1. Researching an
Automobile
What should I look
for?

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© Family Economics & Financial Education – Revised December 2004 – Transportation Unit – Researching an Automobile – Slide 2
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Transportation
 Part of everyone’s life
 15 – 20% of an individual’s budget
 Automobile is the 2nd
most expensive
purchase, only after a home

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© Family Economics & Financial Education – Revised December 2004 – Transportation Unit – Researching an Automobile – Slide 3
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Want to Buy a
Vehicle?
 Consumers should plan their vehicle purchase to
avoid any costly mistakes
 Any large purchases should be planned
 Places to purchase a vehicle:
• Dealership, private owner, internet

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© Family Economics & Financial Education – Revised December 2004 – Transportation Unit – Researching an Automobile – Slide 4
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Planned Buying
Process
1. Prioritizing wants
2. Pre-shopping research
3. Fitting the budget
4. Comparison shopping
5. Negotiating
6. Making the decision
7. Evaluating the decision

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© Family Economics & Financial Education – Revised December 2004 – Transportation Unit – Researching an Automobile – Slide 5
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Step 1 - Prioritizing
Wants
 Assess transportation needs and wants
• Need: something thought to be a necessity
• Want: something unnecessary but desired
 Consider all automobile options as wants
• Prioritize the wants from low to high priority
•Prioritizing wants helps the consumer
• Consider costs and benefits of different vehicle options
• Consider the “big picture” of the vehicle purchase rather than
a specific want (such as heated seats, color, engine size, etc)

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© Family Economics & Financial Education – Revised December 2004 – Transportation Unit – Researching an Automobile – Slide 6
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Prioritizing Wants –
Questions to Think
About
 How will the vehicle be used?
 Where will the buyer be living?
 How will the vehicle be stored or
parked?
 How much will it be driven?
 What options would the buyer like in
the vehicle?

7. 1.16.2.G1
© Family Economics & Financial Education – Revised December 2004 – Transportation Unit – Researching an Automobile – Slide 7
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Step 2 – Pre-
shopping Research
 Research should be based on transportation wants
 Complete this before visiting a car dealership or
salesman
 Helps the buyer to be informed about:
• What they are looking for
• Vehicles in their price range
• Available options

8. 1.16.2.G1
© Family Economics & Financial Education – Revised December 2004 – Transportation Unit – Researching an Automobile – Slide 8
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Ways to Perform the
Research
 Family & friends
• Experiences with different
makes and models of
different vehicles
• Likes, dislikes, and
recommendations
 Periodicals
• Consumer Reports
• Federal Citizen Information
Center
• Kelley Blue Book
• Motor Trend
• Car and Driver
 Access this information at the
public library and/or the internet

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© Family Economics & Financial Education – Revised December 2004 – Transportation Unit – Researching an Automobile – Slide 9
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Price Research
 Price
• Base price: vehicle price with standard equipment, no
extra options
• MSRP: Manufacturer’s suggested retail price
• Includes base price, price of options installed by manufacturer,
and their transportation charge
• Sticker Price
• Dealer’s initial asking price

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© Family Economics & Financial Education – Revised December 2004 – Transportation Unit – Researching an Automobile – Slide 10
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Price Research
continued
 Price continued
• Determine how much a dealer paid to help decide which
vehicles to consider and to negotiate a fair price
• Consumer Reports, Kiplinger’s Personal Finance magazine, and
Edmund’s New Car Prices
• Used cars
• Blue book price: dollar value given to the vehicle based on its
year and model
• Used as a guide for car dealers and banks for pricing trade-ins
• Kelley Blue Book

11. 1.16.2.G1
© Family Economics & Financial Education – Revised December 2004 – Transportation Unit – Researching an Automobile – Slide 11
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Vehicle Options
Research
 General type of vehicle
• Car, truck, 2-door, SUV, sporty
 Make and model
• Ford Taurus, Honda Accord
 Safety
• Braking and emergency handling, airbags
 Reliability
• Some specific models have high marks, may be higher priced but
will save on repair costs

12. 1.16.2.G1
© Family Economics & Financial Education – Revised December 2004 – Transportation Unit – Researching an Automobile – Slide 12
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Vehicle Options
Research continued
 Fuel economy
• Type of gas used, gas mileage
 Power and performance
• Driving on highways, steep hills, mountains, snow,
muddy roads, or in a city
 Comfort and convenience
• Size of headroom and legroom, cargo space

13. 1.16.2.G1
© Family Economics & Financial Education – Revised December 2004 – Transportation Unit – Researching an Automobile – Slide 13
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Vehicle Options
Research continued
 Insurance
• Chosen vehicle affects the price of insurance; obtain a
quote for the vehicles being considered
 Other options
• Power steering and brakes, manual or automatic, air
conditioner, rear-window defogger, radio/tape/CD
player, type of tires, cruise control, sun roof, heated
seats, power door locks and windows, etc.

