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Nonprofit markups.org is exposing the most egregious new car prices

248 points by TreyGuy 4y ago

aunglaungmyat 4y ago
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deleted 4y ago
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xanaxagoras 4y ago
Not for nothing, and this is a cool use of technology and the internet, but was I supposed to be under the impression that car dealers aren't greedy? Greed is the central axis around which capitalist economic activity is oriented. It works very, very well. I'll take greed over feigned compassion and breadlines any day of the week. Recently I bought a Toyota SUV for a $7000 markup. But I was able to sell my lease (which I had no idea was even possible) for $5000.
- dymk 4y ago
  Everybody knows the dealership is trying to screw you. The question is by how much.
- judge2020 4y ago
  I think the point is that the recent rise of manufacturer-direct sales is better - it tends to be a much more enjoyable experience, it allows you to avoid any sort of negotiations for a price (ie. you pay the price you see on the order page), and you get to spec out your exact car configuration instead of settling for whatever's on the lot. Now, dealership laws in many states forbid the automaker from selling their cars directly to the consumer if they already have a dealership in the state, with their only recourse being that the automaker can say "you can't mark this car above MSRP", with varying levels of success.
  - 8n4vidtmkvmk 4y ago
    i got quotes online and then went to the dealership to pick up my car. no negotiation. i just didn't respond to any of the buggers that didn't give me a quote in the first email.
- TreyGuy 4y ago
  Greed also drives the other side of the equation... The consumers side as it pertains to getting the best deal possible! Markups.org is merely trying to use freedom of speech and press to force more transparency and competition across the dealership market segment.
  - xanaxagoras 4y ago
    Yeah, I get it, and it's a cool site. I just thought the headline was a bit much. Although maybe I was thinking of the article's headline, not your headline here on HN. I want to say they were the same when I posted my comment, but I'm not sure.
  - rdtwo 4y ago
    What’s your business model? Where do you earn the money to run the site?
- klabb3 4y ago
  > Greed is the central axis around which capitalist economic activity is oriented. It's hyperbolic, but yeah self-interest is a pretty good approximation for behavior of all living organisms. Powerful natural forces like self-interest should be utilized to produce a good outcome, but they don't guarantee a good outcome just by being powerful. Jealousy and hate are powerful forces too. For capitalism to work, many supporting structures are required. One is information symmetry. If you have to drive 10h and speak with a sales rep for 1h before you learn the price, you don't have a free market. Aside from this being deceitful and false advertising, it introduces economic inefficiencies in the most basic sense. All efforts that bring transparency are to be saluted.
- xenadu02 4y ago
  The problem is the grossly inefficient market where vehicles have an MSRP but the actual price you can pay varies wildly. In that sense it is no different than airline ticket fees (though not baggage fees) and similar schemes. The goal is to stop customers from doing apples-to-apples comparisons when shopping.
svnpenn 4y ago
$150,000 for an F-150? https://sunrise-ford.com/inventory/new-2022-ford-f-150-lightning-platinum-awd-4d-crew-cab-1ft6w1ev4nwg01497 https://sunrise-ford.com/inventory/new-2022-ford-f-150-light...
- CSSer 4y ago
  It’s not just because it’s electric. In rural areas like where I grew up I’ve heard these type of high-end models, like the ones with the “King Ranch” or “Platinum” packages referred to as “Cowboy Cadillacs”. Granted, $150K sounds really high, but even before the pandemic I recall hearing about non-electric $80-$100K trucks.
- TreyGuy 4y ago
  MSRP: $93,874
- throwthere 4y ago
  It's a big sticker but that's a luxury F0150. Making luxury stuff go to the people who are willing to pay the most seems... like the system works. It's the markups on Camrys (Camries?) and Corollas that matters more.
- Phlarp 4y ago
  Yes, but think of the F150 as an entire vertical-- it accounts for ~40% of Ford's North American sales. To say they have "lots of different trim levels" is a little too basic. There are the standard XL and XLT versions, Lariat, Platinum, Limited, Tremor, Raptor and King Ranch each with their own array of add on packages and upgrades. F150 owners treat their trucks like gamers treat their RGB desktops. Does the watercooling and lighting package really improve performance? Not really. Do nerds still spend lots of money on them? Absolutely. Putting a lift-kit on the pickup truck that drives exclusively on paved roads is similar.
andrew_ 4y ago
The mobile experience is so incredibly bad. Tried to add a markup to the site, brutal time trying to navigate it. Moved to a different tab and lost all my input. Image upload is capped at 5mb; which is under the average size my s10e takes by default. Great concept, garbage execution.
- LeoPanthera 4y ago
  Is it really necessary for every website to work perfectly on a pocket sized screen? Some ideas just work better on a big screen, mouse and keyboard. We shouldn't limit ourselves just to make everything work on an iPhone.
  - TreyGuy 4y ago
    The initial execution was to mimic an excel spreadsheet but as we get more feedback we hope to really produce a better UI and UX.
  - andrew_ 4y ago
    As I stated; S10e. Not iPhone. It looks like you just reacted rather than reading, but to answer the question in earnest: no, we don't have to make sites work perfectly on every device. That doesn't preclude criticism, however. Might want to check out current stats for mobile browsing. I've been in web development for 20 years and the numbers continue to go up. So again; no, but you're excluding a lot of traffic, and users. And for a site relying on crowdsourced data, that seems like a poor choice.
    - TreyGuy 4y ago
      Crowd sourcing the data is the only way to uncover the real pricing that happens behind the scenes 3 hours into a dealership trip to buy that new car once you finally sit down at the finance guys office. It happened to me and it's happening in crazy high numbers of interactions. The prices listed online or initially viewed then get bludgeoned by "the mandatory addon and adm" bat once you burned half a day at the dealership and finally sit down to "talk numbers". Utilizing OEM MSRP or posted pricing data I feel paints a more flawed picture!
lotsofpulp 4y ago
As if car buyers are any different. They would not take anything less than the highest offer for selling their used car, just like the dealerships. Is a dealership wanting to sell for the highest price any different than a labor seller wanting to sell for the highest salary?
- curiousgal 4y ago
  I know so many people who knowingly sold their used cars that had structural issues that are hard to diagnose.
  - ghaff 4y ago
    Selling used cars in the current market is one area where information asymmetry probably tends to play out in favor of sellers trading into dealers. Of course, it probably screws the ultimate buyers in a lot of cases. It's not just structural issues. There are a lot of known mechanical issues that a used car manager isn't going to notice in a 5 minute examination for a tradein.
- TreyGuy 4y ago
  The site isn't meant to "get one over" on dealerships. It's merely a tool riding on the back of capitalism and free speech to reward the lowest priced dealers, pull back the veil of sneaky bait and switch pricing models and attempt to force more competition across the industry.
- nomel 4y ago
  There's very little difference between a dealership, and a scalper. Both capture all the items in the market, then work together to inflate the value, artificially. The difference is that many places have laws preventing scalpers, and many places have laws requiring that you buy a car through a dealerships.
  - Gigachad 4y ago
