PART ONE: BUYING A NEW VEHICLE

“A 2012 Trillium study of vehicle advertising in Ontario found that approximately 73 percent of automobile advertisements placed by automobile manufacturers were not in the spirit of the Motor Vehicle Dealers Association – where a consumer could understand the final cost of a vehicle in a clear, comprehensive and prominent manner. In other words, if a dealer would have placed similar ads, we are confident the dealer would be in violation of the MVDA’s advertising regulations.”
Trillium Automobile Dealers Association (TADA) 2016, as submitted to the Ontario Committee on Finance and Economic Affairs

Lemon-Aid supports TADA’s conclusion that carmakers’ ads are deceptive. And, as it’s coming from Canada’s largest provincial new car dealer association with a membership of over 1,000 dealers – that’s almost a third of all new car dealers in Canada – government regulators should be listening.

More Choice, Better Deals

Fueled by low crude-oil prices, rock-bottom interest rates and extended-term loans, Canadians binged on new vehicles in 2017. New vehicle sales over the last 5 years have smashed all previous records. However, over the same period, passenger-car sales have slumped as consumers embraced crossovers, SUVs and pickup trucks, encouraged by the perceived utility of driving a multipurpose vehicle. Changing consumer tastes enabled Fiat Chrysler, Ford and General Motors to make windfall profits by pushing fully-loaded, technology-laden pickup trucks and sport utilities.
With light trucks and SUVs outselling cars two to one in North America, the trend has prompted Fiat Chrysler Automobiles to drop all but a couple of car models from its lineup. Slow sedan sales have also been troublesome for Ford and GM. Reportedly, GM is contemplating killing the decades-old Chevrolet Impala, as well as the Buick LaCrosse, Cadillac CT6 and XTS. All are large sedans few shoppers find appealing anymore.
Although motorists welcome the savings at the pump, lower gas prices aren’t entirely good for the auto industry or the environment. Shoppers have been turning away from “greener” mini-compacts, diesels and hybrids. Despite a lot of cheerleading from the green lobby, electric vehicle sales still don’t amount to more than a drop in the bucket – with the exception of the $100,000 Tesla Model S.
Despite the increasingly advanced technology under the hood and in the dashboard, carmakers have managed to mostly hold the line on price increases of new vehicles. To “move the iron” dealers are sweetening rebates, adding standard equipment and pushing new car loans for up to 96 months to shrink monthly payments, often at near-zero interest. Leasing is immensely popular again, especially when it comes to luxury brands. There have been some price increases, of course, that the industry has camouflaged by increasing “Transport and Preparation” fees, reducing dealer margins, and promoting bargain-priced models in their advertising – which you will have trouble finding at dealerships.
On the used-car side, Canada’s weaker loonie has resulted in a robust export market to the United States for used luxury vehicles, pickups and SUVs, and driven up prices for used vehicles. Agents acting on behalf of U.S. dealers are buying up late-model used vehicle inventories from Canadian dealers, leaving consumers to sift through the remainders. According to auto industry analyst Dennis DesRosiers, more than 300,000 used cars and trucks were plucked from the Canadian market in 2016.

Here Today, Gone Tomorrow

Here’s a look at new or significant model replacements for 2018.
2018 Models

NEW OR SIGNIFICANTLY CHANGED FOR 2018

• Audi A5 Sportback
• Audi Q5
• BMW X2
• BMW X3
• Buick Enclave
• Buick Regal Sportback
• Cadillac XTS
• Chevrolet Equinox
• Chevrolet Traverse
• Ford EcoSport
• Ford Expedition
• Ford Mustang
• Genesis G70
• Genesis G80 Sport
• GMC Terrain
• Honda Accord
• Honda Civic Type R
• Honda Odyssey
• Hyundai Accent
• Hyundai Elantra GT
• Hyundai Kona
• Hyundai Veloster
• Infiniti QX50
• Jeep Wrangler
• Kia Rio
• Kia Stinger
• Kia Stonic
• Lexus LS500
• Lincoln Navigator
• Mercedes-Benz E-Class Coupe/Cabriolet
• MINI Countryman
• Mitsubishi Eclipse Cross
• Nissan Leaf
• Nissan Qashqai
• Smart Fortwo Electric Drive
• Subaru Ascent
• Subaru Crosstrek
• Toyota Camry
• Toyota C-HR
• Volkswagen Atlas
• Volkswagen Tiguan
• Volvo XC40
• Volvo XC60

DROPPED

• Infiniti QX70
• Jeep Patriot
• Lexus CT200h
• Mitsubishi Lancer
• Volkswagen CC
• Volkswagen Touareg

Buying Tips

It’s good to be a patient shopper. Here are some time-tested tips.

1. Buy a vehicle that is relatively uncomplicated, easy to service and has been sold in large numbers over many years. This will ensure that cheaper, independent repair shops can provide service and there is a good supply of less expensive aftermarket parts.

2. The old axiom that there is a right way, a wrong way and an expensive European way to fix a car still holds true for most models from the European luxury carmakers. Dealer service is notoriously expensive after the warranty is over, parts can be very expensive, and only a few specialist independent garages invest in the expensive equipment needed to service them.

