Capped price servicing under fire

[DJM83]

About time Dowling put his pen to something useful

THE Australian Automobile Association has warned that not all fixed-price servicing deals are created equal as figures show some budget-priced hatchbacks can cost more to maintain than a luxury car.

Seven of the top 10 selling brands now offer capped-priced servicing after Toyota introduced it in 2008. More than a dozen rivals have followed.

But in many cases the capped pricing runs out just before expensive routine maintenance begins, or doesn't extend as far as the warranty period.

Some brands require customers to take the vehicle into the dealership twice a year to make up for discounted prices.

In the most dramatic example of the differences that can be found - a $13,990 Nissan Micra hatchback costs $1584 to service over three years, more than 50 per cent dearer than it costs for regular check-ups on a Volkswagen Golf diesel ($876).

The Micra is even more expensive to maintain than a Toyota LandCruiser heavy-duty 4WD ($1260).

Comparing like with like, the new Nissan Pulsar costs $1641 to service, more than twice as much as a Toyota Corolla ($780).

The cheapest cars to maintain over three years are the Hyundai i20 ($567), Holden Barina ($740), Mitsubishi Mirage ($750) and Toyota Yaris ($780).

However, Hyundai's capped price servicing runs out two years before its five-year warranty ends, Holden requires customers to visit every nine months, and Toyota wants to inspect the car every six months.

Mitsubishi, which was second to market with fixed price servicing locally, was once the cheapest of the lot but increased prices across its range late last year.

Its servicing offer, too, runs out before the warranty ends.

Other anomalies: most diesel cars are consistently dearer to service than their petrol-powered equivalents. But in some cases the maintenance costs of diesel cars are cheaper in the initial service period, then rise sharply as the vehicle gets older.

Capped price servicing was introduced to take the guesswork out of car running costs and stop some rogue operators from over-charging.

Figures from accounting firm Deloittes show that the workshop and parts departments account for approximately half of a dealership's profit.

With slim margins on new vehicles as prices have fallen, dealers have used their service bays to make up some of the shortfall.

Before capped-priced servicing was introduced, prices varied markedly even among dealers representing the same car brand.

The AAA says it welcomes fixed price servicing but its endorsement comes with a warning.

"Capped price servicing does provide a greater level of transparency but people must read the fine print,'' Australian Automobile Association Executive Director Andrew McKellar said.

"Not all brands offer the same conditions or service period which means you may not be comparing apples with apples,'' he said.

"Do your homework and examine all the details such as how many services you get at that fixed rate and also how often the service needs to be undertaken.''

Given that fixed price servicing has taken some of the cream out of dealer profits, the AAA says motorists should be even more wary of upselling.

"Even under a fixed price service plan, owners still need to remain on their guard with some dealers trying to upsell to customers on work that isn't needed,'' McKellar said.

"Steer clear of unnecessary service suggestions from the dealer that might go over and above what is in the capped price special, such as a fuel clean, petrol additives or air conditioning decontamination.''

The AAA also reminds motorists that they are not obliged to take their car to a dealership for routine maintenance.

"A reputable independent mechanic may still offer a cheaper service on your new vehicle than the manufacturer's capped price deal,'' McKellar said.

"A log-book service can be undertaken by any licenced mechanic without compromising a warranty from the manufacturer, so don't be afraid to shop around."

Nissan Micra
Price: $13,990
Three years' servicing: $1584
Visits to dealer: Six

Volkswagen Golf TDI
Price: $36,490
Three years' servicing: $876
Visits to dealer: Three

Toyota LandCruiser
Price: $78,990
Three years' servicing: $1260
Visits to dealer: Six

Cheapest cars to service

Hyundai i20
Price: $13,990
Three years' servicing: $567
Visits to dealer: Three

Holden Barina
Price: $15,990
Three years' servicing: $740
Visits to dealer: Four


Mitsubishi Mirage
Price: $12,990
Three years' servicing: $750
Visits to dealer: Three

Toyota Yaris
Price: $14,990
Three years' servicing: $780
Visits to dealer: Six

Im not entirely sure what ill do with my ST, it does have capped price servicing (with anomalies) but i havnt asked my current mechanic what the cost might be

[Rodge]

Figures from accounting firm Deloittes show that the workshop and parts departments account for approximately half of a dealership's profit.

