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Local profit? That is, in many towns, my understanding is that the local dealerships are relatively well off. Which implies that a bit more of the money is ke
by taeric 4y ago
Local profit? That is, in many towns, my understanding is that the local dealerships are relatively well off. Which implies that a bit more of the money is kept local to where the cars are being sold.
I'm guessing this is less true today than in years past.
- naravara 4y agoThe owners of those local dealerships also tend to have a big hand in driving town politics as they’re often the richest people around.
- ABeeSea 4y agoThe other side of that is the dealership owner is often the richest person in a small town and has extremely outsized impact on local politics.
- taeric 4y agoI think that is precisely why the laws have largely not allowed direct sales. :)
- walrus01 4y agoIn many small to medium size towns if you find the family who owns the local ($BRANDNAME) dealership they are often among the wealthiest people in the entire county. edit: I can see from the two other comments here alongside mine that this is a common observation.
- dexwiz 4y agoCars are likely a family’s largest purchase behind real estate. If you are going to sell anything, then sell the most expensive item that EVERYONE buys.
- dijonman2 4y agoWhat does that have to do with anything?
- walrus01 4y agomaybe the amount of profit made in being a middle-man between the manufacturer and consumer end-user is unreasonable and unwarranted?
- rootusrootus 4y agoIt's only unreasonable if they are not providing value. Lots of us get into business exactly because we can provide value and simultaneously become wealthy. This is no sin.
- Someone1234 4y agoIf they provided value then states wouldn't have needed to enshrine their existence into law. I say let them compete with the manufacturer and see if "go to a showroom for a test drive, then click click click, buy, deliver to your home" wins Vs. "Spend an entire day haggling and avoiding all kinds of poor treatment/predatory practices." People HATE dealerships. They make a very fun purchase a very unfun purchase.
- rootusrootus 4y agoPeople hate dealers, love getting a car today. Dealers do what they do because it works, and it is largely what the consumer seems to prefer. You don't think dealers would do online fixed-price sales for pre-orders if it worked? They would! And they will, if the market rewards that. Very few people actually want to wait weeks or months for the car. HN doesn't believe that, because we're tilted towards Tesla fans who are inclined to be okay with this. Average Joe will put up with a few hours at the dealer to get their new ride today.
- bitsnbytes 4y ago"Dealers do what they do because it works, and it is largely what the consumer seems to prefer." Not likely due to consumer preference, as its a given that dealership and buying experience is often hated by the consumer. look at this thread, talk to friends,and search the internet. Sure its anecdotal but its appears to be pretty consistent across the board despite not being a scientific survey. Heck even carmax created their business model around how the consumer hates the buying process and even though carmax often charges more in the $2.5K - $4K range than what you can negotiate elsewhere they are still around. Its more that they (the dealership) has a very strong lobbying influence and have rigged the market in their favor where the consumer has to take it. Like making themselves a forced middleman. kind of how comcast is often rated among its own customer at the top of the most hated company list year after year ,yet they stay in business.
- sanguy 4y agoAnd even more interesting is that family usually owns multiple brand dealerships sometimes to the point of almost a monopoly in the local market.
- bin_bash 4y agoThey also tend to be very involved in local politics. Seems to me they fit the definition of "oligarchs": https://en.wikipedia.org/wiki/Business_oligarch https://en.wikipedia.org/wiki/Business_oligarch
- Victerius 4y agoOkay, I'll bite. How do I open a dealership?
- FireBeyond 4y agoFirst step, have several million dollars available to you. Usually in the region of $10M (which was the estimate for the NBA player Damian Lillard's Toyota dealership, by the time you find a property, build it out, initial inventory stock, etc., etc.)
- ponyous 4y agoDunno, but I can tell you how my family started as I think it's really interesting. Yugoslavia was just falling apart - the entire country went from planned limited production to open market. My family was importing cars from other countries as this started. The demand was so great, that when the truck with cars stopped on a parking lot at his home, people would come running putting their "reserved" stickers on cars. Everyday he did a trip out of the country and back. "Sold" all cars before he had a chance to step outside a truck. This lasted for sometime, giving him enough bankroll to open car dealership. Not sure how exactly it happened, but few years later it became Ford dealership and still is.
- Dylan16807 4y agoCutting out a markup is also a good way to keep money local.
- donthellbanme 4y ago
- zarathustreal 4y agoWhy is "local profit" is assumed to be a positive thing? It seems to me that if we were to prove keeping money in certain places to be a benefit to society as a whole there would be much more effective and direct ways of making it happen
- frosted-flakes 4y agoBecause it's evenly distributed throughout the country.
- taeric 4y agoLocal profit implies locally taxed income.