If You're Getting Owned at The Dealership, You're Not Alone

[DUNE RAP]

I got $4800 discount off my 2021 2DR Rubicon back in February. Sticker was $53.650....Good deal?

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[HungryHound]

And how does the supplier usually become more efficient?

Lean manufacturing, continuous improvement, best practices, commonizing parts, leveraging volume....

 

[HungryHound]

Here's your free pony..... negotiating is a huge bluff game. If Jeep wants you to think the 392 or 4xe is special then it's up to you to do the due diligence and see if that's true. IMHO, they are going to see a huge CAFE penalty from the 392 and some offset from 4xe sales. As long as folks are paying a premium for the 392, they'll be hungry to sell the 4xe. Go to the dealership on the last Tuesday of the month and offer them 5% below invoice for the 4xe. If you're not willing to walk away from a "no" then you're not ready to get a good deal. Walk, wait, if they don't call, call and ask for the sales manager and pitch your deal to him. If he's not into the deal, wait a month and repeat. You can save thousands of you can wait. Mist folks can't wait and that's where your deal falls apart.

I got my 4xe for $50,200 plus taxes and fees (reasonable fees, not made-up crap). Options were paint upgrade, tow, aux switches and heated seats. YOU CAN GET THE SAME DEAL IF YOU CAN WAIT AND PLAY HARDBALL. Jeep needs to sell these for corporate image and CAFE offset. I'm sure your salesman will tell you the opposite. Just remember, half the population won't get a covid vaccine and won't ever buy an EV. Use that leverage to your advantage.

 

[rallydefault]

oh I forgot this is where people tell me, the jeep dealer mechanics are the experts and do the best work! My bad, my bad, wrong thread lol

If you don't think there are plenty of talented mechanics working for dealerships, you're being willfully narrow-minded.

 

[No IFS]

It’s a good lesson for people because the balance of power will shift in the other direction. people will remember how the dealers treated them and will take pleasure in grinding the dealers out for the best deal when the lots are full.

 

[rallydefault]

Hahahahaha I was being sarcastic, jeep dealers are worthless, this whole thread proved how the sales people think we should give them money like a charity case lol go collect unemployment and stop the crying about selling cars then! Lol

I'm sorry but I have no idea what you're trying to say.

 

[Strommen95]

If you wonder why many dealerships are so sleazy, understand they deal with fools like @Dontmindme every single day.

 

[Walker Texas Wrangler]

That has already been tried and hasn't worked for a variety of reasons.

As long as you can buy the exact same vehicle from dealer A, B or C, unless all agree to hold on to a price, which by the way would be price-fixing and therefore illegal, no one can stop consumers from haggling.

Dealers would love nothing better than charge full MSRP and be done; it is buyers who drive the haggling.

Mercedes Benz tried to enforce no-haggling pricing 20 years ago; it got sued by dealer and consumer groups for price-fixing.

I have no idea about the Mercedes Benz case but selling anything at a set price for everyone is not price fixing and it's not illegal. MANY manufacturers have always done this. They have distributor agreements that states that they cannot sell any higher or lower than the manufacturers price. The largest cosmetics company (Coty, who owns Estee Lauder and Clinique among many others) do it (that's why they are never on sale and you can't use coupons on them). Apple also has the same. Levis too. Basically any brand you see excluded on coupons has the policy. The stores would be happy to allow the discount, but they aren't allowed to.

My point is that the manufacturer can control pricing whenever they want and can take it out of the dealers hand with no legal issues.

 

[Ridgway Jeeper]

Regulations and govt agencies exist to protect consumers and we need more, not less!

Consumers need to educate and protect themselves. I am amazed that somebody would actually post your comment and accept it as fact. More often than not govt regulation transfers wealth to those influencing the govt to impose said regulation. I do not believe for one second that the govt has my actual best interests in mind. Interesting perspective yours is. I would be much more appreciative of govt if they simply would mind their own business and stay out of as many aspects of my life as humanly possible.

That said... We purchased a new Jeep last month. Given the real supply and demand issues I was pleased we were able to get what is purported to be an average amount of discount on the deal. I beat them up a bit on the finance interest rate as it was clear they were too high there. I knew where I stood on the Jeeps price, the finance rate and my trade value because I educated myself up front. I left happy with the deal.

I am going to go order a new truck next week and this other dealer is not discounting from sticker on orders. Trucks in inventory are all marked up $3000 over sticker due to supply and demand. There are a few other dealers close enough that I will again do my research and educate myself. I have no desire to travel hundreds of miles to get a "deal", I am willing to pay a little more to keep the deal at least semi local again. The no discount policy IS driving my desire to further research though.

 

[csjlu]

I have no idea about the Mercedes Benz case but selling anything at a set price for everyone is not price fixing and it's not illegal. MANY manufacturers have always done this. They have distributor agreements that states that they cannot sell any higher or lower than the manufacturers price. The largest cosmetics company (Coty, who owns Estee Lauder and Clinique among many others) do it (that's why they are never on sale and you can't use coupons on them). Apple also has the same. Levis too. Basically any brand you see excluded on coupons has the policy. The stores would be happy to allow the discount, but they aren't allowed to.

My point is that the manufacturer can control pricing whenever they want and can take it out of the dealers hand with no legal issues.

I think Aldo's point was that independent dealers cannot collude on price, for which there is precedent in US antitrust law. Luxury good manufacturers like you mention can choose not to sell to discount retailers, and they can also remove marketing support for retailers who choose to sell below agreed-upon price minimums (which is one reason why online retailers may not reveal a sale price until you put it in your "basket"). But if Walmart, Amazon, Costco and Target got together and agreed the the price of X would be Y going forward, just like Aldo's example of dealers agreeing to hold on price, the FTC would be involved.

