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Saturday, October 13, 2012

What are you really paying for?

The dealership this blog is based around does something that I find extremely offensive to the consumer. I have never heard of any other shop that does this so I can't really say how widespread it is in the industry. What I can do, however, is let the world know something for which to look.

As you may or may not know, there are parts that come from the manufacturer of the vehicle, called OEM parts (Original Equipment Manufacturer) and other parts that are made by a different company and sold at parts stores across the country, called aftermarket parts. One of the many advantages of bringing your vehicle to a dealer for repair is that they will use OEM parts. With the use of OEM parts you know you are getting a high quality part that was made specifically for your vehicle.  This is not to say that aftermarket parts are never a good option, nor is it to say that a dealer will never use aftermarket parts.

This particular dealer is passing off certain aftermarket parts as OEM parts to the consumer.  When I first found out about this, I was surprised.  After I found out about it is when I realized I should not be surprised by anything this dealer does to make additional profit.  Was this a mistake?  No.  The parts come in different boxes that are clearly not from the Manufacturer.  The parts department in this dealership still bills the OEM part number on the invoice, charging the matrix pricing (see earlier post) for a part that is inferior in quality and costed them less to buy.

Let's say that part were to fail in 10 months while the customer is out of town and they bring their vehicle to another dealership since they know the part is covered by the OEM part warranty.  Now, another dealer goes to replace the part and they realize it is, in fact, not an OEM part.  They will be unable to process a claim on the part and the customer will have to pay for the repair again.

As I stated earlier, this type of thing is not commonplace , as far as I know, in the industry.  But I still advise you to do your due diligence when having your car serviced.  Most repair shops, dealers and not, are trustworthy and are not there to take every penny they can out of your wallet.  Shop carefully, and when you find a trustworthy shop, stay with them and build a relationship.  

Friday, September 7, 2012

Profit > Customers

The dealership for which I work has a great big sign on the walls that shows the Mission Statement of the dealership.  It describes the merits of the dealership and its employees and how we value every customer and will treat them as a customer we want to maintain forever.  It goes on to describe the honesty the employees will practice and promises to always look out for the customer.

That is wonderful, in theory.  Unfortunately, in this setting it appears to be mostly lip service as this does not translate to the way the customers are treated.  But why aren't the customers treated this way?  Maybe the individual employees just don't follow the mentality of ownership.  Sadly, it is in fact the ownership that creates this atmosphere.  The owners decide how the business is run, and I will assure you that it is not run with the customer in mind.

The ownership at my store is relentless in their pursuit of the almighty dollar.  Don't get me wrong, I understand that we are a business and as a business our purpose is to generate a profit.  I am all for profit, as it means the dealership as a whole is doing well and will maintain jobs and a presence in the community.  However, when people are being robbed blind in order to turn a profit, I have a problem with that.

People bring their vehicle in to be serviced at my dealership expecting to pay a little more, after all it is a dealership and the technicians are well-trained and people feel like they can trust a dealership more than an independent repair shop.  We are usually (more on this in a future post) using superior quality factory parts as opposed to aftermarket parts.  It is expected that our pricing structure will be slightly higher than an independent shop.  We employ tactics that increase our parts and labor pricing from our base pricing structure, unbeknownst to the consumer.  

The parts department uses something called a matrix.  The matrix takes the MSRP of the part and sells it at a price that is much higher that what the manufacturer suggests as the list price.  Now, if they raised a $100 part to $110 to earn a little extra, it wouldn't be that big of a deal.  However, they are selling that $100 part for $180-$230 dollars.  That $100 is the MSRP... not the cost.  That extra money is PURE PROFIT straight out of your pocket and straight into the dealerships bank account.

This is one tactic that makes my blood boil.  Consumers are in our store in good faith.  They are there because they trust us and feel comfortable with us.  If they only knew how badly they were being taken...


Hello, and welcome to Repair Shop Racket, the blog written by an insider in the auto repair business.  

This blog will be a mixed-bag of venting and things which you, the consumer, should look out for when having your vehicle serviced.  I will also occasionally explain things about our industry that may help you understand how your repair facility operates its business.  While I work at a dealership that will never be named, this does not mean the things blogged about happen at all dealerships.  In fact, I would say that a majority of repair shops in dealerships are very honest and fair.

Who am I?

I have been in this industry for over 10 years.  I was factory trained as a technician after I completed High School.  I worked as a technician for a few years and have worked in other capacities in the dealership setting ever since.

Why did I decide to write this blog?

I need a place to vent.  I am an honest individual, but I am forced to do dishonest things to support my family.  I have become increasingly disappointed with the direction the company for which I work is heading.  I thought if I created this blog I could vent for myself and inform the American consumer.