Researching an Automobile What should I look for?
Transportation <ul><li>Part of everyone’s life </li></ul><ul><li>15 – 20% of an individual’s budget </li></ul><ul><li>Auto...
Want to Buy a Vehicle? <ul><li>Consumers should plan their vehicle purchase to avoid any costly mistakes </li></ul><ul><li...
Planned Buying Process <ul><li>Prioritizing wants </li></ul><ul><li>Pre-shopping research </li></ul><ul><li>Fitting the bu...
Step 1 - Prioritizing Wants <ul><li>Assess transportation needs and wants </li></ul><ul><ul><li>Need:   something thought ...
Prioritizing Wants –  Questions to Think About <ul><li>How will the vehicle be used? </li></ul><ul><li>Where will the buye...
Step 2 – Pre-shopping Research <ul><li>Research should be based on transportation wants </li></ul><ul><li>Complete this be...
Ways to Perform the Research <ul><li>Family & friends </li></ul><ul><ul><li>Experiences with different makes and models of...
Price Research <ul><li>Price </li></ul><ul><ul><li>Base price : vehicle price with standard equipment, no extra options </...
Price Research continued <ul><li>Price continued </li></ul><ul><ul><li>Determine how much a dealer paid to help decide whi...
Vehicle Options Research <ul><li>General type of vehicle </li></ul><ul><ul><li>Car, truck, 2-door, SUV, sporty </li></ul><...
Vehicle Options Research continued <ul><li>Fuel economy </li></ul><ul><ul><li>Type of gas used, gas mileage </li></ul></ul...
Vehicle Options Research continued <ul><li>Insurance </li></ul><ul><ul><li>Chosen vehicle affects the price of insurance; ...
New vs. Used Research <ul><li>New Vehicle: </li></ul><ul><ul><li>Not pre-owned </li></ul></ul><ul><ul><li>Warranty </li></...
Step 3 – Fitting the Budget <ul><li>“ Can I afford it?” </li></ul><ul><ul><li>Most important question </li></ul></ul><ul><...
Fitting the Budget continued <ul><li>Fixed expenses </li></ul><ul><ul><li>Depreciation </li></ul></ul><ul><ul><li>Insuranc...
Step 4 – Comparison Shopping <ul><li>Comparing services or products to determine the best buy or quality product at a fair...
Comparison Shopping continued <ul><li>Narrow the choices to a few specific makes and models with desired options </li></ul...
Comparison Shopping continued <ul><li>Goal of comparison shopping </li></ul><ul><ul><li>Narrow the choice even further to ...
Step 5 - Negotiating <ul><li>Process of deciding the actual terms of the purchase and agreement between the seller and buy...
Negotiating continued <ul><li>Keys to all negotiations </li></ul><ul><ul><li>Be able to say NO  </li></ul></ul><ul><ul><li...
Step 6 – Making the Decision <ul><li>The best place to decide on which vehicle to purchase is  NOT  the showroom where you...
Step 7 – Evaluating the Decision <ul><li>Think about the things which went well and what did not </li></ul><ul><ul><li>Thi...
Lemon Laws <ul><li>Lemon </li></ul><ul><ul><li>A vehicle in and out of the repair shop with problems monthly </li></ul></u...
Lemon Laws continued <ul><li>To fall under the lemon law </li></ul><ul><ul><li>New vehicle must have a substantial defect ...
Lemon Laws continued <ul><li>What should you do if you feel you have purchased a lemon? </li></ul><ul><ul><li>Contact the ...
Conclusion <ul><li>Before purchasing a vehicle, follow the planned buying process to avoid a costly mistake </li></ul><ul>...
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Researching an automobile_powerpoint_presentation

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

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