Tag Archives: scams

Car Auctions: How to be cool on the dance floor…

28 Mar

If you can answer “YES” to any of the following questions, then for goodness sake don’t read the rest of this post.

1) You drive a BMW Mini and thought it would be funny if you attached fake ‘eyelashes’ to the headlights.

2) You recently purchased a new Saab for a great price by using your truly awesome bargaining techniques.

3) Your boyfriend drapes his arm around your seat top when you are driving and glares at passing motorists.

Okay. I think we shook them off.

Oh – hang on!  There’s a couple of stragglers who are still here out of curiosity, not sure if I’m joking or not…

4) You often order fresh pizza to be delivered to your home because it is cheaper than cooking stuff yourself.

Got ’em.

That’s the last ones. They just clicked the ‘back’  button and typed “Pizza” into Google. We can talk freely, now.

Right. Buying at a car auction is very easy but you have to take a few simple precautions. There are so many excellent vehicles passing through right now that you may lose your self-control and make a serious mistake.

Resist temptation. Consider my analogy of the night-club. Car auctions are so similar to night-clubs that it is untrue. If you understand how a night-club really works, you will have no trouble at a car auction.

Do your homework.

Check the terms and conditions of the auction house. Visit the place and make sure that you are aware of  your duties as a buyer. Stand to the side and watch people who are bidding. Watch how the auctioneer manages the bidding and notice how little time each car actually spends in front of the podium. Notice that there are areas in the room where the speaker system that relays the auctioneer’s voice sounds crystal clear…and also areas where it is impossible to hear what is being said.

Smarten up your act.

Research the exact car you want to own by using the internet and asking around. Look at similar examples on a local dealer’s forecourt. Visit the auction and watch as identical cars to the one you want go under the hammer. Make a few notes on the vehicles concerned: the last six digits of the chassis number or the registration plate, specification, mileage and service history. Do not even think of buying, just watch. If those cars go under the hammer for 25% – 30% less than the price you would expect, then you may be at the right auction. Go to the very next auction at that site. Did those exact same vehicles go through again? Why?

Don’t pretend to be somebody you aren’t.

Nobody cares who you really are at an auction. Keep it that way.  The serious buyers are so discreet and polished that it may take you many hours or even days before you notice them. They are not your competition. They will always pull out before you do. When the day finally arrives where you go in for the kill and buy, your competition is most likely to be an idiot private buyer who obsessively bids against you, stupidly jacking the car’s price up beyond its real worth.

Practise a few clever moves.

On your first visits to the auction, find an example of the car you want to buy and stick with it as if it were your own. Watch as dealers come up and survey it. Watch what they see, watch what they do. Learn to move your head as they do, so that reflections on the car’s paintwork  (the hall lighting, the car next to it) ‘slide’ over and across the bodywork. By following the reflections, you will more easily spot dents and paint differences. Notice how some dealers run their index finger along a clean car as they pass along it. Do the same. Resprayed panels often ‘feel’ different.

When the car is started up, ready to enter the auction line, watch what the dealers do, where they look, what they check. If the dealer reaches in and turns the steering wheel sharply, you can bet that it is because power steering racks are expensive to replace on that model. If the dealer tries all the electric windows, perhaps they are prone to fail? Watch what is checked under the bonnet. Follow the car into the hall and watch if those dealers bid on that car.

Beauty had better not be just skin-deep.

That 2008 Audi A5 Quattro Sport in the picture above, with 75,000 miles on the clock, sold for £14,200 ($22,580) last week. Now, that actually is the same price that you could buy that car at a dealership here in Britain. So, did somebody get carried away and forget to stop bidding? Perhaps. But then again, in Germany, $22,580 would only buy you that model if it had been hit hard in a collision. You’d need to find at least an extra $8-10,000 to buy an A5 like the one in the photo.

So, a one-way ferry ticket and two days driving will possibly see that car sitting with a delighted new owner in Eastern Europe who has got a bargain.  Alternatively, that A5 may first of all spend a week in a back-street garage, somewhere in Europe. The dashboard and chassis numbers from a crashed left-hand-drive A5 Quattro will be fitted and it will ‘become’ the crashed car…but apparently now no longer crashed. However, that will be somebody else’s problem; the car shown in the picture is the real deal.

Buying a second-hand car always carries risks, whether you buy privately, from a dealer or from an auction. Strangely, perhaps counter-intuitively, the largest auction houses provide a greater level of protection than you might at first think.

More explanations, buying advice, plus extra-clever tips and safety hints to come!

The OFT…Kaylee…and your talking car.

14 Feb

The OFT describes itself as “The U.K.’s consumer and competition authority”. It was  previously known as the Office of Fair Trading. I draw to your attention the fact that there is a difference between “ensuring fair trade” and  “making markets work well for consumers” – which is the OFT’s latest mission statement.

Either way, the OFT has singularly failed to achieve much of benefit for us consumers recently but it has done quite a lot to towards its other goals of increasing competition and expanding business – neither of which have anything to do with fairness. Sorry to labour the point but this is what I wish to draw to your attention.

