Digital Dealer - August 2019 - 9

recapped or a snow tire,
or has less than 1/8 inch
(4/32nds) of tread left at the
shallowest point; (h) a damaged or worn brake which
does not meet government
safety standards." The list
is comprehensive, and this
is just a small sorting of all
the listed requirements.
Of course, Ally is trying to
protect its asset so that it's
actually worth the residual
value placed on it at the end
of the agreement.
U.S. BANK

Besides wording similar
to the above Ally requirements, U.S. Bank added:
"to ensure the warranty, if
any, remains valid." They
also added "You will keep
all maintenance and repair
records. You agree to
pay for all operating costs
including ... towing and
replacement tires." Get this
too: Vehicles are not to be
used for transport, passengers for hire, for livery,
towing, snow plowing, or
construction, and to not
take the vehicle out of state
for "more than 30 consecutive days." Neither Ally nor
U.S. Bank allows vehicle
modifications without prior
approval.
CHRYSLER CAPITAL

In bold print, Chrysler
proclaims: "You promise
that neither you nor anyone
else will ... fail to pay any
fine, toll, ticket or penalty
associated with the Vehicle.
If you fail to pay, you will
reimburse us and pay a
$25 administration fee per
occurrence ..." Regarding
maintenance, "You must at
your expense, maintain the
Vehicle in good operating

order and appearance and
maintain the Vehicle in
accordance with all legal
requirements (including inspections), the manufacturer's recommendations and
warranty requirements...
You agree to keep and
maintain all service records
on the vehicle during the
Lease Term and provide
such records to the Lessor
at the end of the Lease
Term."
GM FINANCIAL

"Before you turn in your
vehicle, you may want to
make repairs related to
excess wear and use, and
any outstanding recalls.
Once your repairs are completed and before turning
in your vehicle, mail or fax
all repair receipts to GM
Financial so credit can be
applied to your account. If
you elect not to repair the
excess wear and use, any
allowable excess wear-anduse charges will be billed
to your account and mailed
to you within 60 days of
turning in your lease."
GM Financial also
provides a list: Make sure
all equipment is present,
including all keys and key
fobs, owner's manual, thirdrow seats (if applicable),
other accessories included
in the lease package, original manufacturer wheels at
the time of the lease, and
power charging cables for
electric vehicles. It seems
they want all of their stuff
back.
HONDA FINANCIAL
SERVICES

On their website when
asked about maintenance
and a lease: "Yes. As part

of your Honda Leadership
Lease agreement, you are
responsible for servicing
your vehicle in accordance
with the manufacturer's
minimum recommendations
and as requested by the
manufacturer in connection
with any recall campaign."
BOTTOM LINE

Leasing or financing
purchase, even when cash
is paid, there are requirements related to maintenance performance for all
franchises. While keeping
the very valuable warranty
in full effect is primarily
related to the financing and
cash purchases, the leasing
programs have much more
stringent requirements for
both performing and documenting that the manufacturer recommendations/
requirements have been
followed explicitly.
I teach every ASM staff
to be honest and factual
with leasees. This includes
educating them that it's wise
to purchase tires at 25,000
miles for instance, when
they are at 4/32nds - in the
danger zone. It's smart to
buy now at "our everyday
low price" and enjoy the
safety and performance
until the end of the lease
than pay "whatever" to
"whomever" at lease end -
a no-brainer decision.
I have blown up the maintenance section on leases
and posted them on the
wall in service drives so that
they serve as an easy, quick
reference - and reminder. I
don't expect F&I personnel
to fuzzy their transaction by
being frank about the maintenance and other requireD I G I TA L D E A L E R . C O M

ments, but at some point,
the facts have to be presented, including providing
the required documentation.
Maintenance requirements
during a typical lease period
are very inexpensive today,
compared to years ago. If
the consumer isn't educated
about these facts, they will
likely get a costly surprise
you don't want them to get
at the end, while you lost
the revenue, as it's now
going elsewhere.
FOR YOU

In the vain of requirements discussed here, I
have had well over 100
requests for the Advanced
Driver Assistance System (ADAS) repair cost
worksheet from AAA that I
offered previously.
If you missed it and
would like a copy, email
Ed@NetProfitGroup.com
with the subject line "AAA
Handout Is for Me." It's
great for educating customers too - who knows, we all
might end up with a Ph.D. in
car stuff.
ED KOVALCHICK has
traveled the world training and
consulting in fixed operations
for manufacturers and dealers.
His extensive background
includes master technician
status, independent shop owner,
dealer with all Chrysler & Nissan
franchises, and founder of Net
Profit Inc., fixed operations
consulting and training. He is
a graduate of the University of
Louisiana and has served as
state president of the Automotive
Service Councils, and the
advisory boards of Wyo Tech and
Virginia College. He has been a
regular columnist and conference
presenter with Dealer Magazine
and Digital Dealer since 1995.
EMAIL: Ed@NetProfitGroup.

AUGUST 2019

9
http://www.DIGITALDEALER.COM
Digital Dealer - August 2019

Table of Contents for the Digital Edition of Digital Dealer - August 2019
