Mazda Canada terminates dealership after charging $25,000 over MSRP.
05-14-10, 11:15 AM
#1
Instructor
Thread Starter
Mazda Canada terminates dealership after charging $25,000 over MSRP.
http://www.wheels.ca/article/785934
On top of that, the car was used and the women was disabled and unemployed.
Great move Mazda, you have gone up in my book. (Not Sarcasm)
On top of that, the car was used and the women was disabled and unemployed.
Great move Mazda, you have gone up in my book. (Not Sarcasm)
Last edited by venom21; 05-14-10 at 11:45 AM.
05-14-10, 12:24 PM
#4
Lexus Fanatic
Here's the full article:
Hah.....Good luck. I don't think many judges are going to be on his side.
Welcome to the real world, Ma'am. Car sales, in general, are a lot more honest than they used to be, but there are still a fair number of vultures out there.
Conversely, there are people out there who don't know what they are doing when car-shopping, don't really know what the car they are shopping for is worth, and will fall for this kind of stuff. You could say they are "dumb" enough to pay it (and within the bounds of buisness and capitalism), but that still, IMO, doesn't condone taking advantage of people like this. There is a thing, in my book at least, called morals.
Big mark-ups on new, hard-to-get sports cars, and vehicles with high demand/low supply vehicles is one thing (that's simply buisness and supply/demand), but a 25K on a routine, run-of-the-mill, mid-size sedan is quite another.
Mazda Canada has terminated a dealership in Orangeville for breaching the company’s business practices including an incident where the store sold a car to a woman for more than $25,000 above its real value.
In a rare move, the auto maker announced Thursday that it had ended the sales and service agreement for Mazda of Orangeville effectively immediately, which means the store cannot sell any new vehicles and parts to customers or make repairs.
The move comes less than a week after the Star revealed the dealership had sold a 2010 Mazda6 G6 sedan to a local woman for about $66,000 including taxes and a trade-in car but she should have paid less than $41,000.
“We informed the dealer this morning that we were terminating the agreement because he had not adhered to the business standards, under the terms of the sales and service agreement,” said Greg Young, Mazda’s director of corporate public relations.
Young noted the huge overpricing of a car to the woman was one example of a breach but the company conducted an investigation and found other violations.
He added there are clauses in the agreement that state the dealer must conduct business in a way that reflects favourably on the image, reputation and goodwill of the store and Mazda.
Young, who could not recall a termination for such breaches in almost two decades at Mazda, said the company has received calls from customers in recent days in response to negative publicity about the incident.
As a consequence of the termination, Mazda will buy back any new vehicles and parts from the dealership. However, the dealership could still sell and service used cars on the lot.
Sunny Bains, president and principle of Mazda of Orangeville, met briefly with company officials at corporate headquarters in Richmond Hill on Thursday and later confirmed the decision.
“You heard that, it’s probably true but I got to go,” Bains said before hanging up.
Bains, who has operated the medium-sized Mazda store for about three years, could seek a temporary court injunction to stop the company from ending the franchise agreement.
The Ontario Motor Vehicle Industry Council, which regulates new and used car dealers, charged Mazda of Orangeville and two senior sales employees recently with “engaging in unfair practice by making an unconscionable representation,” contrary to the Consumer Protection Act.
The dealership faces a maximum fine of $250,000 and the two employees could receive $100,000 fines plus jail time of up two years if they are found guilty. They could also lose their provincial registrations to sell vehicles.
The Star found that the dealership sold a 2010 Mazda6 G6 to an Orangeville women for almost $66,000 or about 60 per cent more than she should have paid by charging her three times the value of extra items and saddling her with an eight-year loan. The woman should not have qualified for the loan because she is unemployed and living on a disability pension.
Furthermore, the dealership slapped several thousand dollars on the manufacturer’s suggested retail price on the car which wasn’t new.
Bains said he fired the two employees after the Star reported details of the deal but the regulator indicated that he has known about the questionable sale for somewhat longer.
Ex-manager “Moe” Shaihk, one of the defendants who lost his jobs, and Bains are also partners in a Suzuki dealership in Pickering.
Bains promised last week he would reimburse the customer, Madeline Leonard, so she “would not be short one penny out of her pocket.” But Leonard said she has not received anything yet including Bains’ promise of a new car.
Regarding Mazda Canada’s decision, Leonard said if the company thinks it is fair, “it’s alright with me.
“I’m the fairest person in the world,” said the 56-year-old woman. “I believe everyone should be fair and honest.”
In a rare move, the auto maker announced Thursday that it had ended the sales and service agreement for Mazda of Orangeville effectively immediately, which means the store cannot sell any new vehicles and parts to customers or make repairs.
The move comes less than a week after the Star revealed the dealership had sold a 2010 Mazda6 G6 sedan to a local woman for about $66,000 including taxes and a trade-in car but she should have paid less than $41,000.
“We informed the dealer this morning that we were terminating the agreement because he had not adhered to the business standards, under the terms of the sales and service agreement,” said Greg Young, Mazda’s director of corporate public relations.
Young noted the huge overpricing of a car to the woman was one example of a breach but the company conducted an investigation and found other violations.
He added there are clauses in the agreement that state the dealer must conduct business in a way that reflects favourably on the image, reputation and goodwill of the store and Mazda.
Young, who could not recall a termination for such breaches in almost two decades at Mazda, said the company has received calls from customers in recent days in response to negative publicity about the incident.
As a consequence of the termination, Mazda will buy back any new vehicles and parts from the dealership. However, the dealership could still sell and service used cars on the lot.
