18-04-2007

18-04-2007 will be the day of reckoning.

A day when hopes are either fulfilled or dashed…

A day when decisions will have to be made…

A day of either celebration or despair…..

Ok I exaggerate. It’s just the day of the final bidding for my COE. Sad to say, my car-buying experience hasn’t been entirely pleasant nor smooth. When I made my booking on the 3rd of March, not once did it cross my mind that I would encounter so many complications and uncertainties. I readily agreed to the $10500 booking deposit, despite it being higher than the norm elsewhere simply because I wanted to just get it over and done with and hoped that putting up more money upfront would help grease things a little. I distinctly remember questioning my Sales Rep before signing on the dotted line..”so what happens if the COE rebounds back to the previous levels or higher? Will this still be the agreed price as in will I be asked to topup?” to which she replied that the price would be as agreed. “This is a 4 bid agreement, what are the chances of me not getting a COE after 4 bids?” “oh, thats extremely unlikely…I say you have a 99% chance of getting your COE…don’t worry about this.” was her reassuring answer….

I guess I was naive to believe that.

7th March: I eagerly logged on to Onemotoring.com to check the bidding results $12000+……strange, I don’t see any bids under my name listed despite my SE telling me that I would be in the bidding just that morning. Later I was told that the bidding was unsuccesful and they would try again.In the days after, I read in forums to learn that others who have made bookings for the same car during my time have been given an option to topup 2K to secure their COE the next bidding. I was pleased that I was not asked to topup and assumed that perhaps I was lucky…..I was wrong.

17th March: I received a sms from my SE asking me to consider topping up $4k so that they would bid $15500 for me the following bidding. I was flabbergasted….others have only been asked to topup $2000 and yet I’m asked to topup $4000. I decided to send a sms questioning why there was a discrepancy and demanded to know why a bid was not put in the previous time despite them saying they would. I received no direct reply to my query. I decided to let the transgressions pass and see what would happen next.

21st March: 2nd bidding came and went. COE shot up to $13500 again no bids entered.

SE subsequently called and asked for $2500 topup so that they would place bid up to $14000, if not they would at most bid $10000. I was getting rather pissed at the antics so my decision was no.

I’m pretty confident that car dealers are very much aware that the COE prices would rebound strongly after the $5200 COE on Feb 14. The sure number of bookings made that week made it obvious to anyone remotely in touch with the trends. So why reduce prices during the COE drop only to ask for topups later when COE prices rebound? I guess it boils down to the old bait and switch. Lure buyers in with lower prices and then ask for topups later when you already hold their deposits and have the bookings. Its probably easier to secure bookings with a lower advertised price and then ask buyers to topup in order to secure their COEs as majority of buyers are naturally anxious to get their cars as soon as possible. This way, a dealer is effectively selling the car at a higher price, while still achieving higher booking rates due to a lower advertised price.

Sad to say, there is little to protect a consumer from such antics as most sales contracts are for for non-guaranteed COE bidding based on a certain number of bid cycles…e.g 2-6 bids. This and the practice of only dropping prices marginally when COE prices plummet and yet raising prices tightly pegged to COE increases ensures that dealers will always have a reasonably stable profit margin, regardless of COE movements. Even if they are ever caught, there is always their “COE topup” wildcard which never fails to work.

I’ll just say that I’m pretty miffed at my dealer. I’ve calculated that even if they secure a COE for me without any topup at the current $14000 rate, they would still have a gross profit of approximately $7000. To my chagrin I’ve learnt of cases of other car buyers amongst my friends and colleagues whose dealers secured COEs for them at similar or lesser margins. I find it myopic for dealers to attempt to maintain their margins without regard to the fact that they can potentially gain much goodwill by willingly lowering their margins and closing the deals.

As such I’ve elected to exercise my consumer power and say NO to such practices. I’ve refused to topup, even for my final bid. If I don’t get my car, so be it.

Although this car has been my first choice, I’ve done sufficient research to know of other alternatives which have not had any substantial price increases so I’ll not have to pay any substantially higher price now than if I’ve made a different choice in the first place.

This has been a difficult decision, but sometimes, one must know when to draw the line.