European Stars and Stripes (Newspaper) - March 22, 1992, Darmstadt, Hesse                                Page 10 c the stars and stripes sunday March 22, 1992 cafes from Page 1 ordered service from experienced salesmen consumer Protection and a fair Price. In Many cases these representations Are not True. According to the Exchange services contracts with automakers car prices Are to be fixed and no bargaining permitted. Vehicles can be delivered anywhere americans Are stationed. Customers can buy a car out of Stock or place an order with the factory. Every step in the process a from ordering to financing to delivery a can take place in an cafes new car sales office. But simplicity does not mean risk free. There is no Quot Money Back guarantee a and Exchange officials said about 450 customers file written com plaints with cafes Europe each year. However cafes Europe does not keep track of All Telephone complaints nor is there a record of complaints filed directly with the sales companies. Nor is it known How Many of the nearly 5,000 people who cancel their orders for new cars each year do so because of dissatisfaction. Of the written complaints to cafes 40 percent Are from customers unhappy with salesmen according to figures provided by cafes Headquarters in Dallas. An additional 30 percent involve warranty repair problems and 20 percent come from customers who were delivered cars that did not match their orders. Other customers complain about late deliveries Price changes and payments that arc made for months before their car arrives. Quot cafes has left me to totally fend for myself against a Large  Johnny Fox Stuttgart Germany. Cafes officials who Are responsible for monitoring new car sales Ana enforcing the cafes contract with the automakers say they Are empowered by the contract to intervene on behalf of unsatisfied customers. Still they refer most cases to the sales companies which they say Are better equipped to handle complaints. It is an arrangement that surprises some Auto Industry experts. Quot in a not sure i understand How the military cafes can promote the Sale of cars and at the same time be responsible for consumer Protection but it sounds even More confusing than what occurs in the states a said Peter Brown editor of automotive news a monthly american Magazine covering trends in the world Auto Market. In the states consumer Protection is most often provided by state and Independent organizations. Brown was one of several Auto Market experts interviewed by the stars and stripes. Without exception All the analysts cited flaws with the cafes system ranging from inflated pricing to the Lack of consumer Protection. The pricing Structure for cars sold on military installations is determined by contracts Between the military and the big three . Manufacturers a Chrysler general motors and Ford. Essentially these contracts give the companies exclusive on Post sales rights free office space and equipment and a Price markup of up to 7 percent per vehicle. Also cafes buys 108 full Page advertisements a year in the stars and stripes to promote the companies products. The advertising is Worth about $140,000 at current rates. In return the manufacturers pay cafes from $175 to $185 for every car comparison shopping . Locations is. Cafes Europe a Survey comparing cafes prices for 1992 identically equipped l cars at various locations in the United states. Make and Mode cafes Europe \ Shreveport la $15,828 $13,223 $16,244 Mercury Sable is Plymouth acclaim Chevrolet Beretta ghz a excluding shipping All prices exclude rebate taxes and registration $15,500 $12,600 $15,747 Washington . $15,000 $12,998 $17,400 new York $15,952 $12,708 $15,446 Dallas $15,996 $12,900 $15,589 source cafes sold. A wow id like that contract a said Jack Gillis director of Public affairs for the consumer federation of America in Washington . Gillis said that most stateside dealers add about 6 percent to the wholesale fir ice also known As the invoice Price be Ore they begin bickering with customers. Very often dealers Settle on a much lower Price and normally Only luxury cars have a larger markup he said. The no bargaining Rule is not intended to provide the lowest possible Price according to cafes but is supposed to protect military members from Price gouging. The 7 percent Cap keeps prices m Check they say. A what we do is provide customers with an Opportunity to order an american made car or truck of their Choice under controlled and protected conditions at a fair Price throughout the Model year a said Thomas Gallagher chief of the cafes automotive Branch at the Headquarters in Dallas. But it also penalizes the astute buyer says Gillis. In the United states a careful shopper can get an american made vehicle at $200 Over invoice Price or even less he said. On a $15,000 car that is a a amps Wes Booher savings of $900 when compared with a car with a 7 percent markup. Although the contracts