It was called The Automobile Information Disclosure Act of 1958 and it was sponsored by Almer Stillwell Monroney, the Senator from Oklahoma who preferred the colloquial nickname “Mike” and whose other legislative priority in 1958 was to create the FAA.
We owe Mike Monroney a lot. He was from that long-discredited and long-forgotten breed of old privileged men who believed there was such a thing as the public interest and that they had a genuine duty to act in that public interest. As with Rudolf Diesel, history has paid him the supreme compliment of omitting capitalization — it’s common for “monroney” to be used in correspondence or business as a mere noun denoting the window sticker in a new car.
We take the monroney for granted nowadays. There are few of us left alive who can remember the days when a car did not have its price and equipment fully and forthrightly glued to the inside of its rear passenger window. In fact, very few of us take the window sticker at all seriously. Everybody knows that in the modern car market the dealer invoice is the “real” sticker, unless you’re talking about a Ferrari or something where the MSRP is just a starting point for further discussions based on one’s history with the marque, the dealership, and/or Goldman Sachs. But the protection and information offered by that label in the window is real, it is meaningful, and it is absolutely critical to any remotely ethical business transaction between the dealer and the consumer. (Read More…)
If you were to listen to the Experts Of The Internet, you might become convinced that Certified Pre-Owned is the only way to go when buying your next whip (I like to say “whip” because I know it annoys many of you). In this case, the experts aren’t entirely wrong — after all, there’s a lot to like about CPO. Late-model cars in like-new condition at a cost that’s considerably less than new, extended warranties, 1,857-point inspections — it’s all good stuff, right? If you play your hand correctly, you can get an outstanding deal and a car that will inspire confidence.
But CPO is a giant pain-in-the-ass for many dealers. Knowing what we know about the dealership world, is it any wonder that a good number of them game the system? If you’re looking to go CPO, you’ll want to know the tricks they pull, and how they affect you, the consumer.
Driving off the dealer lot in a longed-for new vehicle is one of life’s richest pleasures, but there’s no joy if a buyer can’t find the chariot of their dreams.
Now, imagine that your dream ride is a gray Chevrolet Malibu — a 1LT model with two common options. Doesn’t that seem like an attainable goal? Shouldn’t be too hard to find, you’d think, right? Well, one would-be buyer says otherwise. (Read More…)
Imagine that you owned a successful business. For many of you reading this today (including me), you don’t have to imagine, because you’ve done it. If you owned anything from a lemonade stand to a global airline, you’d have a pretty good idea of your costs and profits. You’d know which advertising sources worked best for your business. You’d strive to know where your customers came from. You’d have a system for hiring and training employees.
You’d do all of this and more, because you must have all of your ducks lined up in pretty little rows to be successful.
Well, that is unless you’re a car dealer. In that case, you may have no idea about any part of how your business works and still make money hand over fist.
Don’t believe me? Over the next several weeks, I’ll prove it to you. Today we’ll start with a simple concept that befuddles most dealers: online merchandising.
A record 31 percent of all new vehicles sold this year in the U.S. are leased. I spent a good part of my career studying why some people refuse to lease. Much of their resistance stems from bad buzz. Some say it’s because of the stories they heard about ’80s-era open-end leases where owners were responsible for paying the car’s residual value at lease end. (These are the same customers who will not buy a Hyundai today because they produced crappy cars in the ’80s.) Others oppose leasing because they heard about a guy whose cousin’s neighbor had to pay $5,000 in wear and tear or excess mileage charges at lease end. And there are those of you who will brag comment below about how you always pay cash for your cars and don’t understand why other people won’t follow your lead.
This article is not designed to convert such non-believers to leasing. This advice, drawn from my years in the auto finance business, is for buyers who know the basics and benefits of leasing, want some timely tips on how to get the lowest possible payments, and want to pay less money on lease-end charges.
If you want the best chances of being treated right as a new car buyer, head over to a Toyota or Mercedes-Benz dealer, a new report says.
