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Car Buying Seminar Tom Lindstrom [email protected] China Outreach Ministries www.comumn.org Outline Understanding our assumptions Understanding Cars Dealing with People Dealing with Details Inspecting the Car Recommendations Understanding Our Assumptions T/F Test What REALLY Matters?

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car buying seminar

Car Buying Seminar

Tom Lindstrom [email protected]

China Outreach Ministries

www.comumn.org

outline
Outline
  • Understanding our assumptions
  • Understanding Cars
  • Dealing with People
  • Dealing with Details
  • Inspecting the Car
  • Recommendations
understanding our assumptions

Understanding Our Assumptions

T/F Test

What REALLY Matters?

true false test
TRUE / FALSE TEST
  • 1. Japanese Cars are the cheapest to drive
  • 2. The more I spend purchasing a car, the more dependable it will be
  • 3. Finding a reputable dealer is the most important step
  • 4. Getting a car is going to relieve a lot of anxiety about living in the US
  • 5. Cars with “Prior Salvage” stamped on the title should always be avoided
  • 6. New tires on a car shows it has been cared for
rank the following in order of importance
Appearance

Reliability

Cost of Maintenance

Gas Mileage

Ability to impress my friends

Cheapest price

Safety

Make of car (ie Toyota)

Everything MUST work all the time

Easy to park, learn to drive, etc.

Lower anxiety about vandalism, theft, etc.

Rank the following in order of importance:
what really matters
Dependable transportation that doesn’t interfere with your studies

Lower anxiety regarding safety & damage to your car while you learn to drive

What REALLY matters?
understanding cars
Understanding Cars
  • When cheaper means more expensive and saving money means spending money!
  • Sweeping Generalizations
  • Understanding Wear Cycles
  • Choosing a car based on thorough research
  • Tools for determining the value of a specific car
different cars for different people
Different Cars for Different People
  • For most people, cars are pragmatic…just transportation
slide10
This discussion will focus on practical cars
  • My recommendations will be for cars that are more simple in design
  • If you prefer a fancier car, the research methods shown in this presentation will also help you find such a car!
sweeping generalizations
Japanese cars RUST but are typically more dependable. Repairs sometimes expensive.

European cars are well designed but expensive to repair, more complicated. Complicated electrical systems are their death knoll. Motors and bodies last forever.

American cars rust, are not as well designed, but parts and repairs are readily available. These cars are usually more practical in design, and there are several that stand out as very reliable.

Sweeping Generalizations
which car represents the greater value
Which car represents the greater value?
  • 2002 car with 100k or a 1998 car with 50k?
  • Import car in OK/poor shape or a Domestic car in EXCELLENT condition?

(Normal annual mileage is

12 - 15k per year)

the truth about economy cars
The Truth about “Economy Cars”

Rank the following Cars:

Which one costs $141 to replace the water pump?

Which one costs $624 to replace the water pump?

$33,000 MSRP

$18,000 MSRP

$545

$624!

$46,000 MSRP

$10,000 MSRP

$141!

$322

who would think that this car would have the most expensive repair
Who would think that this car would have the most expensive repair?

And who would think that you could replace a water pump on a $46,000 Cadillac for under $150?

Of the cars on the previous page, the Acura would have the highest rating for dependability…but @ $545 to replace the water pump…you might want to think again about purchasing one!

so what is real economy about
So what is real economy about?
  • Reliability is NOT the same thing as economy!
  • Economy is about the bottom line…how much does it cost to drive a car
  • What does economical transportation look like?
laugh if you want to but this was the cheapest car i have owned
Laugh if you want to, but THIS was the cheapest car I have owned!

