So, I made a deal today to buy a 2022 Kia Carnival EX, a nice car that's good value, especially at a discount. However, the deal collapsed in the finance office when I refused to sign an arbitration agreement that the dealer wouldn't sell without it.

Have you come across such a document when buying new?

 

It makes it sound as if they don't have much faith in their product.

 

Sounds like a Tesla move. I'd walk.

 

I find my local dealers a lot shadier than Tesla corp. Trouble with the stupid franchise model.

 

This was at a very large multi-line store (and one that does not have the best local reputation, so it wasn't totally surprising). In checking the paperwork of the last 3 new vehicles we bought, my wife signed such agreements twice, once in 2016 and then last year when we got the RX 350. Interestingly, in the latter instance in bold letters above her signature it said that it was not necessary to sign the agreement either for the purchase or the financing. The file for my 2016 Toyota Sienna contains no arbitration agreement. I don't recall whether I declined or it wasn't presented.

 

I don't recall ever being asked to sign one but can't definitively say I haven't. I did just pull up my paperwork from the last two GSs I bought and neither had mention of an arbitration agreement.

 

What is an arbitration agreement?

 

these mandatory arbitration provisions are common. I think it's a bit of a boss move to make it a separate agreement; most of the times, it's buried in the terms and conditions. Mandatory arbitration absolutely sucks for consumers; unfortunately, it's really hard to avoid.

 

It's an agreement where you waive your right to sue the other party, and instead, you are required to go to a binding arbitration proceeding. But most of the times, the arbitrator is someone with ties to the automotive (or other applicable) industry, and overwhelmingly rules in favor of the Big Corp.

 

Arbitration clauses are anti-consumer and unfortunately ubiquitous. Tesla, in fairness, at least gives buyers an arbitration opt out. A purchaser can reject Tesla's arbitration requirement within 30 days of signing the purchase agreement containing the arbitration clause.

 

Arbitration clauses are very common. I would sign it and enjoy the new car.

 

Pulled up my paperwork, every one has an arbitration agreement.

 

yeah
It’s not some finance office trick. I understand the desire to sign nothing at the finance office because that’s where they try to sell you warranties for piston return springs and muffler bearings, but the arb agreement is normal and mandatory

 

The sequence here was that the arbitration agreement was presented after I signed the purchase agreement and wrote out the check, so it was, in fact, a "trick," IMHO.

 

I don’t agree. It was just a standard document everybody signs and the finance guy had no idea you would react that way since nobody else does.

The bottom line is if you won’t sign an arbitration agreement you’re not buying a car based on all the purchase agreements I’ve signed in the last 10 years.