Glossary

A | B | C | D | E | F | G | H | I | K | L | M |N | O | P | Q | R | S | T | U | V | W

A

Acquisition Cost
(1) The agreed vehicle purchase price. (2) Term for the total cost of vehicle, plus lessor's markup, minus the lessee's down payment. This will be the financed value of the vehicle at the start of the lease.
Actual Cash Value
The amount of money invested in the purchase and repairs of a used vehicle. Also known as ACV, this represents the amount of out of pocket expense a dealer or broker is "into" a car. For insurance purposes, ACV is the actual cash value of the vehicle prior to collision damage, usually derived from an automotive price guidebook.
Adjusted Capitalized Cost
Capitalized cost minus the capitalized cost reduction.
Advertising Allowance
An incentive program sponsored by car manufacturers to promote dealer advertising. The amount is shown on the factory invoice under "advertising." This amount is credited or paid to the selling dealer by the manufacturer.
Advertising, Dealer
Manufacturers charge a percentage of the total MSRP minus the destination charge for each car the dealership purchases. Most manufacturers charge 1% for national advertising. Some import makes have a flat fee charged to each vehicle. This money assists in the national marketing efforts for that make of vehicle. Since each dealer benefits from this exposure the manufacturer requires each dealer to contribute. The dealership may pass this cost on to the consumer in the base invoice price for each vehicle. In some areas, dealers may be required to participate in local dealership marketing efforts. Each dealer is required to contribute to additional local advertising based on the quantity of vehicles sold. This may result in an additional.5% to 1% of MSRP being added to the invoice price.
After Market
Optional equipment, not factory installed, that is sold and installed by the dealer or an outside reseller.
Aftermarket/imitation parts
Usually defined as parts not produced by or for the original manufacturer of the vehicle.;
Aftermarket
Part not made by the original manufacturer.
All-wheel drive (AWD)
Permanent, full-time four-wheel drive system designed for improved traction on slippery surfaces and off-road use. The main difference between AWD and 4WD systems is that AWD cannot be disengaged by the driver.
Anti-freeze (coolant)
The liquid located in the cooling system and engine that is used to dissipate heat. Engine coolant prevents freeze-up in winter, reduces the engine temperature in the summer, and protects the cooling system from rust and corrosion year round.
Anti-lock braking system (ABS)
System that prevents wheel lock-up by automatically regulating the brakes. ABS can decrease braking distances, prevent skidding and allow more control during sudden stops.
Anticorrosive inhibitor
Protective coatings applied to metal surfaces to retard or prevent corrosion.
Anticorrosive
Materials applied to metal to give corrosion resistance.
As Is
Vehicle sold in existing condition with no arbitration available.
Assignee
A third party that buys a lease agreement from a lessor. You become obligated to the assignee, and the assignee generally assumes the responsibilities of the lessor, although some obligations may remain with the lessor. An assignee may be a lessor for purposes of Regulation M when the assignee has substantial involvement in the lease.
Assignment Fee
A fee that covers the transfer of the lease from the lease originator to the financial lease sponsor. After the dealer or leasing agent negotiates the lease with a lessee, the dealer transfers (assigns) the interest in the lease to the finance group sponsoring the lease. Although this process primarily protects the dealership, the lessee often pays this fee.
Automobile Insurance
Coverage that pays for damage to your car or someone else's when involved in an accident caused by you or someone else. This is vehicle-to-vehicle insurance.

