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Researching an automobile_powerpoint_presentation

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    Researching an automobile_powerpoint_presentation Researching an automobile_powerpoint_presentation Presentation Transcript

    • Researching an Automobile What should I look for?
    • Transportation
      • Part of everyone’s life
      • 15 – 20% of an individual’s budget
      • Automobile is the 2 nd most expensive purchase, only after a home
    • Want to Buy a Vehicle?
      • Consumers should plan their vehicle purchase to avoid any costly mistakes
      • Any large purchases should be planned
      • Places to purchase a vehicle:
        • Dealership, private owner, internet
    • Planned Buying Process
      • Prioritizing wants
      • Pre-shopping research
      • Fitting the budget
      • Comparison shopping
      • Negotiating
      • Making the decision
      • Evaluating the decision
    • Step 1 - Prioritizing Wants
      • Assess transportation needs and wants
        • Need: something thought to be a necessity
        • Want: something unnecessary but desired
      • Consider all automobile options as wants
        • Prioritize the wants from low to high priority
          • Prioritizing wants helps the consumer
            • Consider costs and benefits of different vehicle options
            • Consider the “big picture” of the vehicle purchase rather than a specific want (such as heated seats, color, engine size, etc)
    • Prioritizing Wants – Questions to Think About
      • How will the vehicle be used?
      • Where will the buyer be living?
      • How will the vehicle be stored or parked?
      • How much will it be driven?
      • What options would the buyer like in the vehicle?
    • Step 2 – Pre-shopping Research
      • Research should be based on transportation wants
      • Complete this before visiting a car dealership or salesman
      • Helps the buyer to be informed about:
        • What they are looking for
        • Vehicles in their price range
        • Available options
    • Ways to Perform the Research
      • Family & friends
        • Experiences with different makes and models of different vehicles
        • Likes, dislikes, and recommendations
      • Periodicals
        • Consumer Reports
        • Federal Citizen Information Center
        • Kelley Blue Book
        • Motor Trend
        • Car and Driver
      • Access this information at the public library and/or the internet
    • Price Research
      • Price
        • Base price : vehicle price with standard equipment, no extra options
        • MSRP: Manufacturer’s suggested retail price
          • Includes base price, price of options installed by manufacturer, and their transportation charge
        • Sticker Price
          • Dealer’s initial asking price
    • Price Research continued
      • Price continued
        • Determine how much a dealer paid to help decide which vehicles to consider and to negotiate a fair price
          • Consumer Reports, Kiplinger’s Personal Finance magazine, and Edmund’s New Car Prices
        • Used cars
          • Blue book price: dollar value given to the vehicle based on its year and model
          • Used as a guide for car dealers and banks for pricing trade-ins
            • Kelley Blue Book
    • Vehicle Options Research
      • General type of vehicle
        • Car, truck, 2-door, SUV, sporty
      • Make and model
        • Ford Taurus, Honda Accord
      • Safety
        • Braking and emergency handling, airbags
      • Reliability
        • Some specific models have high marks, may be higher priced but will save on repair costs
    • Vehicle Options Research continued
      • Fuel economy
        • Type of gas used, gas mileage
      • Power and performance
        • Driving on highways, steep hills, mountains, snow, muddy roads, or in a city
      • Comfort and convenience
        • Size of headroom and legroom, cargo space
    • Vehicle Options Research continued
      • Insurance
        • Chosen vehicle affects the price of insurance; obtain a quote for the vehicles being considered
      • Other options
        • Power steering and brakes, manual or automatic, air conditioner, rear-window defogger, radio/tape/CD player, type of tires, cruise control, sun roof, heated seats, power door locks and windows, etc.
    • New vs. Used Research
      • New Vehicle:
        • Not pre-owned
        • Warranty
        • Manufacturer options
        • Wide selection
        • Expensive
        • Depreciation
          • Loss in the vehicle’s value due to time and use (greatest cost)
      • Used Vehicle:
        • Cost less to buy
        • Cost less to insure
        • Avoid rapid deprecation
        • Wide selection
        • May offer warranty
        • Returned leased cars
        • Have an independent mechanic inspect any used car before purchase
    • Step 3 – Fitting the Budget
      • “ Can I afford it?”
        • Most important question
      • Amount the buyer can afford in his/her budget dictates the vehicle price
      • All costs must be taken into consideration before choosing a vehicle
    • Fitting the Budget continued
      • Fixed expenses
        • Depreciation
        • Insurance costs
        • Loan payment and interest if financed
        • Parking fees
        • Licensing
        • Registration
      • Flexible expenses
        • Maintenance
        • Gas
        • Oil
        • Repairs
      * Vehicle price is not the only cost involved
    • Step 4 – Comparison Shopping
      • Comparing services or products to determine the best buy or quality product at a fair price
      • Allows the consumer to build upon the information learned in the pre-shopping research
      • *As the price of a vehicle increases, consumers are often not buying additional safety, capacity, or power, but instead style and prestige
    • Comparison Shopping continued
      • Narrow the choices to a few specific makes and models with desired options
      • Visit the appropriate store to learn more information about each choice to make comparisons
        • Inquire about price, dealer incentives, financing options, leasing, warranties, and service contracts
      • Test drive each potential vehicle
    • Comparison Shopping continued
      • Goal of comparison shopping
        • Narrow the choice even further to negotiate for the best deal
    • Step 5 - Negotiating
      • Process of deciding the actual terms of the purchase and agreement between the seller and buyer
      • Obtain a firm price before discussing any other aspects including a trade-in
      • Compare prices from different dealers
        • Let them know you have done your research and whether their price is high
    • Negotiating continued
      • Keys to all negotiations
        • Be able to say NO
        • Take the purchase to another business
    • Step 6 – Making the Decision
      • The best place to decide on which vehicle to purchase is NOT the showroom where you are around the dealer
        • Take the information home to compare all options
      • After making the decision, return to the dealer to close the sale
    • Step 7 – Evaluating the Decision
      • Think about the things which went well and what did not
        • This will be helpful the next time a similar purchase is made
      • If the process was successful and you are happy, compliment the seller
      • If you have a complaint, make the complaint known to the seller then move to the supervisor if necessary
    • Lemon Laws
      • Lemon
        • A vehicle in and out of the repair shop with problems monthly
      • An estimated new 150,000 vehicles sold each year are lemons.
          • Money Troubles, 2001, Leonard
      • All states have enacted lemon laws
        • Specifics vary state-to-state and are in place to protect consumers
    • Lemon Laws continued
      • To fall under the lemon law
        • New vehicle must have a substantial defect which cannot be fixed in a reasonable time
        • Defect remains unfixed after four repair attempts or the vehicle remains in the repair shop for a total of 30 days
      • This allows the consumer the right to a refund or a new vehicle
    • Lemon Laws continued
      • What should you do if you feel you have purchased a lemon?
        • Contact the state’s attorney general office to request information on the state’s lemon laws and how to use them if they have purchased a lemon
    • Conclusion
      • Before purchasing a vehicle, follow the planned buying process to avoid a costly mistake
        • Prioritize wants
        • Pre-shopping research
        • Fit the budget
        • Comparison shop
        • Negotiate
        • Make the decision
        • Evaluate the decision