Car Dealers Are Evil - Part Deux

Have you checked out the article over at Edmunds.com called “Confessions Of A Car Dealer?” A writer went under cover and became a car salesman for a couple of months and wrote about his eye-opening experience. Here are a few excerpts from the fascinating article:

*** The final box on the 4-square was for the trade-in. This was where the most profit could be made. Buyers are so eager to get out of their old car and into a new one, they overlook the true value of the trade-in. The dealership is well aware of this weakness and exploits it.

*** "You have to break them inside — make them understand that if they want our beautiful new car, they're going to have to pay for it."

*** I could only answer that the system was not set up for educated people who thought for themselves, it wasn't to help customers make informed decisions. The system was designed to catch people off guard, to score a quick sale, to exploit people who were weak or uninformed. Those were our buyers.

*** My manager had, at one point, described the different races and nationalities and what they were like as customers. It would be too inflammatory to repeat what he said here. But the gist of it was that the people of such-and-such nationality were "lie downs" (people who buy without negotiating), while the people of another race were "roaches" (they had bad credit), and people from that country were "mooches" (they tried to buy the car for invoice price).

*** Somehow, the earlier sales sheet had gotten "lost" and the numbers they had agreed on were "forgotten." The price of the minivan and all the extras shot back up and the price of his trade-in took a serious dive. For the next two hours Mr. Park was hammered by every closer in the dealership. I got to watch a variety of styles: impatience, cajoling, begging, threats. Through all this his wife sat by his side clutching their little baby. Mr. Park began complaining that he had a headache and his manner became increasingly angry. At one point he ominously muttered, "Don't screw with me."

*** Leasing is very popular these days. One of the benefits, from the salesman's point of view, is that it is so complicated that the customer sits transfixed during negotiations, unable to defend themselves. Usually, the salesman hits the customer with incredibly high monthly payments on a purchase plan. Then, as if the idea just popped into their mind, the salesman will say, "You know, there might be another way to get the payments down... Have you folks ever considered leasing?"

*** But in the car business, the dealership's profit is the consumer's loss. I'm not suggesting that the dealership be run without a profit, but in one case I heard about, the dealership made a 16 percent profit on a $25,000 car. That meant the consumer, the average Joe buying the car, paid about $4,000 too much.

*** In one case, I participated in leasing a car to a couple at well over its value. I was haunted by the thought that this nice ordinary couple had trusted me, and I had let them sign a contract that would bind them for five years to a high-interest lease. I consoled myself thinking perhaps another dealer would have inflicted greater damage.

At the end of the lengthy article, the writer admitted that during the undercover stint, he had befriended some of his car salesman co-workers. He explains that he realized they were not the enemy, they were merely trying to "make a living." The real evildoers were the managers and dealership owners. They were the ones up in their glass towers, looking down on the lot, crunching the numbers and robbing us blind.

Fine, so maybe the title of my article should be “Dealership Owners And Managers Are Evil.” The point is that as consumers, who work hard for our money, we shouldn’t have to put up with these tactics. Not to mention the blatant disrespect and bigotry.

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