B

Back-End
Dealer profit on financing including service contracts and insurance products
Backfire
Gunshot-like sound from the engine or tailpipe.
Baking
Application of heat to cure and dry a coating. In automotive refinishing, baking is used to speed up the drying of air-drying lacquers and enamel and is sometimes called force drying. The metal temperature in refinish baking usually does not exceed 180°F (82.2° C).
Balancing
By adding small amounts of lead weights to the wheel, it is possible to equal out any unevenly distributed weight which may be present in the tire or wheel. Proper balance helps eliminate unwanted wheel and tire vibrations, and uneven wear caused by an out-of-balanced tire and wheel condition.
Balloon Contract
A loan that is amortized only down to the expected end-of-term value, with a remaining balance to be paid in a lump sum at the end of the term.
Balloon Payment
The final principal payment required from the lessee where the amortization rate provides for less than full principal repayment during the lease term. (e.g., a $10,000 car with a 36- month lease term at 2 percent amortization per month would have a balloon payment of $2,800 in the 37th month).
Battery acid (electrolyte)
The fluid in most automotive batteries. Electrolyte is a solution of sulfuric acid and water.
Battery hold-down
A fastening device used to secure the battery in place. The two most common types are the wedge type (which fastens near the bottom of the battery), and a strap or bracket type (which goes across the top of the battery to hold it firmly in place).
Binder
Insurance company's commitment to insure an item, prior to issuance of actual insurance policy.
Bodily injury liability
Pays your legal defense costs and claims against you if your car injures or kills someone. Covers family members living with you and others driving with your permission.
Book Value
Value placed on a vehicle by a guidebook such as AMR, NADA, Kelley Blue Book, Black Book, and others. May be either wholesale or retail.
Bottoming
When your vehicle reaches the limits of the suspension travel (such as when going over bumps), and the vehicle's springs are completely compressed. The vehicle produces a transfer of noise/harshness, particularly through the steering, with possible contact of the undercarriage with the pavement.
Brake drag
Brakes do not completely release.
Brake fade
Increased brake pedal effort is required to get braking action, particularly on hard stops.
Brake fluid
The liquid in the brake system that acts as a hydraulic fluid. As you step on the brake pedal, the fluid is forced through the brake system and initiates the braking components.
Brake master cylinder (master cylinder)
Master cylinders are used on braking systems to turn the mechanical power provided when you step on the brake pedal into the hydraulic power that is needed to apply the brakes and slow or stop the vehicle. The brake master cylinder is where the brake fluid reservoir is located on most vehicles. The reservoir stores the fluid until it is needed.
Branding
"Branding" usually requires that consumers give permission before certain non-new or non-genuine parts are used. Also required is the branding of the name or logo of the manufacturer of the imitation part on the part itself. Some states require that at least reasonable steps be taken to ensure that the name or logo can be seen after installation. Presumably, these laws are designed to allow consumers or others to pursue all legal remedies against these manufacturers in the event the part fails or damages an adjoining part. Check with your state's insurance regulator for specific information.
Broker
An entity that arranges for the sale or lease of vehicles through another party.
Bucking
Engine stalls, kicks in, and the car lurches.
Bumper to Bumper Warranty
Commonly used to describe the manufacturer's comprehensive warranty. It covers the bumpers but not all in between. Read carefully for exclusions brake pads, belts, battery, etc.
Buried
(1) A customer who is severely upside down will sometimes be called "buried". (2) A vehicle that was returned to the original seller, because of arbitration problems.