14. 1.16.2.G1
© Family Economics & Financial Education – Revised December 2004 – Transportation Unit – Researching an Automobile – Slide 14
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
New vs. Used
Research
 New Vehicle:
• Not pre-owned
• Warranty
• Manufacturer options
• Wide selection
• Expensive
• Depreciation
• Loss in the vehicle’s value
due to time and use (greatest
cost)
 Used Vehicle:
• Cost less to buy
• Cost less to insure
• Avoid rapid deprecation
• Wide selection
• May offer warranty
• Returned leased cars
• Have an independent
mechanic inspect any used car
before purchase

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© Family Economics & Financial Education – Revised December 2004 – Transportation Unit – Researching an Automobile – Slide 15
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Step 3 – Fitting the
Budget
 “Can I afford it?”
• Most important question
 Amount the buyer can afford in his/her budget
dictates the vehicle price
 All costs must be taken into consideration before
choosing a vehicle

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© Family Economics & Financial Education – Revised December 2004 – Transportation Unit – Researching an Automobile – Slide 16
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Fitting the Budget
continued
 Fixed expenses
• Depreciation
• Insurance costs
• Loan payment and interest
if financed
• Parking fees
• Licensing
• Registration
 Flexible expenses
• Maintenance
• Gas
• Oil
• Repairs
*Vehicle price is not the only cost involved

17. Stop to
complete
activity

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© Family Economics & Financial Education – Revised December 2004 – Transportation Unit – Researching an Automobile – Slide 18
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Step 4 – Comparison
Shopping
 Comparing services or products to determine the
best buy or quality product at a fair price
 Allows the consumer to build upon the
information learned in the pre-shopping research
*As the price of a vehicle increases,
consumers are often not buying
additional safety, capacity, or power,
but instead style and prestige

19. 1.16.2.G1
© Family Economics & Financial Education – Revised December 2004 – Transportation Unit – Researching an Automobile – Slide 19
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Comparison Shopping
continued
 Narrow the choices to a few specific makes and
models with desired options
 Visit the appropriate store to learn more
information about each choice to make
comparisons
• Inquire about price, dealer incentives, financing options,
leasing, warranties, and service contracts
 Test drive each potential vehicle

20. 1.16.2.G1
© Family Economics & Financial Education – Revised December 2004 – Transportation Unit – Researching an Automobile – Slide 20
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Comparison Shopping
continued
 Goal of comparison shopping
• Narrow the choice even further to negotiate for the
best deal

21. 1.16.2.G1
© Family Economics & Financial Education – Revised December 2004 – Transportation Unit – Researching an Automobile – Slide 21
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Step 5 - Negotiating
 Process of deciding the actual terms of the
purchase and agreement between the seller and
buyer
 Obtain a firm price before discussing any other
aspects including a trade-in
 Compare prices from different dealers
• Let them know you have done your research and
whether their price is high

22. 1.16.2.G1
© Family Economics & Financial Education – Revised December 2004 – Transportation Unit – Researching an Automobile – Slide 22
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Negotiating
continued
 Keys to all negotiations
• Be able to say NO
• Take the purchase to another business

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© Family Economics & Financial Education – Revised December 2004 – Transportation Unit – Researching an Automobile – Slide 23
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Step 6 – Making the
Decision
 The best place to decide on which vehicle to
purchase is NOT the showroom where you are
around the dealer
• Take the information home to compare all options
 After making the decision, return to the dealer to
close the sale

24. 1.16.2.G1
© Family Economics & Financial Education – Revised December 2004 – Transportation Unit – Researching an Automobile – Slide 24
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Step 7 – Evaluating
the Decision
 Think about the things which went well and what did
not
• This will be helpful the next time a similar purchase is made
 If the process was successful and you are happy,
compliment the seller
 If you have a complaint, make the complaint known to
the seller then move to the supervisor if necessary

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© Family Economics & Financial Education – Revised December 2004 – Transportation Unit – Researching an Automobile – Slide 25
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Lemon Laws
 Lemon
• A vehicle in and out of the repair shop with problems
monthly
 An estimated new 150,000 vehicles sold each year
are lemons.
• Money Troubles, 2001, Leonard
 All states have enacted lemon laws
• Specifics vary state-to-state and are in place to protect
consumers

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© Family Economics & Financial Education – Revised December 2004 – Transportation Unit – Researching an Automobile – Slide 26
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Lemon Laws
continued
 To fall under the lemon law
• New vehicle must have a substantial defect which
cannot be fixed in a reasonable time
• Defect remains unfixed after four repair attempts or the
vehicle remains in the repair shop for a total of 30 days
 This allows the consumer the right to a refund or
a new vehicle

27. 1.16.2.G1
© Family Economics & Financial Education – Revised December 2004 – Transportation Unit – Researching an Automobile – Slide 27
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Lemon Laws
continued
 What should you do if you feel you have
purchased a lemon?
• Contact the state’s attorney general office to request
information on the state’s lemon laws and how to use
them if they have purchased a lemon

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© Family Economics & Financial Education – Revised December 2004 – Transportation Unit – Researching an Automobile – Slide 28
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Conclusion
 Before purchasing a vehicle, follow the planned buying
process to avoid a costly mistake
1. Prioritize wants
2. Pre-shopping research
3. Fit the budget
4. Comparison shop
5. Negotiate
6. Make the decision
7. Evaluate the decision