    Dealers and scalpers provide liquidity. Sellers want the item off their hands now, buyers want something without waiting months for a seller. Dealers link these two needs together and take a cut for the service. There is no monopoly or requirement to sell a car through a dealer. It’s just that people find the service worth the cost.
dang 4y ago
Recent and related: Ford CEO Had Enough: Dealers Raising Prices Need to Stop or Else [video] - https://news.ycombinator.com/item?id=32318698 https://news.ycombinator.com/item?id=32318698 - Aug 2022 (128 comments) Specifically https://news.ycombinator.com/item?id=32319225 https://news.ycombinator.com/item?id=32319225
- TreyGuy 4y ago
  Indeed, it will be interesting to see how this plays out with Ford and if they truly plan to curb the markups or force pricing transparency
kart23 4y ago
carmax has been doing this with teslas. visited a carmax lot and saw around 10 model 3s, identical specs, with less than 50 miles (the 1k miles is the lowest the site will show) and selling them for 10k markup. they’re literally scalping teslas now, not to mention the rest of their overpriced inventory. https://www.carmax.com/cars/preview/23029935 https://www.carmax.com/cars/preview/23029935
- TreyGuy 4y ago
  Oh jeez, ya I know CarMax is bad. We dont really have a clean way of reporting teslas or scalping of resold vehicles by 3rd parties like that right now at markups.org
  - tptacek 4y ago
    I wouldn't buy a Tesla from Carmax (I wouldn't buy a Tesla from anyone), but for everything else, it's pretty great. I bought my last car from them online at an extremely sane price, and they delivered it to my door; a few weeks later a better trim of the same car popped up on their site (many hours away), and I was able to exchange without any drama. I got pretty decent at car buying from dealerships over the years, and I kind of feel like a sucker for playing that game now. Again: I'm sure you're right that buying a Tesla from Carmax is a terrible idea.
    - tmpz22 4y ago
      My personal experience was that sites like carmax and vroom had significantly higher mark ups then dealerships and lots of complaints that their “360 inspection” had terrible quality control problems and frequently shipped bad cars. I can see these sites working for very specific models and trims but overall bad. Honestly it’s all bad unless you get lucky it feels like.
      - ehvatum 4y ago
        I recommend Manheim Auctions, if you can get access.
tekchip 4y ago
I've contributed a few dealerships around Illinois. Wife is looking for a Chevy Bolt after her car was scraped in an accident (the other person's fault). Every dealership other than a single local one is charging between $5K and $10K "market adjustment". I'm sure many of these are just charging the markup no matter what. But I have a theory many charge this if you're from out of town and won't be paying them later for maintenance services. This the local dealership that seems to be the odd one out not charging this.
- lelanthran 4y ago
  > But I have a theory many charge this if you're from out of town and won't be paying them later for maintenance services. How do they know you're from out of town when they give you the quote? Do they refuse to quote without a valid and verified address? After all, can't you just give them a local address when asking for the quote?
  - gruez 4y ago
    That might get tricky if they use your fake address in later pieces of paperwork.
    - lelanthran 4y ago
      > That might get tricky if they use your fake address in later pieces of paperwork. It's alright, you can give them a different address after receiving the quote.
    - deleted 4y ago
      [deleted]
  - mzs 4y ago
    Your driver's license being photo copied is one of the first steps in buying a car at a dealership.
    - lelanthran 4y ago
waffle_ss 4y ago
Is the company actually a non-profit? When I click the donate button Stripe says I'm giving to "Markups, LLC" and the IRS exempt organization search doesn't return results for orgs containing "Markups".
- TreyGuy 4y ago
  No we're not, we are a for profit llc and need to make sure the writer fixes that.
  - gorbypark 4y ago
    You might want to consider a different tld. While .org isn’t strictly for non-profits anymore, it sure does give off the “we’re a non-profit” vibe.
gkanai 4y ago
If this downturn really deepens into a true recession (however it is defined) won't new vehicle markups go away naturally as fewer customers will be buying new cars? Isn't Markups a business that only is relevant during an inflated economy?
- TreyGuy 4y ago
  Indeed, it will flip to the opposite side of the pole. Getting the best deal under MSRP. Pre covid if you were good at searching forums and Facebook groups you might find the select dealers advertising 3-5% below invoice pricing on certain custom orders.
- samizdis 4y ago
  I'm not sure that Markups seems relevant only, or even chiefly, because of the state of the economy. To me, admittedly as an outsider in the UK, the US car dealership model just feels wrong and monopolistic, regardless of prevailing circumstances - an exemplar of rentier capitalism supported by robust, deep-pocketed lobbying [1]. I suspect that Markups will remain relevant for as long as the situation vis-à-vis car dealerships and how they operate persists in the US. Markups may even prove to be instrumental in successfully rallying and focusing consumer support sufficiently to overcome the status quo, and so eventually have no further reason to exist. But the word "eventually" in the previous sentence is key. [1] https://www.opensecrets.org/industries/lobbying.php?ind=T2300 https://www.opensecrets.org/industries/lobbying.php?ind=T230...
- autoexec 4y ago
  You'll mostly get the data during a an inflated economy, but it's still good to know which companies are screwing you over so that you can take your business to someone who didn't when the economy settles back down. I doubt losing my business will cause anyone willing to price gouge to change their practices, but who knows what other evil things that kind of company will do to exploit you so I'll feel even better supporting a business that didn't go out of their way to take advantage of people who are struggling.
  - TreyGuy 4y ago
deleted 4y ago
[deleted]
Panzer04 4y ago
TBH, the only real issue I have with this is dealers capturing all the markup - this is happening because paying those prices gets you a new car now, and not in 12mo when the supply shortage is relieved. I'm not exactly sure how these things work, but if the manufacturer is forbidden from selling direct and dodging the dealer, that's a problem. If the manufacturer could, but is choosing not to, well, that's on them - They are simply transferring the PR hit to the dealer (and giving up the profits, which sounds dubious) Pretty good example of trading one thing for another though! Pay up now for a car now, or wait and save your money for a car that isn't marked up. It's kind of funny seeing corporations try to apply price controls, rather than the government :)
- ramraj07 4y ago
  Most states in the US have laws banning the direct sale of cars without dealers.
  - slrd7z88 4y ago
    For states like California where it is legal, can you only buy Teslas directly?
    - telcal 4y ago
      Tesla's can only be bought new directly from Tesla. They are the manufacturer and "dealer". The sales people work on salary, no commission. Here's the list of states where you can't buy a Tesla directly but there are workarounds for those people https://en.wikipedia.org/wiki/Tesla_US_dealership_disputes https://en.wikipedia.org/wiki/Tesla_US_dealership_disputes
  - kenniskrag 4y ago
    why?
    - deleted 4y ago
      [deleted]
    - 4y ago
Gh0stRAT 4y ago
Hey @TreyGuy (or others from Markup.org) How do you account for dealers which sell for $0 above MSRP but then include a non-negotiable $700 "paint protection" service? As a crowdsourced site, you'll get a ton of reports that a particular dealership has no markup and few if any reports from people who have actually been far enough into the purchase process to discover these hidden markups.
- WalterBright 4y ago
  Nothing is "non-negotiable" in business. Just say "no".
