Past Investigations
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APA’s Report Summary: Visiting New Car Dealers in Vancouver
April, 9 2016

In the winter of 2016, secret shoppers from the Automobile Protection Association visited 20 new car dealerships in Greater Vancouver. Using advertising in the daily newspapers and on the dealers' own websites, the APA’s secret shoppers tried to obtain the advertised vehicles. All visits were recorded on W5's hidden cameras. Overall, nine out of 20 dealers visited earned a Pass rating.

Five provinces require all-in price advertising by auto dealers (this includes Quebec, which requires all-in pricing for ALL advertising to consumers). "All-in" means that the price in the ad is the price you're supposed to pay for the vehicle, except for the sales tax and perhaps a fee to register a loan and a small tire levy. In British Columbia, fees must be disclosed clearly in the ad, but they do not have to be in one price.

Miss the show? Bell Media subscribers can watch it online on the CTV W5 website.

Findings

Extra charges, like Documentation fees (sometimes abbreviated as D.O.C., for Dealer Overhead Charge), that should have been included as part of the all-in price or listed in the ad, were common. Overall, Vancouver dealers appeared to apply fewer extra charges than the dealers in Calgary visited by the APA in 2014.

Many dealers charge a $100 air conditioner "tax"; this should be included in the all-in price as it has been prepaid by the manufacturer, and the dealer doesn’t remit the money collected to a government authority.

Some dealers charged extra to install wheel locks and fill tires with nitrogen; these mandatory extra charges were of negligible value for the base cars with steel wheels shopped by the APA. The extras were less common and less expensive than observed at the Calgary dealerships visited by the APA with W5 in 2014. When questioned about the charges, a couple of dealers were prepared to remove the wheel locks or waive the charge.

Some dealers misrepresented their extra charges as payable to government or a third party authority. North Vancouver Nissan said the Freight and Pre-delivery Inspection charge of $1,595 is a "government charge." Two dealers applied a $25 “battery levy.” British Columbia dropped that levy in 2010; contact the APA if you purchased a vehicle in B.C. after 2010 and were charged for a battery levy.

Tricks with payments

Small increases in weekly and biweekly payments add up to a significant amount of money over the term of a loan or lease. An 84 month loan, which is a fairly standard term nowadays, has 364 weekly payments, and a 60 month lease has 260 weekly payments.

Honda dealers bumped up advertised weekly payments by seemingly small amounts like $2.34 or $10 a week. These small discrepancies added up to a lot of money, because there are so many payments in a weekly offer. The extra $2.34 weekly a dealer charged over the 260 payments in Honda's advertised lease works out to $608. The $10 a week upsell from the unavailable Fit DX to a Fit LX resulted in a $2,600 jump in the price!

Dealer advertising not always the dealer’s

The APA secret shoppers usually chose ads with a local dealer’s name in them. However upon closer examination, the artwork, price and fine print were almost identical for ads placed by different dealers, even between dealers in different provinces. How is it that Nissan, Honda and Toyota dealers shopped by the APA in Vancouver, Calgary and Montreal ran low-ball ads that were nearly identical for unavailable cars? For an answer to that, you have to look at the long shadow of the automakers. They provide car dealers their advertising templates, and take advantage of loopholes in provincial rules that exempt automakers from oversight by the dealer regulators in British Columbia, Ontario, Alberta, Manitoba & Saskatchewan.

Bait and switch

Many vehicles featured in national advertising and in the dealers' own ads were not available at dealerships. A Honda dealer told the APA shoppers there was a three month wait for a base Fit DX like the one in Honda’s ad!

Results for vehicle brands

Chrysler

Neither Chrysler dealer had the base Grand Caravan with no options advertised for $21,988, but they were able to locate one. Coquitlam Chrysler had the highest extra charges of the survey, adding $800 for a post-delivery inspection (on top of the $1,745 Freight and Delivery charge), and a $290 D.O.C. fee. Neither amount appeared in the Chrysler Canada ad, whose fine print states only that extra fee may be required, but doesn’t say how much. That’s not compliant with B.C. regulations.

