How can a car broker save consumers money?

A good car broker can potentially save you money, and if they’re good they’ll also save you lots of time. It should be a broker’s job to represent your best interests to help you find the most suitable vehicle in an efficient and effective manner. But how can a broker save car shoppers money? Generally speaking, car brokers are knowledgeable about the automotive marketplace and should have a strong idea of what prices are achievable. But given the amount of information available to consumers, the broker may not necessarily have proprietary information that isn’t already available to consumers. And it is possible that with some time and effort a very savvy negotiator could end up with a deal almost as good or equal to what a broker could achieve. But the difference is that a broker has a great deal of experience negotiating vehicle prices (both purchase and lease) and knows how to structure an offer the dealer is likely to accept. The broker may even have a relationship and good rapport with a sales or fleet manager at the dealership that allows him/her to cut to the chase more quickly and obtain a great deal with no messing around. If the broker works efficiently and frequently with a dealer to minimize the dealer’s workload (internal admin and resources) then the deal can be even sweeter as the dealer won’t have to build a sales rep’s commission into the selling price as the broker can help alleviate this workload.

Numbers matter

Consumers typically buy a vehicle no more than once every three years. Brokers, on the other hand, facilitate a number of purchases every week – often with the same dealership. In an effort to retain the broker’s business the dealership will often make price concessions to the broker that aren’t available to the public. As number of sales count toward a dealership’s quota and corresponding bonus from the manufacturer, the dealer will be willing to offer deeper discounts to a broker who helps them increase their volume rather than an individual consumer who will only be contributing a one-off sale that leaves the dealership focusing on the individual transaction’s profit margin.

Invoice pricing

We know the “invoice price” – the amount a dealership pays the manufacturer for a vehicle. And this info is becoming more readily available to everyone. But just knowing the invoice price doesn’t necessarily mean you’ll be able to get a great deal. You have to structure offers the dealership will be willing to accept. By knowing the invoice price you have a good baseline but knowing is only half the battle. At Car Compass we share the invoice price and any available incentives with our customers to help set expectations and ensure we’re shopping around an offer to achieve the most competitive price on our clients’ behalf.

To learn more about how a car broker can help you buy a car in the Toronto area, contact Car Compass at 416-477-9328

Angus McComb

How to spot and avoid flood damaged vehicles

The purpose of this post is to help you protect yourself against and avoid flood damaged vehicles, as an influx are expected to surface in Canada following Hurricane Sandy.


Hurricane Sandy submerged a great number of vehicles. And Hurricanes Katrina and Rita water damaged more than half a million vehicles. Perhaps you’re asking yourself “so what? Why is buying a flood damaged car bad?” Well, in Canada flood damaged cars are viewed to be so problematic that they are to be titled “non-repairable” and never used on public roads again, regardless of their apparent condition or any repairs that have been performed. Basically, they’re only good for scrap or parts after being flood damaged as they cannot be legally registered for use on public roads ever again… So is it then a safe assumption that consumers are protected, given that flood damaged cars are titled as non-repairable? Unfortunately not. There are ways that unscrupulous individuals and dealers can dodge or “clean” / “title wash” a non-repairable title in order to make the car appear road-worthy so that they can sell it for more than it’s worth as scrap or parts. And part of the process of evading or cleaning the non-repairable title often involves vehicles crossing state boundaries and ending up in Canada. So Canadian consumers need to be aware of the “flood” of flood damaged cars heading north of the border (sorry, couldn’t resist!) to avoid becoming a victim with a worthless vehicle.

So what should you do to protect yourself from unknowingly purchasing a flood-damaged vehicle?

First and foremost, if you’re purchasing a vehicle imported from the US it’s important to buy from a registered dealership as you are likely protected from flood damaged cars. In Ontario, dealerships operating legally that are registered with OMVIC are required to disclose any flood damage. And if you buy a car that turns out to have flood damage that wasn’t disclosed, then the dealership will be on the hook as it’s their responsibility to identify the damage regardless of whether or not they were aware of it. If you’re buying from a private seller, however, and end up with a flood damaged car, then you’re SOL. So ensure you’re protected and buy from a registered dealer.

