European Stars and Stripes (Newspaper) - June 14, 1992, Darmstadt, Hesse Page 10 b the stars and stripes sunday june 14, 1992questions, answers on cafes car sales the stars and stripes submitted 21 questions in writing to cafes Headquarters in Dallas on june 3, seeking additional information on the Agency a announcement that Day that a formal review of its new car sales program would result in several changes. The following responses were received june 13 in a four Page document signed by it. Col. Louis Ammi Rati the cafes Public affairs chief of information services. The information in parentheses has been added to help clarify the questions. Q1 when will you provide us with the actual review document a1 a we have no plans to do so. Q2 who did the review How Long did it take when was it completed a2 the review was accomplished by a committee at Headquarters cafes with input from Field personnel. It took one month to Complete the Basic review. The warranty review portion is scheduled to be completed during july 1992. Q3 what prompted the review a3 we periodically review ongoing programs. Q4 is it a first of a kind process for the new car sales program a4 no. Q5 As a result of the review Are any changes contemplated in the contracts with automakers either As amendments to existing documents or modifications in future agreements if so what changes would be sought a5 yes. Changes Are pending final contract negotiations. Q6 the june 3 announcement stated that cafes will appoint someone to coordinate the new car sales program in Europe Why has t there always been a single Point of Contact for new car sales in cafes Europe will the new position be full time will it be an expert in Auto sales and or consumer issues a6 it is our understanding that the pcs specialist position at he cafes Europe was previously eliminated. Therefore the use of the word Quot always Quot in this answer May be incorrect. Q7 one task of this new position apparently will be training of cafes business managers. Has there been none of this training in the past a7 As stated the position is not new. Training is ongoing and has been and will be conducted on a regular basis. Q8 what warranty service Quot potential problems Quot referred to in the june 3 announcement have you identified a8 the need to provide More warranty service information to our customers. Q9 has your a full review Quot also referred to in the june 3 news release of cafes warranty services been concluded if so what Are the findings if not what Are the subject areas How is the review being done and by whom a9 this part of the review is still under Way. It is scheduled for completion by the end of july. Q10 does the Standard of warranty service in Europe match stateside standards As required in your contracts a10 yes. Q11 a cafes said june 3 it would give All buyers a list of warranty service locations Why weren to customers already being provided with a list of warranty service locations As required by your contracts All they were. We Are increasing the availability of this information in our Plain talk pamphlet and in the new videos. Q12 window stickers which stars and stripes surveys had shown were missing from Many vehicles being offered for Sale were the manufacturers failing to comply with Federal Law and the cafes contracts in the past has cafes Ever attempted to Monitor the window sticker provisions of Federal Law and its own contracts please detail. A12 manufacturers have always installed the window stickers however they do come off the windows and Over 400 were replaced in 1991. We will continue to Monitor this and give it the emphasis it warrants. Q13 what Are the specifics of your plan referred to on june 3 to Quot increase future audit activities and oversight Quot of Price markups will it include elements of the program other than the 7 percent ceiling a13 periodic audits will be made of new car pricing to Laaura compliance with contractual pricing requirements. As one of the 17 businesses of cafes new car sales will is evaluated and prioritized each year As a potential audit subject. Q14 your report indicates compliance with the 7 percent markup Quot when actual sales were were there different findings for other stages of the transaction particularly at the Purchase order and Deposit stage were mistakes by sales agents common a14 there were some clerical errors found but Correct prices were on the automated order acceptance form. Q15 has the new car sales program Ever been the subject of an internal audit which cafes announced june 3 would begin regularly ? if so How often when was the last audit Why was t the pcs part of the annual internal audit program what will be the scope of this internal audit a15 Yea. In 1990. Pcs is included As potential audit subject each year when determining our annual audit plan. Audit entitles Are determined end prioritized each year based on management concerns sensitivity of subject area established controls or risk the value of assets or sales outside audit results and time since last audit. Q16 the review group concludes that Quot Many customers Are not aware of the services and features Quot of the program. What Are the reasons for that a16 the program has Many customer oriented features. Cafes will be More Active in publicizing the numerous benefits of the program using the pcs videotape program and the updated Plain talk. Q17 who is responsible for developing the Quot multimedia informational series Quot described in the june 3 news release ? is it to begin in the fourth Quarter As announced of the Federal governments fiscal year or a fest fiscal year that ends in january who pays for it will it be prepared commercially a17 cafes in coordination with the Auto companies will develop and distribute the information. Q18 cafes stated june 3 it will update its informational materials and give them to All buyers when were the program pamphlets last updated what in them needs updating Don t the existing contracts require that they be Given to buyers a18 the Plain talk pamphlet was updated in april 1989. The information will be put in mors easily understood language. Yes the contract requires that the pamphlet be Given to buyers. Q19 How will the checklist to be Given to each buyer differ from the pamphlet what is the purpose of having the customer initial it a19 the checklist will identify All documents and information provided to the customer and it will be part of tha Plain talk package. The customer will not initial the checklist rather tha customer will continue to initial the Purchase agreement which signifies that a copy of tha Plain talk brochure has been received. Q20 when will buyers begin receiving videotapes of the details of the new car sales program ? a20 late fall 1992. Q21 has there been any organizational or staffing changes in the new car sales program in the last three months if so what Are they?a21 no. Cafes a amps Lile photo the cafes car lot at Rhein main a Germany is typical of outlets in Europe. From Page 1 7 percent ceiling Over invoice prices that is mandated by cafes contracts with the automakers. Cafes subsequently said that an audit of its contractors records indicated that All pricing errors Are caught before final transactions occur. In its statement saturday cafes did not respond directly to questions about pricing error rates at the Point where customers make initial deposits. The response said Only Quot i Here were some clerical errors found but Correct prices were on the automated order acceptance form a which is the final step in the transaction. Another stars and stripes pricing Survey compared the prices Given by sales agents at cafes locations in Europe where prices cannot be negotiated for three specific models with prices negotiated with dealers at four locations in the United states. For the Ford vehicle the stateside prices were higher in three out of four eases for the general motors and Chrysler products the stateside prices were lower in seven out of eight cases. In its weekend statement cafes said that its full review of overseas Auto warranty services still is under was and would be completed by late july. Asked to identify the warranty Quot potential problems Quot mentioned in its june 3 announcement cafes described them As a the need to provide More warranty service information to our also on the Issue of warranty service cafes stated that the Standard of service overseas is the same As in the states As required by its contracts with the automakers. Nearly 17,000 cars vans and trucks were sold on military installations overseas last year under the cafes Banner. Nearly eight out of 10 were sold in Europe. The Exchange service does not sell the cars directly. Instead it has contracts with Ford general motors and Chrysler to Market the cars. Ford Sells the cars in Europe through its european subsidiary while general motors and Chrysler have hired overseas military sales group a new York based corporation to sell their vehicles. Essentially the companies Are Given a free place to do business and cafes pays the fees for advertising in the stars and stripes. In return the companies pay cafes about $175 for each car they sell that totalled about $3 million last year cafes said. The three year contracts were last renewed for the 1990-91 fiscal year
