5 ms·

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 exp

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.

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.