By on August 5, 2016

Alarm Valet, Image: Dr. Katherine Nell McNeil/PriusChat

Visiting a dealer’s Finance and Insurance office is usually the last excruciating step when buying a car. The F&I rep will go through an endless stack of documents to finalize the sale while attempting to sell as many pointless add-ons as possible.

Many of us know to avoid add-ons like pin striping, paint protection, and extended warranties since they are either overpriced or valueless — but we may be letting the worst offender of all slip by.

Car alarms seem like sensible choices, especially if they’re offered at a good price, but the alarm that many buy in the F&I office can barely be considered more than a dealer profit device. These alarms are often presented as add-ons to the factory alarm that are supposed to improve on the factory security system, but in reality are usually nothing more than a shock sensor and some hacked wires.

These alarms actually start out as key management utilities for dealers, who later turn them into alarms if they are able to stiff the customer. Dealers that install these devices often use them on every vehicle that comes on the lot, since they are programmable to a master fob by inserting a compatible module in the alarm control unit. Once they are programmed to the master fob, any salesman or manager can open the car with their fob, which makes it easier for them to show the car to customers.

These devices are cheap imported units that are usually installed by tapping into power and ground under the steering wheel and connecting to the door lock module. Some of the systems also have starter interrupt to prevent theft. In order to install them, the starter wire is cut and routed through the system. The control unit is usually mounted in an accessible location under the steering wheel so that the module is easy to swap. The initial cost to the dealer for one unit usually runs around $40 or $50.

Karr Alarm, Image: eBay

Once the car is on its way to being sold, the device needs to be converted to a customer-controlled alarm or immobilized. In order to convert them to an alarm, the dealer module is removed from the control unit and a customer module is inserted and activated. Activation usually runs the dealer around $150, so their total cost for an activated unit is about $200. Depending on how the dealership operates, the finance person may try to sell the alarm up front or they might insert it into the deal via some sort of payment padding. The worst dealers will tell the customer that to get a certain interest rate they will need to buy the alarm at anywhere from $600 to $1200. They add points to the non-alarm interest rate to make the payments look the same.

These dealers usually show customers how the alarm is actually worth closer to $1,500 and are not unlike white van speaker scammers in that regard. Some dealers are a little better about it and tell the customer up front that they can have the alarm activated for $300 or $400 and negotiate down from there. They are making money on the unit as long as they can sell it above $200, so dealers are usually willing to negotiate. Many will be pushy, but they will often relent if a customer does not want the alarm. In that case, they will install a disable module instead of the alarm module, leaving the system inoperable but still wired into the car. The dealer will only be out the initial $40 or $50 fee.

Karr Alarm Disable Kit, Image: GenCoupeGeek/GenCoupe.com

There are various schemes that are used to get these alarms into cars and they are often used by low-price advertisers who will advertise a car a few hundred dollars below their competitors but have fine print stating that a $495 security package must be installed. The unfortunate part is that dealers are butchering many new by cutting wires and having the module drilled into the bottom of the dash. Most buyers don’t realize it. Some customers complain and ask for the complete removal of the system, but it’s rare that a dealer agrees to remove it.

The most telling sign of the intended use of these devices is the source. Most of these devices are not manufactured and sold by mainstream alarm manufacturers, but are usually found in some sort package from a F&I consulting company. They are sold along with paint protection and pin striping products — and training on how to sell them. These companies are F&I trainers and the alarm systems are just one of the tools in their arsenal. Some have even been sued for the payment packing practices that they recommend.

These alarm systems rarely provide improved security over the factory systems and can even cause issues down the road, so I recommend finding a car without one since removal of such a system will still leave holes in the dash and patched wires.

[Title Image Credit: PriusChat; Alarm Image Credit: eBay; De-Activation Image: GenCoupe.com]

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63 Comments on “Never Buy a Car Alarm From a Dealership...”


