Alison and I are in the market for a new car. Well, we thought we wanted a car, but now we've decided on a van. A few weekends ago we spent a marathon three days car shopping. We went to three different dealers and a couple of private party sellers. We didn't walk away with a van, but I did walk away deeply disappointed with the process.
For whatever reason, it seems like it's incredibly difficult to find a car dealer whom you can trust. The entire system is set up in a manipulative way, which to me violates the basic rule of a good deal. A good deal is when everyone deals honestly and with respect, and both parties walk away satisfied. Since most car buyers are financing their purchase, many break under the intense pressure in negotiations just so they don't have to deal with the dealer anymore. Clearly not every car dealer is terrible, but there are more bad apples than good.
Alison and I are buying with cash, so we walked away from the bad deals, but honestly, it shouldn't be like this at all. First there's the ridiculous markup on the vehicles, then there's the surprise fees that have no basis in fact or reality, and finally there's the psychological warfare of the salesman and sales manager. The only reason why the system continues is because we all keep buying.
I'm not opposed to a business making a profit and I understand that there's markup on everything, but I think that the auto industry is particularly egregious. In fact, I think a reasonable argument can be made that the auto industry is the modern slaveowner. In order to maximize their profits, they're willing to lie and cheat to get buyers to sign on to payments. While the difference in monthly payments may seem small to the buyer, the profit to the dealer and actual cost to the buyer is extraordinarily high. Certainly buyers are voluntary slaves, but the same principles that underpinned the system of slavery in this country can be found in the auto industry today.
So what's the solution? First, we need to give up our car addiction. It's a great thing to love your car, take care of your car, and have pride in your car. It's an entirely different thing to be obsessed with your car. Buy a car, and drive it for a decade, then shop for its replacement. Second, pay cash. Financing your car only limits your options. The monthly payment seems like its affordable until your company goes out of business, your kid needs braces, or your other car blows up. If you don't have the cash, you can't afford it. Third, say no to dealers. When buying a car, dealers are trying to earn your business. Don't let them steal your money when you're the one who makes the buying decision. Buy from dealers you know and trust, or from places like CarMax where there's complete transparency in the buying process.
It's sad that the auto industry preys on the general public, especially the poor, broke, and uneducated. Let's starve them of the cash they need to stay in business until they get their act together.
Tags: Money Virtue