Letters to the Editors
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Subject: Taking The Graduate Too Seriously
From: Mike
Have you been able to figure out GM's love affair with cheap plastic in their interiors? I am reminded once again that the longer they continue to "grace" their already mediocre vehicles with the stuff recommended in The Graduate, the more those of us who tolerate it in our current GM vehicles will walk when we need a new car. It would be a different story if GM would always lead with superior function to cancel out the form, but they succeed at neither. How about those rear ends on some of the Chevys? But that's for another letter.

Subject: "Top 10 Trouble Signs at a Dealership"
From: Ryan
This write-up by Philip Reed was amazing. I am currently looking at the purchase of a car and find being 18 years of age and great credit makes me their prime target. When I read this article I quickly recognized all of those tactics. It's very frustrating at what people will do to convince you to purchase a car. I have enclosed an incident that the dealership used some of those tactics.

I had gone to a local dealership where I was greeted by an older gentleman who was very helpful. After we had a deal going, another gentleman arrived and took over the sale. I was angered at the fact this gentleman took over the sale and knew nothing about what I had already discussed, which led to repeating myself several times. I went with it and I gave the keys to the salesman to appraise my vehicle, because I really wanted a Wrangler they had.

After what seemed to be a long while had gone by, the gentleman came back without my keys and told me the appraiser and my car are gone and they do not know how long he will be. I calmly pulled out my cell phone and began dialing as I said to the salesman, "That's OK, I will have the car found." Where upon he chuckled and said, "Oh, and how will you do that?" I calmly replied, "I will report the vehicle stolen and the police will pick him up." Of course the man's eyes lit up and he left quickly. Seconds later my car came around the corner and my keys were in my hand. There were several other customers in the place at the time, so I made a huge scene and left at about the same time as 3 other customers. Since then, I went out of my way to notify every possible person I know of the horrible service I have received.

I have emailed links to your article to as many people I could come up with, and posted a link to Edmunds.com on several forums to persuade people to go to you for advice. I know you are not a legal firm, but aren't there laws of what they can and cannot do to an extent? I know it varies from state to state, but are there any basic guidelines?

Sadly, there aren't any laws to prevent the situation that you encountered. Car dealers have a lot of political clout and have fought legislation to impose guidelines. In general, though, dealers are cleaning up their acts and being more customer-friendly. Still, it's important to have an overview of the car-buying process and be prepared. You reacted appropriately to their attempts to hold you hostage. Let's hope that others reading this will do the same. — Ed.

Subject: "Being 'Upside Down'"
From: BP
I found your article to be interesting and very enlightening at first. However, as I proceeded to read applicable rebates and incentives can be considered as a means to erase negative equity, I found this article to be a complete fallacy.

If a $10,000 auto carried incentives of $2,000 in any shape or form, then $8,000 is the current market selling price. It should not be used as strategy to erase negative equity. If I can buy the car for $8,000 cash and you have a trade with $2,000 negative equity and end up financing $10,000, how have you erased negative equity? We won't even get into new car depreciation!

Come on, Edmunds, I thought you guys were smarter than that. Get out of the dealers' wallets and start looking out for consumers. That would include printing accurate information.

Why don't you talk to some of us consumers that are carrying $8,000 to $15,000 negative equity due to the big giants' basement pricing and bottoming out the used car market? That is where the real stories are.

Subject: "Being 'Upside Down'"
From: Robert
What a fascinating commentary on our consumer society. In the poll featured in Edmunds' article, not a single percentage of respondents said they paid cash for their cars. I always have, and I have purchased 13 cars over some 50 years. Of course, there are many who are unable to save in advance for a car purchase. But those folks can usually do much better in obtaining financing from their bank or credit union, rather than putting themselves as overeager buyers in the hands of unscrupulous car dealers. If they are unable to stay right-side up in their cars, perhaps they deserve their unfortunate fate.

Subject: "Being 'Upside Down'"
From: Joe
I am a car dealer with 25 years experience, 15 in a large dealer setting. I have had all the titles: lease manager, finance manager and general manager. Now, I own my own dealership marketing late-model import vehicles. I have just read your article regarding negative equity. I am afraid you end up still giving the customer the wrong advice. Just because the manufacturer of a particular vehicle has put a very large rebate on a vehicle, you should not recommend, or even suggest this be a good method to fix or alleviate the problem of negative equity.

The reason for the large incentive is that the car is not selling well at its currently marketed price. The large rebate is the manufacturer's attempt to be more price-competitive on a weaker, slower selling model. This being the premise, encouraging customers to seek out these models is a recipe for disaster. Postponed disaster perhaps, but inevitable disaster for sure. The customer will end up paying top dollar for a weak model, plus interest, plus dramatic new car depreciation. Thousands of dollars lost the moment they pull off the lot!! Cars that have big rebates now have very low book values later. The car with the large rebate will suffer a more severe and dramatic depreciation during the life of the loan, especially dramatic for those who used their rebate to help pay off their trade-ins. This effect will be compounded and magnified later down the road when that customer tries to trade out of the new car. Ultimately, this advice perpetuates the irresponsible financial behavior exhibited by many of America's car buyers. The only responsible answer to this problem is cash. I feel strongly that if you cannot afford to buy a car for cash, you should not buy a new car at all. If this seems impossible, then the second best solution is to sell your own car, and have a large down payment in the area of 25% of the vehicle purchase price, and to take a 36-month loan at maximum. If the payment over 36 months is too high for the consumer, then they need to buy a less expensive car…period.

