I am looking at results one to ten of sixteen million after a search on Google for "new car information". What information is important and what is not? It depends. If you are looking for a car that you can drive for years without spending half of your time at the mechanic's, looking closely at warranties is a great place to start.
"I'm going to be honest with you, this car is a bad investment and it is bound to fall apart right after you drive it off this lot." In my experience, someone trying to sell a car would never say that. If they did, they would have a very difficult time selling their car. Because you cannot tell if you are looking at a future lawn ornament or a great buy, it makes your task as a consumer much more difficult.
There is a beautiful car sitting in front of you and it could be a bargain or a dud. Unfortunately, as a consumer, you have very few ways of knowing which it is. If the car is new, you could rely on the reputation of the manufacturer but even good manufacturers slip out a "lemon" from time to time. If it is a used car, you should wonder how well the previous owner treated it. They could have been in an accident, avoided maintenance and oil changes, played with the odometer, or they could have taken very good care of it That is the problem, you do not know how good of a car you are looking at.
Michael Spence found a deceptively simple but effective way of determining car value. For his doctorate, he was closely examining the car market, looking for bits of information that could possibly indicate whether a car was going to be a good car or a disaster on wheels. He rationalized: If a seller puts a warranty on a car that is destined to break down time and again, they are going to be spending a lot of money paying for repairs. Ultimately, they may even lose money on the sale. If a good car is being sold with a warranty, then chances are little that the warranty money will be used. In the end, the buyer may spend more buying their car because of the warranty, but they also get a better car.
Michael Spence's research proved to be very valuable. His careful examination of this market and its implications eventually lead him, Georg Akerlof and Joseph Stiglitz to a Nobel Prize. Warranties were found to be a strong indicator of a car's value in a competitive market. Rest assured when you decide to consider warranties in your search, you are making a wise decision and that you are in good company.
Still, there is a lot of old and new car information out there. Simply because a car offers a good warranty does not mean you should go straight for your checkbook. For most of us, cars are a big investment. Shop around and do a little research. For a used car, you can get some information online by looking at a Vehicle history report. CarFax.com for a fee (they even offer a guarantee of their own) can provide information on accident history, fire/flood damage, mileage problems, and lemon history with just a VIN (Vehicle Identification Number). Also, consider taking the time to have it checked by a mechanic. They can help you determine whether it is a good investment or not, what kind of maintenance your car will need, and if you should expect any problems in the near future. If it is a new car, see if you can track down someone who drove an older version of the same make and what they are offering. They may be able to give you some valuable feedback. Ask plenty of questions and do not forget about warranties.
Lastly, make sure you will be happy with your car. Maybe how fast a car can go from zero to sixty, how many horsepower it can deliver, or what kind of mileage it can get is important to you. I am more concerned with the number of wheels, a seat warmer, and a nifty cup holder. Regardless of your tastes, make sure you take a look at the warranty; it is important new car information. Warranties may not be as sexy or exciting as how much horsepower you've got under the hood, but they might give you some idea about how long your car will be able to keep churning out horsepower. That is new car information that counts.
By David Wade