What happen to integrity with dealerships

Do you get docked pay if you get mentioned negatively?

 

(THIS IS ALL ONLY AT MY DEALERSHIP I CANNOT COMMENT ON ANY OTHER DEALERSHIPS)
If people have a problem with us they usually will complain to the service writers (im a porter) or service manager and they will ask us what happened after the customer leaves and 99% of the time its just the customer being an A-Hole so its not that big a deal.

 

If you'd rather not say publicly, who else is part of DCH?

 

I've in general have had good experience with dealers. Whether, Honda, Acura, Nissan or Toyota.
I went in a couple months ago to get the rev1 TSB done along with the free 10k mile oil change and I asked them to take a look at a couple other things. My usual service guy was half ignoring me like usual while I was talking at him. But the important part was his actions. He called me later that day and spoke to every one of my concerns and told me that I could pick a time to come in and take a drive with a tech to demonstrate what I was experiencing.

I took my Honda into the dealer religiously for the larger 15k and 30k services. They did stuff for free well past 100k miles despite I didn't have a warranty past the basic 3year/36k warranty. There was one time I was unhappy with some sort of repair (don't remember what). They said I can talk to their service manager. I called and left him a message. He called back, I explained my case. He refunded the ENTIRE bill. I was going to be happy with just an apology or some credit towards future service.

Eons ago I had a Nissan Maxima. Had all sorts of little problems. I took it back to the dealer to have them address something new every few months. I'd get surveys and I'd give the dealer high marks because they gave an honest effort to address everything. I got to know the service manager well and one day he pulled me aside and told me the good surveys I was sending in was very valuable to him and his team and he thanked me for them.

My friend in college sold Mazdas on the side. When the Miata first came out in the early 90's and they were selling for $10-20k above MSRP, Mazda restricted that dealership's allocation due to their poor survey results. It's a huge lever the manufacturer has against a dealership.

 

Here's a recent interaction with my local dealer. I bought a suspension cam bolt for my older Supra and when installing it (torquing to the 136 ft/lbs as noted in the TSRM) the threads sheared off the bolt. It was a $10 bolt. I took it back to the dealership since parts are supposed to be covered by the Toyota warranty.

The guy looked at it and said, nah we can't help you it was probably installed incorrectly. I said excuse me, it's a bolt a washer and a nut. How in the hell do I install that incorrectly. Then he said, your impact gun probably over torqued it. I said ummm no, I use a $400 snap-on torque wrench which was just calibrated. Would you like to see it, it's in my truck right now. I'm sure your techs use the exact same torque wrench. He just said I can't help you because Toyota will tell us that it was installed the wrong way and won't reimburse us.

I walked out and will absolutely never, ever give that dealership a penny of my business. If I do buy a new Toyota it will be from a different dealership. It's amazing to me that they are willing to lose a customer over a $10 part. If that were my dealership, I'd set that guy straight. I'm seriously thinking of contacting the owner to tell them about it but I doubt they would care either.

 

At my Toyota dealership we are always good willing crap. We always try to do right by the customer even if it does end up being their fault, unless its just blatant misabuse. Thankfully I work on the used car side so I don't have to deal with warranty/headache cars/customers too often.

 

How about parts prices? In Fremont Ca. I was coted God know how much, more than 6 years ago, gest to find the same part at another Bay Area dealer $23,00 cheaper.

 

As someone who's been in the business in one form or another for over 10 years I think I can shed some insight into this idea that "service has gotten worse".

It really comes down to $. Owning a dealership is still a profitable business and no doubt plenty of owners are millionaires because of it. But its NOTHING like it was 15 years ago (the recession permanently changed the car business and their profit margins).

Dealerships used to make relatively crazy profit margins, when you just made a $4,000 profit on a base model corolla its pretty damn easy to give good customer service. Free loaner car? No problem! Cough up some extra $ to cover a repair that wasn't covered under warranty? No problem! Anyone complains about anything throw them some free shit make them feel better. 2 years later they complain about an issue? No problem we'll cover it especially if you plan on buying another car (because they knew they'd make another $3-4k+ doing it).

These days dealers are much more concerned with penny pinching the bottom line, profit margins have plummeted so every dollar now counts. I know I work for a dealership so you probably just think I'm BSing and "biased" but you can look up the #s yourself on NADA. After the recession in 2007/2008 New vehicles were actually sold for an average LOSS. By 2010 average dealer profit on a new cars was a measly few hundred dollars. Even today its only $800. Average new vehicle price is over $30k and dealer profit is average $800. A freaking $2,000 sofa has more profit margin than a $30,000 car.

Average pre-tax profit margin for new cars in 2002 was 13%, today its 2%.

Back in 2002 there was so much $ being made it was common for salesman to get free demos it was a perk of having the job. Nowadays even sales managers don't get demos, just the owner.

Don't feel bad for dealerships they're still making money and I actually love my job. I also think the car business is facing blowback from the days when it was REALLY shady (open ended leases, unlimited markup in financing rates, no invoices, no truecar, etc etc etc). So as a whole it probably deserves the horrible reputation it has now. But the truth is legally you can't even rip someone off these days, at least not like how they used to. Rate markups are capped at 2%, loan values are pegged to LTV so you can only charge so much for products, and EVERYTHING is disclosed and itemized so you can't just sneak stuff in. Maybe other states are different so I can really only speak for California.