  - Gh0stRAT 4y ago
    That's exactly what I did. I had my checkbook and was there to put in a deposit when I found out. Here's an abridged version of how the conversation went: > Me: I don't want that and won't be paying for it. > Them: Well we do it for all new cars and you can't have us not do it. > Me: Well then you can either eat the cost of this unnecessary "service" or sell me the car for $700 under MSRP to make up for it. > Them: Sorry, we can't do that. I walked out and they haven't called me back to say they were bluffing. Meanwhile, I'm working with a different dealership now.
    - 1123581321 4y ago
      You didn’t win this either. The last time I bought a (used) car from a dealership, I walked out, and they caught me as I was walking out the lobby and dropped the add-on, and then another add-on after some arguing since they knew I’d leave. That was successful.
    - WalterBright 4y ago
      There you go. You couldn't reach agreement so no deal. Nobody was forced into anything.
      - lucideer 4y ago
lizardactivist 4y ago
I scroll through the list and see that some dealers -- no, stealers -- have a markup of USD 50k, how does that even result in a sale? I'm genuinely curious why someone looks at that final price, and then decides to go ahead with the purchase. More money than sense and no idea of what a sensible price is?
- deleted 4y ago
  [deleted]
autoexec 4y ago
Shame you can't sort by markup and easily see who the worst offenders are
- TreyGuy 4y ago
  top right hand corner of the list view... select the sort order and pick "price (low)" or "price (high)" https://markups.org/?sort=price-desc https://markups.org/?sort=price-desc
  - autoexec 4y ago
    Thanks! I had tried that, but I guess I saw the kinds of cars at the top of the list and assumed that "price" meant "actual price of the car", I was looking for something labeled more like "markup as a percentage of what this car was actually worth". A dealer with a $1,500 markup on a car worth only $1,200 is much worse than a dealer with a $20,000 markup on a car worth $80,000 I guess it just makes sense that they'd be able to throw a larger markup on cars which are that much more expensive to start with.
fny 4y ago
I feel like consumers writ large are forgetting they can protest. If everyone collectively rejects higher prices, the price will come down. Everyone is manipulating this inflation sentiment to wring consumers out of every penny until they're broke. Stop paying for things where the price has exploded higher and force businesses to deal with tighter margins. Prices will normalize.
- massysett 4y ago
  This doesn’t work when your car is totaled, body shops are backed up for weeks, and you need a car to get to work.
  - atestu 4y ago
    Just buy a used car?
    - dagw 4y ago
      The used car market is experiencing exactly same markups and 'price gouging' as the new car market.
      - atestu 4y ago
        I recently bought a used car, and while the prices are up, I didn't see any 10K markups or price gouging. It's still a much more sensible choice to buy a used car.
      - thowren87 4y ago
        Yeah, sadly the used car market is suffering as well! Read more: https://www.autoweek.com/news/industry-news/a40690607/average-used-car-price-is-now-33000-dollars/ https://www.autoweek.com/news/industry-news/a40690607/averag...
- SamuelAdams 4y ago
  Unfortunately many people do not care about the total cost of the vehicle. They care about the monthly payment. As long as they pay less than 700 USD a month it’s affordable. Even if it’s stretched over a 7-8 year loan at 5% interest. So if you want people to stop paying high prices, you need to get them to look at the total cost of the vehicle. And you need to get lenders to stop handing out loans longer than 4 years. Unfortunately they don’t have an incentive to do this because long, high interest loans are profitable.
nixass 4y ago
When dealer's first question is how much am I willing to spend monthly rather than talk about final price of the vehicle he can just F off and I won't be returning there. They even try to convince you the total price is irrelevant, only monthly payment is what matters
- Loughla 4y ago
  The last time we bought a car, the salesman tried the 4 square nonsense. I declined to look at monthly payments and was evasive about how much I wanted to spend. I just said, "as much as I need to, to get the car I want at a decent price, which according to my research should be X" or "my monthly budget is not your concern, I am willing to pay X for this car". Once I had the final price on the car, and it was very comfortable to me, they STILL tried to get me to sign a 'contract' using the four-square numbers. Just monthly payment amounts, no length or other information. They literally wouldn't move forward until I signed it. Like, wouldn't let me see the manager to finish the deal. The price was so good on this one, though, that I didn't want to just walk out. So I took a black sharpie and crossed everything out, wrote the total price, and signed it at the bottom. It wasn't a legal document. It was literally just a sheet with their handwriting on it saying "monthly price agreement". Nothing finance related, no legal jargon anywhere. Ridiculous. Just absolutely ridiculous, and for what purpose?
  - dano 4y ago
    Ha ha, yeah, I remember a green sales person trying to use the four-square model on me. I looked at him and said "I'm paying cash" which confused him to no end. He had to go see his manager. In the end I didn't buy a car from that dealer. Where the cash comes from is none of their business; i.e., loan or something else.
- dawnerd 4y ago
  They got upset last time when they wanted my social right off the bay and I declined saying I would be paying cash. I’m now driving a Model Y I paid for in cash, so done with dealers.
benrapscallion 4y ago
Partially related: is there a simple metric and/or a website with data on the supply of cars vs. demand? To see how long before the supply constraints ease up and which brands are most affected?
atestu 4y ago
Based on all other comments I have an unpopular opinion: I think this is fine. If 10 people want to buy 1 car, how do you choose which person gets it? You raise the price until there's only 1 person. How else would you do it?
- capableweb 4y ago
  Well yeah, if you want as much money for the car as possible, then you'd do it like that. Personally when I sell stuff second-hand (which tends to be cars, computers, instruments and various accessories), I sell it to whoever is first and closest, in that order.
  - atestu 4y ago
    Right. And I don't think we should fault dealers for wanting to make as much money as possible. They're a business after all. I usually do the same when I sell stuff second-hand because my priority is getting rid of it as fast as possible, not to make the most money. Since dealers have very limited inventories these days, they should take more time to get a better price.
    - n4r9 4y ago
      > They're a business after all. I'd argue that using this phrase to write off wider ethical concerns is one of the key issues here.
      - millerm 4y ago
        Exactly. Many people actually ”need” things, but always end up getting beaten by the person who has more $. It’s just constant battering of people that aren’t as well off as others. It’s often a disgusting system. The poor always suffer due to this “I’ll just hand wave to the ethics and talk about capitalism“.
        coryrc 4y ago
        Capitalism brought hundreds of millions out of abject poverty in the last thirty years. It has real consequences. The poor in the US have better living standards than half the planet and every opportunity to better except their own cultures holding them back. The left refuses to acknowledge or deal with this, creating generational poverty. What's not to blame is "capitalism".
Patrol8394 4y ago
Isn’t the purpose of any business to minimize cost while maximizing profits. As long as there are people willing to pay the price, you can’t certainly blame the seller.
- endofreach 4y ago
  It‘s not like a law of physics. Neoliberalistic ideas that manifested as the ultimate truth, but obviously are not (that truth).
