Teen Driving Week at Carsala: Part One

Image from Wired.com

Teen driving now has a fresh young face from the NASCAR world to help promote a program designed to teach safety to teens.

Colin Braun, 20-year old NASCAR Camping World Truck Series driver has teamed up with Ford Driving Skills for Life (DSFL) to promote the importance of safe driving to teens around the country.

Mile for mile, teenagers are involved in three times as many fatal crashes as all other drivers. Ford Motor Company has a wonderful program called Driving Skill for Life, through which teens are able to improve their skills in four key areas that are critical factors in more than 60 percent of teen vehicle crashes: Hazard Recognition, Vehicle Handling, Space Management, and Speed Management.

Braun, now in his second year driving the No. 6 Con-way Freight Ford F-150 for Roush Fenway Racing, knows the importance of safe driving on and off the track. As part of the yearlong partnership, Braun will participate in DSFL hands-on training events and various nationwide teen safe-driving initiatives.

“I am pleased to be a part of the Ford Driving Skills For Life program. Having grown up racing all my life, I learned early on there is a time and place for driving fast, but public roads are not it.” said Braun. “I think teenagers are more likely to listen to a message coming from someone closer to their own age, so I hope my involvement will make a difference teaching young drivers how to be safer on the road.”

Throughout the year visitors to www.DrivingSkillsforLife.com will have a chance to view Braun’s blog dedicated to safe driving tips, videos, photos and updates from his race season.

So you’re interested in buying a fuel efficient car, but you don’t have $25 grand to throw down on a new Toyota Prius?  You probably also noticed that leasing is dead and great loans can be hard to find.  There’s good news for you.  First, buy a used car and if you’re not sure why, check out my Top 10 Reasons for Buying a Used Car.  Second, you don’t’ have to buy a hybrid to get really good gas mileage.  It’s a myth and it’s propagated by our local, state, and federal governments that do things like give out subsidies for hybrid vehicles or use taxpayer money to help car manufacturers develop hybrid technology.  What’s really important is fuel efficiency - hybrid or not.

To generate this list, Google Trends was used to figure out which high fuel efficiency cars are searched for the most frequently on the web.  Here are the results:

There are a few surprising things about this list:

• 7 out of 10 are foreign made
• Toyota snagged 3 spots on this top 10 list
• Chevrolet nabbed 2 spots on the list (who knew?)
• Chevrolet Volt would be #10, but it’s not in production until 2010
• The Geo Metro and the Geo Tracker came close to making it on this list even though they aren’t in production any longer
• Dodge, Hyundai, Isuzu, Kia, Mazda, Pontiac, Saturn, Scion, Subaru, and Volkswagen should all have something on this list, but none of their cars came even close due to either a low search volume or the complete lack of a high fuel efficiency car

Now that you’ve seen the list, go out and get the high gas mileage car of your choice and make sure you buy one that’s two years old so that you’re getting the best deal, being environmentally friendly, and saving a TON of money using Carsala!

I bought a Honda Civic about nine months ago and it’s great.  However, I have to admit that I really wanted a hybrid car but there weren’t enough used hybrids for sale to get a good discount at the time.  In fact, many used hybrid cars were selling for more than their original purchase price!  Times have changed, and currently used hybrids are much more affordable - at least temporarily.

Gas is at about half of it’s all time high.  However, most Americans intuitively believe that gas prices are going to rise again.  When the economy emerges from its turtle shell and the U.S. stimulus package starts funding new growth and jobs, gas prices are bound to rise - thereby increasing the demand and prices for hybrids.  For now we can bask in the glow of low hybrid car prices.  To prove the low price point, I put together a table today (Feb. 9, 2009), using Carsala’s price quoting tool, for two of three most popular hybrid cars.  Don’t believe the results?  You can and should check the discounts for yourself on Carsala’s web site.