give the Exchange services the authority to police the pricing policies of the contractors surveys and interviews with cafes officials indicate that there is no systematic enforcement program. In november stars and stripes reporters obtained Price quotes on 21 models of 1992 cars in Germany the United kingdom Belgium and Italy. In eight cases the prices quoted exceeded wholesale prices by 8 percent or More with a High of 26 percent. The average markup for All 21 cars in the Survey was 9 percent. The findings were nearly identical to those in a stars and stripes Survey of 1991 models conducted in june 1991. The cafes program is designed to protect customers from a misleading deals a often found in the states said Jeff Gardner general manager of military car sales the Germany based subcontractor that manages Chrysler and general motors sales in Europe. Dealers off base and in the states often use a new see cafes on Page 11 today a stars and stripes Survey shows overcharging. A Why customers Are not Well served. A the a Ford from hello. Monday a How the cafes system a the men who controls the military worldwide Market. Tuesday a cafes Lent the Only game in Europe. A the Lemon lews that done to the mystery othe missing car. Widnie the do s and a car Nesda id snack in Europe a of buying surveys show substantial violation of markup limits for cafes cars by Luke Britt staff writer prices of new cars for Sale on military installations in Europe exceed mandatory limits in More than one out of three cases surveys by the stars and stripes show. The contract Between the military and the three leading . Auto manufacturers imposes a 7 percent ceiling on the markup Over wholesale prices of cars sold through the army and air Force Exchange service As Well As the Navy Exchange service. But in a stripes Survey of 21 models of 1992 cars sold through cafes eight exceeded the limit by a substantial margin. Two others exceeded it by a slight margin. The Survey taken in december 1991, showed that the markup Over dealer in voice prices on All 21 cars averaged 8,3 percent ranging from a Low of 2.6 percent to a High of 26 percent on a Pontiac grand am priced in Mannheim Germany. The average markup on cars that exceeded the limit was 11.3 percent. A Survey of 1991 models conducted in june 1991, yielded nearly identical results. Of 33 cars priced in that Survey 11 cars exceeded the limit. In addition a separate Survey of three 1992 models showed that stateside prices generally were hundreds of dollars less than a fest prices in Europe. The 21-car Survey was based on written prices obtained from salesmen representing Chrysler Ford and general motors at new car sales locations in Germany the United kingdom Italy and Belgium. Reporters asked salesmen to provide quotes on 17 different models of cars trucks and vans. Four models were priced twice with different option packages and body styles. Cars from each of the three manufacturers were represented roughly in proportion to their share of the military Market. Of the three companies Chrysler corp. Products exceeded the contract limits most frequently. Four of nine Chrysler cars were priced at More than 8 percent above the wholesale Price. General motors models substantially exceeded the limit in three out of eight cases while two additional models were slightly Over the limit. One of four Ford cars surveyed was marked up More than 7 percent. The prices provided by salesmen were compared with the prices listed in four Ion leading new car Price guides. The guides provide wholesale and retail prices for cars and All the available options. In most cases the prices listed in the guides were similar. Cafes officials said the methods used in the Survey were  however cafes officials said three of the four Price guides used were invalid because a they do not list exact costs. They Are Only someone a estimate of the value of new  the fourth guide pc Carbooke is the guide cafes uses to Monitor the prices charged by the companies contracted to sell cars on military installations. Pc car Book is a computerized Price guide distributed from the company a Headquarters in Portland Ore. Cafes performs random checks on the prices customers pay for cars purchased through the Exchange service using pc carb Bok As the basis for determining wholesale prices. Thomas Gallagher chief of the cafes automotive Branch said that cafes uses the computerized guide because it provides monthly updates while most other guides Are updated Only once every three months. He also said pc car Book is the Only source a that gives us exact figures on the wholesale Price of cars. The others Are just someone Sopin however Jan Armstrong a spokeswoman for pc Carbooke said there is no significant difference in the information published by any of the guides including ers. All the companies use essentially the same sources she said. A fall our prices Are similar because the see surveys on Page 12