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Jim Ziegler asks: Is It Time For the Retail Automotive Community to Rise Up and Get Rid of CarFax?

Enough is Enough!

Haven't you had it with all of these Data Pirates using our own customer information to defame us, lower our profits, alienate our customers... while at the same time they charge us through the nose to do us harm? 

 

Among the worst of them in my opinion is CarFax. They even believe they have the right to price our cars and trades.... too low of course. While at the same time CarFax exploits negative stereotypes that we are crooks in every commercial the Little Car Fox Rats out the dishonest bumbling and inept idiot car sales person. They charge us to defame us. 

Please read this article we just published in Wards Auto Magazine 

"My latest article is out and it's hot.  

Here are more than 250 Consumer Complaints and reviews about CarFax... look... http://www.consumeraffairs.com/automotive/carfax_inacc.html 

We have manufacturers supporting these people and requiring we do business with them. Let's get mobilized and scream at our factory representatives, reprint this article for your dealers, do press releases, and generally alert your State Dealer Associations and 20-groups. 

 

If a consumer asks for the CarFax, tell them it's $39.00. Whoever told you it was free was lying.

I am available to perform 20-group and Dealer Association Keynote Speeches on this subject. As of right now, I am calling out the Tribe to get on this subject. JIM

CarFax Gets Its Facts Wrong

Dealers tell me horror stories about CarFax experiences with customers. Those range from missing information to erroneous information.

I have a problem with data pirates who use dealer information against us, damage our reputation and cause consumer distrust.

 

To me, CarFax is high on that list. Let’s look at what this vehicle-history firm does.

 

It tells consumers its reports are free but charges dealers for them. So, if a dealer asks customers to pay for the report, they look at you like a criminal.

 

CarFax runs TV ads featuring deceitful car salesmen hiding the truth until the little Car Fox character shows up and sets the customer straight. This sets up CarFax as the Consumer Protector battling the Evil Car People.

 

The company uses dealer data to tell customers what to demand for their trade-in, based on what CarFax says is the value.

 

So, here we have another vendor setting prices and limiting dealer profits and charging dealers while it rummages through their customer information. We give them data and pay them to take it from us.

 

But beyond all that, CarFax is creating huge liability risks to both dealers and the auto makers.

 

“CarFax, lawsuit, settlement.” Enter those words in a Google search to see how many lawsuits have been filed against CarFax, from class actions to individual filings.

 

I Googled a number of other vendors using the same search words and couldn’t find anywhere near as many lawsuits and complaints. In one case, a court rejected a $500,000 award because the plaintiff attorneys said it was too low. 

 

Most of the allegations center on inaccuracy of information. I can attest to that. A relative bought a car two years ago, and the dealer showed us the CarFax showing a clean history. Then, recently when he tried to trade it in, another dealer said CarFax indicated the airbags had been deployed in an accident before he purchased the car.

 

Yes, CarFax does have some sort of disclaimer somewhere on its form saying it’s sort of possible its information might be wrong.

 

Does that give it a license to insinuate that consumers should rely on its information when buying? Do some consumers then believe a dealer altered the CarFax report and falsified information if it turns out to be wrong? Now we have more animosity.

 

Dealers tell me horror stories about CarFax experiences with customers. Those range from missing information to erroneous information saying a car had a problem (thus devaluing it) when it didn’t have a problem at all.

 

I am amazed some auto makers and even some dealer associations have jumped into bed with this firm, either endorsing it or requiring dealers to offer CarFax history reports to consumers.

 

The first time a consumer sues your dealership over anything involving CarFax, point to the auto maker that required the vehicle history. That auto company  should be a co-defendant.

 

CarFax has reached out to me several times asking me to meet with them. They know I talk about them in speeches and blogs. I recently had a trusted third party ask me to meet with CarFax.

 

I told that person there’s no reason for me to meet with these people. I think they are disreputable and they deliberately cause consumers to distrust dealers.

 

I do not believe their information is complete nor do I believe it’s fully accurate. They indirectly set unrealistic sales prices and interfere with the sales process. There’s little chance they could say anything to change my mind. And I’m not for sale.

 

If I were you, I would certainly examine my affiliation with CarFax. Then I would make doubly sure the company was not accessing my dealership management system to get information.

 

Then, I would tell consumers when they asked for the CarFax report that I don’t use it because the results can be erratic and unreliable. If the consumers insist, charge them for the report. It sure isn’t free.

 

Keep those calls and emails coming.

 

Jim Ziegler, president of Ziegler Supersystems, is a trainer, commentator and public speaker on dealership issues. He can be reached at zieglerss@aol.com.

WardsAuto readers also may comment on this article by logging in or registering. 

Views: 5661

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Comment by James A. Ziegler on February 2, 2013 at 11:14am

Todd Vowell please pass the word out to everyone in any form you choose.

Comment by Todd Vowell on February 2, 2013 at 10:37am

Jim, do we have permission to reprint and deliver your message below to our dealer customers, leads, and prospects?