The “Discount Off Blue Book” column was generated by using Carsala’s price quoting tool and for cars in the model years 2006-2008 with no more than 30,000 miles.  The “Estimated Price” column was generated by applying the discount to cars with only 25,000 miles.  Can you believe the average price for a 2007 Honda Civic Hybrid with only 25,000 miles is $16,100?  Remember, these prices are for cars that should be in excellent condition, still have warranties, and have been inspected by a professional.

It’s possible that the Toyota Prius and the Honda Civic Hybrid aren’t right for you.  There are a lot of options to choose from - some better than others.  Here’s a partial list in alphabetical order.  Not all of these cars will be available in the used car market if they are new to the car market or are made in limited quantities.

• Chevrolet Tahoe Hybrid
• Ford Escape Hybrid
• Lexus RX 400h
• Honda Accord Hybrid
• Nissan Altima Hybrid
• Mercury Mariner Hybrid
• Saturn Aura Hybrid
• Saturn Vue Hybrid
• Toyota Camry Hybrid
• Toyota Highlander Hybrid

So if you’re looking to buy a hybrid, now’s a great time.  Looks like I may be getting a hybrid after all…

Many cars have really, really, awful names.  These names fail to inspire us or even cause us to consider buying the cars they name.  Names such as the Volkswagen Routan, Pontiac Parisienne, and Renault Le Car all fail miserably to make me even wonder what those cars look like.  In some special instances, car names can actually do damage to the car company and these cars have made it to the top of my list: The Top 5 Worst Car Names - Period.

Name: Perodua Kancil

Never heard of this car?  I’m not surprised.  I discovered this car during my travels to Malaysia many years ago.  When translated, Kancil is supposed to mean “mouse deer.”  My Malaysia friend translated it to me as “gazelle.”  The problem as you may have picked up is that the name is dangerously close to “cancel,” and in a country where most people speak some English, this is what the car is commonly called.  Don’t feel like driving a car that is already “canceled?”  Neither do many people in Malaysia although it is still produced today.

Name: Nissan Armada

Oh, the ill fated Spanish Grande y Felicísima Armada, or “Great and Most Fortunate Navy.”  If Nissan had only been more fortunate in naming this SUV.  The problem with the name Armada is that it may be best known for the Spanish Armada’s defeat at the hands of England.  Starting with the Battle of Gravelines, the Armada went on to lose about 50 ships and 5,000 men.  Based on the Nissan Armada’s sales and poor reliability history, I reckon another Armada is about to be lost.

Name: Chevy Nova

Poor little Chevy Nova.  The name was supposed to inspire images of a great shining star.  Instead, the name caused this car to be the butt of many, many jokes and false rumors.  In Spanish, Nova can be separated into “no va” which literally means “no go.”  People still claim that the Nova sold poorly in Spanish speaking countries because of the poor name choice.  In reality, it didn’t sell poorly, but I’m betting it would have sold a lot better with a better name.

Name: Oldsmobile

Ransom E. Olds, (yes, his first name was Ransom) was the founder of Olds Motor Works.  In 1897 he named the business after himself.  I know the company’s naming happened more than a century ago, but it’s hard to believe that calling an automobile “old” was ever a good idea, and in 2004 Oldsmobile stopped producing cars.  Although the word Ransom itself has all sorts of criminal and illegal undertones, there’s something intriguing about the name and I’m wondering if it would have been better to change the company name to Ransom rather than shut the whole operation down.

Name: Ford Explorer, Expedition, Excursion, E????

When my wife and I named our two daughters, we spent a lot of time thinking about all the ways a fifth grader could change a first name into an insult.  Apparently nobody at Ford thinks this is a valuable exercise when naming a series of SUVs.  In about 2001, I distinctly remember getting emails and hearing a lot of jokes around the office about the next great Ford SUV - the Expenditure.  I’m sure somebody at Ford got a big bonus and a promotion for naming these cars, but when everybody is making fun of Ford SUVs for being an expenditure, that can’t be good for business.

Do you think I missed a truly terrible car name?  Write a comment and share the name!

