I just don’t draw the same parallel on items that are sold on Amazon versus cars which are tens of thousands of dollars, if not more. I mean why stop at cars then? Why not price real estate in a way where some arbitrary entity fixes prices for them based on certain characteristics and there is virtually no negotiating power, and everyone pays the same amount for like properties.
Agree and changing the approach to car buying/selling to that of Tesla will surely make a “deal” something of the past. All this would do is entice people to keep their cars longer, buy used and thus, prop up the second hand market as we are seeing now. This ultimately hurts the auto manufacturers themselves. And Tesla is able to do it because of their innovative product and the benefit of early adopters, not because of the purchase process.
Right. When I got my bolt I also shopped a tesla 3. Both sticker at 45k. Got the Bolt for 0 down $249. Telsa was $5k down, $500/mo. Yes, I had to hunt for a deal with the Bolt but it was way better than the no haggle tesla pricing.
Which tells you how meaningless stickers are.
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you are missing the point,
What we are saying is that,
What if you were able to get all the customer facing incentives that GM was offering & order it online without talking to a dealer but may be it would have cost you $300/month & if you still wanted to haggle & get it for a lower price you can still go to a dealer & haggle?
So you want a manufacturer direct-to-consumer sales channel in addition to the traditional dealer to consumer? What makes you think franchisees will be on board with this? What makes you believe consumers, when given a choice, will be willing to pay more just for the comfort of placing an order online? I am so confused.
i see. i don’t believe that would happen. if they got rid of dealers or offered some sort of direct pricing it would be at a higher price. maybe not as high as some dealers can get but def not a LH worthy price either.
Happens in a lot of franchise businesses.
The sale happens thru a centralized medium (a website) for a fixed price where the franchise gets the order to be fulfilled. Franchisor usually charge a fee for providing the order to the franchisee. Franchisee get a sale & profit by paying a fee to the franchisor.
But at the same time the franchisee control their local market & can offer additional discounts or whatever to make their own sale directly which usually have extra benefits of not paying a fee to the franchisor.
That’s up to the consumer, if you think you can go to the dealer haggle & get a better price then the online price go do that, if you don’t care for the haggling & just want what is available to you online buy that.
It’s about choice.
The choice currently exists. If the consumer truly doesn’t want to deal, they are free to (at the comfort of their home) reach out to stores near and far, and get what they want at the “no haggle” price. Under normal circumstances, many would be perfectly fine selling cars at MSRP less manufacturer incentives. Under abnormal times such as now, the no haggle price goes up. This even holds true for Tesla with raised MSRP’s.
The benefits of an online add to cart button seem to be very minor when you compare it to the overall changes that need to be made to the industry as a whole.
Yup. Originally Carmax and later Carvana for used cars. Autonation’s ~300 dealers across a wide range of brands for new cars.
OEM-owned stores are not some magic solution either. Just ask anyone who has shopped at MBUSA- or BMWNA-owned stores.
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I am one of them. Both BMW Manhattan and MB Manhattan. Can confirm dealer shenanigans as well as opaqueness in pricing exist at both spots.
It’s only antiquated state government regulation that give franchisees veto power. One could argue, and I do, that franchisees shouldn’t get to decide how consumers buy cars.
I’m curious about their NYC store. They are company owned but I’m having trouble finding the regulatory framework that gives them that exception. Just wondering what the rules are for the company owned stores.
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My favorite part
In order for inventory to remain low and prices high after the the chip-supply problems are resolved, the automakers will be bound up in a version of one of economists’ favorite games, “The Prisoners Dilemma,” forced to cooperate, Wakefield says.
Once that ends, the first company to sacrifice profits to gain market share will likely cause others to follow suit and they’ll be right back where they were before the pandemic.
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i think the answer to the original question is “no, you’re doomed to pay MSRP++ forever. the market will never adjust, supply chains will be broken forever, and the wait time for a car will become similar to that from Soviet Russia…”
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I have argued for that exact scenario before.
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Did you read the Audi purchase thread?
no i didnt?
Try that
i mean i lived in the ussr. my dad waited in line for 7 years for a lada.
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