Here are some tips to help you identify flood damaged cars

(because the vehicle history reports don’t always contain flood damage info – like when an insurance claim isn’t made against the flooded vehicle):

  • Follow your nose! Use a “sniff” test to smell for mould or mildew odours inside the cabin. Or perhaps there’s an overwhelming smell of cleaning product or air fresheners that have perhaps been used to cover-up tell-tale smells. Run the fan, AC and heat to help check for smells.
  • Test all electrical systems. Flood damaged vehicles typically suffer electrical problems when water has gotten into the electronics. So check the lights, wipers, turn signals, cigarette lighter, radio, A/C and heater.
  • Ask! Ask the seller if the car has been damaged (flood or otherwise) or has anything other than a “clean” title. It’s not so much the answer that you seek, but the delivery of the answer. If your gut is telling you something is fishy, it’s often wise to trust it and walk away.
  • Get it inspected by a mechanic you know and trust. Any half-decent mechanic should be able to spot a flood damaged vehicle. If the seller won’t let you get the car in question independently inspected, then that might be a warning sign something is not right.
  • Check for rust and water lines where they wouldn’t normally occur. Check the trunk, glove box, centre console, seat brackets, floor mats, under the floor mats, engine compartment and door jambs. Are there dirt, rust or water marks in suspicious places?
  • Are the floor mats discoloured, mismatching or oddly shaped? Or suspiciously clean? This can indicate that water made it into the cabin.
  • Is there any moisture in the headlamp or tail light enclosures? How about the instrument panel? Do they appear foggy? It can be very difficult to get water out of these areas.

Hopefully these tips on how to spot water damage will help you avoid buying a flood damaged vehicle. Be diligent and trust your instinct. If it sounds too good to be true, it likely is. Don’t try to convince yourself that it’s just a really, really good deal!

As always, I’m here to assist in any way possible when it comes time to purchase or sell a car,


10 money-saving tips for buying or leasing a car

Pagani Zonda vs Smart Car

  1. Set a budget and exercise self-discipline to stick to it. Don’t get tempted by more expensive models or bells and whistles you don’t need. It’s very easy to lust for higher trim levels that aren’t a necessity. And skip the aftermarket products and accessories. Remember that a car is a depreciating asset and spending more on options won’t proportionately increase the residual value of the vehicle (with the exception perhaps of an automatic transmission).
  2. Don’t focus exclusively on just one vehicle. Having a couple of choices you like and could happily live with will help keep pricing near the forefront of your decision-making.
  3. Explore different ownership methods. Don’t make any assumptions about one method being cheaper than another. Leasing – despite often providing the lowest monthly payment – is usually a more expensive method of ownership in the long run. And don’t assume that promotional “0% financing” rates are the least expensive way to own or finance your vehicle (I cover this in-depth in this post). The least expensive way to own is usually by purchasing a well-maintained pre-owned vehicle and driving it to the end of its useful life.
  4. Perform your due diligence. There are many free or inexpensive resources on the internet that will tell you the invoice price (that’s the price a dealership pays for a new car). With this info, you can make an offer at a reasonable mark-up of around 3-5% above the invoice price. If buying used, you should be able to find average asking prices for a specific make and model online by examining used listing sites which you can use as a baseline.
  5. Shop around. Not all dealerships and salespeople are created equal. And the largest and most lavish dealerships aren’t necessarily the most expensive (as moving larger volumes can help keep individual unit prices down). But sometimes being willing to travel to a dealership that’s more eager to move a unit could save you money, so don’t limit yourself to the nearest dealerships.
  6. Considering using a car broker. A car broker is to vehicles what a real estate agent is to homes. Finding a trustworthy car broker in your area that can provide you with reliable advice about cars and dealerships can prove invaluable. They might even be able to help you get a better deal with their dealership contacts and expertise. Just make sure you’re engaging a car broker whose revenue model aligns with your best interests (i.e. you pay for their services rather than allowing them to collect undisclosed commissions from the dealership).
  7. Gas and insurance costs are part of the expense of owning and operating a car. Once you’ve got a short-list of cars you’d be happy owning, call your insurance provider to find out how much each will cost to insure. And call a few different insurance companies or brokers as the rates can vary greatly as can the coverage. Calculate the amount of gas you’re likely to use every year based on your annual driving and the estimated fuel economy. Factor this into your decision-making.
  8. Say “no” to the aftermarket add-ons and accessories. The dealership will probably try and sell you a plethora of extra services or products like special wax jobs, rust proofing, extended warranties etc. to increase their revenues on your transaction. Most of these aren’t worth the premium, but if you feel something would be of great benefit to you, shop around! Chances are you could save hundreds of dollars if you buy the product or service elsewhere. Or negotiate with the dealership on price of the product or service; knowing how much other providers sell the item for will help with your negotiating leverage.
  9. Maximize the value of your trade-in. If you have a vehicle that will be part of the transaction, ensure you’re getting the best possible price for your vehicle. The dealer’s first offer on your trade-in may not be their best. Shop your vehicle around to a few dealerships to be sure the price you’re being offered is fair, otherwise you might be paying more for your car than necessary. Read this post for more info on how to determine your car’s value.
  10. Take care of your investment. Stick to the recommended scheduled maintenance. Never neglect oil changes and filter replacements or your could be driving your vehicle to an early grave. The better you take care of your investment, the longer it will last, the better it will treat you, and the greater the resale value it will achieve. This can be especially true if leasing as many car manufacturers impose costly penalties for failing to adhere to the maintenance schedule. If leasing and you require bodywork or painting done, check with the dealership or car manufacturer for preferred vendors as inferior paint jobs could cost you thousands at the end of your lease – so saving a few bucks to get the less expensive bodywork or paint job will likely cost you much more when you return the car at lease end for inspection.