1983 Ford Econoline 150

10 mpg, but…

Very cheap and easy to repair-

This was the best economy car I had for 15 years!

understanding wear cycles
Tires

Battery

Exhaust

Struts/Shocks

ATF/Antifreeze change

Timing Belt

Alternator

Water Pump

Air Conditioning

Automatic Transmission

Understanding Wear Cycles

Repairs 60 - 90k:

Repairs beyond 100k:

Sometimes a car with 100k on it is

cheaper to drive than a

comparable vehicle with 60k on it

the bottom line on economy
The Bottom Line on Economy
  • Gas Mileage is only part of the cost of operating a car
  • A car considered reliable isn’t necessarily the cheapest to drive
  • Lower miles on a car do not necessarily mean less repairs
  • Knowing your assumptions can lessen your disappointments
slide19
You probably don’t NEED a car after all!

There are other forms of transportation!

my suggestions
My Suggestions
  • Consider a $500 - $1500 car for the purposes of learning to drive
  • Determine what causes you the most anxiety about car ownership and try to reduce your exposure to those risks
  • Buy a car from a “Maintenance NUT”
why consider this car
Why consider this car?
  • $1400 for a ’91 Accord with 215,000k !

The owner of this car kept meticulous records of

repairs and it drove absolutely like new!

or this car
Or this car?
  • ’85 Olds $500

This car has an excellent engine, its safe, and it won’t matter if

you smash it up a little learning to drive!

why start with a cheaper car
Why start with a cheaper car?
  • Most new drivers are very nervous
  • Nervous drivers make mistakes
  • Mistakes cost $$$, raised insurance premiums for years to come
  • A cheaper car means you will be less nervous
so where do we start
So where do we start?
  • How do I decide what make and model of car to buy?
  • How do I know how much I need to spend?
  • What is the most “bang for the buck” in terms of the usability of any given car?
slide26
What can you learn from a junkyard?

Some cars give their owners the “Blues”

Some cars end up junked sooner than you would expect

Certain models have consistently defective major components

for example
The day I was here (at the junkyard) I saw 3 or 4 Mazda 626s in this condition…why are they there when they appear to be in great condition and only five to seven years old?For Example…

BADtransmissions!

issues that send cars to a premature death
Issues that send cars to a Premature Death

Expensive, “surprise” repair bills

Repairs for which no parts are available,often due to defective parts!

When buying a car, how can I minimize

my exposure to the risks of repair bills

I cannot afford?

finding the right car doing your research

Finding the Right Car- Doing your Research!

Researching the history and

reliability of specific models

In the case of the Mazda 626, I found a website for complaining owners whose transmissions failed

obviously our research has to include sources that will help us find and avoid those lemon cars
Obviously, our research has to include sources that will help us find (and avoid) those lemon cars!
  • Periodical Literature
  • Web sites; Governmental, Complaint sites, Consumer Websites, etc
  • The advice of mechanics, friends, relatives
periodicals
Periodicals
  • Consumer Reports is a good place to start
examples of things in consumer s reports
Examples of things inConsumer’s Reports
  • Which cars are the most dependable?
  • What new laws or recalls will affect me?
  • Complaints and Recommendations
slide33
This chart is from the

Consumer Reports

Annual Auto

Issue, published

each spring

slide34
Millions of readers

contribute to the

data collected by

Consumer

Reports, making

their resources

some of the best

available for

comparing cars.

slide35
This chart is also

A part of the

Consumer’s

Reports Annual

Auto issue.

slide36
This chart is a list of

recommendations

for used cars that

statistically have had

a consistently

excellent reputation

over the years…

but keep it all in perspective
But Keep it ALL in Perspective

Glenn, Karen Beach and I all own vans on this list!!!

and consumer reports doesn t include
And, Consumer Reports doesn’t include…
  • Costs of maintaining a vehicle
  • Costs of typical repairs
hence the car book
Hence…The CAR Book
  • Compilation of Govern-

ment data previously

unavailable to the public

  • Focuses on Safety
  • Predicts maintenance costs and charts total costs of ownership including depreciation, etc.
examples of helps the car book can give
Examples of helps The CAR book can give:
  • Summaries of replacement costs for major and minor components on popular vehicles
  • Estimates the costs for preventative maintenance as prescribed by the manufacturers of the new cars
  • Complaint charts
  • Crash test results
  • Depreciation (Use this in your favor…you can

get a 3 year old car for 60% of its new price!)