  • avatar
    raph

    After having seen many add-on security systems fail the mere mention of one in a dealer ad either as a mandatory or complimentary add-on would make me pass on by.

    What a complete deal breaker, especially having to hack into a circuit on the vehicle that at some point will corrode and fail down the road most likely at the most inopportune momemt.

    • 0 avatar
      Ostrich67

      I have a Jetta with the Karr system that I bought used. I didn’t pay for it; it was just there, sucking the battery dry with it’s stupid, incessant flashing LED. What a piece of crap.

  • avatar
    Kenmore

    Anyone else remember the late ’70s alarms that went off solely because the temp had dropped significantly below zero?

    Always thought car alarms were dumb. What passerby cares about someone else’s car? Presumably some are now networked. Are police departments automatically nuisanced with them?

  • avatar
    MrGrieves

    Yeah, this is just one of many fun and potentially sleazy things I’ve had the F&I guy try to sell me. What I’ve been pitched recently (in the past 3 or 4 years):

    Door Ding Insurance
    Glass Replacement Insurance
    Third-Party Bumper-to-Bumper Warranty Coverage
    Dealer-specific “free oil changes for life” maintenance plan

    The upgraded security system pitch usually goes, “Now, this car already has a standard set of anti-theft features. But thieves are smart. They know the factory systems and how to get around them.” I then remind him of the flatbed truck method of car theft and how anything short of a self-destruct system won’t stop that method.

  • avatar
    turf3

    Not to mention that the alarms most likely to be going off all day and night are those attached to $750 cars.

    I really question whether there has been even one single car theft deterred by an alarm in the last 20 years, since everyone has become completely inured to them. Just like backup beepers – when every vehicle on the block is emitting a 100+ dB beep, how do you know which one not to walk behind? You watch them, just like you did before there were backup beepers.

    Ergo, no remaining benefit from car alarms or backup beepers, but plenty of noise pollution from them.

    • 0 avatar
      Kenmore

      “when every vehicle on the block is emitting a 100+ dB beep”

      Nostalgic… brings back working at McDonalds on a football Friday night.

    • 0 avatar
      dukeisduke

      Reminds me of a headline in The Onion, “Local man installs $500 stereo in $400 car”.

    • 0 avatar
      garuda

      The alarm is not to “alarm away” the thief, it is for you to hear that your vehicle is currently being attacked by a cat looking for a warm place to hang out in… I mean car burglar.

    • 0 avatar
      rudiger

      ^This. The advent of cheap car alarms and back-up beepers long ago deteriorated to the point of being nothing more than massive noise pollution and a sign of how far the US has become a third-world nation.

      The constant, electronic beeping is so omnipresent, I can’t imagine ‘anyone’ paying attention to it, anymore. In fact, if I were dumb enough to have one of the damn things on anything I owned, I’d quickly tire of having to constantly turn off the false alarms and turn it off, permanently.

      That is, if that were even possible since the electronics are so cheap.

  • avatar
    I've got a Jaaaaag

    My brother bought a brand new 1992 Plymouth Duster that had a dealer installed ignition lock out, this dealer installed them on every car on the lot, you had to flash the high beams to start the car. It was garbage, they would not take it off with out charging you money to remove it was not added to the sticker price, worst piece of crap ever put on a car.

  • avatar
    omer333

    Before I got my Accord I was looking at a CPO Jetta GLI, all because of Jack’s review.

    The salesman mentioned a lifetime warranty on the engine, which had me intrigued due to VW’s notorious reliability issues.

    When I was at F&I to sign the paperwork, it was explained to me that in order for me to have the lifetime warranty honored by the dealership, I would have to bring the car in for all oil changes and they would use special “additives” to the oil which would cost extra to the oil change. Synthetic oil changes at the dealer were around $70, these “additives” would have put an oil change over $100.

    I also noticed a couple things figured in like a brake light that strobes for around $500, as well as the taxes seemed a little high.