By following these tips you should be in good shape to keep your long-term vehicle ownership costs down. Never over extend yourself or buy more than you can afford.

If you decide a car broker is your preferred route, I’d be happy to assist in finding you your ideal car for the best price.

Angus McComb


Choosing the safest vehicles for your teen

On occasion, I’m tasked with helping a client find a suitable vehicle for their teenager(s). And from what I’ve learned, this is no easy task – mainly because of the stakeholders involved and their rather polar priorities. Parents obviously want something that won’t endanger their children with too much power or a high centre of gravity that might make it more prone to rollovers. And their kids want something cool and quick. The boxes parents (should) look to check are: safety, reliability and low operating cost. But at the same time they don’t want to end up being the lamest parents ever in the eyes of their kids because they’ve come home from the dealership with something like a PT Cruiser (if this offended you, congrats – your kids think you’re lame). And although I’m told by parents that safety, reliability and operating cost are the three most important search criteria, the desire not to be lame always seems to pervade their decision-making; probably more so than it should.

Whatever your shortlist of prospective vehicles may end up being, call your insurance company for quotes. This might be a huge determining factor when selecting the right vehicle for the kids and is a better place to start than to finish. Chances are, the more expensive to insure, the less appropriate for your child. The reason a vehicle is more expensive to insure is a greater propensity to be involved in a claim. So it’s likely faster or more powerful, or is more desirable to a higher-risk demographic. That said, actuaries never cease to amaze me and there will always be exceptions to the rule. But in general, the lower the cost to insure the more likely it’s a suitable option for teenage transportation as probabilities (and actuaries) are telling you it’s less likely to be involved in a claim. Don’t get me wrong, I’m not saying simply choose the cheapest to insure – but there often is a correlation between insurance cost and suitability.

Something like a Toyota Corolla won’t be a teen’s first choice (unless your teen is far more responsible than their age states they should be), but it’s efficient, reliable, safe and inexpensive to operate. And being a lame parent whose kid has survived an accident is way better than the alternative. If you feel a mid-size sedan will be a safer choice (greater mass and larger crumple zones), stay away from 6-cylinder engines. Most mid-size sedans can be configured with either 4- or 6-cylinder engines so pay close attention to the trim level that indicates the number of cylinders. The last thing you want is to enable your offspring to go fast. 4-cylinders are capable of overtaking on the highway, so “needing” a 6-cylinder is moot when it comes to being a “safety” issue.

Now let’s get down to the meat of it. What should you look for?

Shop pre-owned. Insurance premiums for new cars will be more than pre-owned, and pre-owned doesn’t necessarily mean less safe or suitable.

