It is haram to sell an item without pointing out its faults, even if he is selling it to a kaafir

The one who sells an item in which there is a fault must point out its faults, whether he is selling it to a Muslim or a kaafir, otherwise he will be deceiving and sinning. 

Al-Bukhaari (2079) and Muslim (1532) narrated that Hakeem ibn Hizaam (may Allah be pleased with him) said: The Messenger of Allah (peace and blessings of Allah be upon him) said: “The two parties to a transaction have the option (of cancelling it) until they part. If they are honest and disclose any defects, their transaction will be blessed, but if they lie and conceal defects the blessing will be erased.” 

Al-Haafiz ibn Hajar (may Allah have mercy on him) said: “If they are honest” means, on the part of the seller with regard to the price and on the part of the buyer by paying off. “and disclose any defects” means, disclose any faults in the price and in the goods for which it is paid, so it applies on both sides; the same applies to any shortcomings. The hadith shows that they will attain the blessing if they meet the conditions, which are honesty and disclosure of any defects, and the blessing will be erased if the opposite is the case, namely lying and concealment of defects. Will the blessing be given to one of them if he fulfils the conditions but the other does not? The apparent meaning of the hadith suggests it will."(Fath al-Baari). 

Ibn Qudaamah (may Allah have mercy on him) said in al-Mughni (4/108): If a person knows that there is a defect in his goods, it is not permissible for him to sell them unless he discloses it to the purchaser. If he does not disclose it then he is sinning.  This was stated by Ahmad, because of the report of Hakeem ibn Hizaam that the Prophet (peace and blessings of Allah be upon him) said: “The two parties to a transaction have the option (of cancelling it) until they part. If they are honest and disclose any defects, their transaction will be blessed, but if they lie and conceal defects the blessing will be erased.” Agreed upon. And he (peace and blessings of Allah be upon him) said: “The Muslim is the brother of another Muslim, and it is not permissible for a Muslim to sell his brother goods in which there is a defect, without pointing that out to him.” End quote. 

He also said (4/113): The meaning of concealing faults is concealing them from the purchaser knowingly, or hiding them from him in such a way that the purchaser thinks there are no defects; both are deception which is haram  

The hadith “The Muslim is the brother of his fellow Muslim…” was narrated by Ibn Majaah (2246) and classed as saheeh by al-Albaani in Saheeh Ibn Majaah. The prohibition on deceit does not apply only to dealing with Muslims, rather it is haram to deceive both Muslims and kaafirs, but the word Muslim is used here because in most cases one Muslim deals with another. 

Al-Subki (may Allah have mercy on him) said in Takmilat al-Majmoo’ (11/306): The general prohibition on deceit referred to by the author (may Allah have mercy on him) [al-Raafa’i], his companions and al-Shaafa’i and the obligation of pointing out any defects includes cases where the purchaser is a Muslim or a kaafir. The words of the hadith quoted and used as evidence by the author (may Allah have mercy on him) refers to a Muslim dealing with a Muslim. This was narrated concerning a Muslim proposing to a woman to whom his brother has already proposed, or outbidding him. The majority of scholars (may Allah have mercy on him) are of the view that there is no difference in this case between a Muslim and a kaafir. As for limiting the meaning of these ahaadeeth, they only mention Muslims because it is usually the case that one Muslim deals with another, or it may be that the aim is show how abhorrent it is to do such a thing to someone who is Muslim like you. The fact that it is general in meaning is also proven by other evidence. And Allah knows best. End quote. 

He also said: 

The ahaadeeth which forbid deceit and enjoin honesty are very many, and the ruling is known from sharee’ah. Concealing faults is deceit."(Al-Majmoo’ 11/303). 

So you have to disclose the faults that you are aware of in your car, whether you are selling it to a Muslim or a kaafir. 

And Allah knows best.