    The F&I person kept pushing me to get paint protection and Gap insurance. I excused myself to go to the restroom and called my wife to come get me. I walked back to the F&I office and told them to tear up the paperwork, I did not want the car.

    On one hand I was kind of bummed out, because I really liked the car, but I did not want to get screwed any more than I should.

  • avatar
    dukeisduke

    I owned three Toyota Previas, all bought used, and every one of them (the first was originally from Atlanta; the other two were local DFW cars) had an Audiovox alarm system installed by the dealers. We never got a transmitter with any of them, so the alarm systems were completely useless.

    My ’13 Tacoma has an alarm that was installed by the distributor (Gulf States Toyota).

    • 0 avatar

      Not sure what Gulf States is doing but I know some Toyota dealers/regions install the OEM RS3200 system which is a good add-on while others install cheapy units like the one above. If you don’t see a box near your knee then you have the good one.

  • avatar
    indi500fan

    Wow I’d forgotten stuff like this even existed.
    And living in the country, I don’t think I’ve heard a car alarm go off in decades.

    Given the complexity of electrical systems with electronic controllers from bumper to bumper, it’s scary to contemplate the headaches these could produce.

  • avatar
    pb35

    Seriously. I purchased my first new car when I was 20 (87 5.0 Mustang) and the F&I lady was so pushy and she wouldn’t stop so I finally broke and purchased the alarm.

    I later came to find that it was the cheapest, shittiest Audiovox alarm that money could buy. Lesson learned.

    When I bought my SS back in January the finance dude was pushing the extended warranty, hard. How about 49 payments instead of 48? no. You can have the warranty at the rock-bottom price of $500. no, just the car please. Is this a manufacturers warranty? no, it’s an AUTONATION warranty! Like that was supposed to make it better somehow. He finally gave up. I hate those MF’ers.

    • 0 avatar
      Ostrich67

      I bought an extended warranty on a used Mustang, for $1300. I made them pay for $3000 in repairs including a rebuild of the differential which included a 3.73 ring and pinion gear upgrade (which it really didn’t need, but the dealer stuck them with it), seized rear brake calipers (on a 36,000 mile car) and a squealing HVAC blower motor around which the entire car was built.

  • avatar
    Cactuar

    Another fun trick by your favorite automotive department.

    Please someone make us a giant vending machine for cars so we can do away with these crooks once and for all.

    • 0 avatar
      VoGo

      Everyone loves to hate on Tesla. But you will all come around at some point.

      • 0 avatar
        Cactuar

        I’m sure many car guys respect Tesla for doing things differently regarding sales. They just don’t care for the whole EV/environmental thing.

        • 0 avatar
          mcs

          @cactuar: They just don’t care for the whole EV/environmental thing.

          Electrification is one of the best things that’s happened to performance cars. Smooth and quiet with plenty of torque. Low center of gravity. Wait until you see what can be done with torque vectoring when they start putting a motor at each individual wheel. Rimac has been doing some great work along those lines.

        • 0 avatar
          VoGo

          That makes sense. If you have a choice between helping to destroy the world, or helping destroy it, then obviously you want to…

      • 0 avatar
        raph

        Tesla purchase model certainly, I’ve long wanted to buy factory direct over the Internet and schedule a pick-up time at a factory prep center.

        After special ordering my last car and getting exactly what I want I’m sold on the idea of waiting about a month for my car to be built.

        I tell everybody I know that isn’t in a pinch to specal order thier car and don’t settle for what’s on,the lot.

    • 0 avatar
      gasser

      Tesla has such a “vending machine” and dealerships are trying to get state franchise laws to stop them.

      • 0 avatar
        VoGo

        Right. The established ICE carmakers – the majority of which are foreigners – are doing all they can to put the American entrepreneurial Tesla out of business with their lobbyists. Because if they can’t win in the marketplace, at least they can try to use their leverage with the political system.

        Oddly, the vast majority of the B&B line up behind the dark side.