- rdtwo 4y ago
  Best way to do that is government regulatory lock in which is what dealers have
smeej 4y ago
It's not just the new cars. On Saturday, my friend traded in his 2017 GMC Canyon with 86k miles on it for $19k. He had paid $25k for it new in 2017. The dealership now has it listed for used sale for $28,995. If they're turning a $10k profit on a 5yo car driven pretty hard for 5 years and selling it above what it cost when it was new, I have no doubt they're marking up the new ones even higher!
- ghaff 4y ago
  Yeah, the one silver lining of the crunch. When I just bought a new car, I traded in a 2011 Toyota 4Runner with 75K miles and a caved in rear hatch and some non-obvious mechanical problems. Got $15K for it. Was really shocked. Sort of made up for the fact that I pretty much paid sticker plus a couple add-ons.
  - smeej 4y ago
    The same dealership as bought my friend's truck above is offering me over $4k for my 2007 Prius with 208k miles on it. Sure, I expect I could get that private-party. But on trade-in??
jrochkind1 4y ago
The (original) headline says "nonprofit", but this isn't mentioned in the text, which does say "take the plunge to form an LLC in November/December". Is it actually a nonprofit? Or... what does that mean, in this case? Curious to hear more about the business structure with regard to this if anyone knows.
- Rastonbury 4y ago
  It also has ads that ublock didn't catch Edit: Creator commented in here that it's a for-profit LLC and the title is wrong
- TreyGuy 4y ago
  its an error on the writers part. we are a "for profit" LLC
  - jrochkind1 4y ago
    Thanks for quick info! I see it's already been corrected in the OP, thanks! I'm always interested in novel business structures especially around non-profit-ness, but I guess false alarm here! Paging @dang, correct HN headline here by removing "nonprofit"?
O__________O 4y ago
Do dealers all pay the same price for a given make/model/year regardless of volume? If not, while I get consumers only care about markup over MSRP, it’s likely dealers are not all paying the same price wholesale. As such, if data like this becomes the norm, likely lead to small dealers who pay more wholesale going out of business — which long-term would likely be worse for consumers; to be clear, not saying that selling the markup data wrong, but it’s likely to impact the market in ways that may ultimately be a net negative.
- bradfa 4y ago
  In theory, yes, all dealerships pay the "invoice" price for a given vehicle. But often there are other financial stipulations for each vehicle, such as "hold back" which is meant to assist the dealership floorplan interest costs (basically the carmaker pays the interest on the dealer's loan to hold the car on their dealership lot for X days, then beyond that the dealership is on their own). I don't think hold back deals are always the same for every dealer, but I have no insider information. If you ever are negotiating for a new car purchase, you can use the leverage of the hold back in your negotiations. If you're ordering a car and will pick it up the day it arrives at the dealership, then that dealer gets to pocket the entire hold back as they'll pay basically no interest themselves. Or if you're buying a car that's been on the lot for 6 months, the dealer really wants to stop paying interest on it so may take a lower offer just to stop the financial bleeding (granted, this is rare today, cars sell fast).
  - O__________O 4y ago
    My understanding is invoice price the equivalent of MSRP for dealers — and like MSRP, rarely the average price paid, which varies based on number of factors; which circles back to my prior point, the dealers who are getting the best deals from the manufacturers are going to have the most room to bring down the consumer pricing, which means the smaller dealers will likely get pushed out of the market if the “markup pricing” becomes easy to get, which long term will hurt consumers. Lastly, I personally would never by a new vehicle unless it was for a highly specific need and impossible to find used, since they’re rarely a deal; average new car drops 20% in value the first year. _________ Related: https://cars.usnews.com/cars-trucks/what-is-the-dealer-invoice-price https://cars.usnews.com/cars-trucks/what-is-the-dealer-invoi...
t_mann 4y ago
Somewhat tangential, but I'm surprised that a concise domain name like markups with an attractive TLD like org was still available. In the spirit of a non-profit, I'm wondering whether they couldn't have made do with a name that specifies their (laudable, but quite specific) niche (US-centric comparison of car dealers).
agrippanux 4y ago
Comments in this thread remind me why it’s so efficient to use the auto buying program from Costco. You deal with the fleet managers instead of regular sales staff and all required/optional costs are upfront and non-negotiable. If you are an expert haggler you can likely negotiate a better price than what you get through Costco, but for the rest of us it gets you 90% of the way for very little effort.
- rdtwo 4y ago
  Days of old nobody will honor the Costco rate because it only applies to cars in inventory that don’t exist
- programmertote 4y ago
  I tried to use Costco Auto program when I bought a car in late May of this year (2022). Once the dealers heard I came from Costco Auto program, they acted disinterested even though they are part of Costco Auto program (e.g., Al Hendrickson Toyota). Plus, there is no Honda dealer that is part of Costco Auto program within 180 miles of where I live (I live in just a little north of Miami). I went to Mazda of North Miami which supposedly is part of Costco Auto Program, and guess what, they gave me $500 discount and they said that's all I get as part of Cost Auto (but the car was like $4000 above MSRP). I hope that when I purchase my next car, I'll never have to deal with dealerships and can buy it off online. I'm happy to pay 6-10% commission for dealership as long as I don't have to deal with haggling and being pushed to buy shady insurance and other add-ons that I don't need.
brycewray 4y ago
Bought my latest vehicle just before COVID lockdown (i.e., before I had a clue that my commuting days were over) and, thus, also well before Supply Chain Meltdown. Have rued that purchase ever since on the theory of "Geez, it turned out that I really didn't need this vehicle so badly"; but, after seeing these developments and remembering that I was able to get the price down a few thousand from MSRP, I'm thinking I may have come out ahead, after all.
- Loughla 4y ago
  We bought our most recent new car in February of 2020, RIGHT before the whole world blew up. We have gotten calls from the dealer offering us up to 10k over what we originally paid for the car since then, even with the mileage we've put on. Absolutely amazing, the world we live in.
  - robotnikman 4y ago
    Same with my car, which I just got a few months before covid started. The dealership is basically offering to buy it back for the price I paid for it.
navbaker 4y ago
We had extremely good timing buying our new minivan last year, 100% due to pure luck with when our previous car crapped out. We used the Costco buying program, which basically let us go in knowing what we would pay with a pre negotiated price and not have to haggle, and shopped in early April. We were looking for some specific trim options and the dealer let us know that they were out of a few of them due to shortages of some chips, but they did have a whole bunch of a different trim level. We walked out happy with a new van just a few weeks before inventory levels tanked and prices started skyrocketing.
ryantgtg 4y ago
The /r/electricvehicles subreddit has a similar tracker https://datastudio.google.com/reporting/7a243d54-2a8d-44f3-a405-ce2a509c1c07/page/3KHiC https://datastudio.google.com/reporting/7a243d54-2a8d-44f3-a... It's cool, but not has some usability issues (most recent update for a dealership is not always what dictates the color of the marker on the map). Anyway, crappy dealer experiences are a huge reason why so many people purchase Teslas, and why OEMs like Volvo are creating new brands that they can sell direct.

