Review of Nissan Car Loans Finds That Blacks Pay More

July 3, 2001 10:10 PM

Review of Nissan Car Loans Finds That Blacks Pay More A statistical study of more than 300,000 car loans arranged through Nissan dealers from March 1993 to last September — believed by experts to be the largest pool of car loan data ever analyzed for racial patterns — shows that black customers in 33 states consistently paid more than white customers, regardless of their credit histories. (Need free sign up access to NYTimes.com)
posted by Rastafari (21 comments total)

Makes you wonder about other dealerships...
posted by Kikkoman at 11:25 PM on July 3, 2001

i'd say i was shocked, but i'm not. america rules.
posted by moz at 11:29 PM on July 3, 2001

I wonder if they did an analysis based on borrower income levels whether they would find a similar pattern.
posted by lagado at 11:43 PM on July 3, 2001

I'm not sure this is very conclusive. Does it mean that in the other 17 states, whites consistantly pay more? Also, it could be related to other factors. Perhaps, in general, many white people just tended to me more used to the system of having to bargain down dealerships, or something else completely unrelated to the colour of their skin. But, then I'm just a silly Canadian, we don't even have more than a few black families in the area, so I wouldn't really know about all these race problems.
posted by ayedub at 3:07 AM on July 4, 2001

this is so stupid.. did they expect the numbers to be equal? What about Asian, Latin etc.. all the groups wil be at diffrent levels.. and of course the more minority the group the more likely they will be taken advantage of by slimeball car salespeople.. why is this a suprise. Did they controll for handicap? Female? People on Prozac? The list could go in. The world is not black and white and its certainly not fair.. education is the best defense.. did they controll for education level and access to information on the web on buying new cars.
posted by stbalbach at 3:10 AM on July 4, 2001

I'd like to see if people with big dicks pay more, cause, y'know, I really have no idea.
posted by Hjorth at 8:12 AM on July 4, 2001

This thread is starting to follow a path so well trodden it could form a headline in "The Onion"...
White People Question Statistical Evidence Of Racism
"Did they take into account flying green space monkeys?", asks area man.
posted by pascal at 9:03 AM on July 4, 2001

Pascal, there is nothing here about "racism". Racism is a strong word, the article even says it doesnt know why its happening. Discrimination is often inadvertant, happens on both sides of the isle, and when people are educated about it steps can be taken. IMO the problem in this case is education and car dealerships should be required to educate customers simply by providing resources like this to customers.
posted by stbalbach at 9:44 AM on July 4, 2001

I disagree. While personal racism is disgusting it doesn't matter much to me. It's racism practiced by institutions that affects me and that type of racism can generally only be proved by statistical studies. After all discrimination is practiced against a group, not an individual so evidence of it can only be seen by following the experiences of groups.
posted by rdr at 9:52 AM on July 4, 2001

Oh puh-leeze!
So it's not about racism, but it is about discrimination based on race. Well, I have news for you, or rather Merriam-Webster does...

Main Entry: rac·ism
Pronunciation: 'rA-"si-z&m also -"shi-
Function: noun
Date: 1936
1 : a belief that race is the primary determinant of human traits and capacities and that racial differences produce an inherent superiority of a particular race
2 : racial prejudice or discrimination

So first you want to say it's not about black people, then you want to say it's not about racism. Perhaps next you'd like to deny it was in the NY Times?
posted by pascal at 10:03 AM on July 4, 2001

"so I wouldn't really know about all these race problems." - ayedub at 3:07 AM PST on July 4

what part of canada do you come from? we have our own race problems. what about the rampant racism against the aboriginal segment of the population? they suffer many of the same injustices as black people do in the US. [higher incidence of poverty, disporportionate levels of incarceration, ghettoization in the innercity, history of segragation, etc.]
posted by raedyn at 10:14 AM on July 4, 2001

Don't know about anywhere else, but here in Metro Detroit, it's all about location....if your zip code shows you live within the City Limits, you'll pay more. If you live in Bloomfield Hills or Grosse Pointe, no matter if you're plaid, you'll be given preferential treatment. Redlining is technically illegal, but it's alive and well.
posted by Oriole Adams at 10:22 AM on July 4, 2001

Pascal, if you read the article it says they dont know why its happening. They make no claim to racism. Why do you? Wheres your evidence? The evidence in the article has been pointed out is severly lacking in credibility and is probably why the authors leave it up to the imagination of the readers.. its an irresponsible article on the level of day time TV talk shows.. shocking coming from the NYT.
posted by stbalbach at 10:30 AM on July 4, 2001

stbalbach - Maybe my wording was incautious, but that said I was intending to satirize the fact that whenever statistics about race come up, people (in particular white people) tend to employ a level of skepticism about them that is conspicuously absent from debate about statistics in other fields. It just would have been nowhere near as funny if I'd written that in the first place.

You've done nothing so far that convinces me I'm wrong to think that. You claim the evidence is severely lacking in credibility, but on what basis? As far as I can tell, you just expect me to take your word for it. If you read the article thoroughly, I think there's a degree of justification for saying that the evidence as presented shows that racial bias on the part of auto dealers is playing a role in the results.
posted by pascal at 11:03 AM on July 4, 2001

What if Jewish buyers get even better prices then whites. Who knows? They dont show the breakdown so the numbers are taken out of context and are meaningless like so many stats are. As ayedub pointed out what about the 17 other states.. are blacks getting better prices there? Is this a statistically signifigant study drawing on peoples perception of racism for the sake of entertainment to buy more newspapers and push a political agenda, would the NYT step so low? When it comes to racism no one is neutral and so yeah of course there is always vocal skepticism which is why when the numbers are not complete it raises red flags.
posted by stbalbach at 12:21 PM on July 4, 2001

The article is not the study. Neither of us has seen the study, so all either of us can do is speculate as to what the study's complete findings are.

