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  • Additional dealer markup

    I've been shopping for a new car to replace my 10 year old Expedition. There are very few around. Dealers are asking $5,000 or more above published LIST price. A friend said her father wants a new Corvette, but dealers are asking $20,000-$25,000 above the $100,000 list prices. I understand "make hay while the sun shines", but car dealers apparently have no shame. Anyone else seen this?
    Gary Ash
    Dartmouth, Mass.

    '32 Indy car replica (in progress)
    ’41 Commander Land Cruiser
    '48 M5
    '65 Wagonaire Commander
    '63 Wagonaire Standard
    web site at http://www.studegarage.com

  • #2
    Gary, what is old is new again; how far back goes that practice will probably never be ascertained, but it was widespread in the post-WWII era as civilian car production was ramping up. It got so bad the manufacturers were prohibiting dealers from charging more than MSRP, so dealers would require buyers to also take a $250 set of floor mats. Since cars were still in short supply, dealers maintained a wait list and it was known that money under the table would move a name higher on the list.

    jack vines
    PackardV8

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    • #3
      Last fall I started looking to replace my 2002 Ram truck. It was (is) getting close to 200,000 miles. Brand new or late model used was OK to me. However, I was so disgusted with the arrogance and “take it or leave it “ attitude that seems so prevalent with dealers l decided to keep my Ram. The market is over priced and I’m just not going to lay out that much money while being condescendingly treated like a senile fool wanting to buy a computer on wheels.

      For what they are asking for vehicles these days I can buy cheap repaints, pay for upholstery, and repairs while earning interest on my investments instead of buying a depreciating vehicle along with the higher property taxes, fees, and insurance. Unless a deal falls in my lap, I am out of the market for now.
      John Clary
      Greer, SC

      SDC member since 1975

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      • #4
        Car dealers seem to have always been sleazy/slimy in their quest for more of the customer's money.

        But, OTOH, where else does the customer expect to negotiate a price? Not at the hardware store or the appliance store.

        So which one came first?
        RadioRoy, specializing in AM/FM conversions with auxiliary inputs for iPod/satellite/CD player. In the old car radio business since 1985.

        17A-S2 - 50 Commander convertible
        10G-C1 - 51 Champion starlight coupe
        10G-Q4 - 51 Champion business coupe
        4H-K5 - 53 Commander starliner hardtop
        5H-D5 - 54 Commander Conestoga wagon
        56B-D4 - 56 Commander station wagon
        60V-L6 - 60 Lark convertible

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        • #5
          If a dealership usually sells 150 units per month, and now they’re selling 30-40, and they have to go to great lengths to get those, including paying more than usual… and meanwhile they still have the same overhead costs- what are they supposed to do?

          I am 60 years old and still have never bought a new car. I could never get it to make sense- paying interest on an asset that is simultaneously plummeting in value. I’ve had a lot of good times in my life with the money that would have gone down that hole. But I have never begrudged those who do- or those who sell them.

          I guess one thing has not changed- people assuming anything a car dealer does is based in greed- even if it isn’t. Even my good friend Gary.
          Proud NON-CASO

          I do not prize the word "cheap." It is not a badge of honor...it is a symbol of despair. ~ William McKinley

          If it is decreed that I should go down, then let me go down linked with the truth - let me die in the advocacy of what is just and right.- Lincoln

          GOD BLESS AMERICA

          Ephesians 6:10-17
          Romans 15:13
          Deuteronomy 31:6
          Proverbs 28:1

          Illegitimi non carborundum

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          • #6
            How badly do you want a brand new vehicle? Right now immediately, while demand exceeds supply? Or can you wait until that Expedition is 12-13 years old when supply catches up with demand and prices normalize, hopefully?

            Craig

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            • #7
              I have a 6 year old GMC Yukon that I bought 2 years ago. I’ve recently thought about trading it for a Yukon XL or Suburban, until I started looking at the prices today vs when I bought mine. Didn’t take me long to decide to keep what I have.

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              • #8
                There are several dealers that sell the Corvette at MSRP, no mark-ups. Thankfully they are the larger dealers. Normally at least a year wait. I am on a list for 2023 and should be a late September or early October build next year…Mike
                Mike - Assistant Editor, Turning Wheels
                Fort Worth, TX


                1964 Avanti R2 #R-4986

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                • #9
                  Originally posted by Bob Andrews View Post
                  If a dealership usually sells 150 units per month, and now they’re selling 30-40, and they have to go to great lengths to get those, including paying more than usual… and meanwhile they still have the same overhead costs- what are they supposed to do?

                  I guess one thing has not changed- people assuming anything a car dealer does is based in greed- even if it isn’t. Even my good friend Gary.
                  Agreed, Bob; the beat goes on as to overhead no matter how few new vehicles a dealer has to sell. It's a tough situation from so many standpoints.

                  I was discussing this just today with my good friend, the former Chevrolet dealer here in Brownsburg who was purged from GM's dealer ranks in the 2009 GM "reorganization" after the family's three generations had served the town well for more than eight decades. He's now working for a bigger Chevrolet dealer, a former competitor, his job description being "Inventory Manager" so he only need work days as he is nearing retirement age.