248 points by TreyGuy 4y ago

aunglaungmyat 4y ago

Password

deleted 4y ago

[deleted]

xanaxagoras 4y ago

Not for nothing, and this is a cool use of technology and the internet, but was I supposed to be under the impression that car dealers aren't greedy? Greed is the central axis around which capitalist economic activity is oriented. It works very, very well. I'll take greed over feigned compassion and breadlines any day of the week. Recently I bought a Toyota SUV for a $7000 markup. But I was able to sell my lease (which I had no idea was even possible) for $5000.

dymk 4y ago
Everybody knows the dealership is trying to screw you. The question is by how much.
judge2020 4y ago
I think the point is that the recent rise of manufacturer-direct sales is better - it tends to be a much more enjoyable experience, it allows you to avoid any sort of negotiations for a price (ie. you pay the price you see on the order page), and you get to spec out your exact car configuration instead of settling for whatever's on the lot. Now, dealership laws in many states forbid the automaker from selling their cars directly to the consumer if they already have a dealership in the state, with their only recourse being that the automaker can say "you can't mark this car above MSRP", with varying levels of success.
- 8n4vidtmkvmk 4y ago
  i got quotes online and then went to the dealership to pick up my car. no negotiation. i just didn't respond to any of the buggers that didn't give me a quote in the first email.
TreyGuy 4y ago
Greed also drives the other side of the equation... The consumers side as it pertains to getting the best deal possible! Markups.org is merely trying to use freedom of speech and press to force more transparency and competition across the dealership market segment.
- xanaxagoras 4y ago
  Yeah, I get it, and it's a cool site. I just thought the headline was a bit much. Although maybe I was thinking of the article's headline, not your headline here on HN. I want to say they were the same when I posted my comment, but I'm not sure.
- rdtwo 4y ago
  What’s your business model? Where do you earn the money to run the site?
klabb3 4y ago
> Greed is the central axis around which capitalist economic activity is oriented. It's hyperbolic, but yeah self-interest is a pretty good approximation for behavior of all living organisms. Powerful natural forces like self-interest should be utilized to produce a good outcome, but they don't guarantee a good outcome just by being powerful. Jealousy and hate are powerful forces too. For capitalism to work, many supporting structures are required. One is information symmetry. If you have to drive 10h and speak with a sales rep for 1h before you learn the price, you don't have a free market. Aside from this being deceitful and false advertising, it introduces economic inefficiencies in the most basic sense. All efforts that bring transparency are to be saluted.
xenadu02 4y ago
The problem is the grossly inefficient market where vehicles have an MSRP but the actual price you can pay varies wildly. In that sense it is no different than airline ticket fees (though not baggage fees) and similar schemes. The goal is to stop customers from doing apples-to-apples comparisons when shopping.

svnpenn 4y ago

$150,000 for an F-150? https://sunrise-ford.com/inventory/new-2022-ford-f-150-lightning-platinum-awd-4d-crew-cab-1ft6w1ev4nwg01497 https://sunrise-ford.com/inventory/new-2022-ford-f-150-light...

CSSer 4y ago
It’s not just because it’s electric. In rural areas like where I grew up I’ve heard these type of high-end models, like the ones with the “King Ranch” or “Platinum” packages referred to as “Cowboy Cadillacs”. Granted, $150K sounds really high, but even before the pandemic I recall hearing about non-electric $80-$100K trucks.
TreyGuy 4y ago
MSRP: $93,874
throwthere 4y ago
It's a big sticker but that's a luxury F0150. Making luxury stuff go to the people who are willing to pay the most seems... like the system works. It's the markups on Camrys (Camries?) and Corollas that matters more.
Phlarp 4y ago
Yes, but think of the F150 as an entire vertical-- it accounts for ~40% of Ford's North American sales. To say they have "lots of different trim levels" is a little too basic. There are the standard XL and XLT versions, Lariat, Platinum, Limited, Tremor, Raptor and King Ranch each with their own array of add on packages and upgrades. F150 owners treat their trucks like gamers treat their RGB desktops. Does the watercooling and lighting package really improve performance? Not really. Do nerds still spend lots of money on them? Absolutely. Putting a lift-kit on the pickup truck that drives exclusively on paved roads is similar.

andrew_ 4y ago

The mobile experience is so incredibly bad. Tried to add a markup to the site, brutal time trying to navigate it. Moved to a different tab and lost all my input. Image upload is capped at 5mb; which is under the average size my s10e takes by default. Great concept, garbage execution.

LeoPanthera 4y ago
Is it really necessary for every website to work perfectly on a pocket sized screen? Some ideas just work better on a big screen, mouse and keyboard. We shouldn't limit ourselves just to make everything work on an iPhone.
- TreyGuy 4y ago
  The initial execution was to mimic an excel spreadsheet but as we get more feedback we hope to really produce a better UI and UX.
- andrew_ 4y ago
  As I stated; S10e. Not iPhone. It looks like you just reacted rather than reading, but to answer the question in earnest: no, we don't have to make sites work perfectly on every device. That doesn't preclude criticism, however. Might want to check out current stats for mobile browsing. I've been in web development for 20 years and the numbers continue to go up. So again; no, but you're excluding a lot of traffic, and users. And for a site relying on crowdsourced data, that seems like a poor choice.
  - TreyGuy 4y ago
    Crowd sourcing the data is the only way to uncover the real pricing that happens behind the scenes 3 hours into a dealership trip to buy that new car once you finally sit down at the finance guys office. It happened to me and it's happening in crazy high numbers of interactions. The prices listed online or initially viewed then get bludgeoned by "the mandatory addon and adm" bat once you burned half a day at the dealership and finally sit down to "talk numbers". Utilizing OEM MSRP or posted pricing data I feel paints a more flawed picture!

lotsofpulp 4y ago

As if car buyers are any different. They would not take anything less than the highest offer for selling their used car, just like the dealerships. Is a dealership wanting to sell for the highest price any different than a labor seller wanting to sell for the highest salary?

curiousgal 4y ago
I know so many people who knowingly sold their used cars that had structural issues that are hard to diagnose.
- ghaff 4y ago
  Selling used cars in the current market is one area where information asymmetry probably tends to play out in favor of sellers trading into dealers. Of course, it probably screws the ultimate buyers in a lot of cases. It's not just structural issues. There are a lot of known mechanical issues that a used car manager isn't going to notice in a 5 minute examination for a tradein.
TreyGuy 4y ago
The site isn't meant to "get one over" on dealerships. It's merely a tool riding on the back of capitalism and free speech to reward the lowest priced dealers, pull back the veil of sneaky bait and switch pricing models and attempt to force more competition across the industry.
nomel 4y ago
There's very little difference between a dealership, and a scalper. Both capture all the items in the market, then work together to inflate the value, artificially. The difference is that many places have laws preventing scalpers, and many places have laws requiring that you buy a car through a dealerships.
- Gigachad 4y ago
  Dealers and scalpers provide liquidity. Sellers want the item off their hands now, buyers want something without waiting months for a seller. Dealers link these two needs together and take a cut for the service. There is no monopoly or requirement to sell a car through a dealer. It’s just that people find the service worth the cost.

