As a car dealer, you are assessing and taking in trade-ins frequently – and making a mistake on your value estimate can be costly for your business. Damages caused by accidents are a main detractor in a vehicle’s value, and while there are resources you can use to check a vehicle’s history, there’s still a chance you may miss some signs of damage that lower a vehicle value. Let’s explore cosmetic, hidden, and structural car damage, how you can explain these ideas to customers when you’re appraising a vehicle’s value, and how AI tools can help you identify any issues that may escape the naked eye.
When an accident happens..
Today’s vehicles are designed to absorb accidents to an extent -- with crumple or crush zones, engineers develop cars that have parts designed to be damaged and crushed during an accident. These parts can absorb the crash and redistribute the impact to reduce injuries. Even still, of course, accidents result in many types of vehicle damage, some of which is visible to the naked eye, and some of which is hidden. While visible, cosmetic damage is important to repair, and typically noticed by the vehicle owner or your customer, it's equally – if not even more important – to assess the vehicle for structural and hidden damage, and explain the value consequences to your customer.1
Type of damage and how to explain it to customers
Cosmetic Car Damage
Cosmetic damage is any harm done to the exterior appearance of a vehicle, such that there is no impact on the structural integrity or functionality of the vehicle. Some examples include paint dents or scratches, bumper scrapes that result from minor collisions or parking mistakes, or other dings that could be caused by rocks, hail, or small debris. While this type of damage is not as urgent as the next types we will discuss, it is still important to take care of all cosmetic damage within a timely manner, because leaving these issues unresolved can lead to further structural issues down the road like rusting.2
- How can cosmetic damage be repaired? Typically, an auto body shop can handle cosmetic repairs – depending on their severity. Always explain to your customer that these blemishes may lead to a reduction in their vehicle’s trade-in value.
Hidden Car Damage
Hidden damage refers to damage to the internal systems of a car as a result of an accident. And these issues are not typically immediately visible, which makes them higher risk, and likely to go unnoticed by your customer. This can include problems with the suspension system, electrical system, or other mechanical components beneath the façade of the car.2 Some other examples of hidden damage include damage to the trunk, such as locking, open and close, or moisture and seal issues, as well as alignment issues like wobbly steering, vibrations, noise, and squeaking tires.4
- How can hidden damage be repaired? Hidden damage can only be discovered through a qualified inspection that assesses the vehicle’s computer system. A qualified technician is needed to run diagnostic tests and propose solutions.
Structural Car Damage
Structural damage refers to harm in the frame or foundation of a car, including steering and suspension, tire alignment, and general drivability.2 Most vehicles today are built on a unibody frame, and in an accident, these frames can absorb the crash better than vehicles with a body-on-frame, keeping passengers safe. However, an unfortunate result of that is these unibody frames are more susceptible to developing significant structural damages as a result of a crash.3
- How can cosmetic damage be repaired? Typically, to repair structural damage, the vehicle manufacturer will be involved to ensure the car matches factory specifications and drives safely. Any structural damage can be grounds for rejecting a vehicle trade-in, as these damages are dangerous and undesirable for other customers.
How does vehicle damage affect resale value?
A vehicle with structural, hidden, or cosmetic damage decreases in its resale value, with the severity dependent on the significance of the damage. And for car dealers, making sure you identify all damage and explain it to your customer is crucial. Obtaining the vehicle report and conducting AI damage testing are two ways to check for this type of damage, so you can ensure you only resell safe vehicles and keep them at the right price.3
Try ClearCar today
At ClearCar, our AI damage detection tool allows dealers to send customers a link to a self-guided photo process using their phone. The images are then scanned by the AI tool to help the dealer detect damage. The photo will be tagged for the dealer to reference, calling out areas where there are dents, scratches, or rust. Combined with questions that the customer can answer, the AI tool then helps the dealer estimate a price compared to the market to secure the trade-in. Our tool makes the trade-in process pain-free, accurate, and efficient. Try it today.
Sources
- Apex Technical School. 2020. “A Car Accident Guide: Types of Vehicle Collision Damage.” Apex Technical School. Retrieved February 24, 2025. https://apexschool.com/toolbox/car-accident-guide-damage-types
- Rays Automotive. 2024. “Types of Car Damage Explained: Cosmetic, Hidden, or Structural Damage.” Rays Automotive. Retrieved February 24, 2025. https://www.raysautoinc.com/types-of-car-damage-explained-cosmetic-hidden-or-structural-damage
- Gorzelany, Jim. 2020. “Car frame damage and other structural damage.” Carfax. Retrieved February 24, 2025. https://www.carfax.com/maintenance/structural-damage-101
- Roberts, Chris. 2021. “5 Examples of hidden damages found after a car accident.” Mackin’s Auto Body. Retrieved February 24, 2025. https://www.mackinsab.com/blog/hidden-damages-found-after-accident/
