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Surf the Internet by putting "automotive" and any other
word you like into a search engine, and you'll find thousands of Web sites.
These range from major automotive manufacturers' Web sites to handy auto
accessory sites to sites run by individuals interested in telling your
about their classic car. At this Web site, our goal is to help you best
use the resources of the Internet in the process of researching and purchasing
a new or used vehicle and all the related activities such as what to do
with your current car (trade in or sell it yourself?), your financing,
your insurance, and so on. You'll find tips about each of these categories
in separate pages on the Auto Issues Web site, but before you begin you
might like a preview of the basic types, or categories, of Web sites you'll
run across that are directly related to automotive buying and selling.
DEALER-CONTROLLED WEB SITES
AND
DEALER-CONTROLLED BUYING SERVICES
Almost every dealership in America has a Web site;
many have lots more than one. Behind even the best dealership Web page
or online service are the same types of salespeople and "representatives"
facing the same pressures and ethical problems that employees on the
showroom floor or lot face. They, of course, may even be the exact same
people. Many dealerships put up multiple "Sucker Sites" to sooth you
with consumer cyber-speak while the dealership Web managers and sales
personnel and Geek Masters analyze your available credit information,
dissect your life, then work you like any customer at the store or worse.
Because most dealerships know that you're probably thinking about buying
online and are certainly researching cars online because you'd just
as soon avoid going into the dealership, their great Web site gimmick
is to try to create the illusion you're not dealing with a dealership.
So stay alert and follow the tips for protecting your privacy and pocketbook
that are covered in our sections on "Researching New Cars" and "Researching
Used Cars."
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"INDEPENDENT" INTERNET
BUYING SERVICES
Example: CarsDirect.com
These companies act as brokers for you. They
find vehicles at dealerships, buy them from the dealerships, then sell
them to you. Generally, you don't have to visit or talk to dealership
employees directly unless you chose to.
- Who's sending you e-mail? Usually computer
programs developed by the owners of the site. Generally the sites
are run by persons with auto-related experience.
- Who are the "consumer service advisors"
or counselors? Sales personnel, not true "counselors." A few are former
auto sales persons.
- What happens to your trade-in? They are
typically appraised by the site's "select" dealer network, which means
you are at risk for "lowballing," being given less for your trade
than it's worth
- How do they make money? Generally, such
buying services add the equivalent of a broker's fee of $200 - $500
to the sales price, and at times they are paid by the dealers to buy
from them.
Important tip: The non-dealer folks
want your money as badly as any dealership can want your money. There's
absolutely nothing wrong with that. But it does mean you have to be
wary of their promises. For instance, all these sites offer financing,
and all tell you how "convenient" (always a dangerous word) and reasonable
their financing is. And some sites even acknowledge that you should
compare rates. Remember: if you don't shop financing, you probably won't
get the cheapest rate. You could throw away thousands.
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"PROSPECT AGGREGATORS"
Examples:
CarSmart.com,
Auto-by-Tel.com
This type site simply aims you at their affiliated
dealerships. Prospect aggregators work closely with their dealers and
at some point in the transaction usually put you in direct contact with
a specific dealer.
- Who's sending you e-mail? As a rule, you'll
receive e-mails from both the aggregator and eventually the specific
dealer.
- Who are their "consumer advisors?" Salespeople,
not true advisors. Since most prospect aggregators' survival depends
on good dealer relationships, you're not going to find much criticism
of their "approved" dealers from a prospect aggregator's consumer
advisor.
- What happens to your trade? In the main,
the specific dealership "takes it off your hands." Again, you are
subject to usual dealer "lowballing."
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AUTOMOTIVE MANUFACTURER-RELATED
SITES
Examples: GMBuypower.com, GM-AOL site and Yahoo-Ford
site
You're certainly not going to find sales personnel
at a GM site recommending that you buy a Ford, or vice-versa, though
it might be better for you. You're probably not going to see a story
on YAHOO or AOL damning their "affinity partners," either. These manufacturer-related
sites are simply "prospect aggregator" sites with a point of view based
solely on what automotive product or line each site is selling. Such
sites usually deliver you to a dealer by sending you to the dealer's
Web page or "Internet Coordinator."
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SITES THAT DEAL EXCLUSIVELY IN
USED VEHICLES
Some of these sites will sell you a used car, some
will buy your car, some will even guarantee the value of the car you're
buying or selling. Potentially, some of these options are very useful.
But many of them are also a snake pit of potential problems, and others
are virtually worthless. Even the best of the sites frequently involve
old-time used-car types, involve lots of fine print, and thrive on the
"lowball" aspect of the used-vehicle business. Be sure to read the tips
under "Researching Used Cars."
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SITES THAT OFFER ONLY FINANCING
OR LOANS
Some sites offer to "shop" your credit and give you
a menu of potential financing sources. Other sites offer only their
own financing, and, of course, these sites always claim they are the
"best" or "easiest." Others sites will supposedly help you if you may
have credit problems. But none of these sites will tell you to shop
their best rate at your credit union (or bank), and many charge too
much for fees and related items.
Most of these sites also offer loans on many things
other than vehicles such as boats, home equity loans and so on.. Most
of the staff members are not from the auto business.
Where do these sites make their money? The
"comparison" sites are paid a commission by the company that eventually
finances you. The "Agenda" sites, which are those offering own their
own financing, simply sell you the money for more than it costs them.
Manufacturer-owned finance companies such as GMAC or Ford Motor Credit
normally sell money only to dealers; as a consequence, their Web sites
eventually pass you along to a dealership finance manager-oops, I mean
"Financial Advisor" or "Business Manager" -who loves to resell it to
you at a fat profit. Whatever the name of the dealership person you
are passed to, remember they are simply very high-paid and skillful
sales personnel.
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INFORMATION-DRIVEN RATHER
THAN PRODUCT-DRIVEN WEB SITES
Example:
Edmunds.com, a leading commerical pricing guide
NHTSA.com, the National Highway Traffic Safety Administration, a U.S.
government agency
Carsafety.org, the Web site of the Center for Auto Safety, a non-profit
consumer organization
As you can see from our three examples, information-driven
sites cover a wide range. Some are commercial, others are not. Many
of the commercial sites such as Edmund's, offer sound information and
clear privacy statements. But on all commercial sites (and some "consumer"
sites) stay alert for commercial affiliations that try to hook you up
with some service. My general policy in addition is to ignore all ads
which some sites may use to help fund their operation. With that in
mind, I use many of these sites for useful, sound information and am
always on the look out for new sources of useful info. As you surf and
research automotive Web sites, have fun while keeping your good sense
(and critical judgment) at hand.
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