dang 4y ago

Recent and related: Ford CEO Had Enough: Dealers Raising Prices Need to Stop or Else [video] - https://news.ycombinator.com/item?id=32318698 https://news.ycombinator.com/item?id=32318698 - Aug 2022 (128 comments) Specifically https://news.ycombinator.com/item?id=32319225 https://news.ycombinator.com/item?id=32319225

TreyGuy 4y ago
Indeed, it will be interesting to see how this plays out with Ford and if they truly plan to curb the markups or force pricing transparency

kart23 4y ago

carmax has been doing this with teslas. visited a carmax lot and saw around 10 model 3s, identical specs, with less than 50 miles (the 1k miles is the lowest the site will show) and selling them for 10k markup. they’re literally scalping teslas now, not to mention the rest of their overpriced inventory. https://www.carmax.com/cars/preview/23029935 https://www.carmax.com/cars/preview/23029935

TreyGuy 4y ago
Oh jeez, ya I know CarMax is bad. We dont really have a clean way of reporting teslas or scalping of resold vehicles by 3rd parties like that right now at markups.org
- tptacek 4y ago
  I wouldn't buy a Tesla from Carmax (I wouldn't buy a Tesla from anyone), but for everything else, it's pretty great. I bought my last car from them online at an extremely sane price, and they delivered it to my door; a few weeks later a better trim of the same car popped up on their site (many hours away), and I was able to exchange without any drama. I got pretty decent at car buying from dealerships over the years, and I kind of feel like a sucker for playing that game now. Again: I'm sure you're right that buying a Tesla from Carmax is a terrible idea.
  - tmpz22 4y ago
    My personal experience was that sites like carmax and vroom had significantly higher mark ups then dealerships and lots of complaints that their “360 inspection” had terrible quality control problems and frequently shipped bad cars. I can see these sites working for very specific models and trims but overall bad. Honestly it’s all bad unless you get lucky it feels like.
    - ehvatum 4y ago
      I recommend Manheim Auctions, if you can get access.

tekchip 4y ago

I've contributed a few dealerships around Illinois. Wife is looking for a Chevy Bolt after her car was scraped in an accident (the other person's fault). Every dealership other than a single local one is charging between $5K and $10K "market adjustment". I'm sure many of these are just charging the markup no matter what. But I have a theory many charge this if you're from out of town and won't be paying them later for maintenance services. This the local dealership that seems to be the odd one out not charging this.

lelanthran 4y ago
> But I have a theory many charge this if you're from out of town and won't be paying them later for maintenance services. How do they know you're from out of town when they give you the quote? Do they refuse to quote without a valid and verified address? After all, can't you just give them a local address when asking for the quote?
- gruez 4y ago
  That might get tricky if they use your fake address in later pieces of paperwork.
  - lelanthran 4y ago
    > That might get tricky if they use your fake address in later pieces of paperwork. It's alright, you can give them a different address after receiving the quote.
  - deleted 4y ago
    [deleted]
- mzs 4y ago
  Your driver's license being photo copied is one of the first steps in buying a car at a dealership.
  - lelanthran 4y ago

waffle_ss 4y ago

Is the company actually a non-profit? When I click the donate button Stripe says I'm giving to "Markups, LLC" and the IRS exempt organization search doesn't return results for orgs containing "Markups".

TreyGuy 4y ago
No we're not, we are a for profit llc and need to make sure the writer fixes that.
- gorbypark 4y ago
  You might want to consider a different tld. While .org isn’t strictly for non-profits anymore, it sure does give off the “we’re a non-profit” vibe.

gkanai 4y ago

If this downturn really deepens into a true recession (however it is defined) won't new vehicle markups go away naturally as fewer customers will be buying new cars? Isn't Markups a business that only is relevant during an inflated economy?

TreyGuy 4y ago
Indeed, it will flip to the opposite side of the pole. Getting the best deal under MSRP. Pre covid if you were good at searching forums and Facebook groups you might find the select dealers advertising 3-5% below invoice pricing on certain custom orders.
samizdis 4y ago
I'm not sure that Markups seems relevant only, or even chiefly, because of the state of the economy. To me, admittedly as an outsider in the UK, the US car dealership model just feels wrong and monopolistic, regardless of prevailing circumstances - an exemplar of rentier capitalism supported by robust, deep-pocketed lobbying [1]. I suspect that Markups will remain relevant for as long as the situation vis-à-vis car dealerships and how they operate persists in the US. Markups may even prove to be instrumental in successfully rallying and focusing consumer support sufficiently to overcome the status quo, and so eventually have no further reason to exist. But the word "eventually" in the previous sentence is key. [1] https://www.opensecrets.org/industries/lobbying.php?ind=T2300 https://www.opensecrets.org/industries/lobbying.php?ind=T230...
autoexec 4y ago
You'll mostly get the data during a an inflated economy, but it's still good to know which companies are screwing you over so that you can take your business to someone who didn't when the economy settles back down. I doubt losing my business will cause anyone willing to price gouge to change their practices, but who knows what other evil things that kind of company will do to exploit you so I'll feel even better supporting a business that didn't go out of their way to take advantage of people who are struggling.
- TreyGuy 4y ago

deleted 4y ago

[deleted]

Panzer04 4y ago

TBH, the only real issue I have with this is dealers capturing all the markup - this is happening because paying those prices gets you a new car now, and not in 12mo when the supply shortage is relieved. I'm not exactly sure how these things work, but if the manufacturer is forbidden from selling direct and dodging the dealer, that's a problem. If the manufacturer could, but is choosing not to, well, that's on them - They are simply transferring the PR hit to the dealer (and giving up the profits, which sounds dubious) Pretty good example of trading one thing for another though! Pay up now for a car now, or wait and save your money for a car that isn't marked up. It's kind of funny seeing corporations try to apply price controls, rather than the government :)

ramraj07 4y ago
Most states in the US have laws banning the direct sale of cars without dealers.
- slrd7z88 4y ago
  For states like California where it is legal, can you only buy Teslas directly?
  - telcal 4y ago
    Tesla's can only be bought new directly from Tesla. They are the manufacturer and "dealer". The sales people work on salary, no commission. Here's the list of states where you can't buy a Tesla directly but there are workarounds for those people https://en.wikipedia.org/wiki/Tesla_US_dealership_disputes https://en.wikipedia.org/wiki/Tesla_US_dealership_disputes
- kenniskrag 4y ago
  why?
  - deleted 4y ago
    [deleted]
  - 4y ago

Gh0stRAT 4y ago

Hey @TreyGuy (or others from Markup.org) How do you account for dealers which sell for $0 above MSRP but then include a non-negotiable $700 "paint protection" service? As a crowdsourced site, you'll get a ton of reports that a particular dealership has no markup and few if any reports from people who have actually been far enough into the purchase process to discover these hidden markups.

