pathwaydon
08-24-2009, 12:34 PM
Well there's a lot to reply to there.
Let's deal with the profit margins. As a previous poster has indicated consumer websites like carcostcanada.com will give you this information. I'd be suprised to find more then a few vehicles in any line-up that have $2K-$3K in profit. That vast majority of vehicles, at least at Hyundai and I know Toyota have less then $2K in profit. But even if you're correct, if the dealer makes a $27000 investment of capital to purchase the vehicle from the manufacturer is he not entitled to a 5%-6% return on investment? That is likely the lowest return in retail! And most deals don't take a few hours work, in somecases it takes days or weeks. The dealer needs that profit to:
A. Pay the sales rep
B. Pay support people
C. Keep the lights on
D. Pay himself
It's a business. It's not like the dealer gets every dime of a $1500 or $2000 profit. He gets what's left after everyone gets paid.
High Prices in service:
What is the going door rate for an independant mechanic in your area? Let's say Canadian Tire or something. Around here it's about $85/hour. Our door rate at the dealer is $106/hour. Now, if you're going to have to pay to get repairs and whatnot done on yourt car anyway, is it really worth the $20/hour you save going to an independant mechanic? Has he had the specialized training that techs at the dealership are REQUIRED to take. How well does he know your particular make/model/year. If you just spent say $40k on a new 2010 Genesis Coupe, would you take it to Canadian Tire to have work done. Maybe you would, but I wouldn't.
To Rip off or not Rip off.
It really doesn't matter the sticker price of the item. By that prevalent logic, if a new car was only $150.00 no one would ever haggle for a lower price. I doubt it. I will shop around for a less expensive T.V. when I'm in the market, but once I find the one I want at the least expensive price assuming they are both the same make/model year/trim I'll buy it. But I won't try to haggle the guy over the price.
And what about service? I assume from your use of the word stealerships that you have had a few bad experiences with sales reps or a particular dealer. Did you do any research before hand with the BBB or local consumer affairs advocate? Would that have been worth it to you in the long run?
Let's deal with the profit margins. As a previous poster has indicated consumer websites like carcostcanada.com will give you this information. I'd be suprised to find more then a few vehicles in any line-up that have $2K-$3K in profit. That vast majority of vehicles, at least at Hyundai and I know Toyota have less then $2K in profit. But even if you're correct, if the dealer makes a $27000 investment of capital to purchase the vehicle from the manufacturer is he not entitled to a 5%-6% return on investment? That is likely the lowest return in retail! And most deals don't take a few hours work, in somecases it takes days or weeks. The dealer needs that profit to:
A. Pay the sales rep
B. Pay support people
C. Keep the lights on
D. Pay himself
It's a business. It's not like the dealer gets every dime of a $1500 or $2000 profit. He gets what's left after everyone gets paid.
High Prices in service:
What is the going door rate for an independant mechanic in your area? Let's say Canadian Tire or something. Around here it's about $85/hour. Our door rate at the dealer is $106/hour. Now, if you're going to have to pay to get repairs and whatnot done on yourt car anyway, is it really worth the $20/hour you save going to an independant mechanic? Has he had the specialized training that techs at the dealership are REQUIRED to take. How well does he know your particular make/model/year. If you just spent say $40k on a new 2010 Genesis Coupe, would you take it to Canadian Tire to have work done. Maybe you would, but I wouldn't.
To Rip off or not Rip off.
It really doesn't matter the sticker price of the item. By that prevalent logic, if a new car was only $150.00 no one would ever haggle for a lower price. I doubt it. I will shop around for a less expensive T.V. when I'm in the market, but once I find the one I want at the least expensive price assuming they are both the same make/model year/trim I'll buy it. But I won't try to haggle the guy over the price.
And what about service? I assume from your use of the word stealerships that you have had a few bad experiences with sales reps or a particular dealer. Did you do any research before hand with the BBB or local consumer affairs advocate? Would that have been worth it to you in the long run?