C

CAFE
The acronym for Corporate Average Fuel Economy. This single mileage figure is determined by taking a sales weighted average of the fuel consumption for all models produced by a manufacturer. The minimum required figure is an established U.S. government standard. Manufacturers which do not meet the minimum standard are fined.
Cap Cost Reduction
An initial payment on a lease that can further reduce a lessee's monthly payments by lowering the capitalized cost of the vehicle. Typical reductions could be made for additional down payment, dealer discounts, or trade- in.
Capitalized Cost
The agreed-on value of the unit in the lease agreement. Generally, this value includes the actual cost of the unit plus dealer mark-up and delivery costs.
Captive Finance Company
A leasing or finance company that is affiliated with an automobile manufacturer or distributor. Examples would be (GMAC) General Motors Acceptance Corp and (FMC) Ford Motor Credit.
CCA (cold cranking amps)
A rating that indicates the amount of power that a battery can provide for engine cranking in cold-start conditions.
Certificate of Origin
The bill of sale on a unit from the manufacturer to the dealer conveying title of the unit to the dealer.
Charge Back
A charge made to the lessee by the lessor for any expense that is incurred by the lessor that is not a part of the lease agreement, e.g., damage in excess of fair wear and tear, unauthorized purchases, etc.
Chassis
Undercarriage of a vehicle that carries all suspension and powertrain components.
Clear coat
A clear, shiny coat of paint (e.g. urethane or acrylic enamel) applied over the base or color coat of paint on a vehicle.
Clip
A group of related vehicle parts purchased from a salvage yard as an assembly (usually the complete front or complete rear section of a vehicle). Also known as a Salvage Clip.
Closed End Lease
A lease in which the lessee is not responsible for the value of a vehicle when the lease is done. Under this arrangement the lessee may return the vehicle at the end of the term and have no further obligation for the car. Also know as a "walk-away" lease.
Collision insurance
A form of automobile insurance that covers loss to the insured's own vehicle caused by its collision with another vehicle or object. This type of insurance does not cover bodily injury or property damage liability arising out of the collision.;
Collision
Pays for repairs of damage to your car caused by a collision with another vehicle or any other object, regardless of who was responsible.
Color coat
The single stage or basecoat that provides the final color of a coating system.
Compression ratio
Relationship between the cylinder volume when the piston is at the top of the stroke and the volume when it is at the bottom of the stroke. For instance, a compression ratio of 91 means the piston has compressed the air/fuel mixture into a space that is nine times smaller than it would normally utilize.
Conditions
Explanations in the policy of your responsibilities and the company's responsibilities. For example, how claims are to be filed and what proofs you must submit with your claim.;
Consent
"Consent" requires that consumers give permission before certain non-new or non-genuine parts are used. The notice must take the form of a disclosure document with certain language in a legible type size. Since this legislation can vary from state to state, check with your state's insurance regulator for specific information.
Control arms
Pivoting suspension components mounted between the frame (or uni-body) and the wheels.
Coolant (antireeze)
The liquid located in the cooling system and engine used to dissipate heat. Engine coolant prevents freeze-up in winter, reduces the engine temperature in the summer, and protects the cooling system from rust and corrosion year round.
Coolant recovery reservoir
A tank that stores coolant for when the cooling system either needs coolant (coolant is then sucked into the cooling systems radiator) or when the system needs to expel excess coolant. The coolant reservoir can then store that coolant for future system requirements.
Corrosion
Chemical reaction of oxygen and moisture or other caustic materials on a metal surface. Usually referred to as rusting or oxidation.
Courtesy Delivery
Refers to a unit that is ordered directly from the manufacturer and is delivered to a client through a dealer other than the one ordering the car.
Coverage
Description in the policy of the specific circumstances under which you receive benefits.;
Crank
If the car "will not crank" when you turn the ignition key, you typically either hear a clicking sound, or nothing at all. If the car "cranks" it means the engine is spinning or "turning over," but not starting.
Crankcase
The single largest section of engine containing the crankshaft in an oil-tight housing.
Crumple zone
An area of the car that is designed to compress during an accident to absorb the energy from the impact.;
Crush zone
A part designed to bend or crumple when involved in a collision.
Curb weight
The weight of a vehicle measured with no passengers or loads, and carrying a full tank of fuel.
Cuts out
When an engine "cuts out" it loses power or mis-fires. It feels as if the engine is momentarily shut off.

D

Dealer Cost
The actual cost of a new vehicle to the selling dealer after manufacturer holdbacks and wholesale incentives; the amount the dealer must pay the manufacturer.
Dealer Invoice
(1) The amount listed on the manufacturer's bill to the dealer. Wholesale incentives may not be listed. (2) The purchase price of the vehicle that the dealer is obliged to pay the manufacturer.
Dealer Mark-up
The amount that a dealer charges over dealer cost, similar to gross profit.
Dealer Principal
The individual or corporation that owns and controls one or a number of auto dealerships.
Dealer Trade
The swapping of vehicles between dealers to balance inventory or fill a retail customer request.
Dealer
An individual who has been licensed by the state to transact the sale and purchase of new or used vehicles.
Debt to Equity
A ratio used in credit analysis expressing the degree of debt "pressure" based on the relationship between borrowed and invested capital. The ratio may be calculated in a variety of ways; however, the most comprehensive would be total debt divided by total equity. The higher the ratio, the greater the risk being assumed by creditors. A lower ratio generally indicates greater long-term financial safety.
Declarations
Listing of the details of your particular coverage, such as the policy number, kinds of coverage and amounts of money provided by each, your name and address, a description of your vehicle, the premium and coverage duration.;
Deductible
The amount of a loss or claim you must pay before you can collect from the insurance company.;
Detonation
Rapid, rattling combustion, also called knocking.
Dieseling
Engine runs when you turn off the car because fuel continues to burn.
Differential lube (gear oil)
A heavy-duty lubricant designed specifically to handle the requirements of the internal gear and mechanisms. It is located within the differential case.
Differential
Gear system that allows one wheel to rotate faster than the other while providing equal power to each wheel, as necessary, when turning or cornering.
Dipstick
The device used to measure the level of a fluid (usually oil or transmission fluid). It is commonly known as an "oil dipstick" or "transmission dipstick," but also can be found in power steering reservoirs and other fluid reservoirs.
Direct damage
Damage that occurs to a vehicle at the point of impact.
Disc brake
Brake design in which brake pads press against a disc (commonly known as a brake rotor) to slow or stop the vehicle.
Disclaimer
Any one of several statements required to protect the car guy from being held responsible for the things written, spoken or even imagined while conducting car business.
Disposition Fee or Disposal Fee
Charged by the leasing company to cover the cost of moving, cleaning and disposing of the car at the end of the lease. Should be waived if the purchase option is exercised.
Documentation Fee
A charge that some dealers make when applying for and obtaining the license and title.
DOHC (Dual overhead camshafts)
An engine with two camshafts located in the upper portion of the cylinder head.
Domestic
A vehicle produced in Canada, United States or Mexico.
Drive shaft
Shaft coupled to the transmission that supplies power to the drive wheels.
Drivetrain
The power-transmitting components in a car, including clutch, gearbox (or automatic transmission), driveshaft, universal joints, differential and axle shafts.

