$20K markup!!!?

calemasters

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blnewt

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When did car dealers start selling cars for more than they're worth???
 

Steve JLUR

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Parks Motors in Augusta Kansas. Loaded Sahara. How do they get away with this ?
If nobody buys it they didn’t get away with it.
when they stop making morons the world will be a less profitable place…
 

Bulletbill

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It has NOTHING to do with wealth distribution. Most of the high net worth guys I know won’t pay over MSRP. Its supply and demand. There are less available vehicles than buyers. There is also widespread inflation due to a lot a litany of reasons - most of which come from gov social programs designed to redistribute wealth and “address” the so-called “wealth distribution/“inequality””. If dealers are over allowing for used cars they’ll find the margin they need via ADM. The pricing elasticity we are seeing will come gm an end as wage inflation is assuaging and consumerism will slow as the impending recession sets in.
Well,
You can only finance up to MSRP, generally anything over requires cash. I make decent money, but not the kind where dropping 20 grand above MSRP is even remotely feasible.

Who do you think is buying these because it’s not anyone that’s middle class? I shopped for a long time to find mine at invoice because I don’t have an unlimited income stream. Every mod for my vehicle comes with a caveat of “do I really need this for my uses?” And the answer is most times no.

I’m not disparaging anyone that is at the top of the food chain. I just saying they are the only ones that are paying ADM because they can. Unfortunately, that’s just letting dealers know that they can sell high and not lose sales.

Everyone else is still shopping for a deal or buying used. It’s driving the market value up for everything and pricing a lot of people out of the market. The average price for a car (not a Jeep) is $45,000. Does that seem like what the average American can afford considering a trip to the grocery store is almost 14% more than it was a year ago?

I’d say the gap has widened for the have and have nots and it’s not likely to get better for anyone in the future. Those with money can, and those that have had a stagnant income over the last two years can’t.
 
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Nitehawk92

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Parks Motors in Augusta Kansas.
Loaded Sahara.
MSRP: $52K; Cash: $72K.

How do they get away with this ?
It's not getting one over if consumers willingly pay the listed price.

That's not a defense of Additional Dealer Markups. Rather, it's a sober acknowledgement of how free markets actually work.

It's instructive to consider that the Broncos in the linked thread are long gone.
 


NULL POINTER

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This has been going for a long time. Back in the mid 1980's my wife needed a car and we went to the local Subaru dealer in central Buck$ County PA. that I had previously bought a Subaru from for a great price under MSRP.

We test drove it, she loved it, so we were invited in to talk price. Dealer came back with a price $5K above MSRP, which if I recall was somewhere around 15K. I told the sales person that I don't pay MSRP for any vehicle I buy. He just laughed and said "I guess you won't be buying this car then." I said "Are you joking?" He said "No, if you want the car this is the deal." We walked, never heard from them again, and a few days later the car was gone off their lot. I have never even thought about buying a Subaru again.

I recently saw a Bronco at our local Ford dealer, in the show room, for a $10K ADM, plus another $5K for stuff like upholstery protectant, paint protectant, oversize wheels and tires, and a few other dealer add-ons.

I once had a very good Finance professor who always said, "The first law of antiques is that something is only worth what someone pays for it."
 

Bulletbill

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This has been going for a long time. Back in the mid 1980's my wife needed a car and we went to the local Subaru dealer in central Buck$ County PA. that I had previously bought a Subaru from for a great price under MSRP.

We test drove it, she loved it, so we were invited in to talk price. Dealer came back with a price $5K above MSRP, which if I recall was somewhere around 15K. I told the sales person that I don't pay MSRP for any vehicle I buy. He just laughed and said "I guess you won't be buying this car then." I said "Are you joking?" He said "No, if you want the car this is the deal." We walked, never heard from them again, and a few days later the car was gone off their lot. I have never even thought about buying a Subaru again.

I recently saw a Bronco at our local Ford dealer, in the show room, for a $10K ADM, plus another $5K for stuff like upholstery protectant, paint protectant, oversize wheels and tires, and a few other dealer add-ons.

I once had a very good Finance professor who always said, "The first law of antiques is that something is only worth what someone pays for it."
I grew up in central bucks in the 80’s. I still remember a local news expose on Fred Beans dealerships in Doylestown that reported they were spraying a rusty solution on critical components of cars that came in for state inspections and then telling the owners that the parts had to be replaced because they were rusted through and the car wouldn’t pass with it. Always thought they would go under after that.

When I was 18 I moved away from PA and came back 20 years later. I was shocked to see that Fred Beans hadn’t gone the way of the dodo, but instead expanded across the state.

When I was car shopping before the pandemic I went in to see a vehicle on one of their local lots. Even before all the shortages they were charging ADM and wouldn’t budge. I imagine they have only gotten worse since then.

What’s the point of all this? Dealers have sucked and done crappy things for a long time somehow avoiding all the bad press and made bank the whole time. I hope they get rid of the dealer model in the US. It’s outdated and predatory.

There are some good dealers out there. I bought my JL from a great dealer (Faulkner CDJR in central PA) and got my Jeep at invoice. Their service department has been great and I’ve generally had an excellent experience with them. But it seems like they are the rare exception.

…Rant over, continue on🙃
 

NULL POINTER

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I grew up in central bucks in the 80’s. I still remember a local news expose on Fred Beans dealerships in Doylestown that reported they were spraying a rusty solution on critical components of cars that came in for state inspections and then telling the owners that the parts had to be replaced because they were rusted through and the car wouldn’t pass with it. Always thought they would go under after that.

When I was 18 I moved away from PA and came back 20 years later. I was shocked to see that Fred Beans hadn’t gone the way of the dodo, but instead expanded across the state.

When I was car shopping before the pandemic I went in to see a vehicle on one of their local lots. Even before all the shortages they were charging ADM and wouldn’t budge. I imagine they have only gotten worse since then.

What’s the point of all this? Dealers have sucked and done crappy things for a long time somehow avoiding all the bad press and made bank the whole time. I hope they get rid of the dealer model in the US. It’s outdated and predatory.

There are some good dealers out there. I bought my JL from a great dealer (Faulkner CDJR in central PA) and got my Jeep at invoice. Their service department has been great and I’ve generally had an excellent experience with them. But it seems like they are the rare exception.

…Rant over, continue on🙃
Between Fred Beans and Thompson, every brand dealership in Dtown, PA is owned by one or the other, at least it was that way when I left the area. I remember those stories about the rust. Yes there are decent dealers around, you just have to do your research.

I actually met Fred Beans right after he bought the Ford dealership from J.J.Conroy Ford. He was a pretty decent guy back then. A friend's son bought a car there, found out the frame was rusted out, and tried to get the used car manager to take it back. The guy wouldn't budge. Fred heard the conversation and came out and asked the used car manager how old was the kid. He replies 18. Fred then said, how many cars is this kid going to buy in the next 40 to 50 years? I want him to buy them here. Give the kid his money back. Not sure how the dealership evolved to the shenanigans that were exposed later on.
 

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Initial-Jeep

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You can only finance up to MSRP, generally anything over requires cash.
Not these days: 125% MSRP is common.

People don't get wealthy by paying markups or by being fiscally foolish/wasteful. The typical millionaire in the US is frugal--especially with cars. (cf. the book, The Millionaire Next Door).

I'd wager it's the middle class who don't do due diligence and purchases based on "monthly payment" rather than the actual price. There are reasons dealers try to only talk about the monthly payment.

There's also a niche market where these are business purchases: automotive YouTubers will pay extra to be first because that's their business and being first matters greatly (the Bronco being a big one here).


So there's this:

 

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