web searches
WEB searches
  • To locate Automobile related websites, try words such as “reliable used cars” or “automobile complaints” or “defective transmission” or “defective engine” or “automobile complaints” or “automobile recalls”, etc
what you will find on the web
What you will find on the Web
  • Lots of complaint web-sites, some profane and not legitimate
  • Some helpful things
  • Some commercial sites, designed to make money off all information they provide
some helpful web sites
Some Helpful Web-sites
  • www.samarins.com
  • www.carsurvey.org/
  • www.recalls.gov
  • www.dmv.org
  • www.nhtsa.gov
  • www.consumerreports.org
where to go for advice
Where to go for advice
  • Your Host family
  • Trusted people like your advisor, neighbors, COM staff, etc
  • Ask around for referrals to a good mechanic – if you pick your mechanic FIRST, and have him recommend a car, you will always have someone to repair it! (I will include referrals at the end of this presentation)
are there exceptions is it ever wise to buy a car your research says to avoid
Are there exceptions – is it ever wise to buy a car your research says to avoid?
  • Yes when you can buy a car from a trusted friend
  • Yes when you are shown records for maintenance and repairs that outweigh or cancel out the other concerns (Ford Focus)
  • Yes when you can accept the faults of a vehicle, knowing its benefits outweigh the negatives (Astro Van)
dealing with people
Dealing With People
  • Finding a Reputable Dealer
  • Finding a “private party”
  • Understanding Classified Ads
  • Understanding “Minnesota Nice”
  • Negotiating a Sale
finding a reputable dealer is that an oxymoron
Finding a Reputable Dealer…(is that an oxymoron?)
  • New Car Dealerships
  • “Car Lot” used car dealerships
buying a used car from a new car dealership
Buying a used car from a New Car Dealership

Have a higher concern for “nice cars” on their lot

Get business based on name plate of dealership, not on quality of service or repairs!

Lots of overhead, lots of salespeople means they

have to keep standards up (and prices!)

Get first pick of the used cars at the best prices

used car lots
Used Car Lots

Typically have less concern for repeat business

Finding a reputable Used Car Lot is one thing…Finding a good car on such a lot is another!

Nearly ALL the cars here were rejected by

New Car Dealerships for some reason!

locating a car from a private party
Locating a car from a “Private Party”
  • You may want to buy a car directly from the person who knows the most about it…the owner!
  • PP can tell you about repairs done, how the car was driven, etc.
  • Buying from a PP often is a rewarding experience
how do i locate a private party who is selling their car
How do I locate a Private Party who is selling their car?
  • Classified Ads in MN Daily, Tribune, Pioneer Press, Auto Trader, etc.
  • Web sites
  • Bulletin Boards at local establishments
  • Friends/referrals
pros cons of the classified ads
Pros & Cons of the Classified Ads
  • Ads are expensive, so sellers are motivated to sell quickly!
  • Lots of competition getting to the right car before someone else
terminology of the classifieds
Terminology of the Classifieds
  • Babied Owner claims vehicle has had all the “TLC” of a newborn baby
  • Sharp Vehicle is attractive overall
  • Good runner Usually means the car is ugly, but dependable
  • Highway miles Owner is claiming the high miles show less wear than you would expect normally since it was “Highway miles”
  • Mint Car is in virtually new condition…no flaws at all
  • Clean Usually meant to convey the body has no rust
pros and cons of web searches
Pros and Cons of Web Searches
  • Sites like www.carsoup.com have lots of listings with photos
  • Slow turnover - Seller has lots of time to wait for his price…may be overpriced or need repairs (look at photo, try to date when the vehicle was listed)
web sites with used car listings
Web Sites with Used Car Listings
  • www.minneapolis.craigslist.org
  • www.autotrader.com
  • www.cars.com
  • www.edmunds.com
  • www.carsoup.com
  • www.automart.com
  • www.autoextra.com
  • www.autoweb.com
  • www.automotive.com
  • www.usedcars.com
  • And believe it or not, EBAY (but be wary)
east meets west china vs minnesota nice
EAST MEETS WESTChina vs. “Minnesota Nice”

Just what is “Minnesota Nice?”

