I wrote another article on wheel alignments a short time ago. If you’re not conversant with wheel alignments, this is a good article to read and you can find it here. Also, this is a great video on YouTube, http://www.tirekiller.com/.
Most everyone thinks of a wheel alignment as a maintenance item which is the owner’s responsibility that you don’t need to worry about when you first buy the car…at least not until you drive into a pothole, notice a pull to the left or right, or uneven tire wear. Unfortunately most car manufacturers and dealers also look at alignments the same way.
A few months ago, I invested in a new state-of-the-art wheel alignment machine. Older wheel alignment machines require a lot of time and labor to measure the wheels for proper alignment. In fact, it actually takes almost as long to determine if your car’s wheels are out of alignment as it does to also actually correct the alignment. Because of this, most service departments (independents and dealers) will charge you the same just to “check” your alignment as to actually correct it. The cost of 4-wheel alignments averages between $70 and $100. Beware of very low priced alignments. These may be just for the front end of your car and/or by older or obsolete alignment machines. I invested in my new state-of-the-art alignment machine because it allows me to check an alignment in less than 10 minutes which permits me to check a customer’s alignment at no charge.
Now, I check the wheel alignments on every car that comes into my service drive. I also check all of my company cars including my parts delivery trucks my service courtesy vans, my new car demonstrators and my used cars. I do this for the same reason that you should check the wheel alignment on your car, even if it’s brand new. As I explained in my earlier article, a car’s wheel out of alignment is like high blood pressure…often times there are no symptoms. And, just like high blood pressure can be fatal to you, misaligned wheels can be fatal to your tires.
The reason that I’m writing this article so closely on the heels of my last wheel alignment article is because of the astounding data I’ve been able to collect since I began checking every car coming through my service drive (about a hundred each day) for alignment. About one car out of every four that I checked is out of alignment which didn’t surprise me that much. Industry data supports this. But what did surprise me is the fact that about one out of four new cars is also out of alignment! I’m defining a new car as one under one year old or 20,000 miles. My thoughts on this are that some cars may actually be misaligned before they leave the manufacturer and some may have their wheels knocked out of alignment loading and unloading them on ships, trains, and trucks between the manufacturer and the dealer. Of course new cars are also driven by the dealer on road tests, demonstration rides and traded back and forth between dealers. As you can see there are lots of reasons a “new car” can need a wheel alignment.
Because a new car has so few miles on it, it’s impossible for you to notice the misalignment from uneven tire wear. As I explained in my earlier article, the only other tangible symptom for misalignment is pulling to the left or right. But all it takes is two adjustments on two different wheels to be out in opposite directions to cancel each other out in which case there is no revealing pull to left or right.
Now here’s the shocking facts I discovered when I began checking the wheel alignment on all new cars that come through my service drive. Before I purchased my new state-of-the-art Hunter alignment machine, I checked and aligned a new car only when the customer complained of a pull or uneven tire wear. The average number of alignments I checked and fixed each month was only “seven”. Now that I’m checking the measurements on all new cars, I’m aligning an average of forty-six, an increase of 650%! This means that for every wheel alignment I corrected, there were six more that were not detected and fixed. Many of my customers ended up paying for an alignment that should have been covered by their warranty and many may have had to replace their tires sooner than they should have.
It pains me to admit that I haven’t been checking my customers’ new car for alignments before a few months ago, but I really had no choice for two reasons. I couldn’t afford to pay a technician the lengthy labor time required with my old alignment machine and the manufacturer would not pay for an alignment check or alignment on a new car unless the customer complained of a pull or uneven tire wear. This is common practice with most, if not all, manufacturers and I believe it’s a huge mistake. You would think that the manufacturer of the car would understand the technical fact that a car’s wheels can be out of alignment without showing tire wear or pulling. Selling a customer a new car with wheels that are misaligned and not allowing that car to be aligned under warranty is simply not right. The consequences of this can not only be very expensive for the customer, but a potential safety issue as well.
My advice to you is to demand that the dealer and manufacturer who sold you your car prove to you that your wheels are aligned properly as soon as possible after you buy the car. Make this a written condition of the purchase. Ideally all new cars should have their alignments checked just before they are delivered to the customer. Many dealers might encounter a problem with reimbursement by the manufacturer for doing this and that’s why it’s not already being done.
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Showing posts with label maintenance. Show all posts
Showing posts with label maintenance. Show all posts
Monday, August 29, 2011
Monday, March 02, 2009
CAR BUYERS BEWARE OF “THE BOX”
OK, you’ve just bought that new or used car and the pressure is off…right? WRONG! The next step for the car dealer is to get you into the “box”. You won’t hear this word mentioned. It’s inside car dealer slang for the F&I office or the business office. This is the place that you sign all of those papers making the sale legal and final. But in addition to that, it’s also a very important profit center for car dealers. In many car dealerships it’s the most profitable department. It’s not uncommon for car dealers to make an additional $1,000 profit or more in “the box” on each car they sell.
Here’s how that profit is generated. First and usually foremost is making money on the interest they charge you. Essentially, they make money on “the spread” just like banks make money when they loan it. For example, a car dealer will borrow money from Bank of America for 4.9% and loan it to you for 7.9%, or whatever interest rate they can convince you to accept. The second way they earn that big profit in “the box” is by selling you “products” which are added to the price of the car you just bought. There are many products and some of the most common are extended service warranties, maintenance plans, road hazard insurance, GAP insurance, window etch, and LoJack.