In the used car market, being picky about color is more expensive than air conditioning, an automatic transmission, or leather seats.  Who knew?  Well, now you know and you can save a ton of money by knowing this too.

Since Carsala recently gave me the keys to their amazing price quoting tool, I have been playing around with car prices based on different options.  White and silver are the most popular colors in used cars and each of these colors comprises about 15-20% of any type of car.  This means that if I’m shopping for a used car and decide I only want silver, then for every 100 cars on the market I am only interested in 15 to 20 of them.  That limits my choices and limits the discount I’ll get when I go to buy a car.

Here’s a chart with examples of the premium you will pay if you’re picky about color:

To generate the above chart, I calculated savings off of Blue Book value with a single color compared to not having a color preference.  I looked at cars within 100 miles of where I live because I figured that is about how far an average person would drive for a really good deal on a car.  For savings in dollar value, I assumed that all the used cars cost $20,000 even though many of these cars can be bought for much less than this price - this assured the savings values made sense relative to each other.

If you do choose to buy a car using Carsala, they can quote using a combination of colors.  So if you like any color except red for example, they can quote it this way too.  In these types of cases, color may not impact price or savings, but its’ great to know that if you are being really selective about color, it could cost you well over two thousand dollars.

Leave some comments below about what colors you like/love/hate (and why).  Here’s a chart of the most popular colors for 2008.  Remember that if there are fewer cars on the market of the color you want, then the more you’ll pay if you insist of having that specific color.

1984 Dodge Colt Vista looks like a "crossover" to me

What in the world is a family car?  If you check out Wikipedia’s definition, you get some weird Euro concept that doesn’t quite fit into an American’s idea of a family car. After all, family cars have been sedans, station wagons, mini vans, SUVs, and now “crossovers”.  That’s pretty diverse.

While I was stuck on figuring out what is a family car, it suddenly hit me - today’s family car doesn’t exist!  By now your thinking I’m completely off my rocker, but start by putting together a list of what an average family is looking for in a car:

• Enough space for five people and their luggage
• A car that makes it relatively easy for adults and kids to get in and out
• An option for four wheel drive
• Moderate sexiness so you don’t cringe when you see it after two years
• An affordable price
• Good gas mileage

It is the last item in this list that has literally changed today’s family car.  With Americans suddenly concerned about gas prices, a surplus in housing, and a lot of jobs at risk, families are looking to save money by not spending their paychecks on gas.  To get good gas mileage, car makers have commonly sacrificed either the sexiness or the price of the car.  Note that I am considering “good gas mileage” to mean 30 mpg or better.

If you’re currently looking to buy a family car, you probably have a car that’s five years old.  Five years ago, your family car probably got 20 mpg.  If you want to save some money it needs to be substantially better than this.  A quick analysis shows that if you spend $2 per gallon and drive 15,000 miles per year, an upgrade to 30 mpg would reduce your annual gas costs by $500.  This kind of savings is meaningful.

Many people claim that the crossover is the “new family car” but I feel like car makers got out their Legos and tried to come with something new using Legos from last Christmas.  To put “new” into the title, I believe you have to redefine the genre in some way - and a significant improvement in fuel efficiency is enough to pull this off.

MSN has on their website a list of what they consider to be the “Top 11 Crossover Vehicles.” I would be happy, if not elated, to drive many of these crossovers - but they’re not true family cars to me.  Let me dissect a sampling of the cars to show why they don’t fit into my family car definition:

• Cadillac SRX - low gas mileage (20 mpg), not affordable
• Ford Edge - low gas mileage (20 mpg), too small
• Honda CRV - low gas mileage (23.5 mpg) , too small, limited sexiness
• Mercedes R Class - low gas mileage (18.5 mpg), not affordable, limited sexiness
• Subaru Forrester - low gas mileage (25.5 mpg), no sexiness
• Volvo XC 90 - low gas mileage (19.5 mpg), not affordable

2008 Toyota Highlander

There are some cars that are coming closer to being the new family car.  The new Toyota Highlander Hybrid has a huge interior and looks great.  However, it’s too expensive and gas mileage (26 mpg) is good but still lacking.  Maybe Toyota will finally seal the deal when they incorporate the new hybrid technology coming out in the 2010 Prius into the Highlander.  A used Highlander is a better new family car because you can easily save $10 thousand dollars if you can give up the new car smell.

