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Nonprofit markups.org is exposing the most egregious new car prices

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Re: Nonprofit markups.org is exposing the most egregious new car prices

#131

Post by TreyGuy »

sokoloff wrote: post #88
TreyGuy wrote: post #19

Earlier quoted context omitted.

Crowd sourcing the data is the only way to uncover the real pricing that happens behind the scenes 3 hours into a dealership trip to buy that new car once you finally sit down at the finance guys office. It happened to me and it's happening in crazy high numbers of interactions. The prices listed online or initially viewed then get bludgeoned by "the mandatory addon and adm" bat once you burned half a day at the deal…

Start with “I have 60 minutes to conclude this deal [90 if for some reason you need to test drive it]” and start packing up your things at the 55 minute mark. If you spend 3 hours at a dealer after you’ve identified a single car you’re interested in , part of that is on you. Yes, I’ve walked out twice. One dealer rescued the deal; the other lost the sale to a dealer about 20 miles away.

ive easily waited an hour just to have a trade-in valued. this is part of the deal since you wouldnt land in the finance office until your trade in is valued.

Re: Nonprofit markups.org is exposing the most egregious new car prices

#132

Post by lotsofpulp »

paranoidrobot wrote: post #55
lotsofpulp wrote: post #8

As if car buyers are any different. They would not take anything less than the highest offer for selling their used car, just like the dealerships. Is a dealership wanting to sell for the highest price any different than a labor seller wanting to sell for the highest salary?

I think a lot of the objection is that dealers don't make it clear what they're actually selling the thing for. I've heard of plenty of cases (so yeah, anecdata) where a dealer might advertise the car at MSRP, but it's not until you get in there, and actually try to buy it that they reveal they won't actually sell it for MSRP - there's "market adjustments", and mandatory addons and other things.

Price obfuscation and outright lies are of course, unacceptable. I think the general advice for years though, has been to email dealerships asking for final price and using Costco as the benchmark for who to waste time with or not. Although, the supply demand situation may have shifted so far into seller’s favor that dealers can abandon even those standards.

Re: Nonprofit markups.org is exposing the most egregious new car prices

#134

Post by zachshefska »

zachshefska wrote: post #124
atestu wrote: post #96

Based on all other comments I have an unpopular opinion: I think this is fine. If 10 people want to buy 1 car, how do you choose which person gets it? You raise the price until there's only 1 person. How else would you do it?

The market is SO inefficient. While you’re right in describing the principles of supply and demand, the reality is that buying a car should be 10x simpler and the price should just be the price. No games, no haggling, no BS add-ons that increase dealer profits. Retail auto is due for a wake up call, and I sense it’s happening right now. You wouldn’t need markups to make extra profit if the cost infrastructure associa…

And to be clear, consumers shouldn't have to negotiate for hours to try and get a "fair" price during "normal" market conditions.

The current "markup" phenomenon is the same as the prior experience (pre-pandemic) where OEMs intentionally subsidized the purchase of their vehicles well below MSRP, and savvy customers could negotiate thousands off a car deal. It's mind boggling to me that we allow for such an inefficient market to perpetuate! 100 years of franchise dealerships is enough! Time for business and consumers to wake up and enact change.

Re: Nonprofit markups.org is exposing the most egregious new car prices

#135

Post by bradfa »

zachshefska wrote: post #124
atestu wrote: post #96

Based on all other comments I have an unpopular opinion: I think this is fine. If 10 people want to buy 1 car, how do you choose which person gets it? You raise the price until there's only 1 person. How else would you do it?

The market is SO inefficient. While you’re right in describing the principles of supply and demand, the reality is that buying a car should be 10x simpler and the price should just be the price. No games, no haggling, no BS add-ons that increase dealer profits. Retail auto is due for a wake up call, and I sense it’s happening right now. You wouldn’t need markups to make extra profit if the cost infrastructure associa…

Tesla is leading the way today (somewhat painfully in some areas) but they're not the first to try fixing this. GM's Saturn tried to make buying simpler in the 1990s and surely there were other previous examples, too.

Ford seems to be testing the waters about how to simplify the car purchase process: https://fordauthority.com/2022/05/ford-dealers-will-likely-s...

There's plenty of dealerships who have historically had simple purchase processes with standard no haggle pricing but often buyers have to do extensive research in order to find such dealerships.

Re: Nonprofit markups.org is exposing the most egregious new car prices

#136

Post by peoplefromibiza »

atestu wrote: post #96

Based on all other comments I have an unpopular opinion: I think this is fine. If 10 people want to buy 1 car, how do you choose which person gets it? You raise the price until there's only 1 person. How else would you do it?

how about you sell it at the listed price to the first who comes in to sign the contract?

