This year's hurricane season has left a path of destruction across the Southeast, with the death toll of 236 expected to rise. Hurricane Helene and Milton have caused significant damage to homes. infrastructure and vehicles, the economic impact is expected to be catastrophic.
A large number of cars, SUVs and trucks, potentially 10s of 1,000s, were submerged in flood water or destroyed all together by the back to back storms. Privately owned and inventory on dealer lots have been impacted. Ken Ganley Kia, of New Port Richey, Florida lost an estimated 672 vehicles to Helene and whole dealerships were wiped off the map by flood waters in North Carolina. AutoNation has closed 38 of its stores in Florida due to Milton damage and power outages.
Flood damaged vehicles from Helene and Milton will impact the used vehicle market in two ways, by affecting prices upward as people replace their destroyed cars, lowering inventory and flooding the market with thousands of water-damaged vehicles that have been cosmetically cleaned up then made their way back to the used car market.
These newly damaged vehicles will join around 400,000 other water damaged vehicles on the road, including 89,000 damaged in June and August of this year alone, according to CarFax data. Hurricanes Harvey and Irma leftover 637,000 vehicles damaged, Hurricane Katrina approx. 300,000 and Superstorm Sandy left 250,500 flooded vehicles in their wake.
Dealers across the country will need to be vigilant over the next few months procuring used cars for their lots. Flood damaged vehicles can make their way 100s of miles from flood prone areas. "The real danger is that these cars may look fine and run well for a while, but sooner rather than later major problems are likely to occur. Flooded cars literally rot from the inside out and the damage is often difficult for untrained eyes to detect," Carfax spokesman Chris Basso said.
Tips for Avoiding Flood-Damaged Vehicles
The average price of a used car stood at $25,415 as of August 2024, according to Cox Automotive; expect wholesale used car prices to increase after falling over the summer.