Thoughts on Car Buying Process and Open Source

04 Jul 2018

My family spent the fourth of July trying to get a new used car for my mom. She’s been driving a 250k miled Toyota Corolla. The car had to go. We shopped today, and I deeply regret doing this. Sigh. I was an idiot. Worst time to buy, because everyone takes this day off. I’m not going to buy crap on the Fourth anymore. It really does disservice to the great people who built America from scratch. Next time I’m staying home, and thinking about the great men who had balls to call out wrong doings and start perhaps the greatest startup the world has ever seen. Respect

But the process of finding a used car is so painful. At a certain point, I began to calculate the total amount of time that my brother and I put in reading all of the disparate sources of information, and it seems like we’re getting to the threshold where the wages we lost Googling around is becoming unreasonable.

The whole industry is so broken. I firmly believe that the car dealing industry, well the majority, is out to screw customers. Without further ado, here is my rant bullets.

  1. The asymmetric amount of information between the dealer and the customer.

The dealer sells tons of vehicles every month, so they have a unfair advantage over the customer. They know the lowest they can go - they know how long the car has been in their inventory, and unless you know about cars like the back of your hand, they may just slide some flaws over you and pull wool over your eyes.

When I went to a dealership that had cheaper cars, there were all sort of red flags on their cars. One of the cars failed their inspection. Another one got into an accident marked as minor on top of the CarFax, but the description didn’t match the “minor” accident.

One failed the safety inspection, and upon reinspection it passed. When asked about this issue, they said the windshield was broken. But if the car hasn’t been in an accident or some issue, why would the windshield be broken?

  1. Reviews on websites are not normally distributed. Or they don’t follow a good distribution. Honestly, a 4.7 star rating doesn’t really mean anything if we don’t understand about the people who write them. And people are lazy. Including me. If things go well, they don’t write a review. So either things have to be really good, or really bad for the customers to write these reviews. So I don’t know if the reviews are even a good idea to gauge whether a dealership is good or fair.

For example, one person, who doesn’t read the fine print, can think that they got a great deal on a extremely flawed car. Only three years later will they know that they’ve been screwed.

  1. There is no clear transparency on how car prices are generated.

According to this article, the professor who was in the article said many of the pricing tools are unreliable. This is true. I’m really beginning to think that unless kbb or all these car price estimators are run by the government or a non-profit(which they are not), it’s damn cartel. First, if they aggregate all the sales data from dealership data, and the dealerships refuse to go down a certain price. Probably. So what is the point in doing this? Is the price even natural?

The only way to fix this is open source exactly how these companies calculate their prices, or have a government entity do it. But I think there are significant challenges to this.

  1. (sidenote) Some of the low-quality dealerships I went to seem to be taking advantage of people with lower income. The first thing they always ask is what is your credit rating, and can you finance the vehicle? My brother and dad have financed cars in the past, and the interest rate is ridiculous. It leads me to wonder about what my former boss said. He said that as income increase, it’s not like people save. They buy more expensive things. Expensive cars on loan, and bigger houses. I hope these people know what they are doing. And shame on dealers for ridiculous predatory loans.

  2. Why the hell are UI for car dealerships so poorly designed for the mobile? It’s choppy, slow, and makes no sense to me. There’s significant delay in UI requests. In the area of React, Angular, and single page apps and responsive apps, I don’t even know why this exists.

    • Do dealers even give that much of a benefit to customers? OKay. In the era where there was no internet and easy access to information, sure the dealers were there to educate people about the features of the car and supposedly help customers find the car that they want. But nowadays, there are tons of information, videos, on the web. So what purpose do they do to help society at a large scale? Are they not middlemen? I think there are good middlemen that serve a purpose in the economy. These people probably reach out to customers to inform customers on new products. But for something like a car, I bet the first thing they do is to go to Google, and start typing queries and browsing the web on what car meets there criteria. I would like to know what the dealerships really do to reduce economic efficiencies at this point.

Sure they store cars on their lot. But do you really need all those fancy offices and showy rooms for this I wonder…

Summary

At the end of the day, I don’t want a great deal. Okay. Great deals would be nice. But I want a fair deal. I know that selling cars is hard work, so I don’t want to completely negotiate and wear down the salesman. At the same time, I don’t want to be screwed and be a butt of all dealer jokes.