WalterBright 4y ago
Nothing is "non-negotiable" in business. Just say "no".
- Gh0stRAT 4y ago
  That's exactly what I did. I had my checkbook and was there to put in a deposit when I found out. Here's an abridged version of how the conversation went: > Me: I don't want that and won't be paying for it. > Them: Well we do it for all new cars and you can't have us not do it. > Me: Well then you can either eat the cost of this unnecessary "service" or sell me the car for $700 under MSRP to make up for it. > Them: Sorry, we can't do that. I walked out and they haven't called me back to say they were bluffing. Meanwhile, I'm working with a different dealership now.
  - 1123581321 4y ago
    You didn’t win this either. The last time I bought a (used) car from a dealership, I walked out, and they caught me as I was walking out the lobby and dropped the add-on, and then another add-on after some arguing since they knew I’d leave. That was successful.
  - WalterBright 4y ago
    There you go. You couldn't reach agreement so no deal. Nobody was forced into anything.
    - lucideer 4y ago

lizardactivist 4y ago

I scroll through the list and see that some dealers -- no, stealers -- have a markup of USD 50k, how does that even result in a sale? I'm genuinely curious why someone looks at that final price, and then decides to go ahead with the purchase. More money than sense and no idea of what a sensible price is?

deleted 4y ago
[deleted]

autoexec 4y ago

Shame you can't sort by markup and easily see who the worst offenders are

TreyGuy 4y ago
top right hand corner of the list view... select the sort order and pick "price (low)" or "price (high)" https://markups.org/?sort=price-desc https://markups.org/?sort=price-desc
- autoexec 4y ago
  Thanks! I had tried that, but I guess I saw the kinds of cars at the top of the list and assumed that "price" meant "actual price of the car", I was looking for something labeled more like "markup as a percentage of what this car was actually worth". A dealer with a $1,500 markup on a car worth only $1,200 is much worse than a dealer with a $20,000 markup on a car worth $80,000 I guess it just makes sense that they'd be able to throw a larger markup on cars which are that much more expensive to start with.

fny 4y ago

I feel like consumers writ large are forgetting they can protest. If everyone collectively rejects higher prices, the price will come down. Everyone is manipulating this inflation sentiment to wring consumers out of every penny until they're broke. Stop paying for things where the price has exploded higher and force businesses to deal with tighter margins. Prices will normalize.

massysett 4y ago
This doesn’t work when your car is totaled, body shops are backed up for weeks, and you need a car to get to work.
- atestu 4y ago
  Just buy a used car?
  - dagw 4y ago
    The used car market is experiencing exactly same markups and 'price gouging' as the new car market.
    - atestu 4y ago
      I recently bought a used car, and while the prices are up, I didn't see any 10K markups or price gouging. It's still a much more sensible choice to buy a used car.
    - thowren87 4y ago
      Yeah, sadly the used car market is suffering as well! Read more: https://www.autoweek.com/news/industry-news/a40690607/average-used-car-price-is-now-33000-dollars/ https://www.autoweek.com/news/industry-news/a40690607/averag...
SamuelAdams 4y ago
Unfortunately many people do not care about the total cost of the vehicle. They care about the monthly payment. As long as they pay less than 700 USD a month it’s affordable. Even if it’s stretched over a 7-8 year loan at 5% interest. So if you want people to stop paying high prices, you need to get them to look at the total cost of the vehicle. And you need to get lenders to stop handing out loans longer than 4 years. Unfortunately they don’t have an incentive to do this because long, high interest loans are profitable.

nixass 4y ago

When dealer's first question is how much am I willing to spend monthly rather than talk about final price of the vehicle he can just F off and I won't be returning there. They even try to convince you the total price is irrelevant, only monthly payment is what matters

Loughla 4y ago
The last time we bought a car, the salesman tried the 4 square nonsense. I declined to look at monthly payments and was evasive about how much I wanted to spend. I just said, "as much as I need to, to get the car I want at a decent price, which according to my research should be X" or "my monthly budget is not your concern, I am willing to pay X for this car". Once I had the final price on the car, and it was very comfortable to me, they STILL tried to get me to sign a 'contract' using the four-square numbers. Just monthly payment amounts, no length or other information. They literally wouldn't move forward until I signed it. Like, wouldn't let me see the manager to finish the deal. The price was so good on this one, though, that I didn't want to just walk out. So I took a black sharpie and crossed everything out, wrote the total price, and signed it at the bottom. It wasn't a legal document. It was literally just a sheet with their handwriting on it saying "monthly price agreement". Nothing finance related, no legal jargon anywhere. Ridiculous. Just absolutely ridiculous, and for what purpose?
- dano 4y ago
  Ha ha, yeah, I remember a green sales person trying to use the four-square model on me. I looked at him and said "I'm paying cash" which confused him to no end. He had to go see his manager. In the end I didn't buy a car from that dealer. Where the cash comes from is none of their business; i.e., loan or something else.
dawnerd 4y ago
They got upset last time when they wanted my social right off the bay and I declined saying I would be paying cash. I’m now driving a Model Y I paid for in cash, so done with dealers.

benrapscallion 4y ago

Partially related: is there a simple metric and/or a website with data on the supply of cars vs. demand? To see how long before the supply constraints ease up and which brands are most affected?

atestu 4y ago

Based on all other comments I have an unpopular opinion: I think this is fine. If 10 people want to buy 1 car, how do you choose which person gets it? You raise the price until there's only 1 person. How else would you do it?

capableweb 4y ago
Well yeah, if you want as much money for the car as possible, then you'd do it like that. Personally when I sell stuff second-hand (which tends to be cars, computers, instruments and various accessories), I sell it to whoever is first and closest, in that order.
- atestu 4y ago
  Right. And I don't think we should fault dealers for wanting to make as much money as possible. They're a business after all. I usually do the same when I sell stuff second-hand because my priority is getting rid of it as fast as possible, not to make the most money. Since dealers have very limited inventories these days, they should take more time to get a better price.
  - n4r9 4y ago
    > They're a business after all. I'd argue that using this phrase to write off wider ethical concerns is one of the key issues here.
    - millerm 4y ago
      Exactly. Many people actually ”need” things, but always end up getting beaten by the person who has more $. It’s just constant battering of people that aren’t as well off as others. It’s often a disgusting system. The poor always suffer due to this “I’ll just hand wave to the ethics and talk about capitalism“.
      - coryrc 4y ago
        Capitalism brought hundreds of millions out of abject poverty in the last thirty years. It has real consequences. The poor in the US have better living standards than half the planet and every opportunity to better except their own cultures holding them back. The left refuses to acknowledge or deal with this, creating generational poverty. What's not to blame is "capitalism".

