How Much Is That Auto in the Window?

I ran across an article from a couple of years back that appeared in the Wall Street Journal about car dealer practices that aren’t very consumer friendly. The author, Charles Passey, interviewed me for the piece.

Mr. Passey asked me to supply him with examples of car dealers’ worts practices. I sent him copies of invoices, buyer’s orders, dealer addendum labels, and names of people I knew around the US who were experts on unfair and deceptive advertising by car dealers. It was important to me because having what I’ve fought against for so many years written about by a national publication adds credibility. Not only does the Wall Street Journal have the largest circulation of any newspaper in America, but it’s also arguably the most respected daily publication. 

One might ask, why don’t local newspapers write stories about car dealers’ unfair and deceptive sales and advertising? The answer, like so many, is “follow the money”. Every local newspaper has an auto advertising section with most of, if not all of the dealers in that market. Newspapers seem to be the advertising choice of many dealers, although TV and online have definitely cut into their revenue in large metro markets. TV ads are so expensive that most dealers have no choice but to use the newspaper and online. Car dealers are the single largest source of ad revenue in many newspaper markets. 

Now I know that journalistic ethics require a separation between the news, editorial, and advertising departments. But that’s the way it used to be. Today local newspapers and even some national ones are struggling for survival. Ethics go out the window when it comes to survival. Would you steal food for your child if you believed you had no other recourse?

Another reason that I’m encouraged by this Wall Street Journal article is that every auto manufacturing executive reads this newspaper every day, especially articles about automobiles. Also, most car dealers also read the Wall Street Journal. Reading a negative report about deceptive car dealer sales practices in a highly respected national newspaper has got to get their attention. Many manufacturers and most car dealers seem to be in denial about how they endeavor to trick their customers with misleading, false ads and sales practices.

I have to believe the auto industry will awaken one day and realize that almost all other retailers in the 21^st century have left car dealers in the dust. Most car dealers are still employing the “get ‘em in the door any way you can and make as big a profit as you can get away with” shabby tactics that were common practice fifty years ago. Most manufacturers and some dealers are beginning to realize that car dealers are held in the lowest esteem of any other retailer. Car sales and service complaints top the list and car dealers rank dead last or close to it in the annual Gallup poll, HONESTY AND ETHICS IN PROFESSIONS, along with Congressmen, lobbyists, and lawyers. 

I tell manufacturers and my fellow dealers that if we don’t regulate ourselves, you can bet the government will step in and do it for us. Federal Trade Commission is conducting hearings all around America asking for input about unfair and deceptive trade practices by car dealers. If the government steps in like they did with our nation’s banks, car dealers and manufacturers can expect to be up to their eyeballs in expensive regulations, red tape, and bureaucracy.