In 2003, the OFT decided that car manufacturers were using their Dealer Franchise system to unfairly lock owner’s of new cars into over-priced servicing in return for keeping the car’s valuable Warranty up to date.

The OFT estimated that a staggering £500 million could possibly be saved by consumers if car manufacturers dropped their demand that owners could only have their servicing carried out by garages belonging to that manufacturer’s group. The OFT found that franchised dealers were “significantly more expensive” than independent garages and that there was “no clear difference in quality in the services offered by each”.

So far, so good…albeit with that certain whiff of bears, personal hygiene and woodland hanging over their finding.

In 2004, the OFT removed the demands of manufacturers that effectively “lock in” new car owners to their own franchised garages and decreed that the consumer was free to choose independent garages without jeopardizing their warranty.

The manufacturers bowed their heads, examined their finger nails and complied with the OFT.

Independent garages flourished and consumers were delighted to escape the clutches of a single Dealer Franchise garage, whom most believed were milking their wallets.

I would draw your attention at this moment to a line spoken by the character The Terminator, in the film of the same name:

“…I’ll be back…”

Eight years on and we see new car owners skipping without care from one garage to another, finding the right one for their needs while still maintaining their new car warranty.

Unless their car goes wrong. If it goes wrong, it needs taking to a Franchised Dealer. It may go wrong at least once a year.

How does it go wrong? Well, the dashboard lights up like a cheap Christmas tree and the independent garage mechanic looks as if he’s just spent two hours having the EU Directive (PSD 2007 /64/ EC) read to him by a person without teeth.

Kaylee, my delightful eight-year-old friend, is still recovering from the shock of her recent misfortune. In a bid to speed her recovery, I decided it was worth trying out hypnotism on her. Her family had asked me to keep an eye on her while they nipped off to Matalan and I’ve always been fascinated with the inner workings of the human mind.

Kaylee was surprisingly easy to hypnotise. I asked her to regress to a previous life and she soon began talking in a curious dry voice, similar to Anthony Hopkins in Silence of The Lambs.

Me: Where are you, Kaylee?

Kaylee: I’m sitting in an office, Clarice…I’m just chewing on the thoughts of an adversary…

Me: Who are you, Kaylee?

Kaylee: I’ve solved the problem now. The man from the OFT was very ill-educated, Clarice. His poor manners tired me…

Me: What have you done?

Kaylee: Everything is back to normal. The little people…I gave them cars that talked. It was simple.

Me: Cars that talked? Did they ask for cars that talked?

Kaylee: Clarice, you really should listen more closely. If you listen then you will hear the cars talking. Do you remember the lambs, Clarice…? How they screamed..?

Me: You mean the Engine Control Unit? The ECU talks to the diagnostic equipment at the garage?

Kaylee: Precisely. It screams like a victim of torture. It tells the manufacturer of all its faults and all the things wrong with itself.

Me: Well that is a good thing, isn’t it? That means the mechanic can tell what parts need adjustment or replacement.

Kaylee: Only if he understands the secret code, Clarice. And I write the secret code.

Me: Yes, and you sell decoding equipment to garages for big bucks.

Kaylee: That’s right. Big bucks…to garages. But you know that I have high standards, Clarice…it simply would not do if every unwashed mechanic in the world could learn the  beauty of my car’s ECU. Learn its greatest secrets…

Me: You mean, you program in multiple ‘fault codes’ that cannot be collectively interpreted or else do not solve the problem when rectified one by one in a non-accredited garage?

Kaylee: The cars are like children to me, Clarice. All children need to be protected by their family…protected from strangers….wouldn’t you agree…?

Me: Are there fault codes and lines of programming in the car’s ECU that simply do not make sense to anyone but the manufacturer?

Kaylee: A mother always knows what is best for her baby, don’t you think? I do. Anyone can bring up a child, Clarice…but mother always knows best…

I don’t actually have much experience of bringing people out of hypnotism. None, in fact. So, when Kaylee’s parents came in through the front door I told them that Kaylee was in good spirits and that I had a pressing engagement elsewhere.

© 2012 Loop Withers Roadwax.com

“Toyota accused of deceiving customers” – Sunday Times, 6th February, 2012

11 Feb

The Sunday Times believes it has discovered evidence that Toyota were telling their dealer network not to fix problems in customer’s new cars if the customer hadn’t spotted the problem or the problem itself did not pose a threat to safety.

The Sunday Times has also discovered evidence that the Pope is a Catholic and also that there is a drastic shortage of modern rest-room facilities for bears who live in woodland areas.

The Sunday Times article made me feel a sense of despair inside. Was this “investigative journalism” at its best? No. Were Toyota being singled out for doing only what every other mass production car manufacturer does? Yes. Was this news? Hardly. Is there a three ton elephant standing in the corner of the living room that The Sunday Times cannot see? Maybe.

I would like you all all to meet Kaylee. Kaylee is an intelligent and sweet eight year old girl. She is normal and healthy and today I am taking her to a Dealer Franchise.

Kaylee:  Is this where cars are made?

Me:  No, Kaylee. This is where cars are sold to people and where cars are fixed if they go wrong.

