Ford and GM not happy with their dealers

[street]

ERD50
^ yes, it is buyer choice like I stated in my post. If there is only one 5-dollar loaf of bread on the shelve and they raise that loaf to 35 dollars because it is the only one. Someone will buy it some won't, I would be one to not buy. Neither way is right or wrong it is supply and demand and it is called gouging. It comes down to buyer choice, nothing is wrong with paying more but I personally would find an alternative. It is just my view not here to disagree with you or try to change your mind to think my way.

 

[Fermion]

Where is the outrage at my OSB being sold for $40 to $50 a sheet

Dealers are not the only ones making a buck out there.

 

[Music Lover]

"reasonable or fair" is in the eye of the beholder. And if you don't think it is "reasonable or fair.", then don't engage in the transaction. As I said, no one can force you.

"Price gouging may be considered exploitative and unethical." - or factually, it is simply a response to supply/demand. Interfering with supply/demand may be considered exploitative and unethical.

-ERD50

I sold <$500 of weights and exercise equipment for about $1800 during Covid a couple months after the gyms had closed in 2020. I had no shortage of interested buyers.

 

[ERD50]

ERD50
^ yes, it is buyer choice like I stated in my post. If there is only one 5-dollar loaf of bread on the shelve and they raise that loaf to 35 dollars because it is the only one. Someone will buy it some won't, ....

And that's also true if artificial price controls are put in place. Someone buys it, and the next person can't. But it is worse with artificial controls, because the buyer won't value that bread as a scarce item if it only cost them $5. People tend to stock up (why not, it doesn't cost them anything!), which makes the shortage worse. At $35, more people will find alternatives (make their own bread, cut back on bread), saving the bread for those w/o alternatives, which in turn, puts a damper on the price increase (the 'magic' of supply/demand!).

And if bread can fetch a $35 price, that motivates the supply chain to get bread to that area. They can now spend $10 to get bread there, and make a profit. Price fixing discourages that.

... and it is called gouging. ....

Yes, and IMO, "gouging" is a judgemental, incriminating, derogatory term that should be removed from the dialog.

... It is just my view not here to disagree with you or try to change your mind to think my way.

That's fine. It's just a discussion.

-ERD50

 

[Music Lover]

Where is the outrage at my OSB being sold for $40 to $50 a sheet

Dealers are not the only ones making a buck out there.

If you were thinking of selling, would you complain if the value of your house went up by 50% from 2 years ago?

 

[Fermion]

If you were thinking of selling, would you complain if the value of your house went up by 50% from 2 years ago?

You are right, and I am not complaining that my used truck and van are worth more than I paid for them 3 years ago!

 

[pacergal]

Well, whatever the reason, it was nice to see two companies make a statement.
Almost makes me want to buy a Ford next time.

 

[Turbo29]

I aviod dealership service departments like the plague. In my experaince they break (mess up) two things for every one thing they fix. I will take mine in for warranty work if it's an expensive item, otherwise I prefer to just fix it myself. YMMV

Guy turned in front of me (tried to make a left turn from the right lane) so I smashed in the front of my car (a Mazda); fairly major damage, I thought they might total it. Took it to the insurance companies contracted body shop (not Mazda) and they repaired it fine. About a year later I took it to the Mazda dealer to have an open recall done (one of the electronic modules might fail rendering the windshield wipers inoperative).

After the dealer did the recall, the car had a terrible rattle. I think that says it all about dealers. Major accident repaired by a non-dealer body shop -- no problem, minor part replaced by the dealer -- they can't seem to put everything back together right.

 

[braumeister]

I think that says it all about dealers. Major accident repaired by a non-dealer body shop -- no problem, minor part replaced by the dealer -- they can't seem to put everything back together right.

I guess I've just been lucky then. For about the last 20 years I've had all service and repair work done at the dealers where I bought the cars. Good service and excellent work at reasonable prices. I've checked pricing a number of times at nearby independent service shops, so I know I've been treated fairly. Honda and Volvo.

