Independent auto dealerships face a tough challenge
Competing against the often larger and better funded franchise dealerships of the major auto manufacturers. To meet this challenge, independents must commit to ceaseless innovation and superior customer service.

Shop At Small Car Dealerships!

Here's a little hint: If at all possible, when you are shopping for a car go to a small car dealership.
These smaller operations - especially the family owned - are generally much easier to deal with and have a much lower pressure atmosphere! They are more aware of the importance of building a long term relationship with you, and you will probably get a better price as a result.
Still, don't let your guard down, and always prepare yourself by researching the information on this web site.

By purchasing a used car, you can save a lot of money. A new car depreciates quickly in the first few years and after 3 years, it is worth only about 60-70% of the original price. In fact, as soon as you leave the dealership, your new vehicle is suddenly worth $5000-10000 less. When purchasing a new car you basically are paying for its fresh "new" aroma and warranty. Yet, buying a new car does not always mean the buyer will get perfection. A new car may come with problems associated with poor design or manufacturing defects that may have been already repaired during the warranty coverage period if it's a used car. The same is true for all kinds of recalls and service campaigns. Another advantage of buying a used car is that you could buy a loaded model with all the bells and whistles that you might not be able to afford had you bought a new car. However, buying a used car is still a bit of a gamble - there is no guarantee that the car is accident-free, has real mileage, and was properly maintained. There may be some hidden problems like a worn out automatic transmission, or engine problems that may not have been obvious when you test-drove the car. So, next you must ask yourself: Will I save money when buying a used car? How do I eliminate the risk of potential problems and is this actually possible to do? Read on to find out more information. Don't look for cheapest car. When it comes to used cars, "best deal" doesn't mean the cheapest one. Your goal is to look for a car in good condition for reasonable price. If you choosing between relatively cheap car that might have an accident in the past or was poorly maintained, needs some repair, etc. and more expensive one that is in excellent condition, I'd without a doubt choose the more expensive one. You will simply save on repairs and will have less troubles driving it. Don't think they sell it cheap because they don't know the price or they simply want to clear their inventory. If they sell it cheap, definitely there is something wrong with it. Remember, proper price for a certain used vehicle is not the one indicated in blue or black book - they give you just an average price. The actual vehicle value big time depends on a car condition. Two cars may only look the same. One may have been maintained so poorly and the engine won't last long after you buy it. Previous owner of another vehicle may have been religious about maintenance, was using only synthetic oil, has done the rustproof and so on. Without a doubt, I'd rather pay $2000 more for this second car just to have peace of mind driving it. So, how to determine how much you will have to pay for a certain model? Just to show you as an example, I search Ontario used cars for sale website Autotrader.ca for a three years old Honda Accord. The search result gives me more than 200 vehicles with the price ranging from 12,000 to 22,000 CAD. To be realistic, I know that for 12,000 I will not be able to buy something really good. 22,000 CAD seems to me too high. But there are quite a few cars for 17,000 - 18,000 price range - this looks more realistic to me.

Deceptive Car Dealer Ads and Activities - Pervasive As Ever

You hear them on the radio and TV everyday. Some have outrageous ads and sales gimmicks. "Push, pull or drag your trade in for $4000 minimum trade", "Best price in the world!" "Best bumper to bumper warranty ever - we cover everything." "Repo'd car sale today." Bet you didn't know that these ads can be and usually are very misleading and can be illegal.

According to Leslie Anderson, AAA, Misleading advertisements and deceptive marketing from car dealers has been on the rise in recent years. Car dealers, due to a struggling economy are resorting to grey market sales tactics and ads. Many of these ads are either borderline or even illegal in nature. With all the publicity in recent years of scams and illegal business activities by businesses from every state you would think most states would have toughened up their laws and started to crack down on bad car dealers. Only one state, New York, has really done anything.

There are laws already on the books that make many of these advertisements and such illegal, but few states will even look into these activities. In New York, if you run a Push, Pull or Drag sale the odds are you will get fined. The thinking behind New Yorks laws is that if you promise someone a set figure for their vehicle it should not be factored into the discount or markup of the newer, replacement vehicle. This is deceptive advertising. Yet I hear these same ads, with even higher amounts promised on the radio and TV in New York all the time. Then there's the matter of expressed and implied warranties.

Expressed and implied warranties are actually covered under federal laws. Every car dealer must have a federally approved warranty disclosure placed in the window. This is to show if a warranty exists and what is actually covered. This was done as there was too much discrepency in the past with car salesman blurring the line of what is really covered and what isn't. On a recent drive from North Carolina to South Carolina I saw 11 used car dealerships that did not have these in the windows - at one we found they were in the glove compartment. When we asked the salesperson why it wasn't in the window he said it wasn't necessary. In New York, every car dealer you drive by or visit will hav e these prominently displayed.

Then you have the usual lies - car dealers advertising a repossession sale, cream puffs, etc... They will lie about the origination of cars just like in a recent Carfax ad. Oh that was just a little fender scratch (complete repaint from a 50mph accident) or new upholstery (due to a flood and complete submersion). These repossession sales, like Repo Joe, do a media Blitz and claim they have all repossessed vehicles for a great buy. When in fact they probably don't even have one repossessed car that is for sale. Most car dealers get their cars from either trades or local auctions.

