The great repair rip-off: Australian car dealers are making HUGE profits every time you service your automobile with them - but there is a simple way you can save big bucks

  • Australians are duped by expensive and unnecessary car servicing and repairs
  • Dealers make their money in repeat servicing, parts, insurance and add-ons
  • Car-owners return to dealership due to misinformation and are 'price gouged'
  • The strategy means independents 'just can't compete,' mechanic Al Calci said

Australians are being duped by expensive and unnecessary car servicing and repairs, with most dealers making their money after a car has been delivered.

Repeat servicing, additional parts, insurance, add-ons and a blind faith in manufacturer expertise are leaving consumers out of pocket, industry experts warn.

Most car-owners return to the dealership or manufacturer, lured in by capped-price servicing or misinformation about their warranty only to be 'price gouged' at the expense of quality independent services.

'We just can't compete,' Albert Calci (pictured right) the owner of Al's - an independent automotive service on Sydney's Northern Beaches - told Daily Mail Australia

'We just can't compete,' Albert Calci (pictured right) the owner of Al's - an independent automotive service on Sydney's Northern Beaches - told Daily Mail Australia

'We just can't compete,' Albert Calci the owner of Al's - an independent automotive service on Sydney's Northern Beaches - told Daily Mail Australia. 

Mr Calci has been in the industry for nearly 30 years and has seen his business and many others in the area suffer. 

'Price gouging' consumers and using 'scare tactics' to trick car owners into repeat business is common practice, Rod Cedaro of UltraTune, Australia's largest independent car servicing and repairer said.

The second-biggest purchase most Australians make is their car and most will return to the dealership for services and repairs.

Mr Calci has been in the industry for nearly 30 years and has seen his business and many others in the area suffer (pictured: Mr Calci's son helping in the workroom)

Mr Calci has been in the industry for nearly 30 years and has seen his business and many others in the area suffer (pictured: Mr Calci's son helping in the workroom)

But trust in manufacturers is misguided, Rod warned. 

'Dealerships are about 30 per cent more expensive than independent mechanics.'

Rod Simms, Chairman of the ACCC, said it was all part of a ‘culture of repair’ that underpinned systems and policies across the industry based mainly around the manufacturer's warranties.

This means that dealerships make more money through servicing, providing parts, insurance and repeat business than the actual sale of cars. 

'Price gouging' consumers and using 'scare tactics' to trick car owners into repeat business is common practice, Rod Cedaro of UltraTune, Australia's largest independent car servicing and repairer said

'Price gouging' consumers and using 'scare tactics' to trick car owners into repeat business is common practice, Rod Cedaro of UltraTune, Australia's largest independent car servicing and repairer said

The second-biggest purchase most Australians make is their car and most will return to the dealership for services and repairs

The second-biggest purchase most Australians make is their car and most will return to the dealership for services and repairs

'The view that any work done on your car that is outside the manufacturer will impact on the car's warranty is not true,' NRMA spokesperson Peter Khoury said.

'There's a raft of options available ... You're not tied to the manufacturer and just because it's more expensive doesn't mean it's better.'

The cost of car servicing has increased even more over recent years due to 'dealers quarantining their data', Rod Cedaro of UltraTune said. 

'Mechanics are disadvantaged because they don't have access to the manufacturer's data.

'If you can't access the data you can't service the car.'

'The view that any work done on your car that is outside the manufacturer will impact on the car's warranty is not true,' NRMA spokesperson Peter Khoury told Daily Mail Australia
'The view that any work done on your car that is outside the manufacturer will impact on the car's warranty is not true,' NRMA spokesperson Peter Khoury told Daily Mail Australia

'The view that any work done on your car that is outside the manufacturer will impact on the car's warranty is not true,' NRMA spokesperson Peter Khoury said

Electronic data needed to diagnose and repair certain car makes and models are 'held ransom' by dealers who rely on repeat business from customers who simply have no choice but to service their car through the dealership 

Electronic data needed to diagnose and repair certain car makes and models are 'held ransom' by dealers who rely on repeat business from customers who simply have no choice but to service their car through the dealership 

Mr Calci has been in the industry for nearly 30 years and has seen his business (pictured) and many others in the area suffer

Mr Calci has been in the industry for nearly 30 years and has seen his business (pictured) and many others in the area suffer

Electronic data needed to diagnose and repair certain car makes and models are 'held ransom' by dealers who rely on repeat business from customers who simply have no choice but to service their car through the dealership.  

