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June 24, 2019

This Advertised $9.99 Oil Change Actually Costs 70% More

Filed under: Autos,Retail — Edgar (aka MrConsumer) @ 5:44 am

MrConsumer loves a bargain and to find an offer for a $9.99 oil change these days is unheard of. But that’s what Monro, an East coast auto service chain, advertised. They also run nine other auto service chains in the Eastern half of the country and in California. They are Mr. Tire, Tread Quarters, Ken Towery’s, TireChoice, AutoTire, Tire Warehouse, Tire Barn, TiresNow, and CarX.

Monro $9.99 oil changeEnlarged for better readability

*MOUSE PRINT:

That unreadable fine print says there is an additional charge (where permitted) of $2.90 for an oil “filter and/or waste recycling fee and a 9.99% service charge which represent shop supply and equipment costs and profits.”

So already, the $9.99 price is out the window. The $2.90 waste disposal fee is not required by the state, and retailers are required to take back up to two gallons of used oil sold by them per day per person at no charge. A service shop like Monro is not considered a “retailer” according to the state. And then there is that 9.99% shop fee.

But is it really only 9.99% for this oil change?

*MOUSE PRINT:

Here is a condensed version of an estimate from a Monro location using the above $9.99 coupon:

monro estimate

In this case, the 9.99% shop fee charge totals $3.29! Where did that come from? Shouldn’t it be about a dollar on a $9.99 oil change? What Monro does is charge the customer 9.99% on the regular price of the oil change. In this case, that is $25 plus $4.99 for the oil filter plus the $2.90 disposal fee, totaling $32.89. Ten percent of that is $3.29. This is similar to a misguided retailer trying to charge sales tax on the regular price of an item rather than on the discounted price when it is on sale.

We contacted Monro’s chief marketing officer trying to determine if this was a computer programming error or a deliberate and misleading way to calculate the 9.99% shop fee. Her response sidestepped the question:

“We disclose the inclusion of a disposal fee and a service charge fee based on the retail price in all marketing materials.”

We also questioned whether the sales tax was being calculated correctly by basing it on not only the oil change, but also on the environmental/disposal fee and the shop fee. The company expressed confidence in its calculation. However, Massachusetts law only provides for assessment of the 6.25 percent sales tax on tangible goods, and therefore not on services, shop and recycling fees, and service plans, particularly when they are itemized separately on the bill. While Monro did only charge tax on the net price of the oil change excluding the $2 labor charge, they did tax the recycling fee and the inflated shop fee.

It is misleading to customers to advertise what looks like a complete price when in fact the company has additional required fees in order to purchase the advertised service, particularly when clear disclosure of those charges is not made.

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9 Comments

  1. Thanks Edgar.

    It reminds me of Jiffy Lube charging a machine hookup fee of $25 to put freon in your airconditioning car system.

    Comment by nancy — June 24, 2019 @ 7:22 am
  2. Thanks for the heads up Edgar. That’s why I call ahead and get the “out the door” oil change fee. It’s too bad our government doesn’t enforce the laws designed to protect us from such deception.

    Comment by Alana — June 24, 2019 @ 10:02 am
  3. Honestly, if that’s how things work, I’m imposing a $100 shop fee that is automatically waived on all work I do from here forward.

    This doesn’t just sound misleading, this looks outright illegal. I think it’s very clear by the advertisement that the full terms of the taxes and fees are not clarified. While I still don’t think $17 for an oil change is a bad deal I wish that the company was just more upfront with their pricing in this case. Considering it’s likely that the retail price is consistent it may make more sense to just put a dollar amount in the fine print which would have resolved the issue entirely.

    Comment by Joel — June 24, 2019 @ 10:43 am
  4. Not to mention the obligatory “Can you please step over here?” while the car is on the lift followed by $200.00 to $400.00 worth of work you and the “technician” already know the car doesn’t really need.

    Comment by Joe E — June 24, 2019 @ 11:04 am
  5. If they had advertised the oil change for $9.99 PLUS Tax, fees, and charges, people might not take advantage of the sale! It’s like talking to the phone company about phone, cable and Internet; sounds real cheap until you add in the TAX, FEES and charges, and then the bill skyrockets all over again.

    Comment by MerryMarjie — June 24, 2019 @ 1:41 pm
  6. MerryMarjie, They did, albeit in small print.

    Comment by Gert — June 24, 2019 @ 4:27 pm
  7. I went to them as they were advertising Brakes at what looked like a great price. I went to the shop and before letting them touch my truck i pointed to the ad for a brake job, turning rotors…my rotors were perfect so they did not need turning, and a set of pads.

    I told them rotors were perfect and they said they turn them all and my pickup would cost over $600.

    Brought the truck to a local guy, he said rotors were in excellent condition and replaced the pads with lifetime pads for $225.

    Saved $400 by not letting Monro near my truck.

    Comment by Rich — June 25, 2019 @ 8:37 pm
  8. I can’t be 100% confident, but it sure seems like the reason they are charging tax on the service fee even though there is no tangible product is because they recognize that the state would come after them for uncollected taxes otherwise. By the letter of the law (as read above at least), I believe Edger is right in that it should not be taxable. However, to charge a fee that is “costs and profit” is a potentially huge loophole (or an illegal practice). Why not charge $0.01 for the oil change plus a $20 service fee to cover “shop costs and profit” that is then not taxable? Obviously that example would not fly with the state/local taxing authorities, but would be what is going on here if they failed to charge the tax, just on a smaller scale.

    Comment by Joe — June 25, 2019 @ 9:20 pm
  9. There’s a simple answer to this. STAY AWAY FROM CHAINS. If all the consumer pieces exposing how these chains rip off customers and perform subpar work the past 40 years haven’t convinced you yet, then you reap what you sow at this point.

    Comment by David — June 28, 2019 @ 2:15 pm

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