Sunny Bains, president and principle of Mazda of Orangeville, met briefly with company officials at corporate headquarters in Richmond Hill on Thursday and later confirmed the decision.
“You heard that, it’s probably true but I got to go,” Bains said before hanging up.
Bains, who has operated the medium-sized Mazda store for about three years, could seek a temporary court injunction to stop the company from ending the franchise agreement.
The Ontario Motor Vehicle Industry Council, which regulates new and used car dealers, charged Mazda of Orangeville and two senior sales employees recently with “engaging in unfair practice by making an unconscionable representation,” contrary to the Consumer Protection Act.
The dealership faces a maximum fine of $250,000 and the two employees could receive $100,000 fines plus jail time of up two years if they are found guilty. They could also lose their provincial registrations to sell vehicles.
The Star found that the dealership sold a 2010 Mazda6 G6 to an Orangeville women for almost $66,000 or about 60 per cent more than she should have paid by charging her three times the value of extra items and saddling her with an eight-year loan. The woman should not have qualified for the loan because she is unemployed and living on a disability pension.
Furthermore, the dealership slapped several thousand dollars on the manufacturer’s suggested retail price on the car which wasn’t new.
Bains said he fired the two employees after the Star reported details of the deal but the regulator indicated that he has known about the questionable sale for somewhat longer.
Ex-manager “Moe” Shaihk, one of the defendants who lost his jobs, and Bains are also partners in a Suzuki dealership in Pickering.
Bains promised last week he would reimburse the customer, Madeline Leonard, so she “would not be short one penny out of her pocket.” But Leonard said she has not received anything yet including Bains’ promise of a new car.
Regarding Mazda Canada’s decision, Leonard said if the company thinks it is fair, “it’s alright with me.
“I’m the fairest person in the world,” said the 56-year-old woman. “I believe everyone should be fair and honest.”
Bains, who has operated the medium-sized Mazda store for about three years, could seek a temporary court injunction to stop the company from ending the franchise agreement.
“I’m the fairest person in the world,” said the 56-year-old woman. “I believe everyone should be fair and honest.”
Conversely, there are people out there who don't know what they are doing when car-shopping, don't really know what the car they are shopping for is worth, and will fall for this kind of stuff. You could say they are "dumb" enough to pay it (and within the bounds of buisness and capitalism), but that still, IMO, doesn't condone taking advantage of people like this. There is a thing, in my book at least, called morals.
Big mark-ups on new, hard-to-get sports cars, and vehicles with high demand/low supply vehicles is one thing (that's simply buisness and supply/demand), but a 25K on a routine, run-of-the-mill, mid-size sedan is quite another.
05-14-10, 12:30 PM
#5
Lexus Fanatic
That's one thing, among many, I liked about Saturn dealerships (or, rather, retailers, as they called them). For many years, Saturn shops were required to sell at list, plus taxes/tags. There were NO markups, NO incentives, and NO discounts, regardless of supply/demand. The only exception was dealer/factory-approved accessories, which could be aded to the MSRP.
It not only made car-buying easy, especially for new, first-time buyers, but kept the whole buisness honest. And, if you were not satisfied with your new Saturn for ANY reason, you could get your full price back witin 30 days, provided no vehicle damage and a clear title.
It not only made car-buying easy, especially for new, first-time buyers, but kept the whole buisness honest. And, if you were not satisfied with your new Saturn for ANY reason, you could get your full price back witin 30 days, provided no vehicle damage and a clear title.
05-14-10, 12:40 PM
#6
Lexus Fanatic
This is why I don't like any car dealers. They are ALWAYS GOING TO RIP YOU OFF. Not 25k but they are all thieves, They always want to rip you off on the trade and over charge on the car.
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05-14-10, 01:39 PM
#8
Agree with mmarshall that Saturn was easy to buy from. One aspect with car purchasing has been the PITA hard sell tactics encountered. Although my Lexus purchase because of the AAA deal, it was walk in sign my life away scenario. Some may enjoy the hunt but I dislike dealing...then there is a reason why they call them "dealerships".
As a consumer, she should have been aware what the market value for the car is. In her financial position, how does one just walk in and say ok? $60K isn't like finding a quarter on the street.
As a consumer, she should have been aware what the market value for the car is. In her financial position, how does one just walk in and say ok? $60K isn't like finding a quarter on the street.
05-14-10, 05:03 PM
#12
Instructor
Thread Starter
A fully loaded 6 can easily top $50,000 with taxes. Everything is more expensive up here, we have to pay for the social programs somehow. Doesn't really bother me all that much though.
Last edited by venom21; 05-14-10 at 05:09 PM.
05-17-10, 08:14 PM
#13
that includes taxes. A loaded 6 GT V6 is $36,695 (add another $2.5k for nav). PDI is another $1k-$1.5k plus other minor fees. GST is 5% and Ontario's PST is 8%. You're looking at around $46k for a GT V6 w/ nav after taxes.
05-17-10, 08:56 PM
#14
Pole Position
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Sorry if this sounds harsh, but what the hell is she doing buying a $66,000 car while unemployed and living on a disability pension? Others saved this woman from herself this time, but as the saying goes "a fool and his money are soon parted" and there may not be someone to save her next time.
05-17-10, 09:40 PM
#15
Moderator: LFA, Clubhouse
Sorry if this sounds harsh, but what the hell is she doing buying a $66,000 car while unemployed and living on a disability pension? Others saved this woman from herself this time, but as the saying goes "a fool and his money are soon parted" and there may not be someone to save her next time.
In my mind, nearly every business transaction involves at least one party that could be considered "taken advantage of".