These readers make an important point — cars with incentives depreciate much more quickly than cars without incentives. This means that if you use a $4,000 incentive to wipe out $2,000 of negative equity on your old car, you are stepping into a car that, in all likelihood you will again be upside down in. Our advice was in no way meant to encourage people to change cars just to wipe out negative equity. Joe's description of this as "postponed disaster" is partially true. What these readers don't acknowledge is that buying almost any car is stepping into a situation of depreciation. The smartest choice is the car that depreciates the least. We publish True Cost to Own figures so consumers can see what the car they want to buy will be worth in five years. This can save you a lot of money in the long run. — Ed.

Subject: "A Total Loss?"
From: Peter
I read your article and found it to be both informative and interesting. The topic, however, could be more fully addressed if you have looked at the issue from both sides…one being the insured and the other being the claimant.

If you think that there is the possibility that an insured may have a difficult time with a total loss, you should consider the difficulties a claimant faces.

Deal with the subjects of uninsured/underinsured motorist coverage, med-pay coverage, and the concept of being upside down on your value versus loan in your next article.

I for one would like to see an article that dealt with the facts as to how insurance adjusters are trained to save money for their stockholders while abridging the rights of consumers.

That's where the lawyers come in and God bless them.

Subject: "A Total Loss?"
From: Traci
I wanted to respond to your article regarding surviving an accident and dealing with your insurance. We just recently dealt with this (my husband was hit by another lady in January 2005) and there were a few things that your article didn't cover. We dealt with the fact that our vehicle (3-month-old 2005 Chevy Express Van) was totaled and we didn't have "GAP" insurance, therefore, the insurance didn't pay off the total value of our loan and we are left with almost $3,500 owed. The insurance companies are now done and settled and everything has been paid except this portion of our loan. We are now going to file a small claims judgment (through the advice of our attorney) against the other party in hopes of collecting the $3,500 from the other party involved. We never understood the "GAP" insurance thing until now.

Yes, you do learn a lot from an accident and I learned that our insurance company is excellent and they handled everything for us and answered any questions I had. I think there needs to be some article written about "GAP" insurance and that everyone should have it because no one is covered 100% for the value of their new vehicle through any insurance.

We have talked to so many people since our accident and most are clueless to "GAP" insurance. I know I used to be and thought that if it was someone else's fault, then my loan would be taken care of. Not! I think this needs to be addressed a lot more than it is currently.

True, GAP insurance can be a lifesaver, but there are other issues to consider as well. Check our article that goes into more detail here. — Ed.

Subject: "Do You Really Need Premium?"
From: Eric
I recently read the article "Do You Really Need Premium?" and I must say that I am curious as to how the gentlemen mentioned in the article came to the conclusion that there is a possibility that 91 or 89 octane fuel may not need to be used in a vehicle that requires it from the manufacturer.

As an ASE Certified Master Technician/Smog Technician, it is my understanding that the use of lower octane fuels in vehicles that require Premium (91) can cause damage to the vehicle's emission systems including the catalytic converter.

Automotive fuels are rated 87, 89, and 91. The lower the octane rating, the more explosive a fuel is. For example, an 87 octane fuel will burn faster than a 91 octane fuel. The problem is that the 87 fuel may not burn as completely as a 91 octane fuel will in the engine's combustion chamber. This can cause a high amount of pollutants to be released by the vehicle, and may even be too much for the catalytic converter to handle. Sometimes converters can be damaged by this.

Telling consumers that their vehicle "May not need Premium fuel" is not a good thing. It may cause a problem for the environment, it may cause severe damage to a vehicle's emission systems, and it could cost consumers more of their hard-earned money to repair their vehicle in the long run when it comes time for them to have their vehicles inspected for emissions.

Consumers should consult with their automotive manufacturers before deciding to change the fuel they are using in their vehicles.

Thank you for your time.

We agree that consumers should carefully consult their car's manual to find out what level of fuel to use. If premium is "required" they should definitely use premium. If premium is "recommended" and they use regular, the car may not perform as well and might deliver worse fuel economy. However, if any damage were caused to an engine by using regular gas in a car that "recommended" premium, we believe the manufacturer would say so. The experts we talked to point out that there are sensors in the intake and exhaust streams of the car. If overly rich exhaust is detected, the timing is adjusted accordingly for a more complete burning of the fuel. We do appreciate this letter and will keep this information in mind while researching future stories. — Ed.

Subject: Volvo S40 Long-Term Test
From: James
Thanks for picking the S40 T5 for a long-term test vehicle — the S40 has a loyal and active user community online and the general tone of discussion seems to be a bit more grown-up and worldly than that which I experienced in Honda/Acura online forums.

I have to seriously question how the location of the ignition key is a "gross ergonomic error." Firstly, there is no interference with the wiper and most importantly, what on earth would anyone be thinking by trying to change the position of the key while driving? As such "Minor personal irritation" would seem to have been more appropriate! Something I do consider a "gross ergonomic error" is the location of the seat controls in BMW 3 Series vehicles to 2005. Try it with the door closed, preferably while driving, and tell me I'm wrong!

What the S40 T5 has that the TSX doesn't have is a serious level of torque. I love the TSX, but it doesn't come close to the S40 T5 in the fun-to-drive stakes. As for practicality — well, it's a small sedan and they are only marginally more practical than small coupes! What did you expect?!