Don’t go too old – ESC is a MUST. You can go a handful of years back and still have a very safe vehicle with modern safety features. Airbags have pretty much been standard since before 2000. Same can be said for ABS except on the most basic of cars with base trim levels. But one feature you should make a “must have” is ESC (electronic stability control) or some manufacturer-specific variation of the term which will help prevent roll-overs – a deadly type of accident. ABS (anti-lock brakes) are also great for emergency situations and in icy or snowy conditions.

Don’t rule out SUVs. In fact, do the opposite: put them near the top of your list. Once upon a time, SUVs were considered more dangerous because of their high centre of gravity that made them more prone to roll over. But with ESC-equipped SUVs that aren’t prone to roll, you’ll be placing your teen in an elevated vehicle that proves safer. Basic physics can’t be defeated, and the greater the mass the better. Even when compared to cars of similar weight, SUVs have lower death rates (IIHS via Globe & Mail).

Use season-appropriate tires. This may not affect your vehicle decision-making, but leave yourself a few bucks to purchase a decent set of winter tires. They’re one of the best safety features money can buy.

So what vehicles are the best bets for your teens? Here’s a list of vehicles (in no particular order) I believe to be worthy of consideration:

  • SUVs
    • Honda CR-V
    • Toyota RAV4 (4-cylinder)
    • Hyundai Tucson
    • Kia Sportage (2011 or newer)
    • VW Tiguan
    • Honda Element
  • Mid-size sedans
    • Honda Accord (4-cylinder)
    • Toyota Camry (4-cylinder)
    • Nissan Altima (2010 or newer 4-cylinder)
    • Ford Fusion (4-cylinder)
    • Mazda6 (4-cylinder)
    • Hyundai Sonata (4-cylinder)
  • Compact sedans or hatchbacks (note: compact cars aren’t the safest option due to their smaller mass and crumple zones. But sometimes they’re the only option within budget or due to garage / parking constraints.)
    • Mazda3 (2010 or newer)
    • Honda Civic
    • Toyota Corolla
    • Hyundai Elantra
    • Ford Focus
    • Kia Forte
    • VW Golf / Rabbit
    • Mazda2
    • Honda Fit

Whatever type of car you decide on, don’t forget that your kids learn from you (even passively when in the back seat) – so set good examples behind the wheel.
Best of luck with your search. If you’d like assistance, I’d be happy to help!

Angus McComb

2012 BMW X1 xDrive 28i review: a potent little ‘ute

For the past day and a half I’ve been driving around in a new 2012 BMW X1. And when I say new, I mean new – as in only 150km on the odometer new. And it’s not mine, so I’m very much responsible for returning this brand new machine in one piece…

I first sat in the captain’s chair longing for and expecting that glorious new car smell, but evidently not all new car smell is created equal. When you buy a car with leather, the first note to hit your ol’ factory senses is the deep, rich scent of cowhide. You know, a scent not dissimilar to the expensive yet rarely-worn calf skin dress shoes in the closet. But many manufacturers (yes, even the premium ones) have taken to using synthetic leathers (dubbed various names like “ARTICO leather” – despite having nothing to do with leather) and some do a better job than others. Sure, real leather is still available, but it’ll set you back around two grand. Mercedes’ synthetic ARTICO leather isn’t bad from a tactile perspective, and neither is Audi’s. But the leatherette on this BMW feels a little on the thin side and certainly doesn’t provide the ego-stroking aroma of success that sitting on something that has subsequently been turned into a Big Mac provides.

Getting past initial impressions of the leatherette I must say that the cabin is quite pleasant. The seat is perfectly comfortable (this X1 is not equipped with the “Sport Package” which offers sport seats). The steering wheel is thick and meaty – in a good way – as it’s very reassuring to grab onto. The sporting “bumps” in the steering wheel at 10 and 2 o’clock are in just the right spot to remind you that you could take the X1 to the track if necessary. (But don’t – the X1 isn’t designed for that). And it’s a good thing the wheel is so hefty as it takes quite a lot of force to turn at parking lot speeds. The power steering feels lazy, as if it can’t be bothered to help at low speed. The ability to adjust speed sensitivity in the power steering would be of great benefit as I don’t need to feel like Sebastian Vettel parking his F1 car sans power steering after a race.