But... the article makes it quite clear that the data has been collected in order to support a court case, where I imagine the methodology and the statistical significance of the results will come under very close scrutiny. I think this is adequate reason to believe that the people working on it have not done so frivolously, and that they have anticipated the kind of very basic questions you've been asking.

If it suits you, go on believing that the stats have been collected a group of village idiots in the pay of the media. But personally, I can't see any reason to believe that. It will all come out in court, I'm sure.
posted by pascal at 12:47 PM on July 4, 2001

The problem here is car dealerships. I just got done buying a car, and let me tell you. Man, does it suck! You have to try and be such a hardass, otherwise, you get hosed. The car dealerships go out of there way to confuse the hell out of you and screw you at every possible turn. Until all dealerships offer one price to everyone, no negotiating, (including financing) someone will always be able to complain that they got screwed when buying a car.

I think it would be interesting to see a comparison of education levels and/or Internet access vs. price/financing offered.

P.S.: Check out CarSOS if you plan on buying a car soon. It helped me negotiate the deal I wanted.
posted by internal at 1:26 PM on July 4, 2001

Rules for buying a car.

1) Know as much about the cars you're interested in before you go see them, including dealer invoice for every trim level and options. (Having this info on your Palm is good.)

2) Reject any charges added by the dealer. For example, many dealers add an extra charge for rustproofing. Cars are rustproofed at the factory and do not need the fifty cents' worth of additional chemicals the dealer squirts on them, especially not at the 1000% markup. The dealer will tell you they do that to all their cars. Tell the dealer he can either get you one without it, or lose the sale. Chances are the dealer will just strike it off the invoice since, as noted, it doesn't cost them much at all. Another common trick is to charge again for something that's already on the factory invoice. "Dealer prep" charges are always a scam; cars arrive from the factory ready to sell. Yeah, the dealer has to keep them clean after test drives, but this is a cost of doing business. Besides, if it comes down to taking a dirty car or paying a dealer a couple hundred bucks to clean it up, you'd take the dirty car, right?

3) Be up-front with the salesman. Tell him what phase you're in: just test-driving, or ready to buy. If you're test-driving, tell him you do not intend to buy today under any circumstances. If you're ready to buy, tell him up-front you intend to be a hard-ass, that you have the dealer invoice prices and you have done a lot of research. He will of course not like hearing this, but he will get the hint that he should just take care of you as quickly as possible so he can move on and bamboozle someone else. You will have avoided wasting his time and he will grudgingly respect you for it.

4) Your offer should be no more than 7% over dealer invoice and should probably be closer to 5%. Between $700 margin (for a cheaper car) and $1500 (for a really expensive one) is a good place to be. Dealers often get factory incentives ("spiffs") for selling cars so they will make more than this on the car, you can be sure. If they object point out that they will still make something on the sale, which is better than nothing, and that it would be better not to waste time so perhaps they can move on to a more profitable sucker.

5) Always be ready to walk if they won't meet your price. They will ask you to meet them halfway and try various other tricks to make it seem like you're getting such a good deal that it's unfair to them. Do not budge. Tell them, "This is my offer. If you will not accept it, then we have nothing further to talk about." Don't worry, they won't let you walk out. They will stall you and keep you there while they "discuss it with the manager" or whatever. The price will keep coming down, eventually matching your offer. If it seems to stall, feel free to literally get up and leave. If they don't stop you, go somewhere else.

6) If you're trading in your old car, you should visit a couple of independent used car dealers first and offer to sell it to them in order to find out the highest value your car's worth to a used car dealer. Do not take less than this value for a trade-in allowance. (Blue book values and used car ads in the classifieds can give you an idea what you might get if you sold it yourself, but that's a real gamble unless you know your car is very popular.)

7) Have your own financing ahead of time and shop around for that too. But do see what the dealer will offer you for financing; if it's a better deal, take it.

8) Consider an auto broker. You tell them what you want, then, for a fixed percentage markup, they get you that exact vehicle. (It comes from a local dealer, naturally, which means the dealer is theoretically willing to sell it for whatever the broker charges less the broker's markup.) Much less hassle if you know exactly what you want and don't want to spend an afternoon negotiating. In any event, the broker's price can be a good bargaining tool.

9) If you're buying a really popular car, prepare to get reamed. The only solution to this is to pick a different model.

10) Come into the dealership toward the end of the month if possible. Salespeople will be more interested in making their quota. February is also a good time to buy a car, as auto sales tend to be rather flat during that month.
posted by kindall at 2:35 PM on July 4, 2001 [9 favorites]

11) Bring kindall along with you.
posted by iceberg273 at 2:40 PM on July 4, 2001 [1 favorite]

CarBuyingTips.com has some really good advice about buying a car.
posted by gyc at 3:17 PM on July 4, 2001

Heh. Having read the CarSOS site that internal was good enough to link to, I will also add: bring a calculator and verify any financing they offer you so that you can be sure the monthly payments, principal, and interest rate are all in sync. The trick they describe is pretty sleazy.
posted by kindall at 3:33 PM on July 4, 2001