Buying Luxury Cars At Auction

We've all seen them: guys who get mind-blowing deals on some very proper rides. Or, more accurately, we've all heard them. They always seem to make a point of loudly telling their buddy what a steal it was, making sure that anyone within a 50-foot radius hears about it, too. On the one hand, it's tough to blame them. Who hasn't wanted to crow about saving money? On the other hand, there's something to be said for subtlety and keeping figures to yourself. After all, for many years Rolls-Royce only quoted their cars' horsepower specs as being "adequate." Whether or not you advertise your savings to the world is a decision we'll leave to you. But first things first: You need to seek, find and acquire. Auctions can be an excellent way to find used luxury cars selling at a fraction of their retail value. Just remember to do your homework on your top picks, like you would in any other buying scenario.That said, if you have the funds in hand and are willing to bid shrewdly on a car you haven't even been allowed to test drive, the reward may outweigh the risks. Here are some types of auctions to get you started.

Government auctions
It stands to reason there would be a lot of luxury cars at government auctions. After all, Crockett and Tubbs were always busting the world's richest drug dealers on Miami Vice, right? Well, yes and no. Here in the real world, cars are indeed confiscated and auctioned as a result of various criminal activities. The premium cars can be found, but be prepared to sift through a lot of Mazdas and Buicks in the hunt for your Maybach or Bentley.

For starters, browse the U.S. Treasury Department's seized vehicle auction information at their official site, the IRS site and that of the General Services Administration (GSA). Not only will you find the vehicles, auction dates and locations; the sites also explain the entire bidding and buying process.

You may also want to track down sites for state, provincial and local government agencies. The vehicles there are more often retired agency vehicles, but now and then you'll see a luxury car hidden among the scores of Malibus and Caravans.

A word of caution: Don't be lured by the classifieds advertising auctions with $500 BMWs as far as the eye can see. They promise to reveal -- for a price -- top-secret details of government auctions, as if the CIA just leaked some critical details. But all that usually amounts to is a booklet of public information. Save your money and find it yourself online.
You'll find luxury rides in unlikely places...

Business/Public/Private-party auctions
When it comes to great car buys that slipped through our fingers, we all have Saab -- sorry, sob stories. Recently, a rural farm auction in my area featured a mid-1980s Mercedes-Benz 500 SEL, the big sedan model I like to call "Das Boot." I later heard the crowd was more interested in farm machinery, so the well-preserved Benz was virtually ignored and sold for $950.

Business, public and private party auctions are usually one-time events with no specific season or schedule (unlike government auctions). So they tend to be well advertised online and in local classifieds to draw the biggest turnout possible.

Another advantage to these auctions is the likelihood that the vehicles will be closely inspected before going on the block. Chances are you still won't be able to test-drive them, but often the keys are there for you to fire the engine and do the usual spot checks.

A word of caution: Be patient. It will probably take some time to find anything of interest. These auctions don't always feature premium rides -- if any vehicles at all. But when they do, they're often overshadowed by furniture, machinery and other property. It pays to look for the sale where a luxury car doesn't belong. Take the lost Benz incident as an example; you could very well be one of only a couple bidders remotely interested in the car.

Dealer auctions
If a used luxury car isn't a certified pre-owned (CPO) or a local trade, it's likely been purchased at a dealer auction. Buying at this type of auction is the method with the most compromise. The cars will often be newer and in better mechanical shape because they're reconditioned. Sometimes they appear as the result of slow-moving dealer inventory or repossession, or are fresh off a lease. The downside is that you may not save a great deal of money for all your effort.

The real challenge is getting to a dealer auction in the first place. Only licensed dealers are allowed to bid, if attend at all. So, short of obtaining your own credentials (and there are services that claim to help do so on the cheap), you'll have to be buddies with someone on the inside... really good buddies. Good enough that he won't mind you taking some or most of his profit from the sale. And, because the laws vary, you'll want to make sure this method is locally kosher beforehand.

A word of caution: Beware of cars with salvage titles -- that's to say, any car which sustained major damage at some point and was declared a total loss. A competent collision tech can work miracles to make it run and drive right again, but the title will always be branded. You may not mind now, but it will seriously affect its value when you decide to sell.

By Thomas Bey Automotive Correspondent - Every other Friday