Upon reading the news that Hummer certified pre-owned vehicles increased 109% from April ’07 (80 sales) to April ’08 (167 sales), my first thought was: "A fool and his money are soon parted." Who buys a Hummer with fuel prices hovering near $4 a barrel? After all people are staying away in droves from new Hummers, which declined from 4,375 sales in April 2007 to 2,380 in April 2008.

With a little further reflection, the move makes sense for those people who absolutely want to have a Hummer: maybe as a vehicle for a 2nd home or some off-road fun. A new H3 with automatic transmission and navigation system, even in this day of deflated SUV prices, is still going to cost north of $30,000. The value on a similarly equipped 2006 H3 is $22,300.

Does this appeal to me? No, but it seems like the right time to buy a Hummer if it’s something you’ve always wanted. I’d recommend reading more about incentives and other offers at Hummer’s certified pre-owned website. Look under pricing and offers.

Maybe I’ve been blessed by the automotive gods, but I’ve never had a used car that I would term the worst. My worst car was actually a 1984 Dodge Omni I bought new but that’s only because of damage I inflicted on it. Mechanically it ran pretty well until the day came that I grew tired of it and sold it to a friend – who kept it running for a few years.

Mark Vaughn in his column this week at AutoWeek.com says his worst used car ever was a red Ford Pinto nicknamed the Pinto Bean that belched blue smoke because of bad valves. I can’t empathize with Vaughn, though, because the first used car I ever bought was a 1974 Ford Pinto. I owned it for four months, but it treated me great.

What’s the worst used car you ever owned and why? Share your comments.

Going to see Speed Racer this weekend? I’m not, but you might come away from the experience with a need for speed. Well, here’s a suggestion for a used car that could satiate that desire without breaking the bank: a Hyundai Tiburon. It’s my “Deal of the Week”.

This is Hyundai’s front-wheel drive coupe. The 2005 model comes with a choice of two engines: a 2.7-liter DOHC V-6 that produces 172 horsepower at 6000 rpm and 181 lb-ft of torque at 3,800 rpm or the 2.0-liter CVVT engine rated at 138 horsepower at 6,000 rpm and 136 lb-ft of torque at 4,500 rpm.

I reviewed the second generation Tiburon when it came out as a 2003 model. I loved its acceleration and handling. In 2005, interior space got a much-needed bump to make the car comfortable as a daily driver.

So, forsake the more popular Subarus and Mitsubishis and set your sights on a Tiburon, which apropos of nothing, means shark in Spanish. Dealer retail is about $11,200 for a clean model with 45,000 miles.

As always, buy no used car without a complete inspection by an independent mechanic.

The 2007 Honda Fit is a great used car for a high school grad
Photo © Honda

OK, just to be upfront, my parents never bought me a car as a graduation present. But Dad did co-sign my first car loan after college, so there is no lingering resentment there.

This time of year there are plenty of parents looking to buy cars for grads as presents and my advice - which should shock nobody - is to buy used. Check out my list of the perfect used cars for these situations:

• HS Grads Going To Far Flung Colleges
• HS Grads Studying Locally
• HS Grads Going to Trade School
• HS Grads Entering the Military
• HS Grads with No Sense of Purpose
• College Grads Moving Home with No Loans
• College Grads Moving Home with Loans
• College Grads Moving Into a City
• College Grads Going To Grad School
• College Grads Out on Their Own

Remember, every vehicle should be inspected by an independent mechanic before purchase.

Compact SUV sales like the Honda CR-V are white hot
Photo © Honda

Automotive News reports that the top new car dealership groups in the country are seeing a slump in sales. (It’s a subscription required website so I can’t link to it.) The article said the groups are “focused on offsetting weak demand for new vehicles by stepping up sales of higher-margin used cars, providing financing and offering repairs and service.”

I’m going to define higher-margin used cars as compact SUVs and compact cars because demand is increasing for both new car segments. With tighter credit standards, the used car market for both is going to jump, too. Now, more than ever, used car dealers are going to try to squeeze every last nickel out of you they can. You’ve got be prepared before even setting foot on the dealership floor.

Read my piece on How To Fairly Value a Used Car. It’s going to give you a lot of tools in your arsenal. Most importantly, it could lead to you paying a lower price. A dealer’s not going to haggle with a consumer who has done his or her homework. A quick sale can be a good thing for both sides.

Illustration © Keith Griffin

There’s an interesting story in today’s Washington Times via AP. In Miami, dealers are not accepting SUVs as trade-ins or, if they do, they’re shipping them overseas.

The article says at AutoNation's Maroone Nissan of Pembroke Pines, southwest of Fort Lauderdale, used-car sales manager Julio Cardoso noted that he has three SUVs headed to Russia this month. Sales manager Al Johnson said the dealership had exported about one car a month, but this year, they average roughly 10. AutoNation said that nationally, its overseas shipments were up slightly, but not in double digits. It did not disclose specific figures.

Mike Maroone, AutoNation's chief operating officer, said in the article he has been active in exporting cars to Central and South America since the 1970s, while the weak dollar has seen more luxury used vehicles being shipped to Europe recently.

One element of the story annoyed me. A man owned a 2005 Lexus SUV but wanted to trade it in for a minivan for the better gas mileage and to accommodate his infant daughter. There’s not a Lexus SUV on the market that couldn’t hold an infant. I hate when people use their kids an excuse! The guy just can’t afford the fuel for his Lexus but is too proud to admit it.

