Sunday, September 3, 2017

Hurricane Harvey and the Flood of Damaged Cars

Hurricane Harvey flooded at least half a million cars according to current reports.   Whenever a disaster like this occurs we see news stories about the financial losses, both for uninsured car owners and for insurance companies.  We read about the menace of unscrupulous dealers who will buy the flood-damaged cars from insurance companies, fix them, and sell them to unsuspecting buyers.

I’ve grown tired of those stories, when it comes to modern cars, because there are simple answers, if only people would implement them.  Individual losses can be held to a minimum by simply buying comprehensive insurance.  No one should be driving without insurance, and reports suggest that 75% of motorists carry comprehensive coverage.  Those that don’t can learn from experiences like this, or continue to take their chances. 

As for the totaled cars being resold – insurers and government know what to do to solve this problem:  Require all cars that are totaled by insurance to be cut up, not resold in repairable form.  The solution is simple, but insurers fight it because it would reduce the value they can recover from the salvage. 

Think about that for a moment.  The only reason the salvage cars are worth more complete is that complete cars with good titles can then be resold to unsuspecting buyers.  You know that, I know that, and the insurers know that.  Yet they would rather pocket those extra dollars, than protect the consumers who pay their policies.

As a used car buyer, I’d rest a lot easier if I knew all those Harvey cars would be cut up for parts.  But I suspect the opposite will happen – at least half of them will end up back on the road, peddled as “bargains,” only to plague their new owners with endless breakdowns and frustration.

Insurance companies say they do enough, by branding the titles as salvage.  There is a huge industry “washing” salvage titles so that former flood car has a clean title.  There’s also a big business spinning “salvage” titles as “lightly touched” and “easy fixes,” in keeping with the Barnum saying, There’s a sucker born every minute.

Here's an example.  The BMW in this photo was one year old, and the sunroof was left open in a heavy rain.  The floor flooded about two inches deep.  Would you care to guess the repair bill?  It touched five figures to replace those modules and wiring, all of which were waterlogged.



Services like Carfax get lists of flood-totaled cars from insurance companies, but their reach stops at the US border.  Many flood cars are sold as nice, original vehicles in overseas markets where Carfax doesn’t reach and US law does not apply.   As an aside . . . the reverse is true too.  Think about that the next time you look at a “super nice, super low mile” grey market car from Europe or Asia.  Grey market imports – either way – are often not what they seem.

Another problem is that Carfax is not infallible.  Not all insurers report to them, in all states.  Sometimes privacy laws get in the way, and commercial concerns.  And there are the uninsured cars - when they flood no one marks their titles or takes any action at all.

Sometimes, a car seems like such a good deal that people ignore a Carfax report.  Most of the Harvey cars will dry out and look beautiful even if they were flooded to the rooftop.  Experience has taught me that many of those cars will be sold to suckers as “lightly flooded, and easy fixes.”  Some of them will end up in our shop.

Robison Service has a reputation for solving complex electrical problems.  Every hurricane and every flood brings us new customers, with “bargains” they purchased that were “hardly flooded at all.” Time and again we look inside the engines with fiber optic cameras and we find them full of filthy floodwater.  Most often, the entire driveline has turned to junk by the time we see the car, because that water has been stewing in the engine and transmission for 3-4 months.  Those cars look perfect and they will probably never run again.

Then there are the ones that were “lightly flooded.”  Not every car was in 6 feet of water.  “The water just came up to the pedals,” people say, and they show me the high water line.  Indeed, the engine and transmission appear free of water.  But the cars are still junk.  Modern high end cars run the wiring and many modules under the carpets and those bits have also been moldering for months.  Sure, we can fix it.  We can install a new wire harness, and all new modules on the floor.  We can change all the seat motors and all the window motors and other electrics that touched water.

Odd are, you’ll have a $20k repair bill when you’re all done and you could have bought a good used car for less.

Can this really be true?  Take a look . . . . Here is a photos of a three year old Range Rover, taken a few years ago after another big flood.  Looks great, doesn't it?  A real bargain, a $100k car, three years old, for under $20k!


The purple dollies are what we used to roll it into the shop, because it could not be shifted out of park.  But it looked great!

Until we looked closer, and saw . . .

Every electrical module rotted to junk


Every connector in the wiring harness rotted away


Alternator and other bits corroded up tight (so much for "light flooding) and the engine seized solid . . . .


In the end, this great looking Range Rover was towed to the junkyard by a very sad buyer.

The real takeaways from this:
  • Buy insurance before you drive, and include comprehensive;
  • If a deal seems too good to be true, it probably is;
  • If the title and history of a used car cannot be solidly verified, find another car.



© 2017 John Elder Robison

John Elder Robison is the general manager of J E Robison Service Company, celebrating 30 years of independent Bentley, Rolls-Royce, BMW/MINI, Mercedes, and Land Rover restoration and repair in Springfield, Massachusetts.  John is a longtime technical consultant to the car clubs, and he’s owned and restored many fine British and German motorcars.  Find him online at www.robisonservice.com or in the real world at 413-785-1665

Reading this article will make you smarter, especially when it comes to car stuff.  So it's good for you.  But don't take that too far - printing and eating it will probably make you sick.

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