Do you think I’m wrong or missing something in the definition of a family car?  Share your thoughts and insights!

Top ten lists are great!  They’re funny, entertaining, and take our minds off the daily humdrum.  Here’s an unusual top ten list because it will leave you feeling knowledgeable and empowered if you’re considering walking into a car dealer - the Top Ten Things a Dealer Absolutely Won’t Tell You.

1.       “I buy my inventory for a lot less than you think.”

• Haggling over price has always been difficult, but with the Internet, things have become a lot easier: Car buying sites like CarsDirect.com will tell you a car’s invoice; the web site Edmunds.com even lists the invoice price of options. At last, we can know what dealers really pay for vehicles. Or so we think.  In reality, a practice called “holdback” allows dealers to pay 1% to 3% below invoice for vehicles. Dealers buy cars at the invoice price and after the car is sold, the dealer gets a reimbursement for holding the car in inventory for 90 days. When a dealer sells the car faster than that, part of the holdback payment becomes pure profit, even if the car is sold at invoice price. “You’ll never get holdback money back from a dealer,” says Burke Leon, author of “The Insider’s Guide to Buying a New or Used Car,” but just knowing about it can help when a dealer whines about meeting your price.

2.       “Our lenders aren’t as tough as I make them seem.”

• Car dealers will sometimes do anything to pass the buck regarding pricing and sales. One common trick? Blame everything on the lender. For example, some dealers will say that the leasing company requires deals to be based on the sticker price, says Mark Eskeldson, a consumer advocate who runs the watchdog Web site CarInfo.com. This probably isn’t the case, since lenders can’t control a car’s price. Likewise, some dealers will claim the lender requires an extended warranty. Don’t be fooled, warns the Federal Trade Commission in its online FTC Facts for Consumers report on auto-service contracts, adding that you should contact the lender to check this out yourself.

3.       “State lawmakers are in my back pocket.”

• Since auto dealers deliver huge sums in sales taxes to state coffers, they have powerful local and state lobbies and have succeeded in pushing through a lot of legislation to protect their interests. One of their biggest targets is direct sales over the Internet. Most states’ franchise laws make it illegal to sell cars in a particular state without a bricks-and-mortar dealership there, and the dealer lobby has been particularly effective at suppressing auto makers’ attempts to sell over the Web. In 1998 Ford began a program in which car buyers could choose from used Fords online at no-haggle prices, then complete the purchase at a local dealership. A year later, Texas regulators filed a complaint against Ford for acting as a dealer without a franchisee’s license. Ford sued, claiming that Texas law favors local dealerships, discriminating against interstate commerce. A district judge ruled against it.

4.       “The bait-and-switch is alive and well.”

• You walk onto the car lot set on a certain model, but immediately the dealer starts ticking off all the reasons why that car simply isn’t good enough for you. Before you know it, you’ve signed on for a car that’s bigger, better, and more expensive. When you show up armed with all sorts of information you’ve gotten online, the dealer’s best defense is steering you into unfamiliar territory, says Phil Reed, a car-buying consultant at Edmunds.com. That’s exactly what happened to Christine Kemp, a junior high school teacher who got sucked into leasing a $40,690 Toyota 4Runner Limited, despite researching lower priced models for over a year. The salesperson focused on the better towing capabilities of the more expensive model. The dealer steered Kemp toward the Limited for a test-drive, and talked up its perks (to great effect) even though the four-cylinder base model was strong enough to tow Kemp’s jet skis.