Wow, that's an interesting little nugget of info. I wouldn't have thought it would be that high.

[ryeman]

Not at all surprised, said it before, all 4 divisions have to make their own profit....that's why your trade in valuation is so low.

[Trevor 57]

Originally Posted by Rodge

Wow, that's an interesting little nugget of info. I wouldn't have thought it would be that high.

I got my Ranger serviced in W.A. when I was over there, I supplied all the filters, air, oil and fuel and was suprised how cheap it was considering it was a 40,000k service

When I enquired about the 'capped price' the person in the dealership at the time said the 'capped price' was $300 dearer than what they charged me.

[DJM83]

My trade wasnt when compared to others that have traded the same car.

[Silver Ghia]

To me capped prices are just a gimmick, I certainly haven't found servicing costs any cheaper. Probably more expensive actually.

The article does not say there are other catches with the capped price system. Capped prices do not indicate full cost of maintenance over a period of some years, such as:

- They do not necessarily include calendar time items such as brake fluid and coolant flush and replacement (normally every 2 years for brake fluid, and 3 years for coolant).

- Nor timing belt replacement (where fitted). And VW also recommends the water pump to be replaced at the same time as the timing belt due to access reasons - more expense.

So prices of these higher cost items can still vary between dealerships.

[Yellow_Festiva]

The model Ford uses is so filled with flaws it isn't funny....

The wording is that it is the 'most' you will pay, yet in most cases it is actually put as a fixed price. So I guess that is a play on words there...

Also, people tend to agree that the going rate for a dealership service centre is $110ph. That's fine, in fact If I were charged that I would be happy. The problem is, the real rate under the capped price program is circa $200 per hr.

If you don't believe me, go see what your service schedule states in terms of materials used, and time taken. Then compare that to what the capped price is.

Please don't tell me that because I have never run a dealership I have no right to question their costings. They are a franchise, and like any franchise run a tight ship to be as efficient as possible. They should be charging the same or less than independant Joe Blow down the street. Mc Donalds do it, Pizza Hut do it, K-Mart / Ultra Tune do it.

Oh thats right, we get 'free roadside assistance'. NOTHING is free.....

When I got my car, the 'salesperson' said that the Focus 'fixed price' service was $199. He said it was a standard price for minor services. No worries then, happy with that price.

Come collection of the car it wasn't the case. In the end and after a lot of arguments and threats, the dealership honoured the verbal price I was given. So, every minor service I was charged $199, and was told that it included the roadside assistance, and my book was stamped accordingly.

Till I called to get a battery installed while out of Sydney a few months ago. Nope, no record of my car or the number plate on their system (EVER).

When the crap hit the fan with my dodgy 60K service I asked for a 'please explain' and was told that "my car was serviced just the same as any other car on the capped price program, but without the roadside assistance". Their exact words....

What a joke...... honestly. So, it beggers the question, those people who do a lot of KM and perhaps get their car serviced sooner than the 12 months, are they paying for 12 months roadside assistance every 4, 5, 6 or 7 months? Or was Ford clever enough to negotiate a 'per month' fee when paying for it to not double pay from their end???

I have receipts to show that they fudge the figures as well. My fancy auto tranny requires 5.5L of fluid @ $37ish per litre. And 5.6 when doing the filter.

When I questioned them as to why they needed 7L they replied that it was due to the filter also being changed. When I directed them to where they can find the info in the booklet about fluid requirements, included the 100ml extra needed for the filter change I got no reply, and still have no reply to this day.... Great customer service there.

