Shopped around for a couple weeks now between October and November. Was provided one RV in October for 57% from a couple of dealerships and this month was provided 56% at another. The dealer quoting 56% said he swears that he just checked MB corporate and mentioned that the 57% is misquoted by the others.
Do RV’s change on a month to month basis?
My understanding is that Corporate HQ develop RV% based on an annual basis and month-month variations don’t occur. Let’s say that’s correct, what could account for the RV% being higher in one dealer and lower in another?
absolutely they can. So can incentives and money factor. Each month is different. Residual cannot be changed by the dealership, so if he told you 56%, it’s 56%.
Your understanding is incorrect.
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Make sense - so someone from Corporate HQ can simply change the RV% and MF% based on corporate goals, inventory count, or simply want to drive demand in certain vehicles for that particular month?
It really depends on what you mean by corporate HQ… Are you talking manufacturer or lender? The captive/lender/bank are the ones that set the RV.
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Valid point. I assumed this is what he was referring to when I replied, but you know what happens when you assume…
If you look at Edmunds for RV you will see that people are asking for new RV and MF every month. The changes are what makes a car hot one month and not the next. Recent examples being Alfa and Volvo off the top of my head.
Toyota for example changes Residuals every 2 months.
Yes the captive lender and bank - shows that I was not aware the RV was set by those guys and NOT the manufacturer.
It’s a very important distinction because most people will assume that the captive with a name like MB Financial Services or BMW FS are the same as the manufacturer. While they may fall under the same umbrella organization, they are intentionally unique and separate.
While the manufacturer success KPIs are top line revenue KPIs (how well they sell their products, design new cars, expanding dealerships, invoice prices etc.) and bottom line KPIs (inventory management, holding costs etc.) , what are the FS success KPIs? what types of things do they care about to drive that part of the business?