Chrysler’s corporate ad was tricky: The bold print promised “No payment for 90 days” but the fine print stated that interest starts to accumulate after 60 days.

Ford

The fine print on Ford’s website was the longest the APA has ever seen in a vehicle ad, with an extraordinary 106 separate items! The 2015 Escape S advertised by Richport Ford, and also featured on the Ford Canada website in January and February, was unavailable locally. A 2016 Escape S may have been available, but the dealer required a deposit and signed purchase offer to locate one in British Columbia. Richport Ford applied a $599 documentation fee not listed in their ad. After learning of the survey findings from W5, Richport Ford modified their website to mention the $599 documentation fee.

General Motors

All three General Motors dealers had their advertised Chevrolet models in stock. This is consistent with previous APA surveys in Calgary, Toronto and Montreal that indicated a lower incidence of bait-and-switch advertising by GM dealers than competitors in those markets. Eagle Ridge Chevrolet in Coquitlam placed an ad for the 2015 Cruze LT that failed to specify it was a used car (the ad didn’t say it was new either!).

Honda

Destination Kingsway Honda, at 360 Kingsway in Vancouver, was the only Honda dealer to match the advertised weekly payment on a Honda, in stock with no extra fees.

Honda dealers reported a two or three month wait for the Fit DX advertised for a $44 weekly payment. One salesperson told the APA’s secret shoppers that the dealership's 12 salespeople were sharing a single advertised Fit DX which wasn’t scheduled to arrive for another two months! The result is consistent with APA visits to Honda dealers in Calgary in 2014 that also uncovered bait-and-switch advertising.

Hyundai

The APA shoppers visited just one Hyundai dealership to shop for an advertised Elantra L. The salesman at Jim Pattison Hyundai in the North Surry Auto Mall was knowledgeable and competent. The dealership charges $235 for mud flaps and wheel locks on every car, including those that don’t need them; the salesman was prepared to waive the charge. A $250 additional charge payable to Hyundai Canada was lower than the maximum listed in the fine print of the ad.

Kia
The unbelievably low advertised price of $19,988, plus a documentation charge of $549 in tiny fine print for a base Kia Optima at Kia West in Coquitlam turned out to be true. This was an in-house deal, and the dealership had one example of the featured vehicle on their lot. However the dealer misrepresented the manufacturer’s corrosion protection, stating there was “no warranty for rust.”

Nissan

Nissan's manufacturer advertising was the most misleading shopped by the APA. The ad photo, price, and available discounts are a collage that mixes up two Micra models with different equipment, prices, discounts and financing. The photos showed a loaded Micra SR with an automatic transmission selling for about $15,000 next to the $9998 price of a base Micra S, sometimes in an extra-cost colour (add $135). The discount in the ad of up to $3250 on the SR is not available on the basic Micra S.

To obtain a base Micra at the advertised $9998, you have to take Nissan financing at a relatively high interest rate of about 5%, compared to 2.49% that Nissan charges for its other models. By doing that, a buyer ends up paying almost $1000 in additional interest.

To obtain the Micra S at the advertised price of $9998, the fine print in Nissan's ad explains that the price includes $1150 NCF standard finance cash, $650 non-stack cash (which includes a contribution from the dealer that was not always forthcoming) and $500 bonus cash. How many car buyers can understand this?

Nissan charges extra for paint. Every colour except one or two on the Nissan vehicles shopped by the APA incurred a paint surcharge of $135 or $300, but most Nissan ads don’t tell you that.

Among the Nissan dealers visited, the salesman at Morrey Nissan in Burnaby provided very good advice, including a strategy for dealing with Nissan’s tricky interest-rate bump-up on the Micra S.