E

Early Termination Fee
The net amount you owe if your lease ends before its scheduled termination date, calculated as described in your lease agreement. The earlier your lease is terminated, the greater this charge is likely to be. The charge is generally the difference between the early termination payoff and the amount credited to you for the vehicle. Suppose, for example, that your early termination payoff amount is $16,000 and the amount credited for the vehicle is $14,000. The early termination charge would be $16,000 minus $14,000, or $2,000 in this case.
Early Termination Payoff
The total amount you owe if your lease is terminated before the scheduled end of the term before subtracting the value credited to you for the vehicle. The payoff is calculated as described in your lease agreement. The early termination payoff may include the unpaid lease balance and other charges.
Early Termination
Ending of the lease before the scheduled termination date for any reason. The reason may be voluntary or involuntary (for example, the vehicle is returned early, the vehicle is stolen or totaled, or you default on the lease). In most cases of early termination, you must pay an early termination charge.
Electrolyte (battery acid)
The fluid in most automotive batteries. Electrolyte is a solution of sulfuric acid and water.
Electronic fuel injection (EFI)
A fuel delivery system in which nozzles (injectors) spray fuel into the intake manifold or cylinders. This allows for precise fuel control and better fuel efficiency than a carburetor system.
Engine block
The lower portion of the engine. An enclosed casting which contains the cylinders, pistons, connecting rods and crankshaft.
Equal Credit Opportunity Act
A federal law that prohibits discrimination in credit transactions on the basis of race, color, religion, national origin, sex, marital status, age, source of income, or the exercise of any right under the Consumer Credit Protection Act.
Estimate
The written determination made by an appraiser or estimator, upon inspection of a damaged vehicle, regarding the cost required to restore the vehicle to the condition it was in prior to the loss.
Estimator
An appraiser or insurance company representative who inspects a damaged vehicle and determines the cost required to restore the vehicle to the condition prior to the loss.;
Excess Mileage Charge
A charge that is assessed, at a pre-determined rate, on mileage in excess of the amount agreed to in the lease agreement for a closed-end lease.
Excess Wear Charge
A fee, above the amount for excess mileage, that may apply at the termination of a lease. Normal wear and tear is wear typical of vehicles on a similar age and may include minor dings, dents, and scratches. Excessive wear is more severe type of wear that may include physical damage as well as mechanical damage from not following recommended scheduled maintenance. The lease contract may also specify who determines excessive wear and tear.
Exclusions
Descriptions of the situations under which you and your car are not covered.;
Executive Car (Vehicle) Program
Company-provided vehicles for high-level executives. Executive vehicles are often not vital to the executive's job performance, whereas sales and service personnel, among others, depend on their business vehicles to perform their jobs. In many cases, executive vehicles are viewed as perquisite-an added bonus for achieving a certain job status.

F

Factory Incentive Programs
Programs offered by vehicle manufacturers to encourage the purchase of their products. Can consist of "free" optional equipment or incentives, payments. See "Front Money" or "Back-End Money".
Fair Market Value
The current value of a particular vehicle in the marketplace, based on mileage, exterior and interior condition, mechanical fitness and such.
Fast idle
Engine runs fast while vehicle is stopped.
Federal Motor Vehicle Safety Standards
The U.S. Department of Transportation (DOT) establishes minimum safety standards that apply to motor vehicles as well as specific vehicle components.
Federal side impact standard
Effective with the 1997 model year, all passenger cars are required to comply with Standard 214, side impact protection, as defined in the Code of Federal Regulations. Simply put, the entire structure, floor to roof, of all cars must now be reinforced according to strict regulations. Interestingly, this standard does not yet apply to light trucks (minivans, compact pickups, SUVs).;
Fender flange
Outer rim or bend along the lower edge of a fender that gives shape and strength to the side of the fender.
Finish coat
The last coat of paint to be applied. The finish coat determines the amount of gloss.
Flooding
Excess fuel in the cylinders makes starting difficult or impossible.
Floor Plan
A dealer's line of credit to finance the cost of carrying vehicles in inventory.
Four-wheel drive (4WD or 4X4)
Drive system that powers all four wheels. It provides better traction during adverse road conditions and for off-road use.
Frame alignment
Procedure by which the damaged chassis of a car, truck or bus is restored to the manufacturer's specifications.
Franchised Dealer
A licensed vehicle dealer authorized to sell and service a specific brand of new vehicles.
Front-wheel drive
Drive system that provides power to the front wheels of the vehicle. Front-wheel drive systems incorporate a differential into a transmission, creating what is called a transaxle. A transaxle can be automatic or manual shift.
Fuel injection (electronic fuel injection or EFI)
A fuel delivery system in which nozzles (injectors) spray fuel into the intake manifold or cylinders. This allows for precise fuel control and better fuel efficiency than a carburetor system.

