Wednesday, July 20, 2011

Aren't All New Car Dealerships the Same?

Are you in the market for a new car?  Have you perhaps bought a new car recently?  I am sure that you are looking online.  Perhaps you are getting online pricing quotes.  Maybe you are working with 2 different dealerships on the same car.  Think about this for a second.... Not all Dealerships are the same. 

You may have heard recently that a dealership in your area has a connection with the factory or exclusive manufacturer discounts that sound as if they are the only ones allowed to have them.  Maybe they are saying that they get more cars because of their "factory" connection.  Do you believe this?  You shouldn't.  It would be unethical for the manufacturer to not do the same for each franchise dealership.  I mean we all support them by selling their cars so we should all get the same discounts and the same types of inventory etc. Little known facts are that dealers are ALL treated the same.  No one has a "Factory Connection."  No one has exclusive financing offers or exclusive rebates and incentives.  That's a fabrication of the truth.  All dealerships get the same incentives and the same types of inventory.  Some dealers may get more inventory because of their volume but it is only going to be according to their sales volume and the area that they do business.  It has nothing to do with them calling the factory to send 20 more Accords or Camrys since they are running low at the dealership. 

Absolutely not.  Again though, not all dealerships are the same. In the past when you have shopped for a new car, you may have had 2 different dealerships that were competing for your business.  It may have been on the same car with the same MSRP.  So you are telling them you need more discount and they both come back to you with the "bottom dollar" but on dealership is beating the other by $500.  The dealer that tells you this is eager to earn your business even though the price is slightly higher.  They contest that this includes everything except your taxes and tag fees.  They promise you that the other dealership can't be beating them by this much money.  This can't be!  Why would one dealership miss your business totally knowing that you are a savy shopper and that you want them to do better.  So you decide that they are just being greedy. 

You drive the the other dealership to pick up your new car and it still weighs on your mind why they would be so greedy and loose your business over $500.  As you pull in, you see your new shiney car waiting for you to take her home.  You go into the dealership and sit down with the salesperson.  He walks you around the car showing you every feature and as he completes the walkaround, he ends at the window sticker and ellaborates on the pin stripe, fabric protectant, wheel locks, mud flaps, window tint, moonroof deflector, and nitrogen in the tires.  You sit back and think to yourself, "Wow!  I am getting all of this and still saving $500 from what the other dealership offered me."  As you go into the salesperson's office, ready to sign the preliminary paperwork, he presents you with a buyer's order laying out the costs of the car.  He reads out to you the MSRP and then your sales price which was the price that is saving you that $500 we have been talking about. 

But there is more! (example numbers)  "So your sales price is $20,000, that is a discount from the $22,300 MSRP."  This is exciting news to you.  "so $20,000 plus the $199 pinstripe, $599 fabric protectant, $299 wheel locks, $299 mud flaps, $249 window tint, $399 moonroof deflector, and the $149 nitrogen in your tires brings your total sales price to $24,493.00."  You excitement at that point totally withers and turns to anger.  You ask why the price changed from what you originally agreed to.  The salesperson explains, " the $20,000 price was for the car, we add additional accessories at the dealership that we can't just take off or give away.  He attempts to continue explaining the remainder of the buyer's order when he comes down to the "Admin Fee" or Doc Fee" of $599 "which brings us to $25,092 plus your taxes, tags, and local fees.  What the heck is a "Doc Fee?"  They explain to you that it is to cover the expenses of the office staff, courier services, credit reporting services, and other expenses that the dealership incurs when they sell a vehicle. At that point, you think to yourself, "This isn't really happening!"  You realize that you have been misled.  All this time this dealership has known that they were going to charge you for the additional accessories but never told you.  They just hoped that when you got to the dealership to pick up the car, you just went along with it and bought it from them anyway.  It's decision time for you.  Do you do what they planned for you to do and buy the car from them anyway?  You don't want to call the dealership that at the time, was $500 higher because you want to save face right..... WRONG! 

Buying a car is a big decision.  It can be stressful and many decisions are made.  Dealerships that don't always practice the best possible ethics give all dealerships a bad name.  Here is how you should handle that situation.  Don't BUY THAT CAR.  Chances are, if they misled you once, what else are they not being 100% truthful about. 

Call the other dealership.  Verify the price and verify any additional fees incurred with doing business as well as accessories that may be on the car.  More than likely, they quoted you the price on the correct car without all of the accessories and that is why they were only able to discount it as much as they did.  Get ANY deposits back from the dealership or any money that they have taken from you in order to finalize the transaction that you were misled about. Now, put a deposit on the car at the dealership that is honest with you and go pick up your new car. 

Again, not all dealerships are the same. 

Why was the price $500 different??  The misleading dealer has a $599 doc fee.  This fee isn't charged by all dealerships.  Some go as high as $1000!  The majority of the time, these fees are designed to compensate the amount of discount that they are giving you on the car. 

Why do dealerships put accessories on new cars?  Dealerships want to make the most of the service and parts departments at their store.  The more that they showcase on vehicles, the more that they sell as well as more customers will probably want these accessories.  There is an aspect of making profit there somewhere but many times, it is purely to show off what can be done to the cars so that people know what it will look like prior to doing it to their new purchase. 

Why do you tell me that all Dealerships are not the same?  As I stated earlier, some dealerships that mislead customers or don't tell them the whole truth give all dealerships a bad name.  No one has a factory connection as they may claim so we all pay the same for cars.  If one Toyota or Honda store can do it, they all can do it.  If one Toyota dealership has a rebate from Toyota, they ALL DO.  The difference is the people that work at that dealership and the morals that the dealership has.  Every business will at some point in time have an unhappy customer.  The difference is explaining the issue, and resolving the issue fairly. 

Why do dealerships charge documentation fees?  Some dealerships charges documentation fees from $100-$1000.  These fees were designed to offset some costs that dealers had in processing paperwork, title and tag work, couriers, and other expenses.  They have recently gotten out of hand are have been misused to influence a customer to purchase a car at an attractive price, only to have the bottom line increased significantly by a doc or admin fee.  Fees under $300 are typically acceptable. 

Stokes Automotive Group strives for excellence in every transaction that we do.  We appreciate all that have patronized our stores and welcome you to come back to do so again.