Toyota

The APA visited three Toyota dealers in the B.C. Lower Mainland looking for an advertised 2016 base Corolla CE. Not one had the car in inventory. One dealer said they could get it within three or four days, a second said it was not available, and a third said “maybe.” Of the three, only West Coast Toyota in Vancouver did not charge extra fees on top of the ad price. The result is consistent with APA visits to Toyota dealers in Greater Toronto in 2015 that also uncovered bait and switch advertising.

 

What you can do

Most salespeople were not familiar with the details of their dealership’s vehicle promotions. Bring a copy of the dealer or manufacturer ad for the vehicle you are looking for with you.

Read the fine print: in Alberta, British Columbia, Manitoba (as of July 2015), Saskatchewan (as of January 2016) and Quebec, a dealer ad for a new vehicle must include all charges. If you are faced with additional charges above the advertised price, try to obtain a print-out from the dealer and report the incident to the provincial dealer regulator. You should also include a copy of the ad.

Use the list below to pass on or negotiate down the prices of some extras.

 

The APA’s review of dealer extras

The additional products and services sold by new car dealers carry mark-ups as high as 400 percent. Many products are overpriced and several are of little or no value. If they are mandatory, they must be included in the advertised price – that’s the essence of “All-in” pricing.

Green Tire Levies

This refers to a variety of tire-related charges, some of which are worthless, some are marked up excessively, and some were not necessary for the vehicles shopped by the APA.

Nitrogen gas in the tires: regular air is already 80 percent nitrogen. Many tire retailers will fill a tire with pure nitrogen for free or for a small charge of up to $8 a tire.

Road hazard warranty for tires: Sometimes bundled with nitrogen and the provincial tire recycling levy of about $20, this coverage pays part of the cost of replacing a blown tire. The coverage costs the dealer about $60 for all four tires on the small cars the APA shopped, to about $100 for an SUV. The road hazard warranty is more valuable on vehicles with large, expensive-to-replace tires.

Wheel locks: some dealers charged almost as much for the locks as the value of the steel wheels on the base models the APA shopped! The locks cost the dealer $50 to $60 for four and make it harder to steal alloy wheels. Wheel locks are not effective for steel wheels with a design that does not have recessed wheel nuts.

British Columbia: (Understanding Dealer Fees)

The price shown on the vehicle: The price you see on the window sticker, as well as any other advertisement, must be the total price. This is the full amount you have to pay to purchase the vehicle (with the exception of taxes). This number needs to include:

• Dealer fees
• Inspection and pre-delivery fees
• The cost of accessories and optional equipment physically attached to the vehicle
• Any other additional fees and transportation charges.

Dealer fees in advertising

In Alberta, Manitoba, Ontario and Quebec the advertised price must include all dealer charges.
In British Columbia, dealer charges may be displayed in the following ways:

• An ad may prominently display a price of $15,395 plus a $250 doc. fee
• Dealer fees may be shown in the small or fine print of the ad
• If there are no additional fees stated anywhere in an ad or on the vehicle sticker, you have the right to assume that they are already included in the total price.

 

 

The Results of APA's Investigation

Chrysler | Ford | General Motors | Honda | Hyundai | Kia | Nissan | Toyota
 
CHRYSLER
Dealer FAIL/
PASS
Vehicle Ad Vehicle Available All-In Price or Extra Fees Comments

Carter Dodge Chrysler

4650 Lougheed Highway Burnaby
BC V5C 4A6

failFAIL 2016 Grand Caravan CVP base model & SXT No CVP but may be able to locate. Demonstrated an SXT with the Premium Plus package. $21,998 ad price
+$695 Documentation +$125 air tax and tires
Ad states all pricing includes freight of $1,745 and excludes any dealer administration charges. This ad is not compliant with BC rules on extra charges when used by a dealer who charges extra fees like this one. The rust warranty was misrpresented: “I don’t think any car gives you a rust warranty.” Optional rust protection is available: “I recommend it, but in Vancouver it is not as bad as Toronto.” Tricky ad: No payments for 90 days, but fine print shows interest starts to accumulate after 60 days.