You seeing this Ford PR???????

Capped price servicing under fire? About bloody time........

[DJM83]

I didnt start this thread to be a bagging session directed at any dealer/brand.

Thing is i didnt purchased my ST because of the capped price stuff. I purchased because i wanted the car and would have purchased even if it wasnt on the capped price list, as it seems to be exempt from a lot of things unfortunately.

My partner purchased a new corolla 4mths ago and again its on Toyotas capped price at $130, she never purchased because of that, but because she wanted the car.
I know a lot of folk factor in the future servicing when purchasing, but can we not turn it is a dealer/brand slagging session (Yeah i know some have had issues)

[jpd80]

What else can you expect when dealers make next to nothing on new car sales...

[VICFPV]

I cringe everytime I go pick up the car from the dealer servicing dept.
It normally works out to be 249 plus parts and labour and it balloons out to between 650 and 800.
Labour use too be the killer. 300 on average.

[mik]

Personally I don't see how a dealer could possibly pay the huge costs of a dealership and be expected to do it cheaper than a small work shop with a fraction of the costs. o0 ,
interesting article .
But wouldn't it be nice to see a list of car models with longer term ownerships and servicing cost for longer term say up to 150000 k's or even 200000 k's , I would expect some people to get a shock at how much wearing parts cost, clutches , dual mass flywheels, particulate filter, even a simple timing belt can be a very expensive job on some models, another reason I like my falcon.

[Dave R]

I think capped price servicing is a good thing. I used to ring around to different dealerships in my area for quotes which was a waste of time. X dealership would want $100 more than Y dealership, so you would go to X, only for them to try to sting you when you get down there.

Compared to others, Ford's capped price system seems honest enough- once per year minimum (unlike 6 or 9 month intervals elsewhere). I always supply my own oil and the service tends to come out cheaper than the capped price quote. I've used a few dealerships under capped pricing- some still try to sting you. At one service they tried telling me the car "needed" an upper engine clean for $100!! By that they meant we will spray some crap into the throttle body and make a quick 90 bucks, because we think you're a moron.

[davistev]

My last two vehicles I just refused to take my car into the dealership for servicing and did the servicing myself. Over the years I learned that the "get the car serviced by others in order to keep the warranty" was a bunch of crap.

Now I service the vehicle myself as prescribed by the handbook using genuine parts and approved fluids. I have had no issues whatsoever when I brought a vehicle back in for a warranty issue. They do not even look at the book, just at the odometer.

You may ask why would I do that - well - its simple, when you live 1,750km from Adelaide and most country folks will atest, no bloody warranty will fix your car when your broken down on the Gunbarrel Highway. Roadside assistance aint worth **** and a vehicle serviced by it's owner is generally better maintained than some joker at the dealer.

[prydey]

Originally Posted by davistev

Over the years I learned that the "get the car serviced by others in order to keep the warranty" was a bunch of crap.

maybe so, but a full service history will make a car easier to sell, and possibly even fetch more money for it.

now i know many will ark up with the old 'dealer stamp means nothing', 'dealers are all dodgy', 'service history means nothing' etc etc, but bear in mind, enthusiasts like on this forum are very much in the minority and the general population feel much more at ease if the book is full of stamps, and if they are dealership ones, then even more so.

so whilst i'm very capable of servicing my own car, i figure the $180/yr (i supply my own oil) is a small price to pay and i don't have to climb underneath it.

i fail to see how the capped price servicing can be at a different interval to your manufacturer specs though, so not sure why the intervals got mentioned. if your manufacuter recommends 6 or 9 month intervals, then it makes no difference whether its capped or not.

typical mr dowling playing a bit fast and loose with the facts again to try to paint a juicier story.

[FPVF6X201]

Originally Posted by Adrenaline

I always supply my own oil and the service tends to come out cheaper than the capped price quote.

Is there anyway to be sure they use the (probably premium) oil you supply?

