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In the market for a car?
You’ve probably heard someone say demo cars are the best option. Am I right?
They’re not wrong. Buying a demo car has its advantages. But (surprise, surprise) there are a few things you need to keep in mind.
Here’s what you need to know.
What is a demo car?
A demo car is a demonstrator or demonstration car. Dealerships use demo cars for test drives, as display models, as company cars, or possibly as loan cars. These vehicles can be categorised between new and used cars. Because they have very low mileage and are almost new, but aren’t classified as brand-new.
Here are some things to know about demo cars:
- Mileage: Demo cars typically have very low mileage. Somewhere between 1,000 and 10,000 km on the odometer.
- Price: Demo cars are often sold at a discount, usually 8% to 15% less than brand-new models.
- Warranty: Most of the manufacturer’s warranty should still remain. Just check how much is left.
- Condition: There may be some minor wear and tear. Like light scratches or slight interior wear. Not always, but take a close look before buying.
- Usage: Several drivers may have used the demo car. Ask about the car’s usage history to learn more.
Backed by data: According to a 2023 report by AutoTrader South Africa, demo car buyers save between 8% and 15% compared to new car buyers. Depending on the make and model, of course.
Fun fact…the report also notes that the average reported mileage on demo cars sold in SA is under 10,000 km.
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Buying a demo car vs. a new car
Most people believe that buying a demo car is a good idea. Mostly because demo cars are almost new but cost much less. But there’s more to consider. Buyers should compare differences in price, available options, and time left on the warranty and review the car’s condition to get a better idea of the overall value.
Here’s a comparison between buying a demo car vs. a new car:
| Feature | Demo car | New car |
| Price | Lower than new cars (due to prior use) | Full price (no prior use) |
| Mileage | Typically low but not zero | Zero mileage |
| Condition | Like-new but could have minor wear | In perfect condition |
| Warranty | May have a reduced warranty | Full manufacturer’s warranty |
| Availability | Limited in options | Customizable with a full range |
Check this out.
An example of buying a demo car vs a new car: Let’s say you’re eyeing a 2024 Toyota Corolla Cross (ohhh yes). A new one could cost just over R400,000. But, a demo model with only 5,000 km on the odometer might be priced at R360,000 (that’s a ballpark figure).
This means you could save R40,000 (10%) by choosing the demo version. While still getting an almost new car with modern features.
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Advantages and disadvantages of buying a demo car
Buying a demo car comes with advantages and disadvantages. Advantages include lower cost and less depreciation in value. While the disadvantages include slight mileage, a shorter warranty timeframe, and possible wear and tear.
Advantages of buying a demo car
- Lower cost: Demo cars are sold at a reduced price compared to brand-new models.
- Less depreciation: The biggest decline in value has already passed. This means demo cars tend to hold their value a little better.
- Immediate availability: Demo cars are already in stock. Whereas dealerships may have to order new cars.
Disadvantages of buying a demo car
- Mileage: Demo cars come with some mileage, which means they’re not brand new.
- Limited warranty: The warranty is already active. Which means it may be shorter.
- Possible wear and tear: There could be very minor damage like scratches or interior wear.
- Limited choice: There may not be as many model, colour, or feature options to choose from.
Most people are happy with a bit of mileage and even some wear and tear. But the limited warranty can be a hurdle. Especially if it’s A LOT shorter than you’d expect.
If you’re in that camp, try this…
How to reduce the risks of a limited warranty
A demo car has been driven before, which means some of the warranty may have already partially expired.
Before buying:
- Ask the dealer to explain how much of the warranty is left.
- Ask whether you can extend it.
Many manufacturers offer extended warranty packages, and in some cases, you may not need it. Either way, you can walk away knowing that you’re happy with the car’s coverage.
Demo cars for sale in South Africa
Want to buy a demo car in South Africa? Here’s how and where you can start looking for a demo car that suits your needs and budget:
- Browse online platforms
- Visit authorised dealership
- Browse online platforms: Websites like AutoTrader and CARmag have dedicated demo car listing pages. You can also use Cars.co.za. Just browse their ‘Used Cars’ listings and add the right filters. Filter for cars below 10,000km mileage to start.
- Visit authorised dealerships: Major car brands such as Toyota, Volkswagen, BMW, and Mercedes-Benz sell demo cars through their dealerships. If you have a specific car in mind, you can stop by local dealerships to ask about the demo cars on their floor.
(Why not make a day of it? It could be fun.)
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In summary
Buying a demo car is generally a smart move. It’s a great way to get a car that is almost new at a lower price.
But that doesn’t mean there are zero downsides or risks. Go over the advantages and disadvantages again. Ask questions. And choose wisely.
Keep reading on Everycent to learn more about finances and all things money-related in South Africa.
Struggling to pay your debt bills? Check to see if you qualify to lower your debt instalment and free up money for other expenses.