Patrol8394 4y ago

Isn’t the purpose of any business to minimize cost while maximizing profits. As long as there are people willing to pay the price, you can’t certainly blame the seller.

endofreach 4y ago
It‘s not like a law of physics. Neoliberalistic ideas that manifested as the ultimate truth, but obviously are not (that truth).
rdtwo 4y ago
Best way to do that is government regulatory lock in which is what dealers have

smeej 4y ago

It's not just the new cars. On Saturday, my friend traded in his 2017 GMC Canyon with 86k miles on it for $19k. He had paid $25k for it new in 2017. The dealership now has it listed for used sale for $28,995. If they're turning a $10k profit on a 5yo car driven pretty hard for 5 years and selling it above what it cost when it was new, I have no doubt they're marking up the new ones even higher!

ghaff 4y ago
Yeah, the one silver lining of the crunch. When I just bought a new car, I traded in a 2011 Toyota 4Runner with 75K miles and a caved in rear hatch and some non-obvious mechanical problems. Got $15K for it. Was really shocked. Sort of made up for the fact that I pretty much paid sticker plus a couple add-ons.
- smeej 4y ago
  The same dealership as bought my friend's truck above is offering me over $4k for my 2007 Prius with 208k miles on it. Sure, I expect I could get that private-party. But on trade-in??

jrochkind1 4y ago

The (original) headline says "nonprofit", but this isn't mentioned in the text, which does say "take the plunge to form an LLC in November/December". Is it actually a nonprofit? Or... what does that mean, in this case? Curious to hear more about the business structure with regard to this if anyone knows.

Rastonbury 4y ago
It also has ads that ublock didn't catch Edit: Creator commented in here that it's a for-profit LLC and the title is wrong
TreyGuy 4y ago
its an error on the writers part. we are a "for profit" LLC
- jrochkind1 4y ago
  Thanks for quick info! I see it's already been corrected in the OP, thanks! I'm always interested in novel business structures especially around non-profit-ness, but I guess false alarm here! Paging @dang, correct HN headline here by removing "nonprofit"?

O__________O 4y ago

Do dealers all pay the same price for a given make/model/year regardless of volume? If not, while I get consumers only care about markup over MSRP, it’s likely dealers are not all paying the same price wholesale. As such, if data like this becomes the norm, likely lead to small dealers who pay more wholesale going out of business — which long-term would likely be worse for consumers; to be clear, not saying that selling the markup data wrong, but it’s likely to impact the market in ways that may ultimately be a net negative.

bradfa 4y ago
In theory, yes, all dealerships pay the "invoice" price for a given vehicle. But often there are other financial stipulations for each vehicle, such as "hold back" which is meant to assist the dealership floorplan interest costs (basically the carmaker pays the interest on the dealer's loan to hold the car on their dealership lot for X days, then beyond that the dealership is on their own). I don't think hold back deals are always the same for every dealer, but I have no insider information. If you ever are negotiating for a new car purchase, you can use the leverage of the hold back in your negotiations. If you're ordering a car and will pick it up the day it arrives at the dealership, then that dealer gets to pocket the entire hold back as they'll pay basically no interest themselves. Or if you're buying a car that's been on the lot for 6 months, the dealer really wants to stop paying interest on it so may take a lower offer just to stop the financial bleeding (granted, this is rare today, cars sell fast).
- O__________O 4y ago
  My understanding is invoice price the equivalent of MSRP for dealers — and like MSRP, rarely the average price paid, which varies based on number of factors; which circles back to my prior point, the dealers who are getting the best deals from the manufacturers are going to have the most room to bring down the consumer pricing, which means the smaller dealers will likely get pushed out of the market if the “markup pricing” becomes easy to get, which long term will hurt consumers. Lastly, I personally would never by a new vehicle unless it was for a highly specific need and impossible to find used, since they’re rarely a deal; average new car drops 20% in value the first year. _________ Related: https://cars.usnews.com/cars-trucks/what-is-the-dealer-invoice-price https://cars.usnews.com/cars-trucks/what-is-the-dealer-invoi...

t_mann 4y ago

Somewhat tangential, but I'm surprised that a concise domain name like markups with an attractive TLD like org was still available. In the spirit of a non-profit, I'm wondering whether they couldn't have made do with a name that specifies their (laudable, but quite specific) niche (US-centric comparison of car dealers).

agrippanux 4y ago

Comments in this thread remind me why it’s so efficient to use the auto buying program from Costco. You deal with the fleet managers instead of regular sales staff and all required/optional costs are upfront and non-negotiable. If you are an expert haggler you can likely negotiate a better price than what you get through Costco, but for the rest of us it gets you 90% of the way for very little effort.

rdtwo 4y ago
Days of old nobody will honor the Costco rate because it only applies to cars in inventory that don’t exist
programmertote 4y ago
I tried to use Costco Auto program when I bought a car in late May of this year (2022). Once the dealers heard I came from Costco Auto program, they acted disinterested even though they are part of Costco Auto program (e.g., Al Hendrickson Toyota). Plus, there is no Honda dealer that is part of Costco Auto program within 180 miles of where I live (I live in just a little north of Miami). I went to Mazda of North Miami which supposedly is part of Costco Auto Program, and guess what, they gave me $500 discount and they said that's all I get as part of Cost Auto (but the car was like $4000 above MSRP). I hope that when I purchase my next car, I'll never have to deal with dealerships and can buy it off online. I'm happy to pay 6-10% commission for dealership as long as I don't have to deal with haggling and being pushed to buy shady insurance and other add-ons that I don't need.

brycewray 4y ago

Bought my latest vehicle just before COVID lockdown (i.e., before I had a clue that my commuting days were over) and, thus, also well before Supply Chain Meltdown. Have rued that purchase ever since on the theory of "Geez, it turned out that I really didn't need this vehicle so badly"; but, after seeing these developments and remembering that I was able to get the price down a few thousand from MSRP, I'm thinking I may have come out ahead, after all.

Loughla 4y ago
We bought our most recent new car in February of 2020, RIGHT before the whole world blew up. We have gotten calls from the dealer offering us up to 10k over what we originally paid for the car since then, even with the mileage we've put on. Absolutely amazing, the world we live in.
- robotnikman 4y ago
  Same with my car, which I just got a few months before covid started. The dealership is basically offering to buy it back for the price I paid for it.

navbaker 4y ago

We had extremely good timing buying our new minivan last year, 100% due to pure luck with when our previous car crapped out. We used the Costco buying program, which basically let us go in knowing what we would pay with a pre negotiated price and not have to haggle, and shopped in early April. We were looking for some specific trim options and the dealer let us know that they were out of a few of them due to shortages of some chips, but they did have a whole bunch of a different trim level. We walked out happy with a new van just a few weeks before inventory levels tanked and prices started skyrocketing.

ryantgtg 4y ago

The /r/electricvehicles subreddit has a similar tracker https://datastudio.google.com/reporting/7a243d54-2a8d-44f3-a405-ce2a509c1c07/page/3KHiC https://datastudio.google.com/reporting/7a243d54-2a8d-44f3-a... It's cool, but not has some usability issues (most recent update for a dealership is not always what dictates the color of the marker on the map). Anyway, crappy dealer experiences are a huge reason why so many people purchase Teslas, and why OEMs like Volvo are creating new brands that they can sell direct.