Motoring: Cheap tricks of the trade
Saturday 15 January 1994
The car industry is the only one I know that charges extra to get its goods from the factory to the selling agent (if they delivered to your house, there might be some justification for a delivery charge, but they don't). It's a bit like buying a bunch of bananas at your supermarket and finding that the check-out girl charging you extra for transport from St Lucia.
Currently, the big car company making the highest delivery charge in Britain is BMW: pounds 470 including number plates. (And that's another rip-off extra for the car trade: what use is a car without plates?) Ford and Rover both charge pounds 400, Vauxhall pounds 405 (again, including plates). Most companies make a charge in the pounds 300-pounds 450 range. The only exceptions are the luxury makers such as Ferrari and Aston Martin. Spend pounds 177,600 on an Aston Vantage and they'll take it from the Newport Pagnell factory to your Aston dealer free - and throw in the number plates.
Keen hagglers can sometimes negotiate with the dealer and may well be offered an 'on-the-road' price, including delivery charge and number plates. But, of course, if there were no hidden extras in the first place, you might be able to haggle for a better deal on the car itself.
The industry's excuse for delivery charges is predictable: it covers the cost of getting the cars to the dealerships. Yet how can this be true when Rover charges you pounds 400 for British-assembled cars, and Mitsubishi pounds 300 for a Sigma Estate shipped from Australia? It's simple profiteering - a hidden extra that the customer often only discovers when about to hand over the cheque. The sooner one major manufacturer stops the practice, and forces rivals to follow, the better.
ONE CON that British motorists woke up to years ago was the price imbalance between cars on different sides of the Channel. However, since our ERM withdrawal and sterling's collapse, things have evened up, and we are no longer paying much more here. But other injustices continue. The main one is the price difference paid by big companies buying in bulk, and the average customer buying one car. The bigger the discount given to the big guys, the more the little guy has to pay - that's simple economic reality. The practice is more widespread in Britain than anywhere else, because we have the strongest company-car culture. Yet the sheer size of the discounts offered to the big firms has always been a bit of an industry secret. Until now.
It has emerged that NatWest has just struck a sensational deal with Ford to buy Mondeos. NatWest has guaranteed to buy its managers a new Mondeo every four months. It is buying the cars from Ford at a 40 per cent discount. A 2.0-litre Mondeo GLX, pounds 14,000 to you or me, will cost NatWest just pounds 8,400. Ford thus racks up big Mondeo sales, keeping its factories chugging along and helping to preserve its number one position in the UK market (which is starting to be threatened by Vauxhall). At the end of four months NatWest can sell the Mondeos for far more than it paid for them. You don't need to be a banker to see the attraction.
Ford gave NatWest the juiciest discounts, but other makers still offered good deals. Citroen, Volkswagen and Renault respectively offered 39 per cent, 37.5 and 37. A source at Ford tells me that a private customer would now be lucky to get a 5 per cent discount on a new Mondeo, because Ford's new family car is proving deservedly popular.
'Ford's overall strategy to increase the market should be to reduce the price of a car to a private buyer,' says Alan Purham, director of the car trade body, the National Franchised Dealer Association. 'If they stopped throwing large amounts of money at NatWest and other fleet customers, they could reduce the price to the public by around pounds 1,000 a car.'
WHY IS it that British roads seem worse affected by roadworks than any other country's? Despite citizen's charters, stiff penalties for work being finished late, and a general upturn in the British workman's labour rate, it is still common to see, after you've queued in traffic for hours, a coned-off section of apparently perfect road littered with idle bulldozers. Maybe French and Italian roads are better built; maybe it's simply that Continental roads are more lightly trafficked. But all European countries can learn from Japan.
A friend of mine, returning to London for Christmas from his Tokyo base, told me about when one of that city's busiest trunk roads was being dug up for major works. The workmen arrived at night, just after the peak-hour traffic. A 30ft hole was quickly dug. While this was happening, a pedestrian path was being laid around the hole. Ten hours later, just before the worst of the morning rush hour, the job was finished. Had it been done in Britain, my friend asserted, it would have taken weeks.
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