The underlying issue in my opinion is consumers in general have become way more entitled, and at the same time profit margins have plummeted, that's a recipe for unsatisfied consumers.

 

Do you have sources for those profit margin numbers? I have no doubt that they may have shrunk, but I just dont buy that they are 2%. I know services like warranties and lending is where they make up for loss margin on the vehicles but there is no-way they dont make a good chunk of change on each vehicle. I'd bet they are making close to 10% on average.

The reason the vehicles sold for a loss in 2007/8 was because Detroit waaay over produced vehicles which drove prices down across the board. They had to practically give away vehicles at 0% interest just to keep product moving so they could turn over inventory.

edit: I just googled: It looks like Toyota is leading the pack with 13.8% PM

edit2: It looks like they are using EBITDA which isn't a GAAP metric. But the profit margin stuff I've seen based off of operating income is still 6-8%.

So, they are still making quite a bit of money.

 

I'm talking about dealer profits not the actual manufacturer. In 2007/2008 it wasn't the manufacturers losing money (although I'm sure some did) but they were overall still profitable on new cars. It was the dealerships operating at a loss specifically on NEW cars, of course once you factor in fixed operations (parts/service) the new car losses are offset and you still end up profitable, although not all of them as tons of dealerships went out of business in the recession.

You'll never find a dealership that only sells new cars and nothing else because they would go out of business very quickly. New car profits are not enough to cover the massive overhead of a dealership (land, building, salaries, flooring costs, etc), the only reason to even sell new cars at all is so you have a franchise that gives you access to parts and service where the real $ now is. If manufacturers allowed service/parts departments without the hassle of selling new cars dealerships would be jumping all over it. On the sales department side they rely on used cars and backend products (warranties, alarms, lojack, etc) like you mentioned to remain overall profitable. So when I say new cars were sold for a loss I mean specifically front end gross profit, it is made up with backend products, used cars, fixed ops etc... Like I said don't feel bad for the dealers the good ones are still making plenty of cash, but new car departments are still commonly operated at a loss only to make it up in other departments.

Here's source for average loss of $78 per new car sold in 2006 (it got worse in 07-08) and explains how the business model changed:
http://www.autosavant.com/2007/11/1...ed-cars-and-lose-money-on-new-cars-says-nada/

and here's source fo 2.2% which is even worse than I though because it actually includes fixed operations:
http://www.freep.com/story/money/2015/04/10/car-dealers-profit-sales/25572405/

Again want to reiterate no need to feel bad for dealerships as we're hiring more people than ever industry wide and salaries are some of the best in the retail business (I think average salary at dealerships is now over $50k/yr). Just trying to shed some light on why it may seem dealerships have tightened their belts on the new car retail side, because the profit margins are extremely slim.

One way I explain it to people when they ask for just a few dollars a month less and say "its only a few dollars!" I explain we operate on some of the tightest margins in the retail world, lets just say I did discount every car an extra $3/month (its only $3 right?) well $3/month multiplied by the average car loan of 68 months is $204, multiply that by the # of vehicles we sell per year (3,600) and you get $734,400. When dealership average profit is $1.5million adding that $700k would increase your margins by almost 50%. So that's why they fight even over $3/month lol.

One last time not asking for anyone to pitty dealerships. The bad reputation they have was earned from decades of shady business practice, but at the same time its been villainized for its past while not really deserving of its current reputation, the business has changed but the reputation takes time to catch up.

 

This is what's wrong with America

 

This is not just a Toyota problem it is a problem across society in general. It has become about the bottom line which we all know is $$$$$$$ Just last week I took my wifes Honda CVR tour local mechanic which we have been using for the past 15 years for all of our cars. I just wanted a oil and filter change and tire rotation. I was taking to a new guy there and he informed me that the shop was sold and we have all new staff. Red FLag......Ok I said to myself it is only a oil change and tire rotation. The shop called us later that evening and said my wifes truck was ready. We go pick it up and the next day I see oil on my garage floor. Holy Sh.. We then take the truck back and told them it was leaking oil they put the truck back on the rack and made some adjustments to the filter and told us we are good to go. Fast forward three days later and damn more oil on my garage floor. We took the truck back and my wife tells me to keep my cool . They tell us we can wait or come back later to pick it up. I am on my way there now, but I am convinced customer service just sucks all the way around. We are talking about a fuc.... oil change people and as a car maintenance shop you cant do that right. Look like we will be looking for another mechanic .

 

I have had pretty good luck with my service dept, an oil change with a wash is just over 50$ CDN. Told them I had a vibration when I accelerated, getting new u joints put in tomorrow under warranty. When I've made an appointment for work to be done my truck goes in right away with minimal waiting. They did my spark plugs and only charged me .83 of an hour for labour.
So far so good.