Regardless of what they claim they most likely do not know the vehicles history. You can't even rely on Carfax 100% as many vehicles are repaired without full salvage disclosure or even any repair history. A carfax report is only as good as the information that is actually entered into the system. Before you rely on that Carfax or what the dealer says is the cars history listen to this - Tennessee attorneys Frank Watson and David McLaughlin charge that Carfax's ads promise more than it can deliver. "Carfax fails to disclose the limitations of their database," says Watson. "People think they have a little insurance policy on their Carfax report, and it's just not accurate," says McLaughlin. Carfax is an online company that searches databases for a vehicle's history, claiming to be "your best protection against buying a used car with costly, hidden problems." But, critics say when it comes to many accidents, online reporting companies fall short. A class-action lawsuit against Carfax claims the company doesn't have access to police accident data in 23 states.

This article should be a wake up call to car buyers to be more on the alert to car dealer scams, lies and untruths. It should also be an alert to states from Oregon to Florida that more needs to be done to curb bad car sales tactics. Most car dealers aren't small mom and pop organizations. They are large million or billion dollar companies that will do anything to make a dollar. Even crossing the line or blurring what is legal and what isn't. And according to one big dealer in Charlotte, North Carolina whom didn't want his name or dealership mentioned for obvious reasons - "its all about that bottem line and if we get caught, thats what our lawyers are for. Per another car dealer, "it's a buyer beware market: Buyers must beware and be detectives too."

 

DRIVING; The Compelling Logic of the Used-Car Faithful

EVERYONE knows the person who will buy only a new car, whether for the assurance that it wasn't abused or scratched by another human being or for that new-car smell. But a growing group of buyers insists that brand-new cars are a foolish waste of money. They have caught on to something: overall, used cars are better than they used to be.
These customers buy well-maintained cars one to four years old, which come with thousands of miles on the odometer, thousands of dollars in savings and perhaps a few scratches. The cars can be found in top condition and with comprehensive warranties that may protect against costly repairs for up to a total of 100,000 miles.
''We just couldn't see paying over $50,000 for a new car,'' said Maria Mitchell, 48, of Glastonbury, Conn., a professor of mathematics education. That was the price of well-equipped new Mercedes ML500 sport utility vehicle. So she and husband, Peter, a Coast Guard captain, bought a top-of-the-line 2001 ML430 S.U.V., with 29,000 miles on it, for $34,800. ''We feel smart,'' she said.
Lately the market has been particularly favorable to the used-car buyer. ''There's a glut,'' said Art Spinella, an automotive analyst in Santa Barbara, Calif., for CNW Market Research. ''Because of incentives on new cars, like zero-percent financing, people are trading in. And over 3 million cars come off lease in 2003 to become used cars.''
The glut may not last, but the general trend toward quality probably will. Today's used cars, built after 1990 or so, were better made to begin with than cars built in the 70's and 80's. Complaints about ''planned obsolescence'' have disappeared as quality has risen. And the lease cars that make up a large part of today's used-car market are usually only two or three years old, with 20,000 to 40,000 miles, and have been maintained on schedule as a condition of the leases. All of this makes for better used cars, and competition has also created much better warranties.
The best bets for buyers, according to Rob Gentile, manager of the Consumer Reports New and Used Car Pricing Service, are used cars backed by car manufacturers through factory certification. These cars have limited age and mileage and have to pass a careful inspection. Virtually all carmakers sell them, usually increasing prices about $300 for economy models to $2,500 for luxury cars. Even with the premium price, Mr. Gentile said, ''the consumer saves on the depreciation -- and gets a good car and warranty.''
The Mitchells' S.U.V. was factory certified by Mercedes and came with the original warranty, good until 2005 or until the odometer hits 50,000. The Mitchells paid an additional $1,500 for an extended warranty running to 2008, with a 100,000-mile cap.
Only 1.5 million factory certified cars are predicted to be available in 2003, however, of the 44 million used cars that are expected to be sold nationally. Buyers of the other 42.5 million can get good deals, but they should be prepared to put more work into the process.
Franchised dealers will sell about 14.5 million certified cars that are not factory certified. ''Especially make sure that you understand the difference between a dealer-certified used car, which may have an aftermarket warranty the dealer buys, and a factory-certified car, where the factory stands behind it,'' Mr. Gentile said. ''And remember, a good used car warranty doesn't make a good used car.''
Another 14.5 million used vehicles will be sold by independent used-car dealers. Most will be the familiar neighborhood lots, but some are big-box-style chains that sell used cars in large quantities and many brands, often with no-haggle pricing, and set standards for the cars they handle. For example, CarMax, a chain with 38 used-car outlets mostly in the Sun Belt, excludes cars driven more than 60,000 miles and those with frame or flood damage. It sells extended warranties backed by the insurance broker Aon Corporation.

The rest of the used cars changing hands will go from one individual to another through newspaper advertisements, the Internet, or the fellow at work who knows somebody with a great old Toyota. In these deals, just one thing is guaranteed: the buyer had better beware.

A PRIMER
There's More to It Than Kicking the Tires