Odometer Rollback: Figures Can Lie

With few new cars available, used-car demand – and used-car prices – shot up in early 2021. While some prices began to normalize in 2022, another aspect of the used-car trade shot up last year: odometer rollback.

A report released in mid-December by vehicle history company Carfax says about 1.9 million vehicles in the U.S. had their odometers tampered with, a 7% increase on the previous year. Consumers lose an average of $4,000 per rolled-back vehicle, not including the added maintenance, says Carfax.

Those numbers are based on all cars in operation, Carfax spokeswoman Emilie Voss tells Wards. Carfax has some 130,000 sources that send it info and Carfax keeps track of a vehicle’s odometer readings throughout its life, she says. “We flag any discrepancies,” says Voss.

The states with the most significant rollbacks were, as might be expected, those with the largest passenger-vehicle markets. But some states saw a much larger increase in rollback occurrences than others.

California led the incident pack but saw only a 2% increase over the previous year (see chart, below). Texas, with the second-most incidents, saw a Texas-sized 15% rise in incidents, the highest among the top 10 by volume. New York was third in volume, but with only a 4% increase in incidents.

Digital odometers were supposed to make tampering more difficult, but that hasn’t been the case.

“Many people think odometer fraud disappeared with the invention of digital odometers,” says Voss. “But that couldn’t be further from the truth. We’re still seeing the number of vehicles on the road with a rolled-back odometer rise year-over-year. It takes con artists a matter of minutes to wipe thousands and thousands of miles off a vehicle’s odometer.” 

Tampering with a digital odometer has become increasingly easier as the cost of a tool to alter a car’s mileage has gotten cheaper. What used to cost thousands of dollars can now be purchased online for as little as several hundred dollars.

European manufacturers have had more success than American and Asian OEMs in making it harder to alter digital odometers on recent models, Voss tells Wards,  

Reducing a car’s mileage immediately boosts its value, and the difference can be substantial, especially on a premium vehicle, says Max Zanan of MZ Dealer Services, a consultancy.

“Look what it does to the book value if you take a Ferrari, for example, and have only 3,000 (4,830 km) instead of 30,000 miles (48,300 km) on it?” he tells Wards. “The value difference is going to be day and night.”

And while you might envision a shady used-car dealer altering an odometer’s reading, the perpetrator may be much more prosaic. A vehicle lease is much less expensive if the allowed mileage is low, points out Zanan.

“The lower mileage you take, the less your lease payment,” he says, adding that if you exceed that mileage, rolling back the odometer can save a lot of money.

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