2005 Ford Five Hundred
Photo © Ford

It’s been a big week for Ford Motor Co. with first quarter profits of $100 million. But here we’re more concerned with used cars and Ford’s not disappointing us there either.

The Big Blue Oval is out with an enhanced certified pre-owned program. Specific CPO enhancements include:

• Ford, Lincoln and Mercury eligible vehicles have been expanded to include those up to six years old or with up to 80,000 miles.
• Each Ford and Mercury vehicle is backed by a 6-year / 100,000-mile powertrain Limited Warranty and a 3-month / 3,000-mile Comprehensive Limited Warranty. Lincoln pre-owned customers receive a 6-year / 100,000-mile Comprehensive Limited Warranty.
• Ford offers 169 different points of inspection – the most comprehensive inspection process of any other volume manufacturer. (Non-volume manufacturers like Audi have a 300-point inspection, which some might consider overkill.)
• 24-hour roadside assistance is included for the full duration of the Limited Warranty coverage.

According to a news release, Glenn Burke, Ford Certified Pre-owned program manager, says more than 50% of CPO customers are new to Ford or Lincoln Mercury and, on average, 15% will trade their vehicles for a new Ford or Lincoln Mercury product on their subsequent purchase. Through the first quarter of 2008, Ford and Lincoln Mercury CPO sales are up 7.7% year-over-year.

Kind of strange isn’t it? People wouldn’t buy Ford products when they were new in the last few years, but they will used.

By the way, the 2005 Ford Five Hundred pictured with this blog would make an excellent certified pre-owned candidate.

2005 Honda Accord coupe
Photo © Honda

Curious what the top 10 most research used cars were in 2007? Well, at CUDL, the country's leader in indirect and point-of-sale lending for the credit union industry, Honda's Accord and Civic lead the pack, which isn't a surprise. It may surprise you to find out credit unions are a good alternative for financing.

Most Researched Used Cars:

1. Honda Accord
2. Honda Civic
3. Toyota Camry
4. BMW 3 Series
5. Toyota Tacoma
6. Ford F-150
7. Toyota Corolla
8. Nissan Altima
9. Volkswagen Jetta
10. Jeep Grand Cherokee

None of the Hondas surprise me. Used Accords, in fact, are probably pricing well because of the introduction of the new, larger version for 2008.

The F-150’s inclusion also makes sense because it’s the top selling pickup in North America. The Tacoma is kind of a curious surprise because domestic pickup trucks continue to be strong sellers.

Be cautious with a used Camry (words you won’t read that often). Consumer Reports has reported problems with the 2007 V-6 models. The four-cylinder version, though, is (mechanically) bullet proof. The VW Jetta also gives me pause but only because of problems with Volkswagen maintenance. Even a certified pre-owned Jetta should be approached cautiously. What good are covered repairs if your car’s always at the garage?

I doubted the BMW 3 series at first because I don’t think of it as a high volume car, but there were more than 100,000 sold in the U.S. in 2007. The entire Audi line sold that many cars.

1999 Mazda626: one example of a median age vehicle
Photo © Mazda

Interesting news from R.L. Polk & Company via BlackBook.com’s April 2008 newsletter. The median age of cars on U.S. roads rose to 9.2 years in 2007, and 41.3 percent of all cars were 11 years old or older.

That’s good news for people buying a used car. As people keep their cars longer, used car dealers are going to feel pressure to move their products. That means lower prices all around.

But, there’s also concern that the cars are on our roads are getting older. While I’m sure our roads will never resemble the classic-car showcase look of Havana’s streets, it means there are lots of vehicles out there with more than 150,000 miles on them (on average) and lacking modern safety equipment.

Of course, older used cars are also a great way to get out from under punishing new car loans. Buy one for a couple of years, save a bunch of money, and then buy that new car you’re been thinking about. About.com’s Miriam Caldwell, who writes about Money for Folks in their 20s, outlines how it works.

Shreveport, La., was tops in the country for used car value increases in March.
Illustration © Keith Griffin

CNW Research out of Bandon, Or., has released its monthly report on where used cars are increasing and decreasing in value. So, in certain parts of the country it’s good news if you’re selling a used car and bad news if you’re buying one – or vice versa.

Autoremarketing.com reports that Shrevesport, La., takes the top honors. Against a national backdrop of falling used car prices (almost 3%), Shreveport, located in the northwest corner of Louisiana, saw prices increase 13.89% from March ’07 to March ’08.

Head about 375 miles west to Wichita Falls, Texas/Lawton, Okla., and you’ll find the largest decreases in average used-vehicle prices. They dropped their prices 14.66% in the same time frame.

Here are the Top 5 Markets with percentage increase:

1. Shreveport, La. +13.89%
2. Wilkes Barre/Scranton, Pa. +11.02%
3. Buffalo, N.Y. +8.84%
4. Erie, Pa. +7.7%
5. Juneau, Alaska +5.73%

1. Wichita Falls, Texas and Lawton, Okla. -14.66%
2. Monterey-Salinas, Calif. -10.90%
3. Detroit, Mi. -9.5%
4. Sacramento/Stockton/Modesto, Calif. -9.43%
5. Sioux Falls/Mitchell, S.D. -8.87%

The complete list is available at AutoRemarketing.com.

As always, you can learn more by reading my article on how to fairly value a used car.