Jerry Elhman owns Schoen Place Auto, an independent car repair shop in East Rochester, you can see his web site at:
He is a fellow "Ethie Award" recepient and I have a great deal of despect for him and the way he does business.
What follows is a copy of what he wrote on his blog this weekend, I could not agree more and thank Jerry for "spreading the word".
Here are Jerry's words.............................
I've always been amazed by the number of very smart people, who fall for common car dealer scams, in the belief that they are properly taking care of their cars. The "free oil change for life" scam is one that is perhaps the hardest to get people to realize how they are being taken.
I personally know many very smart and normally shrewd and savvy people who even when shown they are overpaying for car maintenance, refuse to give up their "free oil changes" by paying less going somewhere else. They are too focused on "free" and the dealer has them too scared to go anywhere else.
This is becoming a growing dealer scam as more and more dealers offer "free oil change for life" programs. Dealers are recognizing that offering this brings in huge dollars to the service department. Dealers have developed a business case that has the following elements in it:
- First the "free oil changes" are not free. The true statement is that "they are included in the price of the car." The price of the car, (either sales price, trade in, financing costs) have been adjusted to cover the cost of the oil changes. The customer just does not know that.
- Second by getting customers to feel "obligated" to only come to them for their "free oil change" they have a captive customer who has no basis of comparison on services recommended and their costs.
- Third they use the scare tactic that the customer can never have their car serviced anywhere else. They want captive customers. They use the power of fear that if you ever skip even one service visit with the dealership, you void your free oil changes for life, that you actually already paid for in the price of the car.
- Fourth is the biggest part of the business case where significant cash is generated by the "over servicing" of vehicles. This is where the dealer requires far more scheduled maintenance items than the factory requires. "Over Servicing" goals are set to increase gross sales by 30 to 50 percent or more. Customers are sold all kinds of services and parts they do not need and are not required by the factory to maintain the vehicle warranty.
Car and Driver Magazine calculated a typical 4 year cost comparison. "Oil change for life" dealers oversold maintenance services which added up to $2349 over his period. The truly "required" services totaled $618. So on top of paying for the "free oil changes" in the purchase price of the car, the customer also pays an additional average of $1731 in services they did not need.
The bottom line is NOTHING IS FREE! It's a very successful gimmick!
A customer recently brought their new car with 7500 miles to us. They bought the car with "free oil changes for life." The dealer was going to charge $320 for this 7500 mile service which included a complete front and rear brake service and other things. Why would a new car with only 7500 miles need a full brake service? The answer is it doesn't. But that alone was about $110 of the work.
We looked up what the factory required at 7500 miles. All that was required was an oil change service and check over of the car. We charged $39.95. That "free oil change" would have cost this customer about $280 if done at the dealer! NEED I SAY MORE!
as they say "nuf said"! ---- Dom