Maybe those who were too late will come back and be quicker to decide next time, because they think you are fair.

If you make it all about who has more money, they'll go to another dealer.

There's no shortage of them.

Imagine if any store did that: you go to an Apple store to buy a new iPhone, there are 20 people in front of you. Are you ready to outspend some of them?

Re: Nonprofit markups.org is exposing the most egregious new car prices

#137

Post by flazzarino »

zachshefska wrote: post #124
atestu wrote: post #96

Based on all other comments I have an unpopular opinion: I think this is fine. If 10 people want to buy 1 car, how do you choose which person gets it? You raise the price until there's only 1 person. How else would you do it?

The market is SO inefficient. While you’re right in describing the principles of supply and demand, the reality is that buying a car should be 10x simpler and the price should just be the price. No games, no haggling, no BS add-ons that increase dealer profits. Retail auto is due for a wake up call, and I sense it’s happening right now. You wouldn’t need markups to make extra profit if the cost infrastructure associa…

This doesn't address the question asked.

Re: Nonprofit markups.org is exposing the most egregious new car prices

#138

Post by zachshefska »

flazzarino wrote: post #137
zachshefska wrote: post #124

Earlier quoted context omitted.

The market is SO inefficient. While you’re right in describing the principles of supply and demand, the reality is that buying a car should be 10x simpler and the price should just be the price. No games, no haggling, no BS add-ons that increase dealer profits. Retail auto is due for a wake up call, and I sense it’s happening right now. You wouldn’t need markups to make extra profit if the cost infrastructure associa…

This doesn't address the question asked.

Let me be clear; we should move away from Manufacturers SUGGESTED Retail price and go towards Manufacturers Retail Price. Just make it that the price is the price, and then the dealers can become glorified delivery centers/showrooms and service centers.

They'll make tons of gross profit because their cost infrastructure will go down, and OEMs will be happy because they still won't have to deal with customers and can focus on wholesaling cars to their "dealer" network.

The rub is in the finance and insurance products. OEMs all have captive lending arms, and currently dealers make a ton of money ($1,500+ per vehicle retailed) in finance and insurance profit. Navigating that relationship will be interesting as OEMs take on more control of the sales process.

Re: Nonprofit markups.org is exposing the most egregious new car prices

#139

Post by bradfa »

O__________O wrote: post #127

Do dealers all pay the same price for a given make/model/year regardless of volume? If not, while I get consumers only care about markup over MSRP, it’s likely dealers are not all paying the same price wholesale. As such, if data like this becomes the norm, likely lead to small dealers who pay more wholesale going out of business — which long-term would likely be worse for consumers; to be clear, not saying that sell…

In theory, yes, all dealerships pay the "invoice" price for a given vehicle. But often there are other financial stipulations for each vehicle, such as "hold back" which is meant to assist the dealership floorplan interest costs (basically the carmaker pays the interest on the dealer's loan to hold the car on their dealership lot for X days, then beyond that the dealership is on their own). I don't think hold back deals are always the same for every dealer, but I have no insider information.

If you ever are negotiating for a new car purchase, you can use the leverage of the hold back in your negotiations. If you're ordering a car and will pick it up the day it arrives at the dealership, then that dealer gets to pocket the entire hold back as they'll pay basically no interest themselves. Or if you're buying a car that's been on the lot for 6 months, the dealer really wants to stop paying interest on it so may take a lower offer just to stop the financial bleeding (granted, this is rare today, cars sell fast).

Re: Nonprofit markups.org is exposing the most egregious new car prices

#140

Post by jrs235 »

technothrasher wrote: post #104
Gh0stRAT wrote: post #67

Earlier quoted context omitted.

That's exactly what I did. I had my checkbook and was there to put in a deposit when I found out. Here's an abridged version of how the conversation went: > Me: I don't want that and won't be paying for it. > Them: Well we do it for all new cars and you can't have us not do it. > Me: Well then you can either eat the cost of this unnecessary "service" or sell me the car for $700 under MSRP to make up for it. > Them: S…

> Meanwhile, I'm working with a different dealership now. Hopefully that goes well for you. When I recently got a new car, I called around to all the local dealerships before I found one that would order me a car at MSRP. But I knew I wasn't done with the BS. It took seven months for the car to come in, and they didn't add any cash markups, but they did give me a money factor for the lease that was really high. I cou…

"We don't mark it up... we just get a kickback..." (Mental gymnastics in his head are: a mark up on the rate is a percentage added... We just get a [possibly] "flat" commission kickback.)
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