[Dave R]

Originally Posted by FPVF6X201

Is there anyway to be sure they use the (probably premium) oil you supply?

I guess not, although last service I gave them 2x 5L bottles and they returned the excess ~3L to me.

[Silver Ghia]

Originally Posted by Adrenaline

I guess not, although last service I gave them 2x 5L bottles and they returned the excess ~3L to me.

Same with me, I supply my own oil, and there is over 3 litres remaining in the second 5 lt bottle, the other bottle is empty, which they also put back into the boot at each service. I have a box which the bottles neatly fit into so they don't tip over.

[ryeman]

Originally Posted by FPVF6X201

Is there anyway to be sure they use the (probably premium) oil you supply?

The 3.5 L left over in the second pack. ....

Make that the 5 L pack they give you back cos they don't get all the old oil out like DIY would.

[Joe5619]

Unless I missed it, the Article did not say anything about Ford capped pricing.. Is that a good thing or a bad thing?

[last fairlane]

Re the fixed price service
in my local area at Browns plains
I was fueling up my BA Ghia (stock standard)
and was given a flyer from the same servo for fixed price servicing
it was $199 for a service which included minor service plus replacement of
wiper blades air filter and spark plugs sounded good to me
booked it in and told them it was a BA Ghia the reply no probs we can do that
went back that arvo to pick it up and was told $299 of course I queeried the price and was told BAs have special plugs so the extra money
I had a go and told them they are a workshop
and should know about BA plugs
long story short they wouldnt give me the car back
till I coughed up the cash
so in my mind fixed price servicing is for the birds
once bitten twice shy

[Silver Ghia]

Originally Posted by last fairlane

Re the fixed price service
in my local area at Browns plains
I was fueling up my BA Ghia (stock standard)
and was given a flyer from the same servo for fixed price servicing
it was $199 for a service which included minor service plus replacement of
wiper blades air filter and spark plugs sounded good to me
booked it in and told them it was a BA Ghia the reply no probs we can do that
went back that arvo to pick it up and was told $299 of course I queeried the price and was told BAs have special plugs so the extra money
I had a go and told them they are a workshop
and should know about BA plugs
long story short they wouldnt give me the car back
till I coughed up the cash
so in my mind fixed price servicing is for the birds
once bitten twice shy

So were the spark plugs due for replacement, considering they have a life of 150,000kms? And did they use dielectric grease when installing the new plugs? Thats the problem when you take your car to the local garage for a service, they probably wont be familiar with the particular car and its components.

[martinijosh]

Originally Posted by last fairlane

Re the fixed price service
in my local area at Browns plains
I was fueling up my BA Ghia (stock standard)
and was given a flyer from the same servo for fixed price servicing
it was $199 for a service which included minor service plus replacement of
wiper blades air filter and spark plugs sounded good to me
booked it in and told them it was a BA Ghia the reply no probs we can do that
went back that arvo to pick it up and was told $299 of course I queeried the price and was told BAs have special plugs so the extra money
I had a go and told them they are a workshop
and should know about BA plugs
long story short they wouldnt give me the car back
till I coughed up the cash
so in my mind fixed price servicing is for the birds
once bitten twice shy

Is this on browns plains road near the kindy? Those guys always seem a but dodgey

Sent from my HTC Velocity 4G using Tapatalk 2

[csv8]

FORD's fixed price servicing isn't fixed price..always get a phone call, "radiator needs a flush..brake fluid needs changing..etc etc" to me, this should be in fixed price servicing..not an extra....

[Silver Ghia]

Originally Posted by csv8

FORD's fixed price servicing isn't fixed price..always get a phone call, "radiator needs a flush..brake fluid needs changing..etc etc" to me, this should be in fixed price servicing..not an extra....

Yes, these should be fixed price items as well, however being calendar time items, they cannot be included in the normal 15,000km/12 month (or whatever is applicable for the car model) servicing price.

