Car adverts - why are they allowed to quote an unrealistic price?

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RMCF

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Perhaps belongs in the CAR & MOTORING section - mods feel free to move if you want. Its a rant, so I posted it in LETTING OFF STEAM.

I always find it amusing that car manufacturers are allowed to quote prices in their adverts and say "the new XXX, from €22,500, excluding delivery and related charges".

Now, all of us potential buyers are not able to avoid the delivery and related charges, so the 'from' price quoted is not real, and should really be 'from (whatever the lowest priced model is) + the delivery and related charges'.

This is allowing them to make their car sound cheaper than it actually is, and surely shouldn't be allowed?
 
Yeah, this bugs me. Also, in sites like carzone when a car looks like a good price but burried in the small text it mentions that it's an NI car and VRT hasn't been paid.
 
It happens in loads of industries. I remember looking to hire a car. I phoned Europcar at the airport and they quoted me €45 per day. When I got there, they were charging me a further €60 for "airport collection". I queried this and was told that due to the cost of operating in an airport, they had to add it on. I asked if I went in to town to get it would I have to pay that and they said that as the city centre is a premium location that I would have to pay €60 for "premium location collection". So in other words, the charge was completely unavoidable and is only put in to make the headline price seem less expensive.

I suppose it's the same with Ryanair and their €5 check in charge. You can't take a flight without checking in.
 
I'm not sure - never bought a new car, but as long as they mention that the charges exist there probably isn't a problem.

We always quote "excluding VAT/carriage" for example and where relevant, "excluding costs associated with export to xxx" (there can be various certs. etc required) which is much the same thing I suppose?
 
Yeah agree RMCF. There are always extra costs on this price, things like "Oh you want it in a colour other than white, well that will be 500 extra for any other (metallic) colour"! It's just another good reason to buy second hand!
 
The TV & paper ads are the worst, they show a photo of the top of the range GT or Ghia or whatever with all the bells & whistles, slap a huge €22,500 or so price on the screen then in small print "model shown has extras available at additional cost total this model €35,950" or something like that.
 
Caveat said:
We always quote "excluding VAT/carriage" for example
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This is only allowable where products are being sold to or aimed at business customers, who would themselves be registered for VAT, rather than personal/retail customers.

The Sale of Goods and Supply of Services Act stipulates that advertised or quoted retail prices should represent the full cost to the customer. If the cost of carriage is known, for example, this should also be included.

Ryaniar circumvent the laws by having a raft of "optional" services for which charges apply.
 
Also at the moment all the adds quote the price with the scrappage scheme taken into account. Very misleading!
 
Staples said:
This is only allowable where products are being sold to or aimed at business customers, who would themselves be registered for VAT, rather than personal/retail customers.
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Fair enough. We don't bother making the distinction though as we sometimes receive e.g. email enquiries and have no way of knowing whether it is a business or individual we are dealing with as quite often the MD of a business may choose to contact us via a personal gmail account or something. However we do often quote the carriage charge.
 
Not always mathepac, I've seen flights advertised which have a €5/£5 online check-in charge!!

Isn't it €40 to check in at the airport now, soon to be €100 if MOL gets his way!
 
I take your point - the little blue lad in my post above is MOL winking all the way to the bank.
 
Whilst I accept the comment about the misleading pricing on adverts, remember it's a buyers markets out there at the minute and to me, the quoted price for a car, inc of delivery and charges, is the one price you most definately should not be looking to pay. From people I know in the trade, plenty of room for negotiation
 
mathepac said:
Online check-in avoids this particular charge ;)
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Definitely not on their standard pricing. Only promotional fares have free online check-in. So there are about 60% of passengers on each plane who have to pay it.

Don't get me wrong, I love Ryanair and think they offer outstanding value, especially if you operate within the rules.

I just find it ridiculous to not include charges which cannot be avoided.
 
RMCF said:
Perhaps belongs in the CAR & MOTORING section - mods feel free to move if you want. Its a rant, so I posted it in LETTING OFF STEAM.

I always find it amusing that car manufacturers are allowed to quote prices in their adverts and say "the new XXX, from €22,500, excluding delivery and related charges".

Now, all of us potential buyers are not able to avoid the delivery and related charges, so the 'from' price quoted is not real, and should really be 'from (whatever the lowest priced model is) + the delivery and related charges'.

This is allowing them to make their car sound cheaper than it actually is, and surely shouldn't be allowed?
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Delivery and related charges are based on the cost of delivery from the importer to the car dealership plus the cost the dealer incurs getting the car ready for sale (cleaning, de-greasing, checks etc). As delivery charges may vary indifferent parts of the country it is reasonable that this cannot be quoted in the advert. The same applies to preparing the car for sale; each dealer sets their own labour rate and so sets their own “related charges” charge. The alternative is that all the dealers sit down together and decide what they are going to charge but that’s called price fixing and a few of them got in trouble for doing that last year!
 
Purple said:
... As delivery charges may vary indifferent parts of the country it is reasonable that this cannot be quoted in the advert. ... each dealer sets their own labour rate and so sets their own “related charges” charge. ...
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The reality is very different with a small number of organisations providing vehicle delivery services around the country advertised from "... as low as €50 per unit..." or at a fixed known cost. These same organisations provide vehicle manufacturer-approved PDI services to dealers also at fixed known costs.

So "delivery and related charges" are, by and large, predictable, standard, fixed and known in advance, but SIMI members won't tell their customers that.
 
mathepac said:
The reality is very different with a small number of organisations providing vehicle delivery services around the country advertised from "... as low as €50 per unit..." or at a fixed known cost. These same organisations provide vehicle manufacturer-approved PDI services to dealers also at fixed known costs.

So "delivery and related charges" are, by and large, predictable, standard, fixed and known in advance, but SIMI members won't tell their customers that.
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Yes, but it may vary and if they were all quoting the same price people would be on here saying they were price fixing.
 
There's nothing in the Competition Act that precludes the establishment by the manufacturer of recommended or maximum prices that could include delivery and related costs. An individual reatailer is still free to offer a lower price if he/she feels it justified.

The price-fixing case of recent years related to an orchestrated practice on the part of the manufacturer to control and limit the discounts that retailers could offer, effectively denying retailers the opportunuity to comepete with each other on price.

This is completely different.
 
Staples said:
There's nothing in the Competition Act that precludes the establishment by the manufacturer of recommended or maximum prices that could include delivery and related costs. An individual reatailer is still free to offer a lower price if he/she feels it justified.

The price-fixing case of recent years related to an orchestrated practice on the part of the manufacturer to control and limit the discounts that retailers could offer, effectively denying retailers the opportunuity to comepete with each other on price.

This is completely different.
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The price fixing case involved car dealers, not manufacturers. Details here.
Manufacturers can recommended maximum prices that could include delivery and related costs but the dealer can charge what they like.
 
Purple said:
The price fixing case involved car dealers, not manufacturers. Details here.
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I note the distinction. The point, however is that the collusion amounted to a distortion of competition that affected consumers.

Establishing a recommended price (to include delivery) that could be subject to negotiation is not, by itself, a breach of competition law.
 
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