The way you should protect yourself on the interest rate is to have already shopped your own bank or credit union and two other banks for the best interest rate you can qualify for. Never go into “the box” without knowing what the best rate other banks or credit unions will allow you. The best way to protect yourself against the products they will try to sell you is to completely understand each product. Do you want or need an extended warranty on your new car? If this product costs $1,900 for example, how long are you going to keep the car and how long are you likely to be driving it when it’s out of the manufacturer’s warranty? Ask the same questions of each product they try to sell you. If you are unclear on the merits of a product, do not commit. You can always go home and think about and seek advice from friends and advisors.
Another important tactic that I recommend is to never go into “the box” alone. If it’s just you and the F&I manager [often called business manager], and there is a dispute over what was said, it’s just your word against his. Also, having a friend or advisor present will usually be a deterrent to any attempted deception.
These are some of the kinds of deception you should be on the lookout for. Tying the sale of a product like an extended service contract to the interest rate or eligibility to have the bank finance your car is illegal. But this practice happens all too often behind the closed doors of the “the box.” The F&I manger may tell you that the bank “requires” you to buy the extended warranty, GAP insurance another product in order to protect the bank’s collateral. This is simply a lie and it’s illegal for banks or car dealers to do this. Another common form of deception is to simply not disclose the products or interest rate and have you sign the contract without reading it. There are a large number of documents to be signed after you buy a car. Buyers are often in a state of euphoria now that they have bought their dream car and are in too much of a hurry to sign everything and drive their new car home. The car dealer is required by law to give you a signed copy of the installment sales contract. Be sure you carefully read it and be sure have a copy. If you don’t get a copy, you may find that you signed a different contract than the one you read.
Extended service warranties, GAP insurance, and other insurance products are regulated in Florida unlike many other states. This affords you some degree of protection like being able to cancel an insurance product as long as you did not use it. You can do this in 60 days for a 100% cancellation. You don’t get the cash back and your monthly payment won’t go down however. But the amount is taken off the principal amount you are financing through the bank. You cancel insurance products after 60 days, but the cancellation is not pro rata and you pay a large penalty.
If you remember nothing else from this article please remember this one thing. Do not hurry the process of financing your car and signing the papers. Do not let the car dealer encourage you to sign anything you don’t understand. Time is on your side because it will allow you to think and to consult with others who can help you make your final decision. I get a lot of calls from victims of “the box” and the one thing they all have in common is that they let themselves be rushed into signing the documents so that they could drive their dream car home that same day.
Here’s how that profit is generated. First and usually foremost is making money on the interest they charge you. Essentially, they make money on “the spread” just like banks make money when they loan it. For example, a car dealer will borrow money from Bank of America for 4.9% and loan it to you for 7.9%, or whatever interest rate they can convince you to accept. The second way they earn that big profit in “the box” is by selling you “products” which are added to the price of the car you just bought. There are many products and some of the most common are extended service warranties, maintenance plans, road hazard insurance, GAP insurance, window etch, and LoJack.
The way you should protect yourself on the interest rate is to have already shopped your own bank or credit union and two other banks for the best interest rate you can qualify for. Never go into “the box” without knowing what the best rate other banks or credit unions will allow you. The best way to protect yourself against the products they will try to sell you is to completely understand each product. Do you want or need an extended warranty on your new car? If this product costs $1,900 for example, how long are you going to keep the car and how long are you likely to be driving it when it’s out of the manufacturer’s warranty? Ask the same questions of each product they try to sell you. If you are unclear on the merits of a product, do not commit. You can always go home and think about and seek advice from friends and advisors.
Another important tactic that I recommend is to never go into “the box” alone. If it’s just you and the F&I manager [often called business manager], and there is a dispute over what was said, it’s just your word against his. Also, having a friend or advisor present will usually be a deterrent to any attempted deception.
These are some of the kinds of deception you should be on the lookout for. Tying the sale of a product like an extended service contract to the interest rate or eligibility to have the bank finance your car is illegal. But this practice happens all too often behind the closed doors of the “the box.” The F&I manger may tell you that the bank “requires” you to buy the extended warranty, GAP insurance another product in order to protect the bank’s collateral. This is simply a lie and it’s illegal for banks or car dealers to do this. Another common form of deception is to simply not disclose the products or interest rate and have you sign the contract without reading it. There are a large number of documents to be signed after you buy a car. Buyers are often in a state of euphoria now that they have bought their dream car and are in too much of a hurry to sign everything and drive their new car home. The car dealer is required by law to give you a signed copy of the installment sales contract. Be sure you carefully read it and be sure have a copy. If you don’t get a copy, you may find that you signed a different contract than the one you read.
Extended service warranties, GAP insurance, and other insurance products are regulated in Florida unlike many other states. This affords you some degree of protection like being able to cancel an insurance product as long as you did not use it. You can do this in 60 days for a 100% cancellation. You don’t get the cash back and your monthly payment won’t go down however. But the amount is taken off the principal amount you are financing through the bank. You cancel insurance products after 60 days, but the cancellation is not pro rata and you pay a large penalty.
If you remember nothing else from this article please remember this one thing. Do not hurry the process of financing your car and signing the papers. Do not let the car dealer encourage you to sign anything you don’t understand. Time is on your side because it will allow you to think and to consult with others who can help you make your final decision. I get a lot of calls from victims of “the box” and the one thing they all have in common is that they let themselves be rushed into signing the documents so that they could drive their dream car home that same day.
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