Natural disasters
All you have to do is turn on the news to see another natural disaster taking place somewhere in North America. Do you ever wonder where all those vehicles end up after a hurricane, tornado, wildfire, or flood? Most of them end up salvaged, repaired, and back into circulation for car buyers like you.
During Hurricane Katrina that almost 600,000 vehicles were reported to be damaged by flood and debris. Insurance companies pay off the actual cash value of these cars to the owners and lien holders. The insurance companies then send them to auctions to recoup as much money as they can. Normally pennies on the dollar.
Companies such as shade tree mechanics, body shops, repair facilities, and even unethical dealers fix these cars and resale them to the public. I remember hundreds of these cars going through major auctions about 3 to 6 months after Katrina. Dealers and wholesalers attend these auctions to buy inventory for their dealerships. We had to be very careful, even as dealers, not to buy these cars. So many of these vehicles slipped through the system, most of us got stuck with a few of these cars in our inventories.
Another trick is to repair these vehicles and get them as far away as possible from where they were damaged. A car from Katrina, after being repaired, is less likely to be scrutinized if it is being sold in California or yes, even Canada. The short story is, you never know where a car will end up once it is repaired and place back on the lot to sell.