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    Even for an insider, buying a car is a lousy experience

    For all the talk within the auto industry about making the customer buying process more open, honest and less stressful, the reality is some of America’s largest dealers utilize the same old fashioned sales system they’ve relied upon for decades.

    The automotive industry has made precious little progress in reforming the very business practices that cause such strong negative perceptions to persist among most buyers. The industry’s long-held, closely-followed selling “system” is based on a cynical position: dealerships do not respect or trust customers. 

    No other industry has as rich a negative slang encyclopedia to describe its customers: chiselers, flakes, grapes, grinders, lay-downs, strokers, tire-kickers—the list, and the attitude, goes on and on.

    The settings these days may be more comfortable and the salesmen (and yes, nearly all are still men) younger and more pleasant. But, when it gets down to the dirty details of a deal, the name of the game is still the same: sell the car today for as much profit as possible.

    Recently, my wife and I went to four dealerships looking for a late model, relatively inexpensive used car. We thoroughly researched cars and prices through Edmunds, Kelly, Cars.com, etc. Armed with information and experience, we were ready to make the right deal. Or, so we thought.

    Here’s the good, the bad and the ugly about our car buying experience.

    The Good

    The cars themselves. They’re far and away the best part of the shopping experience these days.

    The pre-owned cars we saw were all in excellent condition. No major body flaws, good tires, spotless interiors, etc. All were mechanically sound. Every car we drove was peppy, responsive, well appointed, easy to use and even fun to drive. We did not drive any domestic models, but the overall quality of cars was impressive. And the option of purchasing an extended warranty, though a bit expensive, gave us confidence.

    The Bad

    Salespeople on short leashes. Actually, they’re not really salespeople at all. They’re nice young fellas who are asked by the dealer’s management team to do the scut work: meet and greet, make nice, demo the car and, most importantly, qualify the prospect. Not one of the four salesmen we met was allowed to even give us a price without first consulting with a manager.

    No more cruising the lot. Every dealer promotes their “huge” selection, yet when we asked to see what was available, we were taken to a small parking area adjacent to the showroom where two or, at most, three models sat. Convenient for getting a quick look at the car and a fast test drive, but not good for getting a feel for the total selection available. When we asked to see what other cars they had, we were told, “these are it.”

    No prices on cars. Not a single used vehicle had a price marked on it. When we asked why, only one salesperson could come up with an answer, and not a very good one at that. “Putting prices on the cars only confuses customers, because you have to add sales tax and stuff like that.” If we were confused before, now we were dumbfounded.

    Online vs. Onsite prices. We found an ’06 Hyundai Sonata GL on a dealer’s website for $12,995, but when we got to the dealership, we were told, of course, the car had already been sold. When we were shown another Sonata GL, just like the one we found online, we were told the price was $16,998. When we asked why there was such a big difference the salesperson sneaked out for a consult and returned a few minutes later with a price of $13,998, a reduction of $3,000, but still a thousand more than the online price. When we asked him why he couldn’t honor the $12,995 price, he had no explanation, even though the lower priced online car had 12,000 fewer miles than the one on the lot, The pricing seemed totally random and correlated to no known factors—mileage, equipment, condition—just whatever profit, it seemed, the sales manager needed to make that weekend.

    The Ugly

    Broken promises. After we told the salesperson we wanted the car at the same price as the one with the lower mileage listed on the Internet for $12,995, he disappeared again and came back to say he couldn’t budge on the price. We said we would be willing to pay $13,200 for the car. Sensing he was losing the deal, he left us again for one more pow-wow.

    Surprise extra fees. Our young salesman returns with a clean write-up sheet, listing the price, sales tax, tag fees and a great big, dark number printed, not handwritten, in the column—Dealer fee: $499! (the exclamation point is mine, expressing my utter surprise at this last minute charge). “What’s this for?” To which the salesperson replies, “To cover the cost of the paperwork.”

    Paperwork? This is nothing but pure additional dealer profit. In some states, fees such as these must be disclosed up front, but not in the automotive wild west of Florida. Holding this information back until the very end of the negotiation is equivalent to playing poker with a guy who has an extra ace taped underneath the table. It’s unethical. The disclosure ended our negotiation. We left, disappointed we couldn’t buy the car we wanted, but also disillusioned about the whole process. My wife was particularly bothered and she should know: she handles union labor negotiations for her company. Mostly, though, we felt stupid for not asking up front if there were any such fees.

    After recovering from the experience, we worked up the strength to try one more dealer—Carmax. They only sell used cars. They put prices on every one of them. They disclose their $150 dealer fee up front. Their salespeople get paid the same fee regardless of the price of car they sell. They’ll let you see (and drive) every single car on the lot, if you want. Their prices are a bit higher on average, but the reduction in haggling and aggravation may well be worth it to many buyers. While we did not buy a car there this time, we both agreed Carmax would be the first (and maybe the last) stop on our list the next time we go car shopping.

    As far as the traditional car dealers we shopped, the overall message is crystal clear: the customer is either ignorant (and can be taken advantage of); stubborn (making for more work and less profit) or incapable of making a decision (wasting our valuable time).

    And because most auto salespeople are not highly skilled or experienced in the delicate art of a negotiated sale, the “system” must be used to keep the customer in line and prevent the salesperson from giving away the store.

    It’s not easy to sell a car. There is tremendous competition, the transaction is complex and, yes, customers can be difficult. But, until the auto industry starts trusting its customers, educating them and allowing them to take more control of the buying process, the car buying experience will always be difficult and potentially unpleasant—for the customer, the salesperson and for the dealership.