[winter-rabbit]

Profit is not the issue.

The sales process in the auto industry is often a frustration for customers.

Most sales people will say, I am giving you the car at cost, we are not making any money. Or they don't want to give you a test drive. Nowadays, some dealers won't even allow negotiations.

I can see your sentiment having been in the industry.

Originally Posted by Raiderman

You should see how much jewelry and furniture store markups run...

As a manager in the auto business for many years, $5K is much higher than the average profit per car. And I worked in high-end imports. $2-$3K was about average. Sometimes it was in the $5K-$7K range, sometimes it was a net loss. How much profit should a company make on a $60K car?

Profit is not a dirty word. It pays for the building and staffing. Without profit, businesses go out of business and unemployment continues to go up. So go ahead and b*tch about people trying to make a living. Think about if everyone came after YOUR industry and decided that, instead of making $100K/year, you should be happy with $20K/year, since they feel "screwed". SMH..

[SLCPUNK]

Originally Posted by Raiderman

You should see how much jewelry and furniture store markups run...

Or mashed taters at Ruth's Chris.

[Grand Marshall FIREBALLER]

It's an adversarial relationship no matter how nice the experience. Unfortunately, most dealerships in the car game make it worse by unscrupulous ads that offend the intelligent.

Anyone who falls for a "cash for clunkers" ad today deserves to get taken to the cleaners.


The industry doesn't raise the bar for the experience because there's enough people who want something for nothing. Takes two greedy people for a successful con game.

[BBMW]

This is a valid question, with a valid answer, which is, much less than they'd like to get.

The dealer isn't building the car. There just a a sales agency. They don't even own the cars they sell, they're stock on borrowed money (aky the floor plan.) Essentially, from a sales standpoint, they're just processing paperwork. And doing so gives them the opportunity to make money in other ways (service, used car sales, accessories and other up-sells on new cars, financing, etc.) From a raw, sale of a new car, I'd just give them invoice, and let them live off the trunk money.

Originally Posted by Raiderman

How much profit should a company make on a $60K car?

[tiger08]

Originally Posted by airics

You still overpaid by thousands

That depends on how much of a deal someone would get at a regular dealer, otherwise they arent much higher. It took me two days of fighting at a local Ford dealer for my wifes new Taurus. I got my way but by the time I was done, I would have gladly paid a little more at Carmax.

[Golfinnova]

Have bought one vehicle here locally and have shopped for possible replacements all over. In my experience visiting over 10 dealerships here, I have never been pressured into one certain vehicle and test drives were no problem whatsoever. Any dealer who refuses a test drive doesn't get a sale in my book.

Having worked in the business, I know the game all too well. Some dealerships go for high pressure adversarial sales to maximize profit, some go for less profit in order to increase volume

[gvc8]

Originally Posted by Grand Marshall FIREBALLER

It's an adversarial relationship no matter how nice the experience. Unfortunately, most dealerships in the car game make it worse by unscrupulous ads that offend the intelligent.

Anyone who falls for a "cash for clunkers" ad today deserves to get taken to the cleaners.

agreed, but all that matters is if you're satisfied with the deal you get. If you go in and pay sticker price for what you want and the salesman laughs all the way to the bank , then so be it, as long as you can leave and enjoy your new vehicle without second guessing your deal.

[AA702]

Originally Posted by tiger08

That depends on how much of a deal someone would get at a regular dealer, otherwise they arent much higher. It took me two days of fighting at a local Ford dealer for my wifes new Taurus. I got my way but by the time I was done, I would have gladly paid a little more at Carmax.

Some cases Carmax prices are pretty close. In my case, I was looking for a used Toyota Tacoma work truck. I searched the local dealers and Carmax actually had the best deal at the time. The nearest dealer with the truck I wanted was a Toyota dealer that wanted more money for a truck with more miles. They just wouldn't budge, so I went down to Carmax and I was out of there in a jiffy. It was a really nice experience.

[Croce]

Wow! After reading through this thread I am afraid to step into a car Las Vegas dealership. Wanted to buy a new car after our move to Las Vegas, but now rethinking that plan. Maybe I'll buy one here in Kentucky before we move. The dealers in Las Vegas sound like the ones we had in Chicago in the early 80s. Man o man.

[ScoopLV]

Originally Posted by Raiderman

Profit is not a dirty word. It pays for the building and staffing. Without profit, businesses go out of business and unemployment continues to go up. So go ahead and b*tch about people trying to make a living. Think about if everyone came after YOUR industry and decided that, instead of making $100K/year, you should be happy with $20K/year, since they feel "screwed". SMH..

And trying to get the product for the lowest possible price is ALSO not a dirty word. I have absolutely no desire to pay for a car dealership to run their AC at 68f all day and all night in the summer. I don't want to pay the f&i dude's salary. And I certainly don't want to pay for all those radio, TV and newspaper ads.

There's a reason new cars depreciate by thousands the second they are driven off the lot -- all of that commission and marketing is baked into the price.

People are more frustrated by paying markup at car dealerships and on for real estate because the markup runs four and five figures, not one or two. The markup of a beer at a bar is usually around 500%. People expect that and pay it because it's a few dollars. They don't have to work overtime all year to pay it.

The only people who try to equate the markup on cars and houses with the markup on groceries are salespeople who sell cars and houses.


EDIT -- One other point. It's one thing when the dealers and managers and the auto industry and the politicians shake their heads and say, "well that's just the way it is." It's quite another when a company like Tesla tries to sell cars in a new way that doesn't involve the usual dealer screwage, they are simply shut out of entire states. THAT is why people are so frustrated about car sales.

http://www.boykotx.org/why-texas-ban...inance-reform/

Originally Posted by Croce

Wow! After reading through this thread I am afraid to step into a car Las Vegas dealership. Wanted to buy a new car after our move to Las Vegas, but now rethinking that plan. Maybe I'll buy one here in Kentucky before we move. The dealers in Las Vegas sound like the ones we had in Chicago in the early 80s. Man o man.

Keep in mind that the registration fees on new cars are very, very high in Nevada (compared to other states). This is how we raise revenue in Nevada. It's better to have a car that is more than four years old. Registration taxes drop significantly after four years.