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The benefits of buying used cars from a new-car dealer

Published January 15, 2013

Online technologies have made buying and servicing automobiles easier and more efficient for dealers and consumers.

Unfortunately, online tools and platforms have also emboldened curbsiders, who pose as legitimate sellers but take advantage of unsuspecting car buyers.

In October, the Ontario Motor Vehicle Industry Council (OMVIC), a self-managed body that administers and enforces the Motor Vehicle Dealers Act, launched a consumer awareness campaign aimed at providing education about new online trends of illegal car sales.

OMVIC’s research has discovered a phenomenon known as “tag-teaming,” where two illegal car sellers in different locations, working together to hide their identities, lure unsuspecting car buyers to purchase vehicles.

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Research also showed that curbsiders are using free online classified sites like Kijiji and Craigslist to list their cars (up to 25 per cent of online car ads on these sites are posted by curbsiders).

OMVIC warns that consumers who choose to buy a car privately need to be aware of the tactics used by curbsiders: prices that are much cheaper than other models of the same year and mileage (deals that are too good to be true); and vehicles that are not registered in the seller’s name (that’s a big red flag!).

Another caution for buyers is that not all curbsiders pose as private sellers. OMVIC warns that some work out of legitimate businesses, such as rental companies, repair shops and gas stations.

If consumers are uncertain about the legitimacy of a seller, ask to see their OMVIC license. If they won’t produce one, then leave, and report them to OMVIC (omvic.on.ca or 1-800-943-6002).

To help identify a curbsider, OMVIC has developed an interactive online tool called a Creepometer, which can be found at BuyWithConfidence.ca.

Of course, to avoid the possibility of dealing with a curbsider altogether or falling victim to an online scheme, consumers are encouraged to buy from a registered new-car dealer.

They are bound by a Dealer Code of Ethics, whereby they subscribe to the highest standards and principles and comply with all local, provincial and federal laws.

Registered new-car dealers are required by law to provide advertising disclosure and all-in pricing with no hidden fees; mandatory full disclosure of a vehicle’s history and condition; cancellation or rescission rights if specified information is not disclosed; and access to the Motor Vehicle Dealers Compensation Fund.

Dealerships are routinely audited by OMVIC and their own vehicle manufacturers to ensure the business is complying with all of its contractual and legal obligations.

In addition to the legal protections available to consumers, there are other reasons for choosing a registered new-car dealer. Their sales and service staff are trained and educated to explain the safety, performance and warranty features, financial options and maintenance requirements specific to the makes and models that they represent.

When you buy privately, the seller is only interested in making a quick sale, regardless of whether a vehicle is a good fit. If undisclosed, body repairs, mechanical or lien issues come to light after the sale, the consumer has no recourse. The seller is often long gone.

The last thing a dealer wants to do is to sell a problem vehicle with undisclosed issues and have that customer return with valid concerns.

New-car dealers are in the business of providing products and services that meet all the requirements of the Motor Vehicle Dealer Act.

The more consumers are aware about the risks of dealing with curbsiders and private car sellers, and the protection the law provides when dealing with a registered new-car dealer, the more likely they are to make an informed decision about where to purchase their next vehicle.

This column represents the views of TADA. Email president@tada.ca or visit tada.ca. Frank Romeo, president of the Toronto Automobile Dealers Association, is a new-car dealer in the GTA.

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