Be Aware of These Scams Targeting Automobile Leads

By Cristian Rivera

Although scams and deceptive tactics are not commonplace at the majority of auto dealers, the few cases that do happen create a sense of caution among many U.S. auto shoppers.

That’s why it’s imperative that auto dealers are aware of these scams, and that they do everything they can to assure customers that there is no need for wariness at their store.

Read on for a roundup of the top three most common scams targeting automobile leads during the purchase process, along with tips on best practices for auto dealers and employees.

1. Bait-and-switch tactics used with automobile leads.
   The is a very common tactic for unscrupulous dealers looking to get customers on the lot. Auto dealers will pursue automobile leads by reaching out to them and guaranteeing a price on a particular vehicle. When customers arrive to the auto dealer they find out the actual price of the vehicle is much higher than previously represented – or the particular vehicle they inquired about is “no longer available.”Tip: Be honest when pursuing automobile leads. Never promise a price with the intention of not delivering.
2. Long term, upside-down auto loans.
   Often consumers are focused on monthly payments. When pursuing automobile leads, dishonest dealers promise low monthly rates while hiding the length of the loan term, which can stretch to and beyond 96 months. That’s eight years! And too often the disadvantages of longer-term loans (like negative equity and higher interest rates) aren’t made clear to customers, either.Tip: Auto dealers should never up-sell a vehicle without clearly explaining how the length of the loan term is affected. Be transparent with customers.
3. Replacing auto parts unnecessarily and servicing too soon.
   According to the National Automobile Dealers Association, in 2018 the service department accounted for 45 percent of gross revenue for auto dealers in the U.S. With pressure to sell services, shady service departments sometimes tell consumers that there parts in their vehicle that need to be replaced when in fact the part(s) in question are perfectly fine.Tip: Tell customers it’s always best to be familiar with the maintenance requirements for their vehicle as recommended directly by the manufacturer.

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