'This current system of voluntary sharing isn't working,' Mr Khoury of NRMA said

'This current system of voluntary sharing isn't working,' Mr Khoury of NRMA said

This monopolisation of data has meant many independents do not have access to the patents, propriety rights, diagnostic programs, software and electronic manuals that are specific to car make and models.

Unlike models of the past, cars are 'basically a computer of wheels these days,' Mr Cedaro explained. 

'Dealers have fought tooth and nail to withhold the data. 

'Australia and New Zealand are the only two countries in the world where it hasn't been legalised against.' 

Instead, independent providers currently rely on manufacturers and dealerships to provide access to the data.

'This current system of voluntary sharing isn't working,' Mr Khoury of NRMA said. 

'If electronic data was equally available it would increase the competition and reduce costs for the consumer.' 

Electronic data needed to diagnose and repair certain car makes and models are 'held ransom' by dealers who rely on repeat business from customers who simply have no choice but to service their car through the dealership

Electronic data needed to diagnose and repair certain car makes and models are 'held ransom' by dealers who rely on repeat business from customers who simply have no choice but to service their car through the dealership

'Data should belong to the owner and not the manufacturer,' Mr Cedaro claimed. 

'For us little guys to have access to that kind of information, it would save a lot of time when it comes to diagnosing an issue or fixing it,' Vince Tassone, a mechanic for a small independent provider in the St George of Sydney, said.

'In the first three or fours years after someone buys a car, car dealers offer services for a price that we can't match.

'Most private shops in my area are empty due to capped price servicing. People are scared we're going to charge them an enormous sum to fix the car.'

'For us little guys to have access to that kind of information, it would save a lot of time when it comes to diagnosing an issue or fixing it,' Vince Tassone, a mechanic for a small independent provider in the St George of Sydney said

'For us little guys to have access to that kind of information, it would save a lot of time when it comes to diagnosing an issue or fixing it,' Vince Tassone, a mechanic for a small independent provider in the St George of Sydney said

Mr Calci agreed saying dealers give warranties on new cars and capped price servicing in an attempt to 'just circulate new cars'. 

'[They] can do $130 capped servicing because they've already made their money on the sale.'

But sharing electronic manufacturer information would be 'a game changer', Jordan Christie a mechanic who has been in the industry for nearly 20 years, said.  

'Dealers have relied on the fact their information is to hold ransom.'

Mr Christie spoke of scare tactics employed by dealerships who told customers that if their vehicle was repaired by a non-dealer the warranty would be void, or that fitting non-genuine parts would irreparably damage the car. 

He said car-buyers were often told that if they didn't go to a dealer for service or repairs the staff would not be qualified or have the correct equipment to work on the vehicle. 

'The repairers will benefit from less time identifying parts, using vehicle ID/VIN numbers to order parts from aftermarket companies, less time spent diagnosing and repairing by having access to wiring schematics, diagnostic flowcharts and vehicle specific repair manuals that haven't been written by a third party company.

'Not to mention genuine scan tools that most dealers won't sell to the aftermarket repairers to do things like software updates, tuning updates, repairs or information or updates to media devices and GPS maps.   

Mr Tassone shared a similar experience, saying: 'We have to constantly upgrade our diagnosing computers that cost me as a independent anywhere from $5,000 to $10,000 a year and then I still don't have access to the systems a dealer has.'

The new fight between dealerships and independents came to a head this week with Bill Shorten pledging to force manufacturers to share their data in order to create more competition and lower the cost of service in the industry.

The market monopolisation was also addressed in the Australian Competition and Consumer Commission industry 2017 report where complaints about new car manufacturers rose to more than 10,000 over the past two years.

The new fight between dealerships and independents came to a head this week with Bill Shorten pledging to force manufacturers to share their data in order to create more competition and lower the cost of service in the industry

The new fight between dealerships and independents came to a head this week with Bill Shorten pledging to force manufacturers to share their data in order to create more competition and lower the cost of service in the industry

    

  

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