Dealer integrity and honesty... or lack thereof

360glitch, if this is in the wrong section feel free to move it. It's not Honda specific...

Over the years I've worked many jobs in the sales or sales management field. I've sold everything from furniture to medical supplies to sporting goods. I'd like to think I'm good at it and I always did it in an honest way. My sales "pitch" was just finding out what a customer could afford and getting them the item that would fit their needs and budget. And it works because people appreciate honesty.

A number of years ago I decided to go in a different direction with my career. I figured I could combine my love and knowledge of cars with my sales ability so I took a job in sales at a Nissan dealership. Well, unlike all my other jobs before, it quickly became apparent that my job wasn't just about selling a car that people wanted. It was about selling people the car the salesman could make the most money on. Adding the most bs dealer markup items as possible. I soon realized car sales wasn't for me. I lasted less than a week and famously told them I was going on my lunch break and just never came back again!

So my question is, why are car dealerships so lacking in integrity and honesty for the most part? More so than almost any other business I can think of. And not just the sales and financing department. Don't get me started on service departments and service advisors. Now, I can't say there aren't some honest and competent dealerships, I'm sure there are. But my experience is, they are few and far between.

gtman said:

360glitch, if this is in the wrong section feel free to move it. It's not Honda specific...

Over the years I've worked many jobs in the sales or sales management field. I've sold everything from furniture to medical supplies to sporting goods. I'd like to think I'm good at it and I always did it in an honest way. My sales "pitch" was just finding out what a customer could afford and getting them the item that would fit their needs and budget. And it works because people appreciate honesty.

A number of years ago I decided to go in a different direction with my career. I figured I could combine my love and knowledge of cars with my sales ability so I took a job in sales at a Nissan dealership. Well, unlike all my other jobs before, it quickly became apparent that my job wasn't just about selling a car that people wanted. It was about selling people the car the salesman could make the most money on. Adding the most bs dealer markup items as possible. I soon realized car sales wasn't for me. I lasted less than a week and famously told them I was going on my lunch break and just never came back again!

So my question is, why are car dealerships so lacking in integrity and honesty for the most part? More so than almost any other business I can think of. And not just the sales and financing department. Don't get me started on service departments and service advisors. Now, I can't say there aren't some honest and competent dealerships, I'm sure there are. But my experience is, they are few and far between.

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I can vouch for this; see my post under the "Naughty Dealer" thread. Sale was great but Finance Guy with massive pressure to buy an extended warranty soured the new car buying experience. I mean it's not every day someone buys a new car (not for me, anyway). Davenport Honda in Rocky Mount, NC is no-pressure sales and an awesome place to buy a car as well as have it serviced. I almost backed out of the sale at Leith and drove to Davenport to buy the car. It all ended up OK but buying a car is supposed to be FUN and EXCITING and this time it just wasn't. Hopefully my next one will be, whenever that occurs.

I have to agree with you on the whole finance department pressuring people into expended warranties deal. When I bought my Civic the sales guy was fantastic. Best car buying experience in the showroom I ever had. I got to the finance department and the guy was basically putting me on a guilt trip for not buying an extended warranty plan. He tried everything and then some; more or less said I was foolish not to get it. The thing is, I got suckered into one on my last car and vowed to never get one again. The finance guy definitely took my good experience and soured it very quickly.

I think it's when people try to pay the lowest on something. Both sides are always trying to nickle and dime so they have to make money somewhere.

When I bought my pair of Civics, I was like, this is the range of sales prices for the car in the 4 bordering dealerships, meet me at the 2nd lowest price and make a couple hundred extra off me and they okay'ed immediately, totally worth it. I went in with my girl after work at like 7pm and left with 2 new cars the same evening. Zero hassle and free life time oil changes.

gtman said:

I have to agree with you on the whole finance department pressuring people into expended warranties deal. When I bought my Civic the sales guy was fantastic. Best car buying experience in the showroom I ever had. I got to the finance department and the guy was basically putting me on a guilt trip for not buying an extended warranty plan. He tried everything and then some; more or less said I was foolish not to get it. The thing is, I got suckered into one on my last car and vowed to never get one again. The finance guy definitely took my good experience and soured it very quickly.

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That's almost my exact experience, verbatim. Same when we bought my ex-wife's 2010 EX-L Accord. Smooth sailing for the sale, high-pressure from Finacne Guy.

Car buying is one of the few things I can thing in America where we still haggle. If you pay sticker... you're paying *thousands* over dealer cost.

Now I worked at a grocery store when I was a kid and know the cost of many items were marked up a much higher percentage than a dealer marks up a car. We just have grown used to paying whatever the tag says in most every other establishments.

I get decent deals on cars and try not to bring emotion into play. If a salesman or finance guy starts telling a story trying to pull on my heartstrings, make me feel bad or ignorant about my decisions... I politely, but firmly shut them down. There's a lot of psychological BS that all those folks try to do... and the experience is very predatory. They're a bunch of wolves... and they want to sell to sheep. I go in there like a lazy, chill grizzly bear... not looking to waste energy on a fight but unbeatable. I provide an offer (usually in and around invoice... backed by stuff from True Car/Edmunds/KBB etc). I make it clear I'm there to buy a car... not develop a relationship (because that relationship would be an abusive one... if the dealer had their way) and if they jerk me around, I walk. I expect the dealer to make a good profit by selling around invoice with destination/doc fees... but anything past that is highway robbery. They keep holdback. I get incentives/rebates... if they exist.

I can understand being on the other side... it'd be a tough way to make a living if you get feelings involved. You become a predator preying on folks during a stressful time for many... and many folks don't deal with conflict well and fold early and hard to the dealers benefit.