Coquitlam Chrysler

4650 Lougheed Highway Burnaby
BC V5C 4A6

failFAIL 2016 Grand Caravan CVP No. Seller said had a CVP with Bluetooth + options on the lot (about $850 more) on the lot. like it.” $21,998 ad price
+$800 PDI not in ad
+$290 DOC fee, “We’re in the middle” (compared to what others charge)
At $1,090, this dealer had the highest extra charges of the survey. Ad states all pricing includes freight of $1,745 and excludes... any dealer administration charges. This ad is not compliant with BC rules on extra charges when used by a dealer who charges extra fees like this one. Weekly payment for a base CVP provided by the manager is about $4 higher than in the ad, which works out to over $1,500 over the 416 payments in the 8-year loan. Tricky ad: No payments for 90 days, but fine print shows interest starts to accumulate after 60 days.
 
FORD
Dealer FAIL/
PASS
Vehicle Ad Vehicle Available All-In Price or Extra Fees Comments

Key West Ford

4301 Stewardson Way
New Westminster (604) 256-8491

failPASS 2015 Focus SE sedan Yes Fine print (tiny): Selling price of $19,500 plus dealer doc fee $599, $1,500 down payment Dealer ad promises “Buy a new Focus, receive a laptop.” Seller says it’s an Acer or an Asus. Ad bold print promises a $99 bi-weekly payment which the salesperson says he can match. Odd showroom almost devoid of cars, but has boxes of appliances.

Richport Ford (Cam Clarke Ford on business card)

Richmond Auto Mall

13580 Smallwood Place Richmond
BC V6V 2C1
(604) 273-7331

failFAIL 2015 Escape S 2016 Escape S Just three 2015 Escape S in Canada and dealer can’t find one locally. May be able to locate a 2016 Escape S; deposit and purchase offer required. +$599 Doc fee
+$50 battery and tire levy with tax (Seller said the charge could be waived. There is no battery levy in B.C.)
Dealer ad and Ford Internet ad for the unavailable 2015 Escape S “Starting at $25,489*” Dealer suggests 2016 Escape S for similar price and better finance rate, but requires a purchase offer and refundable deposit to locate one in B.C. Ford has a total of 106 entries in the fine print online, a record for APA investigations. Ad says admin fees are not included in the price without indicating how much they are; that is not compliant when placed by a dealer in B.C. who charges extra fees like this one. After W5 contacts the dealership for an interview, they modify their advertising to mention the $599 documentation fee.
 
GENERAL MOTORS
Dealer FAIL/
PASS
Vehicle Ad Vehicle Available All-In Price or Extra Fees Comments

Carter Chevrolet

800 Automall Drive North Vancouver
BC V7P 3R8

failPASS 2015 Chevy Trax Yes Tiny almost unreadable yellow fine print: $598 D.O.C. Fee $100 a/c $25 tire levy Ad price $19,888, dealer quoted $19,998 (added the air conditioner “tax” maybe?). Ad reads cash price; a buyer financing with GM has to pay an extra $1,000.

Dueck Downtown

888 Terminal Ave. Vancouver
V6A 2M5

failPASS 2015 Cruze, 2016 Cruze Yes Fine print: +$549
Doc fee Not in ad: +$100 AC tax (should be included)
+$25 tire tax (not in ad)
Seller provides helpful worksheet to shoppers. Las Vegas trip is for a cash purchase and requires buyer to pay a 2-for-1airfare (disclosed in the ad). Dealer says, “There’s no rust guarantee or warranty” (not true).

