May 23 2016
Fuel economy scandal dents value of used cars
TOKYO -- The repercussions of Mitsubishi Motors' fuel economy fakery have spread to the used-car market in Japan.
Transaction prices in dealer auctions have declined 30% for the Mitsubishi-branded eK Wagon and 20% for the Dayz, supplied to Nissan Motor. Their sticker prices on used-car lots are also dropping as consumers keep their distance. Sales of the four originally affected models have been suspended, but the impact of Mitsubishi Motors' actions has yet to be contained.
Most used-car operations stock their lots with vehicles bought at dealer auctions. The decline in trading prices at these auctions for the eK Wagon and the other three models has pulled the average for all cars down by around 10%. Even like new vehicles from the quartet sometimes go without bids, according to used-car exporter Be Forward.
The shadow has also fallen over the consumer market. Used-car dealers are offering lower purchase prices for these cars bought directly from owners and are setting lower prices to move the vehicles off their lots.
Used-car seller Gulliver International has cut purchase prices 10-15% for the four minicars. The average selling price of a used version of the latest-model eK Wagon is down around 5% at 860,000 yen ($7,785), according to used-car information provider Car Sensor.
Last autumn, prices dropped 10-20% at dealer auctions in Japan for used Volkswagens after the German automaker was revealed to have gamed emissions tests. But prices later recovered, supported by an ardent fan base and drivers taking the opportunity to buy used VWs on the cheap.
Japanese drivers may be less forgiving of domestic automakers. Mitsubishi Motors has now owned up to employing testing methods that do not comply with Japanese regulations for such other models as the Outlander sport utility vehicle. Suzuki Motor has also admitted using the wrong test. While this news has not affected prices in the used-car market so far, the automakers will not find it easy to dispel consumer suspicions.
The transport ministry is now retesting vehicles itself. And until the results are in, there is no way to calculate how far off the fuel economy figures are. Big discrepancies could further hit prices in the used-car market.
