share.