TRUE CAR and ZAG Cyber Bandits, Parasites or Good for the Car Business?

Jim Ziegler asks...

I am hearing a lot of discussion about True Car and ZAG.  I continually scratch my head and wonder if  desperate dealers are doing the marketing limbo "How Low Can You Go?" 

Are we so bad at what we do that we have to line up and pay vendors to lose money? AND, who is giving these people access to your data that is used against you? 

 

Who owns these companies and what might be their ulterior motive?  Sometimes I ask questions to which I already know the answer. 

 

Am I wrong?


What do you think... JIM

 

 

Jim Ziegler's Guidance and Recommended Action Plan:

Ten Areas We Need to Concentrate on to Bring This Monster to It's Knees...

  1. Government investigation of ALL Data Aggregators taking consumer information from dealers' DMS. Sadly enough, dealers who do business with TrueCar are exposed to  liability charges. Cut off all access to unecessary data, no matter who takes it from the dealers DMS and make it illegal to "resell identifiable consumer data" and "transactional data".
  2. Educate Your Fellow Dealers; If anyone takes financial transactional data, they expose the dealer that allowed it to violations, especially if it is passed on to other vendors or shared.
  3. Educate Consumers to what they're doing with their information...
    a. You buy a car from a dealer, do you really want your personal information, and maybe even your financial information, passed along and sold and shared by "God knows who?"
    b. These People Charge the Dealer $300 which the dealers have to build into the deal
    c. Your Privacy and the Security of your Information could theoretically compromise your identity if you do business a company that takes data from the dealership.
  4. Educate Investors and potential investors they could possibly be mislead if anyone is telling them this is a safe investment because of all of the dealers pushing back, associations pushing back, and government regulators in many states coming after TrueCar's business model as NOT compliant, in some cases they're saying it is Not Legal.
  5. AMEX, USAA and all of their affiliates do not want the bad consumer relations this push back is creating with their members and customers.
  6. Cancel your dealership's Affilation with TrueCar. Tell people with TrueCar certificates that YOU don't honor TrueCar and you feel the company is NOT reputable. Educate consumers as to perceived data exposure if they buy from a TrueCar dealer. Make sure that each consumer knows that using TrueCar actually increases their vehicle cost by $300 to $400.
  7. Make the dealers selling at huge losses take all of those deals. Big problem right now is too many Nissan Dealers and others are taking huge losers to get the factory money. The TrueCar reverse-auction business model will continually push those numbers down until the factory money is non-existent. Consumers need to hear from many dealers, "We don't do TrueCar"
  8. Keep calling your National and State Dealer Associations demanding they get involved and stay involved... No excuses.
  9. Get the Manufacturers into the game. If GM, Ford, Toyota, and other majors change the rules about how we advertise and do business to protect the dealers, we can cut off their ability to set pricing. So keep it up at every dealer meeting. Call your Dealer Council Members and protest to your factory reps. Tell the manufacturers, if they want showroom and facility improvements, we need the ability to make fair profits.
  10. Tell everyone you know. Educate other dealers and industry people. Watch the Painter interviews... I believe this is the first time a vendor has publicly announced they intend to bring down the dealers and hijack our business, taking our profits and starving us out with our own data. Painter has said manufacturers and dealers should go bankrupt and he, in his God-like way "will control distribution..."
    When the TrueCar-Yahoo Deal kicks in we need to stand firm and "Just Say No" we don't honor TrueCar deals.

Read this article as a reference: http://www.autonews.com/apps/pbcs.dll/article?AID=%2F20110831%2FFIN... 

AND, if you doubt the mission... read this...  http://www.zag.com/websiteASSETS/whitepapers/ZAG-WhitePaper3.pdf

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Comment by Keith Shetterly on November 30, 2011 at 8:39am

@ Jerry:  TrueCar . . . "transparent" pricing to the consumer . . . fine print contracts to the dealer . . . "advocate" for the consumer . . . user of the dealer . . . KILL THE BEAST.

Comment by Jim Kristoff on November 30, 2011 at 8:34am

GREAT quote and find from Jerry yesterday....

 

Comment by Jerry Thibeau yesterday

Keith, Nice find with this article: http://www.autonews.com/apps/pbcs.dll/article?AID=%2F20110831%2FFIN...

Here are a few quotes I pulled from the article.  I then added some commentary.

“He wants to make TrueCar a provider of critical price information, in line with his vision of dealerships where new-car showroom sales staffs will be obsolete.”

