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Be cautious with second-hand buys

Undercover team posed as buyers to test used-car dealers' mettle, and the results weren't always pretty

Published April 19, 2013

Used car dealers who target recent immigrants by providing their services in multiple languages may not always have their best interests at heart.

They don’t always have the consumer’s back while speaking English, either.

Count on the pro-consumer Automobile Protection Association to find some unsettling sales practices each time its undercover team ventures into the marketplace, most recently while visiting 20 Vancouver independent used vehicle sellers to determine just how honest they are with the buying public.

What the APA learned in B.C.’s lower mainland serves to inform used-vehicle shoppers in the GTA, as well.

Investigators uncovered one Vancouver dealer who ran materially different ads in English and Chinese. When the Chinese ads for a 2009 Subaru Legacy were translated, they indicated “No Accident,” but the English version didn’t make that claim.

An inspection of the Subaru revealed it was an insurance writeoff. While the sales rep did confess that the car had been in a collision, he erroneously reported that its back end had suffered the hit.

An APA technician discovered it was the front half of the car that had sustained “massive” collision damage, which included a badly straightened frame rail camouflaged with body filler, an open weld around the front-left strut tower, and requiring replacement of the front fenders, right-side doors and front bumper.

While the rep had underreported the damage to an English-speaking customer, a Mandarin-speaking buyer would have been led to believe the car was spotless, according to the ad. George Iny, president of the APA, says the dealer was likely counting on language being beyond the oversight of the regulator.

“The dealers APA visited appear to take advantage of kinship if the opportunity presents itself,” Iny says. “If a client relates to them because the buyer and seller are from the same ethnic community, the extra level of familiarity may work to the buyer’s disadvantage.”

The Vancouver-area investigation, captured by CTV’s W5 cameras, is the latest in a series of disquieting glimpses into the used-car trade, which in the past has revealed dealers marketing poorly rebuilt accident writeoffs as safe transportation.

When the APA examined Toronto-area dealers last year, none of the 11 used-car lots and two new-car dealers investigated attempted to pass off a former wreck as a safe used car — a first for the investigation in the GTA. Instead, the wrecks had migrated to curbsiders — shady unlicensed dealers posing as private sellers — who were hawking unsafe vehicles at hard-to-resist prices.

Vancouver dealers proved to be not nearly as subtle.

APA investigators uncovered about 50 rebuilt vehicles in their sample of Vancouver lots, four of which were so poorly repaired that they were deemed not roadworthy — despite the fact the cars had passed provincial inspections.

The 2009 Subaru had been written off by the Insurance Corporation of British Columbia (ICBC), the government-run auto insurance provider. The wreck was purchased by the dealer and sent for repair, after which it passed two ICBC-approved inspections.

When the APA followed the paper trail, they found the inspection forms had plenty of blank sections where the collision damage and repairs should have been noted. Instead, the word, “Pass” was circled once at the top of a column.

Iny says that Ontario, like British Columbia, is saddled with an underperforming vehicle inspection system, but adds the process is more compromised on the west coast.

“B.C. appears much more lenient in assessing the level of damage that is permissible for rebuilding. There is no special training or licensing for structural inspectors.”

“Ontario’s MTO may be more restrictive about determining which people or repair facilities can perform structural inspections. In Ontario a really bad wreck is more likely to be categorized as ‘Dismantle, for parts only.’”

APA investigators found plenty of misrepresented used vehicles in Vancouver.

A 2004 Toyota Corolla with 75,000 km on the clock was marketed with a clean accident history. However, APA’s inspection revealed the fenders, front bumper, both light boxes, the radiator and condenser had been replaced, and found some structural damage to the frame rails.

A 2007 Honda Fit with 95,000 km was described by the seller as having had a minor frontal collision, but the inspection showed the car sustained a severe right front impact. The bumper, hood and both fenders were replaced and the right side subframe rail had been crudely straightened and rewelded.

A 2005 Toyota Matrix with 131,000 km was reportedly in a collision that required the two right-side doors to be replaced, while everything else was “original.” In reality, the collision damage extended over three sides of the Matrix and involved six body panels. The structural B-pillar had been hammered into place instead of replaced.

One dealer resorted to putting ads on Kijiji portraying his cars as “For sale by owner,” when clearly the cars were sitting on a commercial lot. A body shop was selling its repaired cars the same way. Dealers in B.C. are prohibited from misrepresenting themselves as private parties in advertising.

Overall, eight dealers passed and 12 sellers failed in the APA probe. Beyond the underreporting of collision damage, the most common way for dealers to earn a fail is to charge an excessive administration fee (more than $300) to process the sale.

The APA’s position is that filling out paperwork is part of the purchase of buying a car, and should be included in the price. In every instance in the Vancouver study, the fees were not mentioned in vehicle advertising, but tacked on at the dealership.

“In Ontario all mandatory fees, other than HST and licence fees, must be included in the advertised price, unless the vehicle is advertised for sale uncertified. In that case, it must be made clear that the vehicle as advertised is uncertified and the price for the safety inspection must be shown in a clear and prominent manner,” explains Iny.

Shopping for a used vehicle with a lower-than-average price in the Vancouver area carries a high likelihood of finding a badly rebuilt wreck at an independent dealer or by a curbsider, Iny concludes.

In Ontario, while better regulation and disclosure may have banished the worst cars from lots, curbsiders appear to be a vital conduit for legitimate businesses to dispose of their wrecks by selling them at a discount to a willing public.

While the Vancouver study did not include any used-car operations run by new-car dealers, the APA suggests better-quality examples can be found there — but not in every instance.

As always, exercise vigilance when shopping second-hand.

Some Used-car Shopping Tips

When pressed, most used-car dealers will disclose collision information, but the Vancouver study reveals a tendency to underreport damage. Always arrange an independent inspection of a prospective used vehicle done prior to payment.

CarFax, CarProof and AutoCheck history reports verify the mileage shown on the odometer and recognize rebuilt or salvaged vehicles. But these reports can miss collision repairs by the previous owner arranged without involving their insurance firm.

Purchase the ministry’s Used Vehicle Information Package even if you’re shopping on a lot (obtain the car’s VIN to buy the printout). Armed with the vehicle’s history, you can negotiate a better price if, say, you learn the car has been sitting on the lot for an extended period.

Almost every used-vehicle lot offers aftermarket warranties for an extra charge — but take the time to learn which components are covered, the stated limitations and payout caps.

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