        • 0 avatar
          2manycars

          Given the exclusive tax breaks and subsidies that Tesla gets it’s hardly a level playing field. Left to its own devices the company likely would already have already folded.

          I have no problem with tax breaks per se, it’s always best to keep as much money out of the hands of politicians as possible. But in the interest of fairness and equality before the law those breaks need to be open to any company that brings a similar level of economic opportunity to the table.

          It’s not “the market” when government decides that some animals are more equal than others according to its own agenda.

          (And I’m sure you’ll go on about GM and Chrysler again, but I was against those as well, and those are done deals. You can’t change the past. Tesla’s situation, on the other hand, is current.)

          • 0 avatar
            mcs

            @2manycars: Given the exclusive tax breaks and subsidies that Tesla gets it’s hardly a level playing field.

            Their tax breaks aren’t exclusive. Other companies can and do get the same incentives and tax breaks. Actually, they’ll be the first to lose some of those tax breaks, so it will be the other way around.

          • 0 avatar
            VoGo

            Except that Tesla doesn’t get any exclusive tax breaks or subsidies. I think you are confusing them with GM that got $10 Billion in the bailout.

        • 0 avatar
          JD23

          Many of the “foreigners” employ more Americans than Tesla and are owned by a significant number of American investors, so your distinction between Americans and foreigners is rather arbitrary.

          • 0 avatar
            VoGo

            Arbitrary? Hardly. A company is either American or it isn’t. How is that hard to understand? It certainly wasn’t hard to understand in the 1980’s when the Big Three were lobbying so hard to keep foreign carmakers out.

          • 0 avatar
            JimZ

            only on TTAC could an article about car alarms be derailed into talking about Tesla.

          • 0 avatar
            VoGo

            The heart of the issue is the current distribution system in the US. Tesla is the only company trying to disrupt that model.

  • avatar
    Kyree S. Williams

    I have never seen this before in any of the new-brand dealerships from which I’ve purchased, or CarMax. Is this something that is mainly restricted to BHPH lots? And if so, does it also serve as an immobilizer to prevent the car from starting if the customer misses a payment?

    • 0 avatar

      This type of device is mostly installed at franchise stores that sell new cars. The BHPH lots have a different type of device that has some similar features but works in a different manner.

      The type of device covered above is not tied to the payment schedule.

    • 0 avatar
      Adam Tonge

      I know a dealership group that installs them. They also try to add pin-striping, “Maintenance for Life”, window tint, the “Desert Protection Package”, over priced GAP, and inflated financing to every vehicle.

    • 0 avatar
      dal20402

      Dealers that add this kind of thing rarely make it past the first round of my email inquiries, so it’s been awhile since I’ve been exposed to this kind of sales pitch. They’re the ones that won’t answer a direct question like “How much is the price after all taxes and fees?” or “What are the key terms of the lease?” Instead, they always answer “come in today and we’ll talk about it.”

  • avatar
    Dilrod

    When I was in the service (around 1990) some guy in our barracks had an alarm that would start of with a commanding voice: “Warning! You are too close to the vehicle!” About 30 seconds of close proximity would finally set it off.

    Guys would pull their car up beside it on the way out of the parking lot just to set it off.

  • avatar
    moitz

    Either the dealer I bought my car from is the most honest dealer in the world, or I got taken for a ride on tons of things without ever knowing it. After reading all the horror stories about dealerships on this site I was convinced they were going to try to suck my soul out of my mouth when I bought my car last month, but I had exactly none of these experiences. No four-square, hard upsells, mandatory add-ons, financing games, nothing.

    • 0 avatar

      Looks like you got a good one. It is really the luck of the draw. I’ve participated in about 10 new car purchases over the past couple of years and about 6 of them went like butter while the other 4 all had some hiccups, upsells, or complications.