5.        ”I’ll give you a great price - and then lowball your trade-in…”

• If you’re trading in an old car, explains Leon, the dealer’s greatest potential for profit is in giving you a low value on your trade-in. How come? Most people have no idea what their car is worth, and besides, you’re less likely to play hardball on this point when that new car is much more interesting. Leon recommends always settling on a trade-in price before even considering a new or used car. Last year, Reed went undercover as a salesman and then wrote about it for Edmunds.com. One day, he met a man that had gotten $5,000 for his used Chevy Cavalier, but a week later it was on the lot with an asking price of $12,000.

6.        ”…and you won’t know, since the Blue Book favors me.”

• To help prevent a trade-in disaster, some consumers try to learn their old car’s worth by looking at the Kelley Blue Book (KBB), long held as the gold standard for used-car prices. But both Leon and Spinella warn that those numbers aren’t gospel. Here’s why: KBB publishes two different guides, one for dealers, which prints wholesale prices, and one for consumers, which has retail prices (and is therefore of little help in determining what your car is worth to the dealer). Plus, at KBB’s Web site, you can look up trade-in figures that, even for a car in excellent shape, are below the dealer’s lowest figure (the wholesale price). So even if the dealer gives you the best KBB value for a trade-in, there’s a built-in profit if he turns around and sells the car for wholesale.

7.        ”The car you’re buying was totaled last month.”

• The advocacy group Consumers for Auto Reliability and Safety estimates that one in nine used cars sold has hidden damage, including more than a million cars each year that are totaled, rebuilt and often sold as if free of damage. How do some dealers get away with it? Titling laws vary enough from state to state that a totaled car can be “cleansed” of its salvage brand by being retitled in a new state. Such cars are often shuffled around the country through auctions, and while the final dealer may make a legal claim that he didn’t know about any damage, Brown says that it’s a case of see-no-evil. “Dealers know what they’re buying at these auctions,” he says. One common way to check if there has been any major damage to a car is get a car history report from a service like CARFAX or AutoCheck.

8.       “Your loan puts cash in my pocket.”

• Ever wonder why that dealer is so keen on finding you an auto loan, even when you offer cash? When dealers set up loans, they commonly take the rate offered by the lender, then tack up to two percentage points on top. All or part of that so-called dealer markup is given to the dealer. And dealers aren’t required by law to disclose the practice. The National Automobile Dealers Association (NADA), says that dealers are entitled to a markup for arranging financing. “Because dealers buy credit in bulk and provide the retail infrastructure for serving individual customers, they get lower rates than a consumer,” says a NADA spokesman in a written statement. The problem says attorney Aurora Dawn Harris is that they, “pretend that they’re providing you a free service. And sometimes they’re making most of their profit on it.”

9.       “Our ‘new and improved’ customer service is a farce.”

• After years of having the worst of all possible raps, car dealers now insist that they’ve cleaned up their act. In a speech last year, NADA Chairman Harold Wells proudly cited a 1998 Gallup poll showing that 76% of Americans who bought cars were satisfied with their experience. Too bad he left out the rest of the picture. For one, franchised auto dealers still top the Better Business Bureau’s list of businesses receiving the most complaints - by a long shot. In 1999 auto dealers were the source of 17,686 complaints compared with 9,538 complaints for the No. 2 business, computer dealers.

10.   “A lease is a great deal…for me.”

• You may have noticed that many dealers would rather you lease than buy. The reason is simple: Leases generally bring dealerships more profit than sales, even for the exact same car. Why? Well, consumers tend to know less about leasing than buying. So, while 80% of car buyers haggle over the car’s purchase price, only 10% of leasing customers do, according to Spinella. Plus, lease customers tend to choose more expensive cars. So be extra wary if your dealer does whatever possible to steer you into a lease. One common tactic, says Eskeldson, is to give customers an “apples-to-oranges” chart comparing payments on a lease vs. a loan - quoting a low interest rate on the lease and a high one on the sale. Says Eskeldson, “If the consumer doesn’t know how to calculate his own lease payment, he is ripe for a rip-off.”

This list is primarily from an original article written for SmartMoney.  Write a comment and share your own inside information about the things that dealers won’t tell you!