I talk on my radio show about misleading car dealer ads and have written several articles explaining what to look out for and to avoid.  However, others have decided to get into the game, and it may just be a company you trust.

Case in point, a listener sent me an email solicitation from his insurance company, which is Allstate.  Their claim is that with the “Allstate Car Buying Service” you can “save an average of $3279 off MSRP”.  That looks pretty good when you see that in bold, colorful, letters splashed across an email.  They then direct you to go to a TrueCar certified dealer.

TrueCar has a very jaded past which makes me wonder why “the good hands people” would partner with them. The founder of TrueCar has resigned amid massive lawsuits from hundreds of dealerships, the California New Car Dealers Association, and their own shareholders.  In the CNDA suit, it states:  “both the consumer and new car dealers are not being protected”.  The shareholder suit alleges “wrongful acts and omissions” in the TrueCar process. Microfiber Car Duster ... Check Amazon for Pricing.   Another suit brought by 117 new car dealerships cite “false advertising”.

As I always do, I looked at the fine print on the email sent to my friend.  The first line states:  “Between 7/1/15 and 9/30/15, the average estimated savings off MSRP presented by TrueCar Certified Dealers to users of TrueCar powered websites, based on users who configured virtual vehicles and who TrueCar identified as purchasing a new vehicle of the same make and model listed on the certificate from a Certified Dealer as of 10/31/2015, was $3,279.”  The first issue for me is the info is almost a year old from when they started tracking the info, and there seems to be a lot of double-talk there.

The fine print continued:  “your actual savings may vary based on multiple factors including the vehicle you select, region, dealer, and applicable vehicle specific manufacturer incentives which are subject to change. The Manufacturer’s Suggested Retail Price (“MSRP”) is determined by the manufacturer, and may not reflect the price at which vehicles are generally sold in the dealer’s trade area as not all vehicles are sold at MSRP. Each dealer sets its own pricing. Neither TrueCar nor Allstate brokers sells or leases motor vehicles.”  When I see a disclaimer that makes a solid statement in bold print, then bury the info in fine print that the offer “may vary”, that offer has no credibility to me. Meguiaru2019s X2000 Wa... Buy New $6.20 (as of 09:50 UTC - Details)

So how good is the deal if the savings claim of $3279 is actually true?  One of the interesting aspects of this is that TrueCar, to keep its name out in public, predicts future sales and more importantly, they track automaker incentive spending.  Looking at their release from October of 2015, the average incentive spending across all automakers was $3090.  Using their own numbers, the people who took advantage of either TrueCar or the Allstate Car Buying Service averaged savings of $189 under the sticker price (MSRP) of the car they purchased. You can make up your own mind on whether you think that is a good deal or not.

Frankly, Allstate’s “guaranteed savings offer of $3279 off MSRP” is easy to achieve with incentive spending staying over $3000 per vehicle so far in 2016.  According to the TrueCar numbers for March 2016, Fiat Chrysler spent $3887 per vehicle, Ford spent $3271, GM $3943, and Nissan $3362.  In fairness, some of that incentive spending encompasses lease incentives, dealer incentives, etc. but it all affects the final price consumers pay.

The moral of the story is you have to be careful of all car ads, not just those from car dealerships.

Reprinted from Car Pro.

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The Best of Jerry Reynolds

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