WHO'S THE VICTIM IN THIS NEW SCAM?

AFTER WRITING ABOUT ODOMETER ROLLBACK scams in this space a couple of months ago, I've learned that leasing has evidently spawned a new rollback scheme. Shady characters at some dealerships are perpetuating it. On behalf of customers! A colleague's friend, shopping for a leased car at a local dealership, voiced concerns to the salesman about paying end-of-lease financial penalties if she returned

AFTER WRITING ABOUT ODOMETER ROLLBACK scams in this space a couple of months ago, I've learned that leasing has evidently spawned a new rollback scheme. Shady characters at some dealerships are perpetuating it. On behalf of customers!

A colleague's friend, shopping for a leased car at a local dealership, voiced concerns to the salesman about paying end-of-lease financial penalties if she returned the car with excessive mileage.

The salesman offered a questionable solution. He told her, “We have someone here who can roll back odometers on lease cars coming back so the customer isn't charged extra mileage.”

It's a new take on an old theme. Usually odometer rollbacks victimize the customer. But this leasing odometer scam is perpetuated for the customer.

Who's the victim, though?

Is it the auto companies or financial institutions that own the titles to vehicles coming off lease? Is it a dealer who later buys the car at auction for more money than it's really worth? Or is it a consumer who ends up buying the remarketed vehicle with a doctored odometer?

The salesman's illicit rollback proposal made the woman roll her eyes. She quickly left the dealership. It struck her as unsavory, even if she were the beneficiary. It also made her wonder what unscrupulous things the dealership might do…to her.

Getting good Vibes

When the Pontiac Vibe debuted, a lot of people wondered what its standard 115-volt power outlet could power.

But no one thought it would provide emergency power to a dealership. Add that to the list, says Mary Henige, a GM spokeswoman.

Here's why:

Somerset Pontiac-GMC dealership in Troy, MI lost power one night.

Jim Bechtell, the store's general sales manager, decided to try the Vibe outlet the next morning. It worked. Using an extension cord connected to a running Vibe outside, the store powered a lamp, two typewriters and two calculators for the entire day.

The dealership stayed open. It even sold eight cars. The service department was closed because they obviously couldn't operate the power lifts from a 1-amp outlet. Power was restored that evening.

Darn right they are!

“Are cars getting too complicated?” asked an April 2002 Ward's Dealer Business story on the auto industry stuffing so many high-tech gizmos into new vehicles.

“Yes!” answers reader Chet Sergey of SERCO Ind. in Wolcott, CT. He adds, “I've been wanting to get this off my chest for a year now.”

He says, “When any of these on-board computer-dependent fancy ‘standard’ accessories break or malfunction on my newer fly-by-wire cars, they will stay unrepaired because of the complexity, obvious unreliability and cost to fix.

“As one old dealer service manager said, ‘Detroit is making cars so they don't want you to keep them beyond warranty. After it expires, the vehicles cost too much to fix.’”

I almost hate to say it here, but see this issue's pg. 21 story on the latest high technology for vehicle keyless entry systems.

Resolve dealership disputes

A common dispute between dealership departments involves how quickly the service department takes care of internal units.

Sales department personnel, eager to get cars readied for sale, figure they're the service department's best customers. But to the service department, they're sometimes just another customer — and a pesky one at that. The sparks can fly.

One way to prevent that is to pay a labor rate for internal unit work that's $10 an hour above posted rates. One of our contributors proposed that in the March 2002 issue of the magazine. A three-hour job may cost you $30 more, but you become a priority service customer and end up getting units on the lot faster.

Ell R. Linton tells me he's been doing something similar for 30 years at Broadway Ford Truck Sales Inc. He's president and general manager of the St. Louis, MO store.

Here's how he resolved the inter-departmental disputes:

“We met this problem by having a mechanic (or as many as needed), plus a ‘get ready’ man assigned exclusively for the truck sales department. Their salaries and benefits are charged to the sales department. The sales managers decide the priority of their work.

“When we were all in one building, the service foremen merely oversaw their work. Now our sales department is in a separate building with four stalls dedicated to the new and used departments, still with their own employees. Service gets any overflow work necessary.

“Our rental and lease department also has its own repair personnel and dedicated stalls. We haven't had a priority work dispute between the two departments in over 30 years.”


Steve Finlay is editor of Ward's Dealer Business. His e-mail address is: [email protected]

TAGS: Dealers Retail
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