 

[Midpack]

It was reported on my local news this morning that both Ford and GM are letting their dealers know that overcharging for their vehicles is not okay.

https://ktla.com/news/money-smart/ford-gm-tell-their-dealers-to-stop-ripping-off-car-buyers-or-else/

Looks like PR motivated posturing by GM and Ford to me. Dealers can't get market adjustments above MSRP if the market won't pay it - obviously customers are. And what do manufacturers expect dealers to do with limited supply? Dealers have fixed costs they have to cover, like EVERY business ever. Ford and GM just want to sound like they're on the customers side, probably telling dealers a different story off the record. The tide will turn on supply v demand, they'll be sorry when fewer buyers want their cars, if they've punished dealers in the current situation.

 

[Buckeye]

You are right, and I am not complaining that my used truck and van are worth more than I paid for them 3 years ago!

This is what happened to my nephew. His truck got stolen and I posted a question in Other Topics about whether he has to pay taxes on any gain on the insurance settlement or is paying him what it is now worth just making him whole? An unusual situation, for sure, but might be happening to more people now with the increased cost of used vehicles, especially trucks. Hopefully, insurance companies do not issue 1099's.

 

[Out of Steam]

Car dealers have very strong protections from their own state governments and they are independent businesses. When I worked for MegaMotors, I was amazed at the crap the dealers could get away with due to state laws.

The number of state legislators who are (or were) car dealers is not small.

 

[Starsky]

Certain models and colors are very hard to find, and you will often see dealers marking up the versions of vehicles that have the most desirable paint colors and other boutique features while selling the more common versions at a discount. This has been going on for years, as dealers are only allocated a limited number of certain vehicles. Car buyers won't or can't always delay their purchases for long periods of time, so they are forced to buy from available inventory where supply and demand most impact pricing.

The problem now it that supply is another factor that enables dealers to charge more, and it cuts across all makes and models. (Heck, it takes a year from the order to receive a sofa these days!) If I were a dealer, vehicle discounts would be virtually nonexistent.

The Ford pickups, Bronco and electronic Mustang are all new models that have huge built-in audiences. The pickups and Broncos come so many different configurations from the factory that it must seriously limit the availability of certain editions.

Scarcity is a huge marketing focus these days with the huge success of limited-run brands like Supreme. It motivates the purchase decision to occur faster, and minimizes unsold inventory and warehousing costs. In this case the scarcity is uninvited, but the results are the same. As inventory goes down prices will go up. I think the dealers are in the right and the manufacturers should work with them. They can get back to lowering prices when the supply chain improves.

 

[street]

^ I sure don't blame a dealer for selling at any price they can get. That is business and supply and demand. I have set prices high and gouged when supply was down. There always is someone that will buy at inflated price. The buyer has choices in most cases.

I wouldn't buy a big-ticket item that isn't an absolute need at where prices are now. Be interesting to see how long this lasts and what actually might happen to auto industry.

 

[kgtest]

And enough with the gaslighting about inflation. Dealers have the upper hand right now and they are making buyers pay.

Toyota wants me to pay 2k over MSRP for a Camry. I'm not happy with dealers either.

 

[Music Lover]

We're probably going to take advantage of the price increase and sell my wife's 2017 Colorado. We were thinking of selling it for a while, now might be the best time.

 

[ERD50]

It was reported on my local news this morning that both Ford and GM are letting their dealers know that overcharging for their vehicles is not okay.

https://ktla.com/news/money-smart/ford-gm-tell-their-dealers-to-stop-ripping-off-car-buyers-or-else/

Interesting responses in this thread, when you consider how many threads we've had on tips on how get a car at a rock bottom price. (below MSRP) Some of that is working with the supply/demand to keep it in your favor.

But when the shoe is on the other foot...

-ERD50

 

[RobbieB]

Yup. Nobody can tell anyone what to sell for. It's mine and I'll sell it for as much as I can.

