Hidden camera investigation finds most Calgary car dealerships breach consumer rules
Jon Woodward and Stephen Grant, W5
Published Saturday, March 18, 2017 7:00AM EDT
Last Updated Sunday, March 19, 2017 2:19PM EDT
Calgary consumers are still more likely than not to be exposed to questionable sales tactics and advertising practices when they’re trying to buy a new car – even after a government push to clean up the industry.
Those are the results of an undercover operation by the Automobile Protection Association, an industry watchdog group whose secret shoppers watched salespeople try to wring out thousands of dollars from people they thought were unsuspecting consumers.
In all, 17 out of 20 dealerships failed the APA’s tests. And on each failure, W5’s hidden cameras were rolling.
The footage became the basis for a documentary that questions why it seems like most dealers in the province don’t respect the rules.
“When you have these high failure rates, 17 out of 20, it points to systemic problems in the industry,” said APA president George Iny.
“It’s not the actions of a few rotten apples.”
Iny said one of the most common infractions was the extra fees added -- often at the last minute -- by dealers.
Alberta requires “all-in pricing” by law. That means that if a dealership advertises a price of a car, that’s the price at which the car has to be sold, plus sales tax.
But that didn’t stop some dealers from stacking on the charges. In one case, a hot deal turned lukewarm when the fees added up to more than $1,000.
Another big problem: cars that appeared new in the ads, but not so new in the showroom: some had been driven thousands of kilometers.
The W5 documentary identifies more dubious tactics so viewers can go into the dealers better prepared.
W5 also identifies some of the dealerships that failed – and then goes looking for answers from those dealers, and the province’s car dealership regulator, the Alberta Motor Vehicle Industry Council (AMVIC).
Click here (or see below) to read the AMVIC Report on Governance and Operations, an independent review of AMVIC, which was released in December 2016. The review includes 22 recommendations to change the structure and organization of AMVIC. The Alberta Government has accepted all 22 recommendations and AMVIC says it is committed to implementing the recommendations in the report.
AMVIC has been under the microscope before: it's been the subject of seven provincial government reviews in 17 years, relating to its ability to properly regulate the industry. A scathing report released last year resulted in the dismissal of its president, John Bachinsky.
Alberta's minister who oversees AMVIC called the situation a "gong show" and vowed that it would get better.
Stephanie McLean told W5 in a telephone interview she is already changing some rules, and increasing the organization's accountability to the public by increasing public representation on its board.
“It’s a gong show. You can quote me on that,” said the Service Alberta minister. “But I am working hard and I want Albertans to know my number one priority is to have their backs. We’re finally on the right track.”
A story detailing the full telephone interview will be posted online Monday.It’s not the first time the APA has been to Alberta: in 2015, only 3 out of 22 dealers passed the APA tests.
Eleven of those dealerships who failed then also failed this year, according to the survey.
Iny says it’s clear a lot more work needs to be done.
“I think there’s a culture of deceit unfortunately in part of the industry,” Iny said, adding that with high-pressure sales tactics, it’s not easy to figure out what’s allowed and what isn’t.
“We ask ourselves that question. If we were shopping alone without a W5 camera, without a car dealer helping us in the background, we think we could be had,” Iny said.
With files from Madeline McNair
To see the APA's detailed report, click here