G

Gap Amount
In the event a leased vehicle is stolen or totaled, the difference between the early termination payoff amount, not including any past-due amounts, and the amount for which the vehicle is insured before the insurance deductible and any other policy deductions are subtracted. The definition of gap amount may vary in different states or in different lease agreements.
Gap Insurance
In the event a leased vehicle is stolen or damaged beyond repair, gap insurance covers the "gap" between what insurance would pay, less any deductible, and the remaining amount owned under the vehicle lease.
Gas Guzzler Tax
The Energy Tax Act of 1978 established a Gas Guzzler Tax on the sale of new model year vehicles whose fuel economy fails to meet certain statutory levels. The purpose of this tax is to discourage the production and purchase of fuel inefficient vehicles. The assessment is usually not included in the base invoice price and may add $1000 to $3000 the cost of the vehicle. The level of fuel economy is not just based on EPA Mileage Ratings, but rather on a gas consumption value that includes several performance factors. The federal government derives this value from a formula based on engine displacement, horsepower, vehicle weight and fuel type.
Gear oil (differential lube)
A heavy-duty lubricant designed specifically to handle the requirements of the internal gear and mechanisms. It is located within the differential case.
Grab
Brakes "grab" when the car stops even when applying light pressure on the brake pedal.
Gray Market Vehicle
Cars that have been imported into the country but not through authorized dealers. They may not meet American safety and emission standards. These cars may have significantly lower values than cars imported through normal channels.
Gross Capitalized Cost
The agreed-upon value of the vehicle, which generally may be negotiated, plus any items you agree to pay for over the lease term (amortized amounts), such as taxes, fees, service contracts, insurance, and any prior credit or lease balance.)
Group number
A designated number identifying the battery height, terminal design, length, width and overall physical description of the battery.

H

Hesitation
Momentary loss of power on acceleration.
Holdback
Money, held by the manufacturer to be refunded to dealer at a date after the sale of vehicle. The invoice price minus the amount of holdback is often referred to as dealer net price. Holdback can be as much as 3% of the MSRP less destination charge.
Horsepower
The measurement of the engine's ability to produce energy.

I

Incentives
(1) A form of reward offered to boost sales; a special price reduction or rebate from vehicle manufacturers to influence the sale of a particular model. Incentives can be low to zero percent financing rates, no down payment, cash back offers, "free" options, etc. (2) Amounts rebated or credited, or special programs offered to encourage the lease of certain vehicles.
Indirect damage
Additional or secondary damage to parts or systems that may be the result of direct damage.
Intermittent
A problem that comes and goes with no obvious pattern.

K

Kelley Blue Book
A guidebook that provides values on new and used vehicles for the automotive buyer and the industry that builds and sells the vehicles.
Knocking
Rapid, rattling combustion, also called detonation.

L

Last Six
Last six characters of a VIN/serial number of a vehicle.
Lease Rate
A percentage used by some lessors and assignees to describe the rent charge portion of your monthly payment. However, no federal standard exists for calculating the lease rate. Any rates or factors used in lease calculations do not have to be disclosed under federal law. If a lease rate is given as a percentage in an advertisement or on any lease form, the ad or form must also state, "This percentage may not measure the overall cost of financing this lease." Some states may require lease rate disclosure using the state's definition.
Lemon Laws
State laws that provide remedies to consumers for vehicles that repeatedly fail to meet certain standards of quality and performance. Lemon laws vary by state and may not cover leased vehicles.)
Lessee
Party who leases vehicle. Holds temporary possession of the vehicle.
Lessor
The company funding the lease.
Liability
Your financial responsibility incurred because of an accident.;
Like kind and quality
The definition varies but often requires some certification of quality by an entity like CAPA. Some states have legislation in place that requires notice or consent prior to the installation of imitation parts and verbiage stating that the part and/or the warranty be of "like kind and quality" as those of the original manufacturer of the vehicle. This notice is supposed to remind consumers that the manufacturer of the imitation parts, not the manufacturer of the vehicle, provides any warranty associated with the part. Check with your state's insurance regulator for specific information.
LKQ
Parts marketed from salvage vehicles, re-sold by recyclers. Also called recycled OEM.
Low Ball
A quote on a new vehicle that is under a legitimate price. If a buyer responds she may be offered a switch car at a higher price. A low ball quote may be made on a trade in vehicle, offering less than wholesale to "adjust" the customer's expectation.

