Anyone who has shopped for a used car recently knows that this market is white-hot. Good late-model used cars and trucks are in high demand.
Take, for example, the recently published list of best pre-owned cars for the money from Web2carz.com which included two Toyotas, a made-by-Toyota Lexus, a Honda, a Mazda, and one token non-Japanese vehicle: A big Ford (F) truck. (See "How to Find the Best Used Cars for Under $10,000" for more details.)
Its recommendations aren't surprising. Japanese brands, and Toyotas and Hondas in particular, have long been near the top of Consumer Reports' vaunted reliability surveys. But the list isn't exactly practical, either.
With the used car market the way it is right now, the most in-demand models command higher prices. So if you really want a flavor-of-the-moment car like a used Prius (one of Web2carz.com's choices), prepare to pay quite a bit over Blue Book value. And that's assuming you can even find one for sale nearby.
You Don't Have to Pay a Premium for a Good Used Car
While the vehicles recommended by Web2carz are all fine choices for used car shoppers, there are better bets for those who don't want to pay a premium for a reliable ride.
You can get more for your money without being left stranded by the side of the road. But you have to be willing to look past the obvious choices. You have to be willing to recognize that most cars these days are pretty reliable if they've been well-maintained.
One last thing: You have to be willing to buy American.
Could a Used American Car Make More Sense?
It seems like a silly question. After all, a lot of sensible folks won't even consider an American car nowadays. It's easy to understand why: Decades of slipshod products and managerial arrogance led legions of once-loyal General Motors (GM), Ford, and Chrysler buyers to consider imported alternatives, and for the most part they liked what they found.
Toyota (TM), Honda (HMC), and the other Japanese makers offered reliability and efficiency at good prices while Detroit's cars seemed like phoned-in afterthoughts to the trucks and SUVs that had become the Big Three's bread and butter.
But that has been changing. Detroit's cars have been improving steadily for the last decade. In the last few years, some Ford and GM products have even managed to earn "Recommended" ratings from Consumer Reports -- in some cases, outscoring the seemingly "obvious" Toyota and Honda alternatives.
And even many of the ones that didn't top the charts still turn out to be good, dependable cars. I bought a used Cadillac myself last year, and while the model in question wasn't a Consumer Reports favorite, it has been a great car -- and so far, a completely reliable one. And the best part? Compared to the other cars we considered, it was a terrific value. Yes, value.
The Reason You Get More American Car for Your oney
Thanks to that compromised reputation, American cars have tended to depreciate more rapidly than their Japanese counterparts over the last couple of decades. That tendency has persisted even as American vehicles have improved, and it means that you can get a pretty good car for less than the "obvious" Japanese alternative would cost you -- if you shop carefully.
Shopping carefully is key, and while reading the ratings and reviews is an important first step, many used car shoppers make the mistake of relying a little too much on those Consumer Reports ratings.
It's important to remember that one of the biggest factors affecting the future reliability of any given used car has nothing to do with where it was made and lots to do with how well (or badly) it was treated by its first owner. A well-treated Ford is likely to be a far safer bet over time than an abused Toyota.
So don't buy without a test drive (or two), and pay attention while you're behind the wheel: Does everything seem smooth? Is the interior in good shape? Is there anything suggesting that the car has had major repairs? If in doubt, ask if you can have your mechanic inspect the car before buying to rule out major problems, or if buying from a dealer, ask about a short-term warranty.
Don't rule out a car that seems right for you simply because of its nameplate. Just as in investing, looking beyond the obvious choices can give you more value -- and potentially more rewards -- than you'd get if you just followed the crowds.
Fool.com writer John Rosevear owns shares of Ford and GM -- and an excellent 2006 Cadillac. The Motley Fool owns shares of Ford. Motley Fool newsletter services have recommended buying shares of Ford and GM.