Earlier this year, when the Federal Trade Commission cracked down on deceptive car dealer advertising, one Texas dealer was among the 10 included in the agency’s sweep. While the dealer doesn’t operate in Houston, car shoppers in the city aren’t exempted from deceiving advertising practices. Nonetheless, you will not be deceived if you know how car ads trick customers. Learn the ways dealer ads deceive people to avoid being a victim in the future.
‘Ad Car’ Ads
The most common way dealers rip off customers is by advertising what is considered a ‘phantom’ car. You can identify a phantom car advertisement by this line: one at this price. The car is offered at a cheap price and for a good reason—it is a base model in an unpopular color. Referred to by insiders as an ‘ad car,’ this vehicle is for advertising purposes only—it will not be sold to you, despite the advertisement. You will not even see it in person.
The point of advertising such car is to lure customers into the lot and convince them to buy any of the more expensive vehicles in the inventory. When you actually visit and ask to see or test-drive the car, you will be offered a number of excuses. The salesman may say that the vehicle was already sold, or that it is out on a test drive. He would then proceed to show you all the other cars they are selling, all of which are pricier than what you came for.
Top Trim for Base Price
Another way dealers deceive customers is by advertising one vehicle with a different price. The usual pairing is a top trim model and a base price: in the ad, you will see a low price displayed with a fully loaded vehicle. The two naturally don’t go together, as it is impossible to pay the price of the base model for the one with top trim, but the ad makes you think otherwise. As if such deception is not enough, the advertised price is exclusive of fees. Hence, if you do buy the car, expect to pay much more than the price indicated.
In some cases, dealers advertise an attractive offer, one that seems more realistic than others—a car sold at a discounted price. Unfortunately, just when you are eager to buy, you realize you cannot buy the vehicle at the advertised price. At the dealership, you will find out that the reduced price found in the ad had factored in rebates that you don’t qualify for. These may include college graduate rebate, military rebate, or customer loyalty rebate (available if you have bought a vehicle from the same automaker in the past). In the end of the day, if you are determined to buy the car, you will pay the full price.
Fuel Economy Illusion
Dealers get the attention of car buyers who want fuel-efficient cars through ads that show cars with an unbelievable mileage. Consider this example: a guy is driving the vehicle full throttle on the highway, and the ad says “only 50 mpg.” More often than not, the mpg presented is not the one for the pictured car—it is often for a base model with a smaller engine.
Affordable Lease Payment with Upfront Fee
There are many ads that promote low lease payments for luxury models. However, there is a catch—you are required to pay a generous sum to begin the lease. The upfront fee may not be indicated in the ad, or it may be written in very fine print. Regardless, ads like these are designed to trick you into believing you will save money when in reality, you will be spending more. A lease of $200 a month is not inexpensive if you factor in an upfront payment of $5,000. With these costs, you are better off buying a less expensive but reliable car.