M

Master cylinder (brake master cylinder)
Master cylinders are used on braking systems to turn the mechanical power that is provided when you step on the brake pedal into the powerful hydraulic power that is needed to apply the brakes and slow or stop the vehicle. The brake master cylinder is where the brake fluid reservoir is located on most vehicles. The reservoir stores the fluid until it is needed.
Medical payments or personal injury protection
Pays medical expenses resulting from an accident for you and others riding in your car. Also pays for you or your family members injured while riding in another's car or while walking.
Mileage Allowance
Mileage limit for lease term.
Misfire (Miss)
Engine runs rough or unsteady at idle or speed.
Money Factor
A number, often given as a decimal, used by some lessors to determine the rent charge portion of your monthly payment. This number is not a lease rate and cannot be converted to a lease rate by moving the decimal point. The equivalent interest rate formula is Money Factor x 2400 = Interest Rate
MSO
Manufacturers Statement of Origin. Some manufacturers that resell used vehicles will not provide a MSO prior to sale in order to apply for a title.
Multi-point injection
A fuel delivery system that utilizes a fuel injector for each cylinder.

N

NADA
An acronym that stands for National Automobile Dealers Association. Founded in 1917, NADA represents more than 19,400 franchised vehicle dealers.NADA represents America's franchised new car and truck dealers. NADA also publishes a guidebook of used vehicle values.
Negative Equity
Additional money owed on a vehicle when comparing how much a vehicle is worth to the outstanding loan. For example, if a vehicle is worth $10,000 but there is a loan for $12,000; there would be $2,000 in negative equity - - since the value of the vehicle would not cover $2,000 of the loan.
Negative Equity
The difference between a trade's value and the amount owed.
Net Net Price
Invoice price minus the amount of holdback and dealer advertising. Typically Net Net pricing is only available to qualified fleet buyers.
Net Price
Invoice price minus the amount of dealer holdback.
NIADA
An acronym for the National Independent Auto Dealers Associations, a statewide membership that tiers into a national association of 15,000 independent or pre-owned vehicle dealers. Formed in 1946 to represent independent automobile dealers nationwide.
Notice
"Notice" requires insurers or repair facilities to give notice to consumers that "aftermarket" (see definition above) parts were used in preparation of the repair estimate. The notice usually must take the form of a disclosure document containing specified language in a legible type size. This notice is supposed to remind consumers that the manufacturer of the imitation parts, not the manufacturer of the vehicle, provides any warranty associated with the part. Check with your state's insurance regulator for specific information.

O

Oblique crash test
A newer crash test where the cars collide at right angles to one another as opposed to head-on. This test is more representative of common passenger car accidents.;
OEM parts
"Original Equipment Manufacturer" parts are designed and/or built by the original manufacturer of the vehicle. These parts are manufactured using the same material, design and manufacturing methods as the parts that were on the vehicle when it came from the factory.
OEM
Original Equipment Manufacture.
Off-Lease
A vehicle that has been returned to the lessee at the end of the lease period.
Open End Lease
A lease in which the lessor is not responsible for the value of a vehicle when the lease is done. Under this arrangement the lessee is responsible for the difference between the current actual market value at the end of the lease and the residual value. Also known as a "finance" lease.