This is bad for the manufacturers since having a good sales force is what convinces a customer to buy a Honda over a Toyota, or vice versa.

"Things are fundamentally changing so fast," Painter says. "If dealers and manufacturers don't embrace new ways of communicating with the customers, they won't survive."

If dealers don’t embrace True Car, True Car won’t survive!

“Last week, TrueCar agreed to buy ALG, formerly known as Automotive Lease Guide, from DealerTrack Holdings Inc. in a deal valued at $83 million. ALG's forecasts of vehicles' future residual values are used by finance companies to set lease terms.”

This will open up a whole new can of worms for dealers, guess what’s coming next?

“"The car sells itself at that point. It's effectively a commodity," he says”

Price commoditizing the automotive industry is not good for manufacturers or dealers!

“Painter describes himself as a person who wants "to get on with it." He dropped out of West Point and the University of California, Berkeley.”

I say we help him drop out of the automotive industry as well!

“He says he plans to acquire more companies this year and, over the next 18 to 24 months, launch other companies that focus on simplifying auto financing, leases, insurance and trade-ins.”

Once he succeeds with this, he’ll be going after every other profit center in the dealership.

“TrueCar, founded in 2005, "has been my longest-running gig," Painter says. "I hope to be running this company for the next 20 years."”

At the expense of hard working dealership personnel!  Will dealers really let this man dictate the way they run their business?

KILL THE BEAST!

Don’t let this man or his company profit off your dealership!

 

Comment by Jim Kristoff on November 30, 2011 at 8:30am

Here again is Keiths post from yesterday....it says it all...

 

Comment by Keith Shetterly yesterday

Here's a quote I'd like to see defended by the Lurking TrueCar Employee, straight fromhttp://www.zag.com/websiteASSETS/whitepapers/ZAG-WhitePaper3.pdf (bold by yours truly) "Upfront pricing is the new world order. Its arrival heralds a bona fide tipping point in automotive retailing. Upfront pricing isnon-negotiable in an environment defined by net margin compression, anonymous access to robust product information for consumers via the Internet, and the commoditization of the car. To facilitate a purchasing decision, the online commodity shopper wants an informational advantage, and that is truly achieved only when the buyer can get access to an upfront price—anonymously—and has the tools to compare that price with the market average, to know it’s fair."

 

Comment by Jerry Thibeau on November 30, 2011 at 8:26am

Ture Car posted this on my YouTube page:

"Hi Jerry. The TrueCar concept is about fairness for both sides, reducing friction and moving more vehicles. Not every dealer believes in our vision, but those that do sell more cars and wind up keeping their operating costs down while retaining customers. Our customers are happy because there was no friction and the deals are often a significant savings of several thousand dollars. If anyone would like more info about TrueCar, feel free to reach out: info@truecar.com."

Comment by Keith Shetterly on November 30, 2011 at 5:42am

Thanks Jim!  I was disappointed at TC's response, or lack thereof, in this thread.  Pretty much sealed it for me.  And you can quote me!  :)

Comment by Jim Kristoff on November 30, 2011 at 5:23am

@Keith......great summation!!!.....I am going to use your quote to get the attention of automotive people over on LinkedIn to join the discussion here!!

Comment by Michael Deville on November 29, 2011 at 10:24pm

The real story is; I ran a report, the dealers in this area don't even have the car that they price 1600 back of invoice.

No car??  Interesting. Run an ad with no car at the time of the ad. ????? Deskman or not, no car!!!!

Comment by Keith Shetterly on November 29, 2011 at 10:06pm

To those reading and lurking:  Thank you very much for your attention here.  TrueCar's stated agenda has nothing to do with leads you can or cannot work; nothing to do with whether you can make money from them.  Their PUBLICALLY STATED vision is a car sales floor without sales staff and the car purchase is a commodity transportation purchase.  If you're a dealer, why would you ever accept "help" from someone who says they want you extinct?  That you're irrelevant?  Don't ignore the impacts to YOUR business from THEIR agenda.  They've got a $200million financing gun pointed at killing your future.  Why do you want to help?

Comment by James A. Ziegler on November 29, 2011 at 9:02pm

Ready to go to bed for the night...one last thought friends....

KILL THE BEAST

Comment by Joe Clementi on November 29, 2011 at 8:59pm

@Stanley.  You might be right :)?  Thanks for the laugh

 

@Jim.  I didn't know you were so popular :)  Perhaps, fame has its advantages?

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