That only further supports the point of dealer raking in the benefits.
No manufacturer save for Tesla is going to drop their pricing just because their overhead goes down (which it won’t if they have to directly hire support staff to do their own sales assuming they keep servicing as a franchised component)
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Its not even about the prices. We benefit when the price is overinflated to the point that they cannot move inventory, that’s when discounts and rebates roll in and the spread between MSRP and Residual narrows.
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Laughs in Stellantis
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Is this really only blocking new GAS powered direct dealerships and leaves all EV only alone?
then this is aimed at Ford’s new single price plan.
I think ford will still sell through a dealership if they go that route. They will just do hourly employees like Tesla does. They have franchise agreements they can’t break afaik.
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Tesla, anyone?
I thought that’s why Ford set up a new “division” known as Ford Model E to bypass some of the current regulations and / or dump a hundred million in legal fees trying to get it that way?
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That could def be the case. I’m sure evs were never included in their agreements made years ago
Tesla is def the exception but they will raise pricing when it’s viable. Right now it seems they’re just lowering to corner the market, pump up the stock price. When you have endless cash you can afford not to profit, or profit less for years.
The Amazon model, put the competition out of business then raise pricing when there’s no one else left. Tesla is years ahead of the competition at this point and their costs seem to be much lower since all other companies are losing billions in their ev divisions.
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Of course. But the same applies to the dealer model when manufacturer raises prices - consumer pays more. But if Volvo dealers sell a $62,240 C40 at 11% off + rebates and consumers snap them, then why Volvo can’t sell the same car directly for the same $55,400? This “negotiation” to the rock bottom is psychological.
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Because they don’t sell them all for 11% off + rebates. They sell a few while selling many more for higher. Go to a single entity setting the pricing and you may not see the mean sales price decrease but you will definitely see the -3 sigma sales price increase.
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CSI scores for Saturn were really high for the fixed price model.
But the costs of non-parts sharing were very high and GM’s zero-sum internal politics meant everyone else within the company looked at Saturn’s budget as a potential windfall for themselves.
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I was making a point that no one needs a middle man, not that 99% pay more than 11% off.
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Huge point here being mostly overlooked.
Tesla’s service generally sucks as those service centers are allowed to pretty much treat customers any they want because the customer essentially has less good choices.
Many buyers want to be able to buy at one dealer and service at another for a variety of reasons. Service (under warranty really) is a important factor for most car buyers and having many dealers that you can choose from for warranty/service work is a great option.
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The middle man is what enables us to get 11% off though. No middle man and the deals we love to chase will be gone
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Again - Volvo can sell at the same 11% off directly to consumers if they can sell to dealers and incentivize them on top of it. And I don’t want to chase, BTW lol
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Just because the manufacturer gains a larger margin doesn’t change the market price people are going to be willing to pay. What motivation would the manufacturer have to slash their new found margins?
The only thing that’s going to happen with this is squishing the standard deviation of deals.
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Why can’t free market decide if current dealership model works or the direct channel is better? Why does a supposed free-market champion need to take the trouble to legislate the behavior?
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Not sure what you mean by “slash their new found margins”? They sell to dealers at 11% off MSRP. How’s selling directly to consumer at the same price is slashing? We all know that C40 is overpriced at $62K, not so much at $55K. Slashing MSRP? Yes.
The market determines what these will sell for. Getting rid of the middle man doesn’t change what the market is willing to pay, it just pads margins to the manufacturer. The only thing that’s going to happen with a direct to manufacturer model is the current mean sales price will turn into the future mean sales price, the manufacturer will gain a larger margin since they’ll absorb the money the dealer pockets, and the standard deviation of deals will go to 0.
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