Comment by James A. Ziegler on February 2, 2013 at 7:06am

LAWSUIT AGAINST CARFAX- WOW!

Comment by James A. Ziegler on February 2, 2013 at 6:50am

LAWSUIT  AGAINST CARFAX:

I just had an interesting conversation with Attorney, Lenny Bellavia who I have known for several years. His firm has represented dealers' interest in many high-profile lawsuits. Most notable they represented the Chrysler Dealers in the Bankruptcy.

He is preparing a Mass-Action Lawsuit against CarFax on behalf of the dealers and already has more than 100 dealers signed on. I am not involved... not yet anyway and this is the first I've heard of it and I am cheering because he has such a good track record for standing up when dealers are abused and for winning these cases.

Employees should certainly make your dealer aware of this. If I was a dealer myself, I'd be on board immediately. My opinions of CarFax are well known by what we expressed on this blog, in speeches and other appearances. I really hope dealers get behind this.  I've posted his contact inf below and I am assured he reads email on the weekends. 

LBellavia@Dealerlaw.com 

Leonard A. Bellavia, Esq.

Bellavia,Blatt,Andron & Crossett, P.C.
200 Old Country Road, Suite 400
Mineola, NY 11501
516-873-3000  Fax 516-873-9032
Comment by Richard Roy on January 28, 2013 at 6:28pm

On a completely different subject; I'll be attending NADA Orlando and looking to meet with industry folk on a number of different opportunities...one being the development of a dealer ratings site....with direct input from dealers on the overall development, features, etc. for www.autodealerratings.com - I'm planning to develop this site out around Q2 2013, but looking for more feedback from industry...specifically dealers before I get the programmers going. PM me if you would like meet or provide some feedback at NADA Orlando.

Comment by Richard Roy on January 28, 2013 at 6:22pm

Hi James, here's a similar article: http://alphaautocredit.com/false-carfax-reports/ - Since reading this article I have learned more about what "really" happens with CarFax reports. It's really a shame the whole industry has figured out how to game the system so to speak. Any VHR provider program is only as good as the information that goes into the system. As long as car dealers, insurance providers, body shops, etc. game the system no VHR provider will give consumers accurate / honest information.

Just do a Google search now for "false / fake carfax reports" and you'll see all the SERPs that come up on the subject.

Comment by James A. Ziegler on January 2, 2013 at 8:58am

HONK IF YOU HATE CARFAX

Okay, we gave this blog a rest during the Holidays.  NOW, as the NADA Convention draws closer, it's time to crank it up and turn it up the heat. These people continue to abuse dealers with excessive pricing.... exclusionary deals with manufacturers and lead providers: They continue to advertise commercials implying Car Dealers are either 'Crooks' 'Liars' 'Morons'  and Cheats. Every commercial the dumb-ass car salesman tries to conceal the facts and won't show the consumer the CarFax until the little cartoon Fox rats him out to be deceptive.

Then, there's the fact that case after case has come to light where the consumers and the dealers both got screwed because a car with a clean CarFax later popped up damage to long prior to the purchase. They do not get all information and they get a lot of late-late information that costs dealers and consumers thousands. 

Then they choose to take it upon themselves to price our cars and price our trades. That is despicable. 

If I were a dealer today, I'd throw their representatives out of my dealership and complain continually to the manufacturer for using them. 

Those are my reasons for despising CarFax. It's my opinions of course I might be wrong.

WHAT IS YOUR OPINION OR HORROR STORY CONCERNING CARFAX ABUSE OR MISINFORMATION?

ADD YOUR OWN COMMENTS HERE: WHY DO YOU HATE CARFAX?

Comment by James A. Ziegler on December 5, 2012 at 2:25pm

I have had several dealers tell me stories this week about how they rejected the Carfax Representative and discussed this Blog and my articles.  From the number of calls and comments I am personally receiving, I can promise you this is catching on and gaining momentum. 

Comment by Debra L Bly on November 30, 2012 at 2:36pm

Justin,

It was a good article but old news, I mistook the google date for last time visited to be the date it was posted.  Sorry to have posted old news on Car Fax.  It does show that they have had issues for a very long time

Comment by James A. Ziegler on November 30, 2012 at 2:33pm

If anyone want to watch the video of the original story it is here  CBS NEWS STORY HERE

Hey Debra L. Bly - a little clarification. I just called the attorney who was featured in the news story and he was laughing. That story was not from today, but rather was from 2007.

So when I read your post... Interesting report from CBS News today - http://www.autopi.com/carfaxCBS.html 

I was all excited but needed to post this correction. it is really good that came up however because it shows just how long these alleged CarFax consumer abuses have been in the public spotlight. What I did not like about the story was the fact that they said in the story that many consumers evidently believe the Dealer altered the Carfax, instead of the truth that CarFax is full of holes as I believe they are.

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