  • Non-interference in the lives of others
  • Indirect answers to your questions smothered in sickly smiles
  • Better to be a doormat than to upset anyone!
  • Saying little or nothing when upset, yet bearing a grudge for a long time
i have found a car how do i determine what it is worth
I have found a car…how do I determine what it is worth?
  • Carry a NADA guide, available at bookstores
  • Check the web: www.edmunds.com, www.kbb.com, www.carsoup.com, newspaper classifieds, Auto Trader
  • Be careful to deduct for everything you can in determining value, and enter the EXACT model
  • After looking at a few cars you will know their value, and you may refine your search
  • It is NOT a criminal act to ask MORE than “book” value
how can i do a title search
How can I do a title search?
  • Find the VIN# of the vehicle
  • www.carfax.com $25 for unlimited checks for 30 days or $20 for a single VIN check
  • www.autocheck.com (one free check)
inspecting the car
Inspecting the Car
  • First Impressions
  • Things you can inspect yourself
  • Professional Inspection

5

if you are buying a beater to learn to drive ignore this but
If you are buying a “beater” to learn to drive, ignore this, but
  • Pay attention to how the car looks to you
  • Look for evenness and consistency in the paint, door gaps, etc.
  • Check to see that doors, windows, locks all work (non-functional things can be SO annoying!)
things you can check yourself
Things you can check yourself
  • Check all VIN numbers to see that they match (See www.samarins.com for full description of where VIN#’s are located)
  • Check www.carfax.com (or similar site) to see if the car has ever had a Salvage title
before starting the car
Before Starting the Car
  • Lift the hood; check fluids
  • Inspect Radiator, hoses, belts
starting the car
Starting the Car
  • Listen to the car start cold…there should be no unusual sounds from the motor
  • Look out the rear of the car. There should be no blue smoke. Some steam is normal for a few minutes, but not smoke.
  • After the car warms a little, put the transmission in R. It should not lag before engaging.
slide68
Inspect the Tires

Abnormal wear can

tell you

things about the car

the owner

may not know!

automatic transmission fluid
Automatic Transmission Fluid
  • The fluid should be pink, have little odor
  • If the fluid is brown, smell it. Its normal to have some odor, but it should not smell burnt.
  • Level of fluid is checked only with car hot, on level ground
what are the advantages of having the car inspected professionally
What are the advantages of having the car inspected professionally?
  • Pro inspections cost $50 - $80 but give you something to negotiate with…probably saving you that much money when arriving at a final price
  • Pro inspections are VERY thorough
  • Probably not necessary for a “beater”
a word about salvage titles
A word about Salvage Titles
  • Salvage / Prior Salvage stamp vehicles should be at least 20% cheaper than comparable model
  • Don’t rule out a vehicle with prior salvage stamped on title, but be careful!
  • Have the vehicle inspected
one more thing
One More Thing
  • Since the wear & tear on a car varies a LOT based on how it is driven, have the owner/seller take you for a ride and see how he handles the car. Is he hasty when going from Reverse to Drive? Does he “MASH” the accelerator and or brakes?
  • Ask him about the use of the vehicle
negotiating a sale
Negotiating a Sale
  • You MAY try to get a lower price on the phone, but the Seller may hang up on you! Asking price is not usually more than 10-15% higher than seller’s anticipated selling price.
  • Be careful not to point out things wrong with the car as though the seller was trying to cheat you!
  • Don’t be manipulated or pressured to buy. But at the same time, don’t ignore the advice of someone trying to help!
dealing with details
Dealing With Details
  • What is the procedure for payment?
  • Where do we go to transfer the Title?
  • What legal issues do I face?
  • How much insurance do I need?