P

Passive safety features
Features incorporated into the structural design of the car or featuers which the driver cannot control. For example crumple zones, bumpers, side intrusion beams and rollover bars.
Payoff
The amount you have to pay your lender or leasing company to satisfy your outstanding loan. It includes the outstanding principal balance, earned (but unpaid interest), and any late fees.
PCV (Positive crankcase ventilation)
If the PCV valve is clogged, your car will run rough or stall. It may also cause engine to use oil, smoke, and have high emissions.
Physical damage
A term indicating damage such as collision, comprehensive, fire and theft, or any damage to the vehicle itself.
Play
Degree of "looseness" in steering wheel, delay between turning the steering wheel and the wheels turning.
POA
Power of Attorney; a limited attorney-in-fact granted an agent to sign all papers and documents that may be necessary pertaining to the sale and subsequent title transfer of vehicles. Auctions are frequently provided a POA to facilitate the title transfer process for cars sold by consignors at auction.
Port fuel injection
A fuel delivery system that utilizes a fuel injector for each cylinder.
Power loss
Engine runs at reduced speed or requires more throttle to maintain constant speed.
Powertrain
A name applied to the group of components used to transmit engine power to the driving wheels. It can consist of engine, clutch, transmission, universal joints, drive shaft, differential gear, and axle shafts. Powertrain components are matched according to driver needs such as high torque, fuel economy, or convenience.
Powertrain
Motor, transmission and drive assembly - especially on front-wheel drive vehicles.
Premium
The cost of the insurance policy, usually paid out in periodic installments.
Prepayment Penalty
A fee sometimes imposed by a lending institution when a loan on vehicles or equipment is paid off prior to the expiration of the finance term.
Price Protection
Often, when a manufacturer announces a price increase during a model year, it will guarantee that vehicles ordered by a specified date will be delivered at the former price.
Program Car
A vehicle that is sold directly to a daily rental company by an automaker under terms set by the manufacturer. Program cars represent a large portion of current model-year vehicles remarketed through auctions.
Property damage liability
Pays your legal defense costs and claims against you if your car damages another's property. Does not cover your property, including your auto.
Pull
Vehicle moves to one side when braking.

Q

Quarter panel
A side panel that is generally one-quarter of the total length of the vehicle and extends from the rear door to the end of the car.

R

Rating
The process by which the price of your insurance coverage is determined. States are divided into rating territories. Your insurance company bases part of the price of your policy on the claims history of all the drivers it insures in your territory. Other factors such as your driving record and age also affect the rating.
Reconditioning
Repair, refurbishment or other mandated work that needs to be taken into account to bring a vehicle up to resalable condition.
Recycled parts
Used vehicle parts bought from a secondary source.
Refinish
Term used to designate a part or a vehicle that is to be repainted.
Residual
The projection of the market value of a vehicle at the end of a lease. Specialized companies that evaluate used car price data to make their forecasts typically calculate residual values. Financial companies, including the captive finance operations of the auto companies, use these values to set lease terms.
Ride
The driver's comfort level while driving. Factors that determine a vehicle's ride include the suspension, steering and braking characteristics.
Roadside Assistance
Commonly included with a new vehicle during the warranty period. Acts like a AAA membership. Provides towing, tire changes, jump starts, locksmith services and fuel delivery if you run out. Coverage varies.
Rough idle
When vehicle stops, engine vibrates or shakes.
RPM (Revolutions per minute)
The number of times an object, such as a tire, makes one complete revolution around its axis.
Rust-proofing
A protective coating is applied to vulnerable areas on your vehicle (usually the under-carriage and bottom of the vehicle).

S

Safe driver plan
A system in which points are assigned for traffic violations and certain accidents, and each point adds a percentage surcharge to the rating factor. It is similar to merit rating.
Salvage
A vehicle that is not economical to repair and is sold for the value of its salvageable parts.
Salvaged
A vehicle totaled in an accident and then repaired. There is no guarantee of street worthiness for a salvaged vehicle. It may look good, but be hazardous to drive. The term may also apply to individual parts or systems that have been removed from a totaled vehicle for use in collision repair.
Secondary Finance
Financing for below average credit scores.
Security Deposit
Paid upfront by the lessee to help ensure lessee compliance with the terms of the agreement.
Service Contract
A contract that you may purchase to cover expenses such as the repair or replacement of vehicle components and that may pay for related services such as towing or replacement rental cars. In most cases, service contracts do not cover routine maintenance.
Shimmy
Side-to-side motion that makes tires and steering wheel shake.
Shock absorber
A suspension component designed to dampen spring oscillation. It can be either gas- or oil-fed, depending on make and model of vehicle.
Sidewall
The most visible part of the tire when viewing the vehicle from either side. The sidewall contains information about the tire size, grade, and ratings as well as the manufacturer's name.
Simple Interest
The charge for a loan calculated by applying a rate of interest against the amount of the loan. Contrasts with compound interest in that only the principal earns interest for the entire life of the transaction.
Single coat
Usually referred to as a coat of paint - each stroke overlaps the previous stroke by 50 percent.
Single Payment Lease
A lease that requires a single payment made in advance rather than periodic payments made over the term of the lease. This lump-sum payment should be less than the total amount you would pay were you to make periodic payments over the term of the lease.
Sled
A vehicle that is generally considered to be past its prime.
Sluggish
Vehicle does not accelerate smoothly or with authority.
SOHC (Single overhead camshaft)
An engine with one camshaft located in the upper portion of the cylinder head.
Special Finance
Financing for less than average credit. See Secondary Finance
Specific gravity
This term is usually used in connection with the testing of the battery's electrolyte. A specific gravity test is used to determine the battery's state of charge. On sealed "maintenance free" batteries there is usually an indicator on the top of the battery that serves the same function.
Spot repair
A job in which a small section of a panel is refinished.
Stall
Engine dies.
Stroker
A person at the car dealer who is not a serious buyer.
Strut
Also known as a "MacPherson strut." This suspension component incorporates the dampening ability of a shock absorber with the rebound of a coil spring. It is mounted to the outer portion of the assembly. If no spring is present, it is called a "modified strut."
Stumble
Engine begins to stall but then kicks in.
Sublease
Oral or written contractual transfer of your right to use the leased vehicle to another person. Such a transfer is usually prohibited without the lessor's or assignee's approval.
Supplement
The document that is created when unforeseen additional costs for parts and procedures are necessary to complete a repair.
Supplemental payments
Court costs, bail bonds, expenses related to a lawsuit including defense, or any other specific payments your insurance provides which are not specifically listed in other parts of the policy.
Surge
Vehicle speeds up and slows down with no acceleration or braking by driver.