  • avatar
    PrincipalDan

    The only “anti-theft” devices I’ve ever had were the factory kind that set off the lights and the horn if someone breaks in or opens the door with the key instead of the fob.

    The only one I really had trouble with was the one in my 1997 Ford Escort wagon. A good hard clap of thunder would set it off, as would strong wind gusts rocking the vehicle as it sat parked and locked. That thing was pain but luckily could be reset by hitting the key fob to unlock/lock.

    • 0 avatar

      These systems have similar issues because the shock sensor they use is cheap. Many people complain about the alarm being set off by thunder, cars passing by, or other noises that should be uneventful.

      • 0 avatar
        PrincipalDan

        In college I worked for their maintenance department. We had an old C10 Chevy that we used for short trips around town to pick up parts etc. It had a loose piece of rub-strip hanging off the passenger quarter panel. Driving through town next to the parallel parked cars (under 35 mph) I once sent off a car alarm because the loose trim smacked the taillight.

  • avatar
    motoridersd

    When I bought my 2007 Mazda 3, I demanded they remove their alarm system from the car. The F&I person tried to push back, but I refused to give in. I even made sure that there was no cosmetic remnant of the module that was mounted under the steering wheel. I never saw any holes, so it was either just mounted with a clip or screwed into something under the dash that wasn’t visible.

  • avatar
    bunkie

    Ah, the white van speaker scam. Back in 1979, I was managing an actual speaker company up in Boston. These guys were *everywhere*. I once got propositioned at 60mph while driving on Route 128. Too funny…

    • 0 avatar

      I got one better. I worked bouncer at a disco-dance club on long island. We got every sort of scammer who’d drift by. Moonies. Drug dealers (not the locals) We had two guys who’d white van it occasionally.

      Back at school, in Boston, I’m outside a place I bartended at. Friday night, who pulls up. I say “Hey, I saw you guys at the Fulton Street Pub !. They left tracks….

      no, I never bought any speakers :) When I sold stereo at a legit store, they had one of these things cut up so I knew the scam.

  • avatar
    eggsalad

    I feel so badly for the poor dealerships who resort to things like alarms to make a living. We should run a telethon or something!

    For real fun, check out Jim Marsh Mitsubishi in Las Vegas. They add a $4000 “Desert Protection Package to every car, just to help the poor car buyer out.They even went so far as to create a Dealer Suggested Retail Price that’s $6000 over the MSRP so they can give you a $3000 discount! Isn’t that wonderful of them?

  • avatar
    healthy skeptic

    >> Visiting a dealer’s Finance and Insurance office is usually the last excruciating step when buying a car.

    Amen. For me, that was far worse than the actual sales process.

  • avatar
    Cabriolet

    Those dealer installed alarms were installed by teenagers for a couple of bucks and mostly stopped working after a year or two. If i removed 1 i must have removed at least 50. Had one car that would never crank on a wet day. Found the so called brain and traced the wires under the floor carpet under the drivers feet. a twisted up mass of wire laying on wet insulation. Took the junk out hooked up the cut wires and soldered and taped them up good and the car never again failed to crank. Those cheap alarms (China) were junk. A good buddy of mine had an old real nice Mercedes that he brought used had it for 20 years but every year he went to Florida and left the Mercedes in the garage when he came home the battery was always dead. Spend a small fortune at the dealer but the problem was never found. Finally took it to a local mechanic that found a well made alarm installed way back in the dashboard. The alarm must have been dropped before the install because the circuit board was all broken up. Paid for 3 hours labor and the battery never went dead again. Must have spend over $1,000.00 or more at Mercedes dealer.

  • avatar
    rpn453

    Even if they offered the alarm for free, I’d run from any new car that has already had the wiring hacked up.

  • avatar
    Bill

    The Chevy dealer I worked at 15 years ago used to install a “e-lock” antitheft device on every car they sold, new and used. It had a key that looked like a little plastic padlock that had to be plugged in for the car to start. It also had a little LED that blinked when the key wasn’t plugged in. There was only one universal key, and 99.9 percent of our customers just left the key plugged in at all times. IIRC we charged $200 for that POS. If you didn’t have the key you could jumper two terminals, terminal B and E IIRC, with a paperclip to start the car.