 

Whats wrong with america is people who feel like entitled assholes when they walk into the dealership and get upset when things dont go there way with there service writer or a porter took to long to write his vin down even if its busy or there is only 1 working.
Toyota employees (on service side atleast) are trying to do everything they can to help you and get you in and out and quick and easily as possible, there not there to wreck your day or your truck they are just following company policy.

 

Understood.....and you may have a valid point to some degree. However, from my experience in dealing with Toyota maintenance has been subpar at best. I just had my 10,000 maintenance work done and I explained to the service writer have my driver seat head rest repaired. It does not stay in position. After two hours of waiting they told me the oil was changed, tires rotated, and I don't need the TSB. OK fine...sign the paper work and I am on my way. The next day I noticed my head rest still would not stay in the same position. I truly believe I need another seat which I suspect would have to be ordered. Well I guess I will have to take off again and return it back to the shop. Time is Money.

This 25000 mile free maintenance to me is only some sort of sales pitch. It just seems to me all they want to do is oil changes, tire rotations, and bull shit inspections as opposed to addressing a customers concerns like TSB, rear diff noise, or transmission fluid check. I mean my truck rides fine right now, but with all of these problems people are reporting I would suspect Toyota would want to put my mind at ease.

I remember back some time ago I had my 06 in for a oil change and left it at the dealership around 8;30am and went to work. I called them around 11:30 am and ask the service manager about the status of my truck. He told me mine would be next in line and should be completed around 1:30pm. I called back around 3:00pm and he told me it is not finished yet but it should be ready by 4:30. WOW.......how many hours is that to do a oil change and tire rotation. I got off work around 5:30 pm and headed over to Toyota and when I got there they told it is being worked on now. I decide to snoop around and found out they had my truck not in the maintenance area but out back changing the oil. The guy changing my oil look like some cat from some 3rd world country. I raised my hood up and found oil all over my engine, and I went to complain to the manager and he said my next oil change is free.

I got one better. Why don't you just keep that free oil change and stick where the sun does not shine. After my 36000 mile warranty I just started taking my truck to my mechanic who has done excellent work on all my cars and my Tacoma for the past 15 years.

As far as these warranties and extended warranties offered by Toyota or any other car maker they are not worth the paper they are written on. I can say my Toyota buying experience has been stellar, but as far as maintenance Toyota to me has a ways to go. Maybe Corporate/Company Policy is the real problem here. I just love it when people say we are just following Company policy. It seems kind of funny to me that these companies have solid systems in place to get your money. Talk about streamlining and efficiency. Nevertheless, when it comes to solving, troubleshooting, or correcting problems it seems to be a hit or miss. I wonder why that is?

 

I feel the same about this, i really really dont trust the dealership anymore, sales and service department alike. I feel like they sell and repair so many vehicles that they dont care if mistakes happen or if the customer service is not what it should be, because they will still get the business. The problem is management/leadership really.

 

I had a very good relationship with a Ford dealer for years because the service writer I started with made it to service manager and the service manager went up to GM. They always took care of any service issues I had. The sales side was a different story mainly because of turnover. My 1993 F150 was suppose to have a spare tire lock. I had been driving it for close to a year when one day I went to air the spare and noticed that it had no lock. I stopped in the showroom and some smart ass sales guys said "you are just now noticing" I said yep I have had no reason to crawl under truck and check until now. Service manager over heard the argument and sent one of his guys to get a lock and install. Then there was the special order 1997 that I never took delivery on. It went on hold for 2 different things. Problem was the sales guy was afraid to call me. At this time I was on a first name basis with GM. He adamantly defended his young buck sales dude. I gave them 2 days to locate a truck with the exact specs. They did but the dealer that had it would not trade. It all turned out well in the end because I did not want the color on the one the wife wanted and I ended up getting one from another dealer in the color I wanted.

 

Wow, never had an issue like that at service. Usually when I drop my truck off in AM, they squeeze me in and have it ready before I get there after work about 4ish. Even the Subby dealership does well.

Now I did have the body shop not know where my truck was for a day, and then take two days to change a bumper and tail light.

 

I took my 2013 Taco in for the last free oil change and someone swapped out one of my cleats. The broken one had a different code on it. I wouldnt have noticed except I used it on the way out there, dropped off something at a store and then after I got home I loaded something else up and thats when it "fell apart" in my hands.

Had the FX pros installed at a tire shop, big named one in Santa Fe. Anyhow I had the shop removed sensors on my gen2, install in 2017 wheel/tires and remove sensors from 2017 and install on my FX pros. I had one extra set of 2013 TRD sport wheel on craigslist, after a guy comes ove rto pick them up we notice all the wheels are hashed up from removing old weights and installing weight on the inside of the wheels. Wait a min!, those wheels had teh stock tires on them and why would a tech/kid/moron/thief remove weights and install them on the backside of a wheel that wasn't going back on a truck?

Im sure they figure by the time I figure it out its too late for me to say anything. I feel like email the corporate dudes and complaining. Dont even get me going on teh ducati dealership/service dicks.

 

I cannot complain about the Toyota dealership where I bought my truck. Now due to a Subie dealer I will never buy a Subaru again. Love my Subie, but had a terrible experience so brand is done to me.