4

what is the procedure for payment
What is the procedure for payment?
  • Most sellers accept a personal check as down payment. If you do not follow through with the sale, the money is theirs to keep.
  • Buyer will return at a later time with Bank Check for the full amount and Seller returns the Buyer’s down payment.
  • Writing out an agreement may be a good idea.
payment procedure continued
Payment Procedure continued…
  • Alternatively, Buyer and Seller can go together to the bank to exchange funds
  • Buyer can carry a check from a bank that he could sign over to whomever he wishes
where do we go to transfer the title of ownership
Where do we go to transfer the Title of Ownership?
  • Its primarily in the Seller’s interests to go with the Buyer to insure the Title is properly transferred.
  • The Dept. of Motor Vehicle in Minnesota has several locations for transferring the Title of Ownership – they can be found in the Government Blue Pages in the front of the phone book
  • Going together and doing all the signatures in front of the DMV personnel can save you a lot of stress should you make a mistake
title includes
Title includes:
  • Odometer readings

when issued

  • If the car has a “Lien”
  • VIN number
  • Owner(s) name/address, etc.
be careful filling out the title as any alterations changes void the title
Be careful filling out the title as any alterations/changes VOID the title!
  • Put your name down in USA order (family name LAST)
slide80
If you can, fill out the title in the presence of a DMV official
  • If your are not able to go together to register, register online www.mndriveinfo.org (this does NOT transfer the title but starts the process)
recommendations
Recommendations
  • Getting Insurance
  • Recommended Cars
  • Finding a Reputable Mechanic
  • Auto Body Repair

7

insurance
Insurance
  • It is illegal to drive a car on a MN highway without insurance. You need insurance to pick up the car you buy…and you need the VIN# to insure it.
  • The liability insurance MN requires is probably not enough! Consider raising it, at least until you are a seasoned driver.
  • You, as driver of your car, are alone responsible for whatever you hit, regardless of “fault” and unless you carry collision coverage, the loss is yours.
choosing insurance
Choosing Insurance

Because International Students are the riskiest group to insure and because they have the highest accident rate due to their unfamiliarity with cars…

  • Few companies insure unlicensed drivers
  • Those that do offer insurance to this group charge big bucks!
  • When you do find insurance, consider collision coverage in addition to liability
understanding the types of insurance
Understanding the types of Insurance
  • Liability only covers damage you do to other people’s cars and property
  • Collision adds coverage for damage you do to your own car
  • Comprehensive covers damage such as storms, parking lot scrapes, etc.
recommendations85
Recommendations
  • The following cars are good choices but not your only choices!
  • If you are choosing to buy a cheaper car, ($500 - $1500) your choices are narrower and will depend more on the condition of the car than the make and model…but keep the following in mind~
brand specific recommendations
Brand Specific Recommendations
  • Practically any Toyota- These cars accept abuse and neglect like no other car made.
  • Honda Accord, Civic, etc.- People LOVE these cars
  • Mazdas OK- They probably don’t last as long as Toyotas but usually good cars
  • Nissan- Good, simple cars
recommendations continued
Recommendations continued…
  • Mitusbishi; repairs can be expensive, but if you find a good one you should be OK
  • Hyundai In recent years these cars have made big strides ahead in quality
  • Suzuki? If you get a good price, low miles
cars things to avoid
Cars / things to avoid
  • 95-97 Plymouth / Dodge Neon head gasket
  • Late 90’s Mazda 626 AT
  • Late 90’s Mitsubishi Galant AT
  • GM 2.4 liter 4 cylinder
  • 00-02 Ford Focus check recalls
toyota camry
Toyota Camry
  • These cars can last 250,000+ miles
  • Galvanized sheet metal means they don’t rust!
  • Great resale value
  • Act quickly to get

one 

chevrolet prizm toyota corolla
Chevrolet Prizm / Toyota Corolla
  • Prizm is the Corolla with Chevy name
  • Economical…should last 200,000 miles
  • Not much to worry about here
honda accord
Honda Accord
  • Quick, responsive handling
  • Very reliable, satisfying ownership
honda civic
Honda Civic
  • Very economical transportation
  • Very, very reliable!
less obvious recommendations
Less Obvious Recommendations…