I told the finance guy... right off the bat... I was only buying the car, but would be happy to hear about all the possible extras if he would be as kind to accept my 'No's'. He gave a sentence or two in defense of everything.... road hazard warranty... paint protection... maintenance plan... extended warranty. I stayed big old chill grizzly and we got to signing papers in about 5 minutes.

I always find multiple examples of the same car I am interested in, then email back and forth with dealerships to get their lowest "internet" offer. From there I go face-to-face and test drive with one then discuss with all to see who will give me the best price. Then I mention I have a trade and see what they will give me for it. I push for more on the trade. Sometimes a dealer who wouldn't come down on the price will come up on the trade. When dealing with the finance guy, I push for a lower interest rate and explain I have a credit union I prefer to work with. They will usually come down a bit on the interest rate. Doesn't matter much since I wind up calling US Air Force Credit Union anyway for the refinance, and they handle GAP insurance. I bought my SI for 22k that way. After buying the car, the only thing that brings me back to a dealership for service is a recall.

Micah said:

After buying the car, the only thing that brings me back to a dealership for service is a recall.

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X2

CivicXI said:

I think it's when people try to pay the lowest on something.

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I think it's a combination of this and that typically there is tremendous information asymmetry -- the sales guy, sales floor manager, and especially the finance guy know a whole lot more about the financial details of the car as well as the overall market for that car model than you can ever possibly know. Sure, you know the EX-L has feature X even though the salesman claims it doesn't -- we've all had that experience -- but you have no real idea what the dealership paid for the car, what manufacturer incentives are in play for the dealership as a whole, how sales at the dealer are going that month, etc. And all those things affect the price the dealer will accept.

Sites like TrueCar and Edmonds should serve to negate some of this information asymmetry, and maybe in their early days they did, but now they all seem to have tie-ins to the dealers.

Luckyarmpit said:

...Sale was great but Finance Guy with massive pressure to buy an extended warranty soured the new car buying experience...

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I had the same experience when I bought my 12' Si and didn't go back to that dealership when I bought my 17'.

I know I've mentioned it on here before, but I spent 13 years working in a dealership...I was in sales for a few years and then moved up to finance.

So please understand that I'm saying all this with over a decade of day in and day out experience...most of these comments are absolutely correct. Basically, if you think it's bad going to a dealer, imagine working there....I never thought of myself as a bad person, but eventually I became desensitized and looked at it as more of an "us vs them" situation ("us" being the dealer, "them" being the customer).

It also depends on the dealership and the pay structure. For instance, my dealership paid a 25% commission on the gross profit of the car, but the "salary" was $250 a week. So essentially you have $1000 a month guaranteed income, and the rest you have to fight for. But wait, it gets better...in the store I was at, you didn't really get a $250 a week salary because you needed to sell at least 7 cars in order to cover your "draw" (i.e. your $250 a week). If you had a good month that didn't matter, because you'd cover your draw with one or two sales. If you had a bad month you'd owe the dealership money! I knew salespeople that would have bad month after bad month, and be thousands in debt to the dealer, and would have to eventually quit to go start the process over at another dealership, and that cycle would repeat. And normally the dealer wouldn't fire people for underperforming, since it's still another warm body to make sure there's floor overage. Usually what they'd do is "flood the floor" and hire a lot of salespeople at once, and like clockwork, those that would make it would sell and those that couldn't hack it would quit. And as if all that misery wasn't enough, you were there all the damn time because of customers coming in on your day off, or just not wanting to miss sales. I would usually work a bell-to-bell shift, which we jokingly referred to as a "german" schedule as it was from 9 to 9 (nein...get it?!). God forbid someone else sold one of your customers, because either you had to do a split deal, or you'd lose the sale all together. And every dealer has the same archetypes. I feel like this post is long winded enough so I won't go into it (although with some extremely light prodding I'd be happy to do so).

When my daughter was born, it made me re-evaluate my life and how I wanted her to see me. It woke me up to what I was actually doing for a living and even though the money was good, it wasn't worth it either in the time spent there or the cost on my soul.

No disrespect intended to anyone on here that works for a dealer, but if you do, and you take an honest look at yourself, your co-workers, the dealer-principal, etc., you know what I've said is accurate.

This isn't to say that ALL dealerships are wretched hives of scum and villainy...it's just that, yeah, most of them are...

grumpyguy6 said:

This isn't to say that ALL dealerships are wretched hives of scum and villainy...it's just that, yeah, most of them are...

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I've got a bad feeling about this....

My experience with my sales guy was great ,heck it lasted about two years,lol, but that is as far as it goes. When we finally came to the day to buy it,we go in with 6 grand down an knew exactly what we wanted. Finance manager tried to make us by a fit, told him absolutely not. Then for over an hour tried to talk us into buying a bottom of the line civic. Got mad cause I refused and told him if he couldn't give have had we want we were leaving. So, we left and got a call the next morning saying they found a bank and we could get what we wanted under the terms I gave them.worst buying experience I ever had.
So when signing the papers he made it sound as though he did some great thing getting us an extended warranty, it cost me two grand. It was my fault,so I learned a lesson.
After that, issue after issue with the service department there, Martin Honda in Newark De, resulted in me reporting them to Honda America,and going to another dealer. Now in spite of all my problems being fixed, this second dealership has at least been honest with me and hasn't physically screwed up anything on the car like Martin honda did.

The Quakers actually invented the concept of a price-tag and a single-price for everyone.

Their reasoning was that it was unethical to charge different people different prices for the same item, or something along those lines.

grumpyguy6 said:

This isn't to say that ALL dealerships are wretched hives of scum and villainy...it's just that, yeah, most of them are...

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Really a good post. I appreciate you sharing.

Micah said:

I've got a bad feeling about this....

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That's the kind of thing that makes these forums so classy... I saw it too.