Eagle Ridge Chevrolet

2595 Barnet Highway Coquitlam
BC V3E1K8

failPASS 2015 Cruze LT Turbo Yes Large print: $13,387 (+ fine print)
+$495 documentation fee
Tricky ad doesn’t reveal the Cruze is used (It doesn’t say it’s new either!). Important information hidden in the fine print. To get the $85 payment in the bold print, the fine print requires a $2000 down payment and 96 month loan at 4.99%. Salesman candid, “The DOC fee pays to keep the lights on, and for people behind the scene.” He provides good disclosure and a helpful worksheet.
 
HONDA
Dealer FAIL/
PASS
Vehicle Ad Vehicle Available All-In Price or Extra Fees Comments

Destination Kingsway Honda

368 Kingsway Vancouver
V5T 3J6

failPASS 2016 Civic LX Yes $399 Doc. fee is “already included, no hidden fees” Dealer matches the Honda Canada ad for $59 weekly on a 60-month lease with $0 down. Ad does not contain extra admin or DOC. fees in the fine print, a good point.

Marv Jones Honda

20611 Lougheed Highway Maple Ridge BC V2X 2P9

failFAIL 2016 Civic LX Yes, two base cars in stock Ad price +$268.44 and $130.56 due at signing for Green Registration Fee, Business Office Fee & tire warranty, not listed in ad. Honda Canada ad for $59 weekly on a 60-month lease with $0 down. Ad does not mention the extra charges in the fine print. Seller not familiar with the offer: “I have to find out where the $59 came from; I have to see my manager.”

Pacific Honda

816 Automall Drive North Vancouver
V7P 3R8

failFAIL 2016 Fit DX No, Delivery in over two months with refundable deposit, 12 salespeople sharing just one base car. Due at signing: +$100 AC tax (car has no air conditioner)
+$320 fee (not in ad, which is $0 down) +$35 tax
Honda Canada ad for $44 weekly on a 60-month lease with $0 down. Ad has no extra Admin or D.O.C. fees in the fine print, a good point. The Honda ad fine print requires the dealer to contribute “$320 lease dollars deducted from the negotiated selling price after taxes.” The dealer appears to have charged back their “lease dollars” as part the down payment.

Richmond Honda

Richmond Auto Mall 13600 Smallwood Place Richmond
BC V6V 1W8

failFAIL 2016 Fit DX No, Fit DX not in production yet, if ordered, delivery in 2-3 months $275 doc fee $50 tire & battery levy (Partial fake charge, there is no battery levy in BC.
Tire levy is $20 on the Fit.)
Honda Canada ad for $44 weekly on a 60-month lease with $0 down. Ad has no extra Admin or D.O.C. fees in the fine print, a good point. A $2.34 bump in the weekly payment at the dealer results in a price increase of more than $608 compared to the ad. The seller says the difference is the addition of the doc fee, the tire & battery levy and interest, but that does not account for the full amount of the increase.
 
HYUNDAI
Dealer FAIL/
PASS
Vehicle Ad Vehicle Available All-In Price or Extra Fees Comments

Jim Pattison Hyundai

North Surrey Auto Mall 15365 Guildford Drive Surrey
BC V3R 0H9

Hardip Saggu

failPASS 2016 Elantra L manual Yes $11,995 in ad +$235 wheel locks & mud flaps (won’t charge if not yet installed, “but we put them on every car”)
+$250 admin fee payable to Hyundai Canada +$25 levy
Fine print in ad reads “price excludes dealer admin. fees of up to $499” which is higher than the total of the extra charges at the dealership. BC VSA says listing fees this way appears compliant. Very knowledgeable seller who provided superior service.
 
KIA
Dealer FAIL/
PASS
Vehicle Ad Vehicle Available All-In Price or Extra Fees Comments

Kia West

1881 United Blvd. Coquitlam
BC V3K 0B6

failPASS 2015 base Optima (ad reads “Loaded”) Yes $19,888 Tiny fine print: +$549 documentation fee Very low advertised price turns out to be true. Seller says there is “No warranty for rust, but cars come with a factory undercoat.” Knowledgeable seller.
 
