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I recently bought a Prius Prime and the amount of work I had to do to buy it at MSRP was ridiculous. If you have an oversubscribed car the dealer model just do

I recently bought a Prius Prime and the amount of work I had to do to buy it at MSRP was ridiculous. If you have an oversubscribed car the dealer model just doesn’t work. If car companies are going to compete in the future they will have to either eliminate dealers or at least force some type of structure to the sales process, otherwise people will gravitate to the companies that do (like Tesla).

eatonphil 4y ago
Dumb questions: isn't this just the market at work though? Why is it actually a problem for car makers if the car is sold above MSRP? Just a worse consumer experience that reflects poorly on the brand? Sony seems to deal with it with sold-out ps5 and resellers gauging. I mean you're not the only one suggesting this is a problem. Ford clearly seems to have a problem with dealerships and their markup I guess (or I misread the article).
- workingon 4y ago
  It’s not a problem now, it will be a problem when you can easily get a Ford direct at MSRP but you have to pay dealer markup for a Chevy.
  - eatonphil 4y ago
    It would only matter if their MSRP prices were identical though, right? I don't buy new cars so I don't actually know. Is it common for competing brands like Chevrolet and Ford to price similar models at identical price? I always assumed thered be variations.
    - peter422 4y ago
      It wasn’t just the cost, but the effort. Calling 10+ dealerships, having to track the inventory, etc. Just getting on a centralized waiting list would have been 10x easier and more user friendly.
  - fma 4y ago
    "...We've got to go to non-negotiated price..." Who's to say Ford can't "markup" either? To me that's exactly what it is...non-negotiated. If the dealer can sell a Mach-E for $5k above MSRP, Ford is leaving money on the table. Ford can bump up their non-negotiated price just as much. Why not? What are you going to do, go to another dealership and negotiate?
    - workingon 4y ago
      It’s like any other system. A middle man has to take their cut and will increase costs. There is no reason (that I know of) to think the dealership model would ever decrease costs.
      - fma 4y ago
        A middle man doesn't necessarily increase prices. If you want to letter a package from the east coast to the west coast, do you forgo the USPS stamp simply on principal they are the middle man and thus increases your cost? I can think of a handful of questions that need to be answered besides just saying "middle man bad". What's the cost of delivering dozens of vehicles from the plant to a dealership vs delivering one off vehicles to a house? Or the cost of an OEM having their own employees distributed to answer questions on a vehicle. GM has more than 4000 dealerships...would sales decrease because it would be less accessible to customers to see, test drive and service vehicles? I don't believe the current dealership model of huge lots, tens of employees is efficient. But I'm not so certain an OEM handling everything themselves is optimal.
- thehappypm 4y ago
  It’s a problem because the dealer keeps the markup. The dealer isn’t doing any R&D or really much of value, as you can see they’re being replaced by a web site.
thrill 4y ago
The last car I bought I showed up at the dealer with a certified check and it still took over three hours to complete the deal. I'm done with that business model.
- sammalloy 4y ago
  You got off easy. Took me eight hours at the dealer spread out over two days, with an additional total commuting time of two hours, so ten hours to buy a car. And you thought that was it? Nope. Took them an additional six months to issue the completed registration. When they say the dealer sucks, it’s always an understatement.

eatonphil 4y ago

Dumb questions: isn't this just the market at work though? Why is it actually a problem for car makers if the car is sold above MSRP? Just a worse consumer experience that reflects poorly on the brand? Sony seems to deal with it with sold-out ps5 and resellers gauging. I mean you're not the only one suggesting this is a problem. Ford clearly seems to have a problem with dealerships and their markup I guess (or I misread the article).

workingon 4y ago
It’s not a problem now, it will be a problem when you can easily get a Ford direct at MSRP but you have to pay dealer markup for a Chevy.
- eatonphil 4y ago
  It would only matter if their MSRP prices were identical though, right? I don't buy new cars so I don't actually know. Is it common for competing brands like Chevrolet and Ford to price similar models at identical price? I always assumed thered be variations.
  - peter422 4y ago
    It wasn’t just the cost, but the effort. Calling 10+ dealerships, having to track the inventory, etc. Just getting on a centralized waiting list would have been 10x easier and more user friendly.
- fma 4y ago
  "...We've got to go to non-negotiated price..." Who's to say Ford can't "markup" either? To me that's exactly what it is...non-negotiated. If the dealer can sell a Mach-E for $5k above MSRP, Ford is leaving money on the table. Ford can bump up their non-negotiated price just as much. Why not? What are you going to do, go to another dealership and negotiate?
  - workingon 4y ago
    It’s like any other system. A middle man has to take their cut and will increase costs. There is no reason (that I know of) to think the dealership model would ever decrease costs.
    - fma 4y ago
      A middle man doesn't necessarily increase prices. If you want to letter a package from the east coast to the west coast, do you forgo the USPS stamp simply on principal they are the middle man and thus increases your cost? I can think of a handful of questions that need to be answered besides just saying "middle man bad". What's the cost of delivering dozens of vehicles from the plant to a dealership vs delivering one off vehicles to a house? Or the cost of an OEM having their own employees distributed to answer questions on a vehicle. GM has more than 4000 dealerships...would sales decrease because it would be less accessible to customers to see, test drive and service vehicles? I don't believe the current dealership model of huge lots, tens of employees is efficient. But I'm not so certain an OEM handling everything themselves is optimal.
thehappypm 4y ago
It’s a problem because the dealer keeps the markup. The dealer isn’t doing any R&D or really much of value, as you can see they’re being replaced by a web site.

thrill 4y ago

The last car I bought I showed up at the dealer with a certified check and it still took over three hours to complete the deal. I'm done with that business model.

sammalloy 4y ago
You got off easy. Took me eight hours at the dealer spread out over two days, with an additional total commuting time of two hours, so ten hours to buy a car. And you thought that was it? Nope. Took them an additional six months to issue the completed registration. When they say the dealer sucks, it’s always an understatement.