The cabin controls are all accessible and placed in ergonomically sensible locations. I can’t fault the X1 much for its interior design and functionality; and for $1,900 one can upgrade to 100% beef seats if so inclined. But if you have kids or wear on your seats heavily then leatherette may actually be more functional over the long term. It’s easier to clean and less likely to crack and wear. But you will miss that smell.

Your ears, however, will not miss the ambient road noise as the cabin is well insulated and manages to keep things relatively refined inside. The turbo-charged four cylinder engine will creep into the cabin on occasion but nothing unmanageable. If you’re expecting silky-smooth 6-cylinder power delivery and sounds from the turbo four-cylinder, don’t. Initial throttle response isn’t sharp and the engine doesn’t purr. You most definitely know you’re driving a four-banger at low rpm. Raspy, unrefined and raucous might be the best adjectives. But the story changes entirely when you plant your right foot. It’s very willing and able to put all of its 241 ponies to work and they do a pretty spectacular job via the 8-speed auto trans once the single, twin-scroll turbo gets spooling. The engine note improves at higher RPM and the power is nothing short of impressive for a measly 2.0 litres of displacement. There may be a bit of disconnect between the sporting impression the meaty steering wheel exudes and the actual driving experience, but it’s kind of charming. It’s the little CUV that could. So if you can put lethargic throttle response aside, you’ll be thrilled with the performance and fuel economy from this little turbo four that thinks it’s a six.

This CUV can certainly ‘ute. It may be at the smaller end of the size spectrum, but interior space configuration is done to expected German efficacy that makes the most of what it has. And at 6’1 I have plenty of legroom; so much in fact that I don’t even have to put the driver’s seat all the way back – a first for me.
Check out these photos of the X1 and its interior:

It’s a pretty good car with great driving dynamics (throttle responsiveness aside), but then again it should be for a base price of around $40K in Canada with freight and PDI. If this will be stretching your budget by a healthy margin but you still want a good, practical CUV then I highly recommend checking out the new Ford Escape and Mazda CX-5. Starting at around $25K they make for a pretty compelling value proposition.

Lastly: BMW, please, please bring the diesel version of the X1 to North America. We want it.


If you’re located in or around Toronto and in the market for an X1 (or any vehicle for that matter), I’d be pleased to be your car broker.

Angus McComb – Car Broker

0% financing vs. cash incentives – which is better?

zero percentIf you’re in the market for a new car, chances are you’ve noticed promotions within ads offering motivators like 0% financing or cash purchase incentives. The key word in the ads is often the word “or” – e.g. “0% financing or cash purchase incentive”. This means you can only have one or the other. And if you’re going to maximize your available savings, you need to know how to analyze the best option to pursue as it might not be as clear cut as it seems.

Let’s quickly cover the basics. 0% financing is, in theory, free money as you can finance your vehicle purchase with no cost for borrowing the money. However, like communism, what’s good in theory isn’t always good in practice – as is sometimes the case with 0% financing. If there’s a “cash purchase incentive” being offered in lieu of 0% financing, then the financing isn’t really free, is it? You’re foregoing the cash purchase discount by financing, thus making the cost of borrowing not 0%, but the amount of the cash incentive. Misleading? I think so, and I really believe manufacturers should be prohibited from this kind of misleading advertising. But I digress…

In order to decide whether taking 0% financing or the cash incentive is best for you, you need to know what interest rate you can attain from your financial institution for an automotive loan, as the dealership will — perhaps surprisingly — regard this as a cash purchase as they’re being handed a cheque from your lender. So with financing from your own bank rather than the auto manufacturer’s financial services arm you can cash in on the “cash purchase discount/incentive”, even though you are in fact financing your vehicle purchase. And in some cases, paying your lender an annual interest rate of roughly 5% can work out to a lower monthly payment by capitalizing on the cash incentive instead of the “0%” financing (which we now know isn’t really free if there’s an alternative cash incentive at play). So do your homework. Call you bank to find out your interest rate on an auto loan. Then use an online financing calculator to determine whether it’s cheaper to borrow from your bank or the manufacturer’s financial services arm at “0%”. You might just be surprised at how much money a tiny bit of research can save you!

Angus McComb

855-STEER-ME or 416-477-9328