Cars you might have overlooked 

ford escort mercury tracer
Ford Escort / Mercury Tracer
  • Cheap, dependable transportation
  • EASY to find competent mechanic to work on these cars
  • Available 2 door, 4 door, wagon
  • Lower purchase and resale value than import
buick regal century
Buick Regal / Century
  • Dependability on a par with import cars
  • 3.8 liter motor is one of the best in automotive history, 3.1 is also good
  • Depreciates rapidly

(3 year old value

is 50% of new- very

affordable!)

chevrolet corsica beretta
Chevrolet Corsica / Beretta
  • Discontinued in 1997, but if you find one in decent shape, consider it. 3.1 V6 (avoid the 4 cylinder engine)
other things to think about
Other things to think about
  • Remember that finding a car “One Owner’ or from a person whose judgment you trust is your best asset in looking for a car
  • Almost any car in excellent condition is going to be a better choice than a more reputable car that has been abused
cars to avoid issues to deal with
Cars to avoid, Issues to deal with
  • Ford Focus 2000 – 2002 (recalls)
  • Ford 3.8 liter motors in certain cars and vans 1992 – 1996
  • Chrysler vans with AT troubles
  • European luxury cars – complex electrical
  • Honda transmissions do NOT accept abuse! (shifting to drive while the car is moving in reverse)
finding a mechanic
Finding a Mechanic
  • New car dealerships may have the latest diagnostic equipment and lots of “well-trained” mechanics, BUT that doesn’t guarantee they are good at fixing cars!
  • Mechanics without a franchise endorsement can only remain in operation if they do good work!
mechanics
Mechanics
  • Auto Repair Service 965 Pierce Butler Route, St Paul 651-487-1431 Not far from CTC
  • Phalen Park Auto Repair(Kuan’s)1383 Arcade St. St. Paul, MN 55106 651-771-1590
  • Midwest Vee259 Como Avenue Saint Paul, Minnesota 55103 651 489-8853(specialists for european cars)
  • Baber Auto Repair Service 1690 Hamline Ave N Roseville, 55113 651-646-8661
auto body repair
Auto Body Repair
  • Raymond Auto Body, Inc. 1075 Pierce Butler Route St. Paul, MN 55104 651 488-0588
other issues to consider
Other Issues to Consider
  • The Law is the LAW – do not bring a casual attitude to the rules of the road; you must always have a licensed driver sitting next to you when on a learner’s permit. And all the rules apply to you even when nobody else is watching. 
other issues the impound lot
Other issues…the Impound Lot
  • If you don’t know the parking rules of the city, beware!
  • Fees: $172 (Mpls) $208 (St Paul) for tickets and towing PLUS any storage fees
  • http://www.ci.minneapolis.mn.us/snow/parking-info.asp for rules in MPLS.
  • http://www.ci.stpaul.mn.us/depts/publicworks/snowplow.html for St Paul rules
other issues your owner s manual
Other Issues…your owner’s manual
  • Read it!
  • You might also want to find a general book on cars to get you started
  • (I knew a student who put too much air in his tires…they blew up on the highway going to Duluth. This wouldn’t have happened if he would have read the owner’s manual!)
i hope this presentation was helpful
I hope this presentation was helpful
  • Your greatest resource in finding a good car is the recommendations of friends and classmates who have some experience with cars
  • If you have an American host family, you can ask them as well
good luck shopping
Good Luck Shopping!

(I think this Lamborghini costs more than your education!)

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