T

T.O.
Sales managers may require salespeople to T.O. prospect or "turn-over" the prospect to either a manager or senior salesperson if the sales process stalls. Turning over prospects is a common and fairly effective method to gaining the sale.
Torque
Force produced by the engine.
Towing costs
Optional automobile coverage which pays the cost up to a fixed amount for the towing of a disabled automobile.
Trade-in Allowance
An amount offered by a selling dealer for a used vehicle, to be applied to the purchase cost of a replacement vehicle.
Transaxle
Used in front-wheel drive and rear-engine, rear-wheel drive vehicles. Transaxles incorporate both a transmission and a differential into a single unit.
Transverse mounted engine
An engine that is mounted from side-to-side, in relation to the vehicle.
Tread
The pattern that is designed into the area of the tire that comes into contact with the road (or other driving surface). These patterns or groves in the tire provide increased traction.
TSB (Technical service bulletin)
An advisory issued by manufacturers that describes performance problems for vehicles of a specific make, model and year.

U

Under carriage
Supporting structure and framework. Essentially, it is the under-side of the vehicle.
Unitized body construction
Fabrication in which the frame and body are made out of a large number of sheet metal panels of varying sizes and shapes assembled and welded into a single unit.
Upfitting
The process of installing special equipment to a vehicle after it has already been built by the manufacturer.
Upside Down
The financial situation where the amount of the outstanding loan on a vehicle is greater than the worth of the vehicle.

V

Vacuum hose
A hose (usually rubber or hard plastic) that transfers vacuum to various components in the engine.
Vacuum
Vacuum is produced by the engine. A suction force is created (similar to your vacuum cleaner) through the vacuum hoses to activate various components in the engine.

W

Wander
Vehicle drifts from side to side while driver steers straight.
Wear and Tear
In considering a lease there are two types of wear and tear normal and excess. Normal wear and tear includes dings and minor dents, small scratches, stone chips in the paint finish, reduced tread on tires. Excess wear and tear includes broken or missing parts, dented or damaged body panels or trim, cuts, tears, burns or permanent stains in the fabric, cracked or broken glass, improper or poor quality repairs, tire/wheel damage or less than acceptable tread remaining, mechanical or electrical malfunctions. Wear and tear that would be considered normal can be considered excessive if there are too many of them (minor door dings for example). If the lessee does not want to purchase the vehicle at lease end, two options exist for handling excess wear and tear. First, the damage may be repaired before the end of the lease. Alternatively, the lessee may agree to pay the estimated cost of repair when returning the vehicle.
Wheel (rim)
This is what the tire is mounted on. Wheels can be made of steal or an alloy, such as aluminum.
Wholesale Value
The price, based on auction results or dealer trade reports, that a dealer expects to pay for a vehicle.
Write Down
A unit (car or truck) is said to be going into "write down" after an extended period of time in dealer inventory. Dealers lose a percentage of profit margin on these units unless they sell them off prior to this time period. Units about to go into write down are usually pushed in advertising or internally by sales managers.