NISSAN
Dealer FAIL/
PASS
Vehicle Ad Vehicle Available All-In Price or Extra Fees Comments

Downtown Nissan

216 2nd Ave. Vancouver
BC V5Y 1C6

failFAIL 2015 Micra S Maybe. Seller believes he has one. The 2015 silver Micra in the showroom was an automatic. $395 doc fee
$135 silver paint color
$25 tire levy
Deceptive Nissan Canada ad combines the price and discounts of two different models. Doc fee of $395 not mentioned in the Nissan Canada ad. To get the advertised “all-inclusive” $9,998 price, the buyer has to take Nissan Canada Financing at a higher interest rate; otherwise the price is about $1,000 higher.

West Coast Nissan

19625 Lougheed HWY Pitt Meadows
BC V3Y 1Z2

Alty Goolab

failFAIL 2015
Micra S
NO, sold out Search showed one white one blue metallic and two silver with paint surcharges. $399 admin
$25 levy
$135 for paint (offered to drop the charge)
Dealer ad using Nissan promotion. Fine print reads “All prices & payments plus taxes & levies”. No mention of the $399 dealer admin charge. Top notch salesperson did vehicle search without asking for a deposit or seeing his manager. He explained the smaller $640 discount on the cash price and larger $1,650 discount with Nissan financing at a higher interest rate. Recommended taking the loan to get the lower price and paying it off early if money available. (Very good advice)

Morrey Nissan

4450 Still Creek Drive Burnaby
BC V5C 6C6
(604) 291-7261

Mario Huang

failPASS 2015
Micra S
Yes, a white Micra S on the lot with the price in large red numerals on the side. $120 floor mats
$25 tire levy
Dealer ad using Nissan Canada template. Best Nissan dealer printout, explaining the tricky ad program. No admin fee. Recommends taking Nissan’s financing at the regular rate to get the lower ad price, says “It’s an open contract and you can pay early.” (Very good advice)

North Vancouver Nissan

819 Automall Drive North Vancouver
BC V7P 3R8

failFAIL 2015 Micra S Yes $399 admin.
$228.94 Mats & wheel locks (seller said these could be removed)
$135 paint
$25 tire levy
Dealer using a confusing Nissan Canada ad template which does not list the additional charges for the admin fee, and mats and wheel locks. Some misleading or deceptive statements: Freight and PDI is “for the government”. There is no rust warranty.
 
TOYOTA
Dealer FAIL/
PASS
Vehicle Ad Vehicle Available All-In Price or Extra Fees Comments

Jim Pattison
Toyota
North Surrey Auto Mall

15389 Guildford Drive Surrey
BC V3R 0H9

failFAIL 2016 Corolla CE, Manual Yes (3-4 days to get one “after we sign the deal”) +$395 “For us, it’s always $395, no matter what you do ... Don’t worry about it, I’ll give it to you for less” Toyota Canada template shared by 15 dealers. Fine print does not appear to specify the $395 admin. fee, so this dealer is not compliant with the rules in B.C.

West Coast Toyota

19950 Lougheed HWY Pitt Meadows
BC V3Y2S9

failPASS 2016 Corolla CE, manual No +$25 tire levy Printout provided by the seller indicates that dealer fees have been waived.
$995 down payment matches the fine print in the ad.
Dealer ad using Toyota Canada template. Complies with fine print in the ad which has no extra dealer charges: “All prices & payments plus taxes & levies” “It’s not a popular car,” just 3 in BC. Doesn’t know how long it will take to get one. Best Toyota dealer visit.

Regency Toyota

401 Kingsway Vancouver
BC V5T 3K1

failFAIL 2016 Corolla CE manual Maybe, 3-4 days if “up north” (in BC), longer if not. +$325 Admin. fee
+$25 tire levy
Toyota Canada template shared by 15 dealers. Fine print does not appear to specify the $325 admin. fee so the ad is not compliant with rules in B.C.
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