But what service departments should do, is have each vehicle service history on computer so that when you book your car in for its next service, the owner states what the km reading is, the advisor puts that reading in the computer, then presto, the computer shows exactly what is required. For example xxx km service + coolant flush = $xx +$yy = $zz. After all, isn't that what computers do and should do?

Unfortunately unforeseen items outside the service schedule including brakes are on-condition items with prices that are dependent on what is required, so there is no avoiding that dreaded phone call that can double the service cost or even more.

[Rodge]

Originally Posted by Silver Ghia

Yes, these should be fixed price items as well, however being calendar time items, they cannot be included in the normal 15,000km/12 month (or whatever is applicable for the car model) servicing price.

But what service departments should do, is have each vehicle service history on computer so that when you book your car in for its next service, the owner states what the km reading is, the advisor puts that reading in the computer, then presto, the computer shows exactly what is required. For example xxx km service + coolant flush = $xx +$yy = $zz. After all, isn't that what computers do and should do?

Unfortunately unforeseen items outside the service schedule including brakes are on-condition items with prices that are dependent on what is required, so there is no avoiding that dreaded phone call that can double the service cost or even more.

I don't get it. Its well known that brake fluid is hydroscopic and requires changing every 2 years and also that the coolant loses it effectiveness after 3 years so I would have thought these scheduled service items would be included in the capped price service scheme. Have I got the wrong end of the stick because it would appear to be very strange if they arn't.

[Yellow_Festiva]

Originally Posted by Rodge

I don't get it. Its well known that brake fluid is hydroscopic and requires changing every 2 years and also that the coolant loses it effectiveness after 3 years so I would have thought these scheduled service items would be included in the capped price service scheme. Have I got the wrong end of the stick because it would appear to be very strange if they arn't.

They do mention that there are additional costs with a *.

The problem is, some people do little driving and only get a service a year, some people do 40k a year and do 2.5 services a year.

The intervals are km based in the drop down menu, not time based. Having said that, you choose model by model, and with the coolant interval they use this line:

"If the radiator coolant needs to be replaced (between every 3 - 10 years depending on the model) an additional charge of $185 will apply."

Do they go out of their way to be vague? In the process of entering the data, it wouldn't have been that hard to be model specific with this. Eg, the interval for diesel Focus is 10 years.

So, for things like coolant and brakes, they can't really match it to a km interval, on the other hand the auto box in the Focus needs to be done at 60K and that is listed with the capped price.

[Franco Cozzo]

Originally Posted by csv8

FORD's fixed price servicing isn't fixed price..always get a phone call, "radiator needs a flush..brake fluid needs changing..etc etc" to me, this should be in fixed price servicing..not an extra....

Be weary about a lot of that stuff, at Honda we were upselling customers A/C deodorise, injector cleaning and power steering flushes on cars going in for their first 10,000km service and customers were going for it hook, line and sucker.

The more the boys on the front counter upsold customers, the quicker we got cars in/out of the workshop we would get bonus pays, if we made more than $10,000 a day in sales over a working week.

[mike_nofx]

Wait, I'm not sure I understand.
So a system brought out by dealerships in the last few years ISN'T designed to save the buyer money (and in return reduce dealership profits)? But instead to disguise the price and make them money?
I'm so shocked.

[Rodge]

Thanks for explaining that. $185 extra to change the coolant makes it pretty clear what "value" this system gives customers.

[prydey]

Originally Posted by Rodge

Thanks for explaining that. $185 extra to change the coolant makes it pretty clear what "value" this system gives customers.

mate, instead of coming on here and having a whinge every time servicing is brought up, just do it yourself and save everyones time.

i guess it all depends what 'value' you put on your time. i use to do all my own work but these days i have 2 kids (not to mention wife) and time weekends or during the week isn't a luxury i often have, so if $185 will free up my weekend to spend it with my family, to me its well worth it!!

of course you can do things cheaper yourself. do you really expect dealerships to do it for nothing? they aren't charities!