Kaylee: So, the car maker owns this big building and employs all the people?

Me: No, the car maker would rather nail himself to the mast of a sinking ship than do that. He just has his name over the door, like McDogburgers or Putrid Pizza.

Kaylee: So, this is a franchise operation, an administrative and business ‘firewall’ between the manufacturer and the end-customer, acting as a quasi-independent provider of car financing loans, spare parts, service facilities and a drop-in centre for owners with warranty issues?

Me: Yes. Now, get me a coffee from that machine next to the lady with the white blouse.

Kaylee: I got you a FairTrade double latte with extra sugar but you need to put your own vodka into it.

Me: Thank you.

Kaylee: So, the people here make their money buy selling spare parts to the people who bring their cars in for service and also charging them for the time spent to fit the parts, sundry items used in that process and selling them service packages?

Me; Yes. Kaylee, this is tomato soup.

Kaylee. Deal with it. So, surely the franchise dealer is motivated to increase profit by maximising the amount of work that can be carried out on each car that comes in?

Me: Yes.

Kaylee: Ideally, that would necessitate separating the honest mechanic from the ‘front-of-house’ sales team, who are then heavily incentivised to use their highly developed interpersonal skills to maximise the commitment of the car owner, encouraging them to pay for necessary and/or advisable and/or arbitrary work. For this system to be perfected, surely the franchise should nominate a Service Manager and that individual will then instruct the mechanic on what work needs to be carried out on behalf of the customer?

Me: Yes. Kaylee, did you put sugar in this tomato soup?

Kaylee. Sweetener. You need to lose weight. So, if I was the owner of a dealer franchise and I wanted to make extra bucks, I would get the most persuasive, devious and manipulative person I knew and make them my Service Manager. I’d cut a secret cash incentive scheme with them, based on the increased net sales of services added to existing customer’s data. I’d tell the mechanics to carry out work without questioning the Service Manager’s authority and I’d make sure that the customer never gets to talk to anyone but me or the Service Manager.

Me: I bet you would.

Kaylee: However, At the same time, I can ingratiate myself towards the customer I am currently milking to death by suggesting that we invoice the manufacturer for any defects that  might reasonably be covered by the terms of the warranty? Either way, as a franchise, we get payed by one party or the other, don’t we?

Me: That’s right Kaylee. That is why manufacturers fight hard to control warranty claims made by customers who find faults in their cars. The manufacturer is always paranoid that the Service manager is playing both ends for his own benefit.

Kaylee: But surely, there is always evidence of a clear failure or defect in a part and that would have to be presented either to the manufacturer or the customer as evidence of work needing to be done? I mean, people aren’t stupid and there are such things as laws to protect against blatant fraud?

Me: The manufacturer always asks to see the part and can usually tell if it is a legitimate claim. But 99.9% of the time, you can hold up any broken part, one you’ve taken from another car, and the customer will assume that you are not lying. The deception is almost impossible to prove and the customer rarely if ever, disputes the integrity of the Service Manager.

Kaylee: But surely, the scam must go belly-up every now and then? I mean, one day, the Service Manager goes too far with the wrong person?

Me: Yes, but then he has covered all his bases. He has dismantled the customer’s car, has the parts stacked neatly all over the workshop, he holds his ground and he knows that the customer desperately needs his car back. If the customer accuses him of lying, he folds his arms and drags the franchise owner back from the golf course. The customer soon gets the message. Beyond ‘rigging’ a car with hidden cameras, many scams are impossible to prove.

Kaylee: But surely, if the Service Manager is pulling outrageous scams, the service data returning to the manufacturer will show disproportionate levels of component failure on cars serviced at that franchise?

Me: Yes, if the Service Manager is stupid but normally they are clever. They ‘cluster’ faults, attributing them to certain customers or cars where either the customer is an ass or the car is actually a ‘turkey’ which the manufacturer already knows about. That way, it makes it  almost impossible for the manufacturer to prove anything either, regardless of their suspicions. If the manufacturer loves the sales figures for the franchise overall, the manufacturer would be shooting himself in the foot by getting involved.

Kaylee: So, every time we put our car in to be serviced, we stand to get ripped off?

Me: Not every time, not every dealer. Focus on how the scam works and you will see that it pays to pick and choose your dealer and not come across like an ass with plenty of money and no knowledge of modern cars.

Kaylee: But hundreds of thousands of customers must be being ripped off for millions each year by unscrupulous Service Managers and dealerships. Why don’t big investigative newsgroups ever cover this outrageous scam?

Me: Good question.

Kaylee: How old do I have to be before I can buy myself a dealer franchise and learn to play golf?



© 2012 Loop Withers Roadwax.com

Six Second Pass

11 Feb

Do you want to know why the local garage you always take your car to could also be taking you for a ride? You don’t think that they are? Does it always seems to cost you between £300 – £400 for the annual service? You still don’t think they are taking you for a ride…?

Read my next blog feature. This is just a Six Second Pass.

Feeling like I just wasted your time?

Get your wallet out and count the money. Its all still there.

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