The Other Side Of Car Dealers

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Late last week I posted an entry linking to a podcast from This American Life. The podcast is called ‘Cars’ and it followed the ebbs and flows of a dealership trying to meet its sales goals for the month.

You got to see an insight into the dealership side of the industry as well as a glimpse of the dealership staff as people.

I remarked at the time that while many people have a sour view of car salesmen, the sales guys and girls I’d met in my time covering Saab seemed very straight-up. They were great people and I enjoyed their company in the times we got to meet up.

Of course, there is another side to the business. A darker side.

Hugh W, a New Yorker, thought he’d pass on his experience with the dark side of the car sales industry. It’s one of those experiences that makes people wince when they think about walking into a dealership and as you’ll see, it had consequences.

[hr] [dropcap]I[/dropcap] thought you might be interested in a story of my adventure at a dealership around 1986 or 87. Basically, it’s a story of a dealer that tried every trick in the book to make me part with a few more dollars, and in the end got his comeuppance.

I was shopping for a new small pickup truck to replace a second-hand one that had given up the ghost to the gods of rust on the isle of Martha’s Vineyard. I finally decided on a Toyota, completely basic, no A/C, no 4WD, manual transmission; and I found just what I was looking for on the lot at Crabapple Toyota in New Rochelle, New York, about 20 miles north of the city. On their showroom window, there was plastered a huge sign saying, as I recall, “ All Vehicles, Zero down, four year financing at 5%.” The sticker price was about $6,000.

The first thing I asked the salesman was what his best price was. He said; “oh, no, I can’t tell you that. You have to give me a ‘bid’ and I’ll take it to the manager.” I said that I wasn’t there to play games; that I could find the same vehicle somewhere else, and he should give me his best offer and I would either take it or leave it. He said no, that he couldn’t do that. So I started to leave, and then he came running after me and said “wait a minute, I’ll see if the manager will make an exception.” So I waited, and eventually he came back and said he could sell the truck at $5,500, or thereabouts. I said that seemed OK, but I wanted a step rear bumper and the brush guard at the front. He said that would add something like $800. I said no, and the price magically dropped to $325.

So we went to the showroom and sat down. He wrote up the order, and I noticed that they had added about $500 for pin striping and a similar amount for rustproofing. I said no. They said it was standard. I said it wasn’t standard, as it wasn’t on the car on the lot and wasn’t on the manufacturer’s stickers. He said that’s the way they delivered all their cars, and if I didn’t accept it there was no deal. I said fine, and got up to leave. He said “wait a minute, let me talk to my manager.” And low and behold, the manager made another “special exception, because they really wanted me to have the truck.”

Now we progressed to the Finance Office, and their “finance guy” runs the numbers and hands me the contract that includes a down payment and finance running about 10%. I took a look and pointed out that it should be zero down and 5%. He said that didn’t apply to truck sales. I said that the huge sign in the window said “all vehicles” and had no exceptions about trucks. He said sorry, that they couldn’t do the deal under those conditions. So I said “fine” and started to leave. And by now, it was like a Groucho Marx routine and I knew what to expect: another talk with the manager, and another special exception. So I sat down again to finish up the deal.

I looked at the contract again. Price was ok, zero down, 5% financing, but now there was something like a $400 add-on for a service contract. They had the gall to tell me that Toyota’s warranty wasn’t any good so they wanted to make their customers happy with the owning experience, and for all vehicles with the special finance deal, it was mandatory. So we went through the whole routine again….I got up to leave, he talks to his manager, they make a special exception. And I finally signed the deal and drove away with a great little truck.

But I was shaking with the experience….how stressful it was….how I had never before been so utterly and brazenly lied to. And then I realized, how many less-aware people were taken in and cheated by these thieves, and that is what they were; highway robbers in suits without guns. So I composed a long letter to New York State’s Attorney General detailing the experience, much as I’ve written above. And of course, the letter went into a deep and dark hole.

But it didn’t.

A couple of years later, I was on vacation on Martha’s Vineyard and I received a phone call from a prosecutor for the New York State Attorney General. It seems that my letter had led to a huge investigation of Crabtree, who owned almost a dozen different dealerships. Under threat of criminal indictment, there was a consent settlement that returned millions of dollars to swindled buyers and drove them out of business. They told me that they were having a television news conference a few days hence to announce the settlement and they asked me to come as the fellow that started it all. I politely declined, as that wasn’t worth returning 250 miles to New York for from vacation. But, man oh man, that was a really satisfying call.

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Bottom line – they’re out there. Caveat Emptor.

My thanks to Hugh W for sharing his experience.

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3 Comments

  1. It’s refreshing to hear that a State’s Attorney General actually responded to a complaint. I figured, at best, they only responded if they received a large volume of similar complaints.

  2. I’m assuming that they had other complaints, but the clarity and detail of my letter, along with the extensive listing of snares and delusions set by Crabtree, apparently triggered a closer look and an investigation where they contacted various buyers who may not even have made a complaint.

    As I told Swade in a follow up email, I’ve had nothing but great experiences at various Saab dealers including Zumbach, Gary Blake, and Reinertsen.

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