If it's too expensive, don't buy it.

 

[Dean56]

GMC dealers where I live are adding $3k above MSRP.....and getting it. Trucks are slowly being delivered.

 

[kumquat]

Dealers don't make their big dollars on new car sales. They make them on the service floor.



Being Canadian (where dealers are prohibited by law from charging more than MSRP) I've noticed a few 'extra' charges but less than $1K. Still, I think, they are saving their new stock for old customers.

 

[Koolau]

Auto dealers have incredible fixed expenses with buildings, taxes and utilities to pay for. And they have employees salaries and fringe benefits to pay monthly. When there is nothing to sell, they've got to make changes somewhere to pay the fixed expenses. And unfortunately most cannot do much other than to layoff employees.

True enough but one huge expense dealers have been able to cut WAY back on is interest on inventory loans. For the most part they HAVE no inventory. YMMV

 

[CRLLS]

I happened to be in the local Ford dealership and was walking around the showroom floor. No. I'm not buying. They had a Ford F-150 Raptor with a MSRP of just under $80,000. They also showed an additional market adjustment of, get this, $20,000. That makes it just about $100,000 before taxes and processing fees. I was chatting with a salesman and asked who in their right mind, would pay that. He said they had recently sold 2. I am not against paying MSPR if necessary, in a tight market. I simply refuse to pay market adjustment prices.

I don't think that mfgrs will do much with dealers who use these practices. I do think that there is more of a tie between a mfgr and a dealer than simple independent transactions. They are very much intertwined and are not an arms-length relationship. There is more knobs that a mfgr can turn than moving to the back of the order line. I think the mfgrs should use those knobs. Right or wrong, it is giving the brands bad press more than the dealer.

 

[ExFlyBoy5]

GMC dealers where I live are adding $3k above MSRP.....and getting it. Trucks are slowly being delivered.

Oddly enough (at least to me), our neighbor went out an bought a brand new, tricked out GMC Tahoe about a month ago. The dealership that they bought from had been advertising these at about $5K over MSRP. What's so odd you ask? Well, they have 3 other cars that work just fine (two adults that drive in the home) and when they bought the GMC, they parked it in the garage and as far as we can tell, they haven't driven it.

 

[Fermion]

Oddly enough (at least to me), our neighbor went out an bought a brand new, tricked out GMC Tahoe about a month ago. The dealership that they bought from had been advertising these at about $5K over MSRP. What's so odd you ask? Well, they have 3 other cars that work just fine (two adults that drive in the home) and when they bought the GMC, they parked it in the garage and as far as we can tell, they haven't driven it.

Probably they could sell it for 20% more than they bought it for this summer if the shortages continue.

 

[RetiredAndLovingIt]

I happened to be in the local Ford dealership and was walking around the showroom floor. No. I'm not buying. They had a Ford F-150 Raptor with a MSRP of just under $80,000. They also showed an additional market adjustment of, get this, $20,000. That makes it just about $100,000 before taxes and processing fees. I was chatting with a salesman and asked who in their right mind, would pay that. He said they had recently sold 2. I am not against paying MSPR if necessary, in a tight market. I simply refuse to pay market adjustment prices.

I don't think that mfgrs will do much with dealers who use these practices. I do think that there is more of a tie between a mfgr and a dealer than simple independent transactions. They are very much intertwined and are not an arms-length relationship. There is more knobs that a mfgr can turn than moving to the back of the order line. I think the mfgrs should use those knobs. Right or wrong, it is giving the brands bad press more than the dealer.

Ha Ha, have you ever met an honest car salesman?

I was watching my local dealers site and checking the inventory every day and the same SUV's sat there every day for a month about when he played that game. Once he dropped the market adjustment he started selling them again.
I also find it very annoying when you check a dealers "NEW" inventory, they should not be allowed to included In Transit vehicles in the search but then they might only show less than 10 vehicles.