    I hated installing them, as we hacked up the wiring harness and drilled holes in the dash of a brand new car for such a POS. We used cheap crimp butt connectors, so down the road Im sure we had some no start issues relating to either corrosion, or those connectors coming loose. I always tried to mount them as far out of the way as possible, as I also was worried about someone hitting their leg on that hard, small piece of plastic in an accident instead of the larger, padded dash surface. In fact I got in trouble once when I installed one on the bottom of the steering column cover on a used Saturn. It was well hidden, so well hidden in fact that the sales manager couldn’t find where to put the stupid key to start it. I was kindly informed to relocate that POS to a more conspicuous, less safe location on my time. The stuff you put up with when you are in your early 20’s trying to get through school.

  • avatar
    snakebit

    I’ve not encountered being sold this add-on alarm. I have dealt with F&I people in dealerships, and for the most part, it’s an unnecessary step in the car-buying process that I haven’t been subjected to with my last two cars, mainly because I told the salesperson I would walk if the sales manager stopped by his desk or I had to visit the F&I office.

    My biggest bitch with dealers is the “documentation fee” which is never disclosed on the window of the car, or mentioned initially by the salesman, but is inserted at the very last moment on most sales agreements, even when you agree to buy the car at the posted window price. The only time I’ve paid it was on a classic car that was exceptional, it was disclosed in the initial ad, and I was able to adjust my offer downward to effectively eliminate it.

    It’s legal in most states for the dealer to ask you to pay it, but it’s also legal for you tell the dealer to take it off the sales agreement before you agree to sign. This fee is 100 percent dealer profit. If your dealer tells you it’s a state law that he charge it, tell him to check the webpage for the state consumer affairs bureau, your rights about the fee may be in the first or second paragraph it’s so contentious a subject for consumer affairs. If your dealer sales manager(and it’s usually him, because the salesman doesn’t want to enter the fray about justifying the fee)tells you he can’t remove the fee because he would have to refund everyone one else who paid it, don’t laugh at him as would be a proper reaction, but tell him that you’re about to buy this car for real, but will walk right out of the showroom if the fee is not removed from the agreement. This fee and the practice of not disclosing it until the very last moment has to be the sleaziest practice that dealers still perpetrate.

  • avatar
    Maymar

    When I dealt with used cars, it was invariably anything with some aftermarket remote that needed to be jump-started profusely (or Lexuses and Acuras/loaded Hondas). I can’t trust anything that’s had some minimum wage installer hack into the wiring.

  • avatar
    tsoden

    There was one particular insurance company up here that used to provide an Anti theft system that could be installed in your car when you signed up with their policy which would lead to an added reduction in your insurance cost. The system provided a blinky LED, and forced the driver to do something a bit absurd before being able to start the car… in the case of a former friend of mine, he had to flip his turn signal arm down first before the car would start.

  • avatar
    A B Able Truck

    What’s overlooked in this editorial is the fact that the dealerships who preinstall these systems have now rendered a portion of your new car and/or extended warranty useless. Even if you don’t purchase the system, the damage is done. The security you feel with the warranty is now compromised. You’re not getting what you paid for – they are stealing from you. Every vehicle on these lots and the ones that have been sold have been modified. You bought a new vehicle and they modified without consent – this is fraud, theft, misrepresentation and conversion at a massive scale.

    Even if these systems come with a 3 year/36,000 parts and labor warranty. They won’t pay for lodging, transportation or the other benefits your new vehicle warranty may allow. You now have to deal with a second company for reimbursement and that is “if” you sent in your registration card for the system. You purchased extended warranty to cover bumper to bumper for additional years – too bad so sad they’ll say.


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