You Thought That Car Was Expensive? Wait Until You Get Fleeced By The Shop

by Bertel Schmitt

Published: March 30th, 2012

you thought that car was expensive wait until you get fleeced by the shop

Selling overpriced “Original” parts can be like printing money. I know carmakers that generate 30 percent of their profits out of parts sales. How do you drive parts sales? By forcing customers to stay as long as possible with your dealer, a money pit the customer tries to flee as early and as quickly as possible. The golden fleece in the business are repairs only an authorized dealer can perform, using overpriced parts only the authorized dealer has. Countless attempts have been made to break this monopoly. Another attempt is on the way.

For decades, there has been a cat and mouse game between manufacturers and the law. In the U.S. and in Europe, repair information must be made available to independents. But there is always some special information for authorized dealers only. The computerization of cars swung the pendulum towards auto manufacturers and their dealers. Why does a car key sometimes cost hundreds of dollars? Because it can.

OEMs face off with independent workshops, and especially with parts suppliers. Suppliers typically don’t make much money selling part to OEMs, but make a lot selling to independents, even at prices much lower than those of OEMs. Mark-ups between 10 and 100 times the ex-factory cost are not unheard of.

The European automotive supplier body CLEPA is tired of playing cat and mouse with manufacturers. CLEPA says will take at least one carmaker to court if manufacturers continue to withhold repair and maintenance information, Just-Auto writes.

Said CLEPA’s outgoing CEO Lars Holmqvist:

“We have come to the point where we are fed up. We have talked to the carmakers for one year and we have not reached an agreement which is satisfactory. When you buy a car you just don’t borrow it – you should have all the necessary information.”

#BertelSchmitt #CLEPA #OEM #Parts #Repairs

Bertel Schmitt

Bertel Schmitt comes back to journalism after taking a 35 year break in advertising and marketing. He ran and owned advertising agencies in Duesseldorf, Germany, and New York City. Volkswagen A.G. was Bertel's most important corporate account. Schmitt's advertising and marketing career touched many corners of the industry with a special focus on automotive products and services. Since 2004, he lives in Japan and China with his wife <a href="http://www.tomokoandbertel.com"> Tomoko </a>. Bertel Schmitt is a founding board member of the <a href="http://www.offshoresuperseries.com"> Offshore Super Series </a>, an American offshore powerboat racing organization. He is co-owner of the racing team Typhoon.

More by Bertel Schmitt

Comments

Join the conversation

4 of 68 comments

Skor on Mar 31, 2012

The war over who gets to supply replacement parts is as old as the car. During the early days of the US auto industry, there was a court case about just that. The courts ruled that it was OK for independent parts suppliers to provide replacement parts. The auto companies were not happy since OEM parts biz was incredibly lucrative. Henry Ford stated that he would give away his cars if he could get a monopoly on supplying replacement parts.

Like Reply
Terry on Mar 31, 2012

GSLIPPY...I brought up the Skyactive because YOU called it rubbish, and outside of the numbers, you havent even driven the car. Are we drivers, or are we armchair automotive critics? Of course doing the job yourself--provided it is successful-- would be less expensive than paying anybody to do the work. That is a given. But all too often owners--even technicians--make the mistake of getting into the "Get a code, get a part" diagnostic method. Yours worked out..but let's say that P0340/345 code wasnt repaired after replacing the part. As an engineer with your experience, you could probably trace it down. But how many others could? You might work on your car(s), friends, others at times. Try doing this 8 hours a day from 3 to 10 cars a day, and we have to prove the part is bad before we replace it, and if it doesnt fix the issue, we take the part off, and re-diagnose at no cost to the customer. Our goal is customer satisfaction and "Fix It Right The First Time" My point is that there are 2 sides to every story, and the drift of this thread is that dealerships are "stealerships". Dont paint us all with the same brush regardless of your personal experiences. As one who takes pride in my profession, I respond in kind to those that denigrate it. I apologize for my "tone" in my posts. Terry

Like Reply
- See 1 previous
- SCE to AUX on Apr 02, 2012
  
  We're armchair automotive critics, most of us, since we don't have the luxury of driving every car out there. If Mazda wants to distinguish its SKYACTIV technology, it needs to present something remarkable about it (maybe it's cleaner?), instead of just trying to impress customers with a cool product name.
  
  Like
- Terry on Apr 02, 2012
  
  @SCE to AUX GSlippy--as an engineer you would appreciate all the changes and technology that falls under the Skyactive umbrella. The engine, transmission, chassis, braking etc have well over 150 patents applied for. Ive been through all the Skyactive training, work on them and drive them every day. To say that the term 'Skyactive"is merely a "cool product name" shows that you have not the slightest idea of what these cars are made of. Which then leads to credibility, or lack thereof. Armchair critics indeed. Carry on.
  
  Like

Recent Comments

Alan Well, it will take 30 years to fix Nissan up after the Renault Alliance reduced Nissan to a paltry mess.I think Nissan will eventually improve.
Alan This will be overpriced for what it offers.I think the "Western" auto manufacturers rip off the consumer with the Thai and Chinese made vehicles.A Chinese made Model 3 in Australia is over $70k AUD(for 1995 $45k USD) which is far more expensive than a similar Chinesium EV of equal or better quality and loaded with goodies.Chinese pickups are $20k to $30k cheaper than Thai built pickups from Ford and the Japanese brands. Who's ripping who off?
Alan Years ago Jack Baruth held a "competition" for a piece from the B&B on the oddest pickup story (or something like that). I think 5 people were awarded the prizes.I never received mine, something about being in Australia. If TTAC is global how do you offer prizes to those overseas or are we omitted on the sly from competing?In the end I lost significant respect for Baruth.
Alan My view is there are good vehicles from most manufacturers that are worth looking at second hand.I can tell you I don't recommend anything from the Chrysler/Jeep/Fiat/etc gene pool. Toyotas are overly expensive second hand for what they offer, but they seem to be reliable enough.I have a friend who swears by secondhand Subarus and so far he seems to not have had too many issue.As Lou stated many utes, pickups and real SUVs (4x4) seem quite good.
28-Cars-Later So is there some kind of undiagnosed disease where every rando thinks their POS is actually valuable?83K miles Ok.new valve cover gasket.Eh, it happens with age. spark plugsOkay, we probably had to be kewl and put in aftermarket iridium plugs, because EVO.new catalytic converterUh, yeah that's bad at 80Kish. Auto tranny failing. From the ad: the SST fails in one of the following ways:Clutch slip has turned into; multiple codes being thrown, shifting a gear or 2 in manual mode (2-3 or 2-4), and limp mode.Codes include: P2733 P2809 P183D P1871Ok that's really bad. So between this and the cat it suggests to me someone jacked up the car real good hooning it, because EVO, and since its not a Toyota it doesn't respond well to hard abuse over time.$20,000, what? Pesos? Zimbabwe Dollars?Try $2,000 USD pal. You're fracked dude, park it in da hood and leave the keys in it.BONUS: Comment in the ad: GLWS but I highly doubt you get any action on this car what so ever at that price with the SST on its way out. That trans can be $10k + to repair.