Temkin Group, a customer experience research and consulting firm, ranked 294 companies, including 20 auto dealers, based on satisfaction surveys from 10,000 Americans. While Toyota took the top spot with a 66 percent rating, the report holds bad news for many automakers, and the industry as a whole. (Read More…)
Mitsubishi confirms it is going to shoehorn another SUV into its lineup to tempt those utility-hungry Americans.
That, Volvo wants everyone to buy S90s from their beds, Fiat Chrysler isn’t having a dealer’s trash talk, UAW bolsters its ranks, and your gas is going up … after the break!
Fiat’s American retailers are struggling to bring in buyers as well as pay the cost of their dealerships, but help is on the way from the parents.
On March 9, Fiat Chrysler Automobiles pitched a plan to stabilize dealers, offering Fiat stores the opportunity to combine their operations with the Chrysler-Jeep-Dodge-Ram dealers many are adjacent to, Automotive News reports.
The tale continued last week as the House Committee on Financial Services revealed that their work on this case now includes trying to get the CFPB and Department of Justice to agree on that age-old problem on how to get white car buyers to admit that they are actually white.
Let us review this investigation, which recently prompted the House committee to publish a report about the CFPB probe, titled “Unsafe at Any Bureaucracy: CFPB Junk Science and Indirect Auto Lending.”
We have opined in these pages before about how for every Tesla sold in America, there are two or three glowing stories written about the electric automaker. There are days when over 50 percent of the pieces on auto industry news feeds are about Tesla, which is not bad for a company capturing 0.1 percent of the U.S. automobile market. Tesla Motors CEO Elon Musk is truly a marketing and public relations genius.
Given that, it is fascinating when a negative story surfaces about Tesla’s way of doing business and the slobbering media is strangely silent. (Read More…)
After I purchased my S2000 and was about to drive off the lot, my salesperson regaled me with stories about the Honda’s previous owners – an elderly couple who loved the sports car, called it their “baby,” but traded it for a Mercedes-Benz E350 Coupe because they wanted more room. None of this history was noted in their website or internet ads for the S2000, but why wasn’t it?
It turns out that most franchised dealer’s new and pre-owned vehicle ads on AutoTrader and cars.com as well as their own websites do not tell such stories because they are composed by automated services. The fun part is that dealers sometimes never proofread them, like in the example above showcasing the ultimate in Additional Dealer Markup. Even better is when dealers try to write the ads themselves. Let’s take a look.
Car dealers trying to head off Tesla Motors’ attempts to set up factory-direct showrooms in Ohio lost a round last month when a dealership licensing amendment that would have blocked Tesla from selling vehicles direct to retail customers in the state wasn’t voted upon in the state legislature. Now the dealers are trying the litigation route, suing Tesla and state agencies to have Tesla’s retail license voided. The defendants are Tesla, the Ohio Department of Public Safety and the Ohio Bureau of Motor Vehicles. The plaintiffs include Midwestern Auto Group in Dublin, Ohio, and Ricart Automotive Group, of Groveport, Ohio. (Read More…)
It is no surprise that U.S. automobile dealers have been in a tizzy the past few months as the Consumer Financial Protection Bureau (CFPB) has been rattling its swords threatening to ban them from marking up interest rates on car loans, a sacred profit center for dealerships. Using methodology that assumes a person’s race can be determined by their last name and their gender by their first name, the CFPB claims that certain protected classes are being discriminated against in terms of being charged higher interest rates and thus the practice must stop.
What is a surprise is that Congress is equally annoyed with the agency’s strategy and lack of transparency, and recently announced new regulations limiting their power. No matter the outcome, there is a real possibility that the unintended consequences of the CFPB’s actions will be higher car loan rates for you. (Read More…)
After I purchased my S2000 and was about to drive off the lot, my salesperson regaled me with stories about the Honda’s previous owners – an elderly couple who loved the sports car, called it their “baby,” but traded it for a Mercedes-Benz E350 Coupe because they wanted more room. None of this history was noted in their website or internet ads for the S2000, but why wasn’t it?
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