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"The way the salespeople negotiate between two different parties – on one side with the customer, on the other side with their manager" This is what really str

"The way the salespeople negotiate between two different parties – on one side with the customer, on the other side with their manager" This is what really struck at me. I was really surprise at how isolated a car sales guy is, even within the same dealership. It truly is every guy for themselves. Is this situation ripe for a disruption?

janesvilleseo 13y ago
Yes, but it's protected by law. Look at how difficult it is for Tesla to sell via a more direct method, without using dealerships.
fleitz 13y ago
Honda already has by not over producing vehicles. IIRC Honda nets about $1K more per car than any domestic. There's also no-haggle dealerships for people who like to get the same deal as everyone else.
- alexeisadeski3 13y ago
  No-haggle dealerships are a rip off if you're a good negotiator though.
mikemac 13y ago
Planet Money did an excellent piece on just this - Cars Direct attempted something similar (and failed) in the late 90's. http://www.npr.org/blogs/money/2013/02/19/172402376/why-buying-a-car-never-changes http://www.npr.org/blogs/money/2013/02/19/172402376/why-buyi...
ryanmarsh 13y ago
It is very ripe for disruption and has been for decades. The entire model (as other commenters have stated) is protected by law at the behest of a special interest lobby. I sold new cars for a while. The dealer really should just be a showroom staffed by manufacturer sales people with perhaps some bonus structure. Instead it's filled with middlemen whose children will only eat if they can convince you to pay more for the car than a more efficient market would allow for. If you watch the movie "Suckers" you'll understand the "asshole" culture of car sales. Unfortunately it's really that way because you have to be an asshole (a taker) to survive.
- alexeisadeski3 13y ago
  Even without legal protection, it's likely that buying a car would remain a confrontational experience. We negotiate over cars because the price is sufficiently high that it's worth it to pay an employee who's sole job is to wiggle that extra 5% out of you. Other examples of items we negotiate the purchase of include pianos, heavy industrial equipment, home repair and maintenance, and myriad commercial products and services. Hardly any of these are "protected" in a similar fashion to car dealers. Further evidence in support of this theory is the trend in poorer countries to increase the number of items with negotiated prices: As the wages of decent negotiators fall, it makes more sense for a business to hire them and thus improve margins.

janesvilleseo 13y ago

Yes, but it's protected by law. Look at how difficult it is for Tesla to sell via a more direct method, without using dealerships.

fleitz 13y ago

Honda already has by not over producing vehicles. IIRC Honda nets about $1K more per car than any domestic. There's also no-haggle dealerships for people who like to get the same deal as everyone else.

alexeisadeski3 13y ago
No-haggle dealerships are a rip off if you're a good negotiator though.

mikemac 13y ago

Planet Money did an excellent piece on just this - Cars Direct attempted something similar (and failed) in the late 90's. http://www.npr.org/blogs/money/2013/02/19/172402376/why-buying-a-car-never-changes http://www.npr.org/blogs/money/2013/02/19/172402376/why-buyi...

ryanmarsh 13y ago

It is very ripe for disruption and has been for decades. The entire model (as other commenters have stated) is protected by law at the behest of a special interest lobby. I sold new cars for a while. The dealer really should just be a showroom staffed by manufacturer sales people with perhaps some bonus structure. Instead it's filled with middlemen whose children will only eat if they can convince you to pay more for the car than a more efficient market would allow for. If you watch the movie "Suckers" you'll understand the "asshole" culture of car sales. Unfortunately it's really that way because you have to be an asshole (a taker) to survive.

alexeisadeski3 13y ago
Even without legal protection, it's likely that buying a car would remain a confrontational experience. We negotiate over cars because the price is sufficiently high that it's worth it to pay an employee who's sole job is to wiggle that extra 5% out of you. Other examples of items we negotiate the purchase of include pianos, heavy industrial equipment, home repair and maintenance, and myriad commercial products and services. Hardly any of these are "protected" in a similar fashion to car dealers. Further evidence in support of this theory is the trend in poorer countries to increase the number of items with negotiated prices: As the wages of decent negotiators fall, it makes more sense for a business to hire them and thus improve margins.