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Market conditions explain the higher price, but why does the extra money go to the dealership rather than the manufacturer? I think something other than the mar
by gweinberg 4y ago
Market conditions explain the higher price, but why does the extra money go to the dealership rather than the manufacturer? I think something other than the market is at work here.
- chrisseaton 4y ago> why does the extra money go to the dealership rather than the manufacturer? Because my understanding is they own the cars, once they're delivered from the manufacturer. They own the asset.
- greedo 4y agoIt's because they're collecting rents from having state legislation pretty much guarantee they're the only way to buy a car brand (other than Tesla). And though collusion might be hard to prove, it's pretty obvious to a shopper that the price transparency from the Internet is just as potent a weapon for dealers as it is for shoppers.
- charcircuit 4y ago>but why does the extra money go to the dealership rather than the manufacturer? Because the manaufacturer decided to not raise the price. This means the next person now has the ability to raise the price.
- JakeAl 4y agoPeople are also buying up all the inventory of available cars and flipping them at CarMax for a profit. Look on CarMax and you see loads of brand new cars with 3-6K markup. That's who the dealerships are competing with.