                  Here are his exact words when I asked him how he was doing, getting new vehicles to sell: "New car inventory is non-existent and I see no end in sight..." He also said a few other things about the current situation I won't post to avoid having this topic locked and my being thrown off the forum for a month!

                  To address Gary Ash's original question: Gary, just repair whatever you have and keep driving it until the market calms down. (As to what I can't understand: Why do dealers continue to advertise? If I had a new-car franchise, I'd be tempted to cut my advertising to near zero...why spend advertising dollars -adding to your overhead- to entice customers to come in when you have few units to sell and can't deal on anything? ) BP

                  We've got to quit saying, "How stupid can you be?" Too many people are taking it as a challenge.

                  Ayn Rand:
                  "You can avoid reality, but you cannot avoid the consequences of avoiding reality."

                  G. K. Chesterton: This triangle of truisms, of father, mother, and child, cannot be destroyed; it can only destroy those civilizations which disregard it.

                  Comment


                  • #10
                    (As to what I can't understand: Why do dealers continue to advertise?

                    I wonder the same thing about all the new car ads on TV. Seems like they have no new cars to sell, or the few they do get sell immediately so why advertise? Maybe just to keep the name before the public.
                    Don Wilson, Centralia, WA

                    40 Champion 4 door*
                    50 Champion 2 door*
                    53 Commander K Auto*
                    53 Commander K overdrive*
                    55 President Speedster
                    62 GT 4Speed*
                    63 Avanti R1*
                    64 Champ 1/2 ton

                    * Formerly owned

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                    • #11
                      Originally posted by ddub View Post
                      (As to what I can't understand: Why do dealers continue to advertise?

                      I wonder the same thing about all the new car ads on TV. Seems like they have no new cars to sell, or the few they do get sell immediately so why advertise? Maybe just to keep the name before the public.
                      I think that some of it may be related to long term contracts.
                      Gary L.
                      Wappinger, NY

                      SDC member since 1968
                      Studebaker enthusiast much longer

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                      • #12
                        I can tell you what’s happening here in central NY in the industry. One example is our local dealership here in Oswego. It’s a third generation Chevy/Buick dealer that underwent a multi-million dollar refurbishment. A few years back they bought the Chrysler/Dodge franchise and built a brand new multi-million dollar facility next to their Chevy store, opening in March 2020 after over a year in the making. As of last week their Chevy store had exactly ONE new car available. Where there was once a string of new vehicles packed along their road frontage, they have a few used units, angle parked and spread out. Their staff fills their days with monitoring multiple online auctions (with the accompanying risk of buying online) bidding on cars, and phone calls from other dealers looking to buy units, any units, offering as high as retail rather than having their parking lots look empty. Looking like you’re out of business is very damaging to the business long-term.

                        I know several dealers, and several salesmen, who put on their ties and come to work every day, mostly to disappoint and even offend customers with lack of inventory and negotiating room on the few units they have. They are stressed beyond belief trying to make enough to pay their own bills and make people happy who think they’re trying to screw them. The dealership buyers are sitting in front of multiple computer screens trying to buy while competing with Carvana, who continues to gobble up inventory at alarming rates.

                        It has now been over 50 years since I started going to auctions with my dad. I’ve seen many ups and downs in the industry; but I’ve never seen times like these. Nobody that I know has. And it seems like every day there is a new policy to make the situation even worse. No telling where it will end.
                        Proud NON-CASO

                        I do not prize the word "cheap." It is not a badge of honor...it is a symbol of despair. ~ William McKinley

                        If it is decreed that I should go down, then let me go down linked with the truth - let me die in the advocacy of what is just and right.- Lincoln

                        GOD BLESS AMERICA

                        Ephesians 6:10-17
                        Romans 15:13
                        Deuteronomy 31:6
                        Proverbs 28:1

                        Illegitimi non carborundum

                        Comment


                        • #13
                          Originally posted by studegary View Post
                          I think that some of it may be related to long term contracts.
                          It is well known that auto manufacturers sponsor sporting events, and many other shows on network TV. Even if it isn't a long-term contract, they aren't going to give up and lose their prime-time position by not continuing to support and advertise, even though they don't have product in stock to sell.

                          Craig

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                          • #14
                            Your Post #12 nails it, Bob. Well said. BP
                            We've got to quit saying, "How stupid can you be?" Too many people are taking it as a challenge.

                            Ayn Rand:
                            "You can avoid reality, but you cannot avoid the consequences of avoiding reality."

                            G. K. Chesterton: This triangle of truisms, of father, mother, and child, cannot be destroyed; it can only destroy those civilizations which disregard it.

                            Comment


                            • #15
                              Originally posted by Bob Andrews View Post
                              ... And it seems like every day there is a new policy to make the situation even worse. No telling where it will end.
                              Well...in context to how we are being expected to respond to such things...we probably just need to "lower expectations," and brace ourselves for a future "mandate," to ditch our older vehicles and be ordered to purchase a new one.
                              John Clary
                              Greer, SC

                              SDC member since 1975

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