3. Think twice before you buy a diesel. Most give a poor return on expenditure, are complicated to service and dealer-dependent. Recent European “clean diesels” are dirtier and less reliable than their gasoline equivalents and expensive to maintain and repair.

4. Be wary of Chrysler, Dodge or Jeep models if you’re buying a new vehicle to own for the long haul. Fiat Chrysler is the weakest of the Detroit Three and its lineup has a history of serious safety- and performance-related defects, with the TIPM module being a case in point. A defective Totally Integrated Power Module, or TIPM, can introduce a tsunami of electrical faults, including no-start conditions, dead instruments, no cooling fan (leading to engine overheating) and random stalling. Automatic transmissions, brakes, the electrical system and air conditioners on several Fiat Chrysler group vehicles are also troublesome. On the other hand, the Canadian-made Dodge Charger and Chrysler 300 break the mould and are recommended buys. The Dodge RAM is a good pickup buy. However, the new EcoDiesel V6, supplied by Fiat, in the RAM 1500 light-duty pickup has been very troublesome.

5. Don’t be blinded by luxury brands. Higher-priced vehicles don’t ensure you will get a higher level of quality or reliability. Think Cadillac ATS and XTS, Lincoln MKS, MKT, MKX (with EcoBoost) and the VW Touareg. Many of the premium European brands, including Audi, BMW and Mercedes-Benz, are touted as the pinnacle of luxury and perfection, yet seasoned owners will tell you that these complex machines can break down regularly, especially after the factory warranty and no-charge service plan (a common sales incentive) expire. If you want a luxury badge, the Asian brands offer better reliability, with Lexus and Acura leading the pack.

6. Avoid turbocharged engines when it’s still possible if you’re planning to keep your vehicle for the long haul (8 years or more). Auto manufacturers are turning to turbocharged small engines to hit ever more ambitious fuel-economy targets set by the government. Unfortunately, in real-world driving they are often little more fuel efficient than larger six-cylinder and V8 engines, and not as smooth. For instance, the Automobile Protection Association (APA) found that 2013-2015 Fords with EcoBoost four-cylinder engines burn more fuel than similar models with conventional four-cylinder engines. Turbo-equipped vehicles can generate rosy numbers in laboratory fuel economy tests, where the acceleration cycle is so gentle that the turbo is hardly working, but the APA’s real-world evaluations revealed that the actual fuel consumption of some models is disappointing and the likelihood of expensive repairs down the road is higher. So far, Toyota has completely avoided turbocharged engines in its mainstream vehicles.

7. Don’t buy a Ford vehicle equipped with a dual-clutch (PowerShift) automatic transmission. Developed by Ford and Getrag, the automated six-speed is essentially a manual transmission with two clutches alternating to engage the gears. Electric solenoid actuation provides quick and efficient shifts, avoiding the hydraulic losses associated with torque converters. While it enhances economy, the complex transmission is jerky in operation and, ultimately, unreliable. Found in Focus and Fiesta models, the automatic transmission is extremely expensive to replace after the end of the warranty. Dual-clutch automatic transmissions in VW and Audi products are also troublesome, with expensive failures after the warranty expires.

8. Choose a used vehicle with a conventional hydraulic automatic transmission, or a manual gearbox if you are comfortable with a gearshift. Be wary of continuously variable (CVT) automatics in used vehicles. With the exception of Synergy Drive transmissions used in the Prius and other Toyota hybrids, all the automakers selling vehicles in North America with CVT automatics have been bedeviled by poor durability. Nissan CVT-equipped vehicles were so failure prone that the company extended its warranty for up to 10 years on vehicles produced until 2010. Nissan’s transmission subsidiary, Jatco, has supplied the same CVT transmission to other makes, such as Jeep. Fortunately, new vehicles with CVTs have become somewhat less risky, as materials, lubricants and computer programming have evolved to address durability concerns.

9. Check to see if the vehicle comes with a spare tire and jack, not a spray can of sealant and air compressor. Include this stipulation in the contract. If you wait until after the vehicle is delivered, the dealer will likely charge you $350+ for a space-saver spare, jack and tie-down assembly. Some models, like the MINI and certain BMWs, have no provision for a spare tire in their cargo areas. In that case, you will likely be stuck with hard-riding and more expensive run-flat tires, or required to call roadside assistance when a conventional tire goes flat.

10. Don’t buy a new vehicle with below-average reliability. Yes, an extended warranty can help address the risks that come with a vehicle that has a reputation for failures, but choosing a better vehicle is the better solution. New vehicles with poor reliability eventually suffer from plunging depreciation, which impacts your pocketbook at trade-in time. An alternative is to lease the vehicle if payments are attractive, with the knowledge that the automaker will be on the hook for major repairs and any loss on resale.

11. Use your credit card for the down payment and put down as little money as possible. If you want to cancel a sales contract or work order because a promised service wasn’t delivered, it’s easier to do with a credit card than with cash.