A Brief Guide to Using the Web for Automotive Research
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."
Independent" Internet Buying Services
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.
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."
Automotive Manufacturer-Related Sites
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 some news sites 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."
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."
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.
Information-Driven Rather Than Product-Driven Web Sites
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.