Shoppers Gripe About Deals : Despite Low Financing, Car Bargains Are Elusive

When Detroit blitzed the nation late last month with its lowest interest rates ever, Rochelle Brown got pretty excited. The 45-year-old Reseda teacher had already squeezed 11 years out of her aging Chevrolet, and figured it was time to go bargain hunting for something new.

But after a weekend of shopping jam-packed General Motors dealerships, Brown still had her 1975 Monte Carlo, and she wasn’t so sure Detroit’s auto makers and their dealers were offering such great deals after all.

“The dealer will out-deal you every time because he does this every day, and you don’t,” Brown said Sunday, as she looked at new Monte Carlos at Terry York Chevrolet in Encino.

“We’ve been to a couple of Oldsmobile dealers, and you can’t get them to go below sticker,” Brown added. “They said they were discounting, but when you do the math, you just don’t see it. You’re going to spend a lot of money for a new car, one way or another.”

Nearly two weeks after the nation’s domestic car dealerships first were inundated with consumers enticed into the market by car loan rates that have now dropped to as low as zero percent, Brown and thousands of other car buyers are finding out the hard way that discount auto financing doesn’t always translate into bottom-line bargains.

“On the 2.9% stuff (cars covered by the special low-interest financing), they’re not being flexible at all,” said Miner Smith as he shopped with his wife at Los Feliz Ford in Glendale.

On the second full weekend of Detroit’s all-time low interest programs, Southern California car dealerships were still busy with buyers and browsers, and domestic car sales threaten to break all early September records when they are reported later this week.

But the surge of new interest among Californians in domestic cars has also brought back some old gripes about Detroit and its sales force. Car buyers interviewed over the weekend complained that many domestic car dealers have suddenly been flooded with so many customers that they frequently are unwilling to dicker or spend much time with customers who want to haggle for a better deal. At the same time, they said many dealers are only pushing high-priced cars loaded with expensive equipment, leaving customers with little choice but to pay more for their cars than they expected.

Moreover, many customers are not even asking about the low financing because those loans must be paid off in two or three years, making monthly payments too high for many buyers.

At Campbell Ford in Garden Grove, for example, about half of the customers in the last week opted for 60-month financing at 9.9%, sales manager Glen Wilson said.

However, Wilson and other sales people at Orange County dealerships say that the low rates have had a tremendous marketing impact.

But the initial excitement sparked by the cheap financing may be wearing off. More and more car shoppers said last weekend that they felt confused, and perhaps a bit angry, after negotiating over prices. And some who suffered through a weekend of inattention and high prices said the experience has simply reinforced their long-held aversion to dealing with dealers.

“They’re pulling out all sorts of tricks,” said Kristen Jones, who spent Saturday hunting through Glendale for an elusive commodity--a modestly priced car. “That’s my conclusion after only two days. . . . I think the most obvious is not coming down on the sticker price.”

But local dealers still insisted that they were ready to offer discounts to get rid of their unsold 1986 models. “Some of our customers are coming in here saying that other dealers won’t talk to them if they start talking discount, but we’re not that way,” said Sydney Burke, sales manager at Superior Pontiac in Monterey Park. “We want to deal and move the inventory.”

Added George Gascon, general sales manager at City Ford in Los Angeles: “I don’t believe the low interest rates have affected sales prices one way or another.”

But Terry Buen isn’t convinced. Along with her family, she came all the way from Bakersfield to the Los Angeles area to shop for son John’s first car, in search of better prices and better service. Unfortunately, they said, they didn’t find either.

After visiting three car lots, Buen concluded that all of the dealers were being “pretty firm” on their prices, “because they know the cars are going to go fast.”

‘Nice Gimmick’

“And you can’t find a salesman,” Buen said as John inspected a white Camaro at Kramer Chevrolet in Santa Monica. “You have to wait half an hour or an hour to find a salesman--then you grab him.”

Philip Gwinn called the low-rate financing a “nice gimmick” as he scanned cars at Allen Gwynn Chevrolet in Glendale. “But I don’t know if that many people will be able to take advantage of it,” because the selection was so limited. Most of the cars he looked at came fully loaded.

“Oh, it’s so aggravating,” said 45-year-old Mark Lasky of Reseda, who was inspecting a Jeep Cherokee at Canoga AMC/Jeep/ Renault in Canoga Park over the weekend. “They’re just not honest with you. They say ‘let’s talk,’ and all you get is baloney.”

Import dealers may be winning out as a result of all the customer complaints about their domestic rivals; several Japanese car dealers insisted that their sales were surging on the strength of new buyers turned off by the hard-sell they had been subjected to by the domestics.

‘Buy a Real Car’

“We tell customers it is better to pay some interest to the bank than extra profits to the dealer,” said Marco Medina, sales manager at Downey Toyota in Downey. One Subaru salesman at Valley Park Ford, Volkswagen, Subaru in Canoga Park echoed that sentiment. “People look at 2.9 cars, don’t like them, then they come here to buy a real car,” he said. The dealer was offering financing between 12% and 14%, leaving some customers unfazed.

But domestic dealers insisted that they were still negotiating, adding that they have to be willing to cut prices in order to move their old inventory and make room for the new 1987 models coming in October. Alan Dietor, sales manager at University Ford and Chrysler in San Diego, stressed that he was “dealing with each case individually, because we want to move these cars.”

‘It’s Calmed Down’

In Orange County, for instance, business at many Ford, AMC, General Motors and Chrysler-Plymouth dealers was brisk, but it was still down from the previous weekend, when many dealers set sales records and stayed open until past midnight cajoling customers.

And many of the customers were what dealers called “moochers”-- more cautious shoppers and people with poor credit.

“It’s calmed down,” said Terry Waters, sales manager at Connell Chevrolet in Costa Mesa. “It’s nothing like the first week” of low interest rates.

Over the Labor Day weekend, for example, Connell salesmen sold 120 cars, Waters said. But from Friday through mid-afternoon Sunday, he said, his sales force had sold 40 cars--down significantly from the previous weekend but still ahead of a normal weekend’s tally of 30 sales.

With the initial rush spurred by the low rates over, the next wave is a “shopping-type person,” added Bill Roof, president of Garden City Dodge in Garden Grove.

Still, domestic dealers weren’t complaining about business. Said Roof: “It’s the best surge on an interest-rate program I’ve ever seen.”

With customers rushing to new-car dealers, used-car lots generally are lonely places.

At Bauer Motors in Costa Mesa, which sells Buicks, Jaguars, Isuzus and Lotuses, salesmen could not attend to all the customers on their lot, but at a used-car lot a few miles north on Harbor Boulevard in Santa Ana, salesmen leaned back in their chairs and surveyed empty lots and few casual tire-kickers.

“It’s very bad,” said Ignacio Baldez, a salesman at Cal State Auto Sales & Leasing Co. “Nobody is buying used cars.”

Pausing from his task of tying balloons to some cars in the Cal State lot, Baldez predicted better days ahead for used car dealers. When the interest rate promotions end in a few weeks, there will be a glut of used cars on the market at low prices, he reasoned.

Ken Wilson of Garden Grove could represent the type of buyer Baldez is looking for. On Sunday, Wilson was at Bauer Motors, “hoping someone turned in a good used car.”

Times staff writers Nancy Rivera Brooks, Stephanie Droll, Alan Goldstein, Greg Johnson and Jeff Rowe contributed to this story.