I'm not aware of legal precedent that gives manufacturers like Jeep control over final sales price when there is a third part intermediary like a dealer - there may be, I just don't know it. But wresting control of distribution from crappy intermediaries is at the heart of the DTC push in consumer retail, and why Nike, Apple and others have invested so much in building out their DTC channels. Higher profits also play a part, but DTC also prevents brand dilution from stale inventory sitting on shelves of undifferentiated retailers, only to get marked down and undermine full price efforts elsewhere. The US dealership model in its current form prevents this DTC shift from happening, and it also prevents dealers from achieving sufficient scale to influence pricing. This is one of the many reasons why Tesla is taking share from traditional auto.

 

[aldo98229]

I have no idea about the Mercedes Benz case but selling anything at a set price for everyone is not price fixing and it's not illegal. MANY manufacturers have always done this. They have distributor agreements that states that they cannot sell any higher or lower than the manufacturers price. The largest cosmetics company (Coty, who owns Estee Lauder and Clinique among many others) do it (that's why they are never on sale and you can't use coupons on them). Apple also has the same. Levis too. Basically any brand you see excluded on coupons has the policy. The stores would be happy to allow the discount, but they aren't allowed to.

My point is that the manufacturer can control pricing whenever they want and can take it out of the dealers hand with no legal issues.

Feel free to argue with the courts.

https://www.motorauthority.com/news/1025159_mercedes-benz-settles-in-price-fixing-lawsuit

https://www.autonews.com/article/20...t-on-after-5-dealers-settle-in-price-fix-case

 

[rcadden]

IMO the biggest challenge (and one that I had to work to overcome myself) is uneducated consumers. People who walk into the dealership with the mindset of "I'm going to drive home in a new car today".

My dad's best friend from elementary school is a millionaire. You wouldn't know it by looking at him or even talking to him, but he straight up retired when he was 40. I asked him one day how he's been so successful, he told me he does two things:
1. He starts businesses where he sees an opportunity. You can't necessarily learn this one easily, but everything the man touches turns to gold. He's a hard boss, from what I understand, but he also treats his employees right, takes care of them, etc. Thus, he expects a lot.
2. He *never* buys anything he hasn't researched endlessly. He's got 3-4 houses/condos, a huge fancy RV, several vehicles, a big ranch, etc. If he can build it himself, that's always his first option. If not, he researches it to death to figure out the cheapest way to do/get it. He's not "cheap", he's what I would call "frugal". He's not afraid to spend for quality, but he never does it unnecessarily.

He also doesn't give a rat's ass what others think of him. Yeah, he's got nice stuff, but it's all stuff that he wanted, needed, or uses. He lives his life in an incredible lack of comparison to others.

 

[Walker Texas Wrangler]

Feel free to argue with the courts.

https://www.motorauthority.com/news/1025159_mercedes-benz-settles-in-price-fixing-lawsuit

https://www.autonews.com/article/20...t-on-after-5-dealers-settle-in-price-fix-case

Feel free to read what I wrote...."set price for everyone" was in the first sentence. In the Mercedes article you linked to, they were price fixing because they made the prices different for the NY area only. Completely different.
CSJU makes some good points though. But, manufacturers can absolutely control the price things are being sold from third party retailers (and they do). They can withhold advertising dollars (co-op), cancel your exclusivity for a certain mile radius and just plain not sell to you anymore if you don't sell for an agreed upon price. Jeep Corporate could do this if they want to, that's how you control your dilution.
Saturn did it in the past, Carmax still does. Though the used market is pretty different. I'm not saying they should, I'm just saying that they can. Not really a bid deal and not worth splitting hairs over.

 

[aldo98229]

Feel free to read what I wrote...."set price for everyone" was in the first sentence. In the Mercedes article you linked to, they were price fixing because they made the prices different for the NY area only. Completely different.
CSJU makes some good points though. But, manufacturers can absolutely control the price things are being sold from third party retailers (and they do). They can withhold advertising dollars (co-op), cancel your exclusivity for a certain mile radius and just plain not sell to you anymore if you don't sell for an agreed upon price. Jeep Corporate could do this if they want to, that's how you control your dilution.
Saturn did it in the past, Carmax still does. Though the used market is pretty different. I'm not saying they should, I'm just saying that they can. Not really a bid deal and not worth splitting hairs over.

Carmax enforces no-haggle pricing on used vehicles only. By definition, each used vehicle is unique and, therefore, each vehicle has a different price.

New vehicles is different: manufacturers would be enforcing prices upon thousands of identical units.

Yes, Saturn is the closest there was to no-haggle pricing on new vehicles. But it is debatable how fixed those prices really were, once dealers allowed for trade-in values, loan terms, etc. In any event, Saturn is gone and no one seems to miss it.

 

[JEEPIDON]

Dealers shouldn't exist, period...they are nothing more than middle men to me...I never service my car at a dealer, so other than marking up the car to sell it to me, what does a dealer do? Jeep.com should sell the car directly to consumer, especially since it would benefit the manufacturer and the consumer to have it that way...oh I forgot this is where people tell me, the jeep dealer mechanics are the experts and do the best work! My bad, my bad, wrong thread lol

So all dealers should go away? Who handles the trade ins? Who handles the warranty work? Who does all of the other administrative duties?

I understand that this forum loves to make mountains out of nothing, dream up bad dealer scenarios and just rant on, hell half the stories are frustration pent up thinking about how bad the dealer will react and on and on and on!

I agree there are some bad and real bad actors out there but there are also very good dealers and folks to work with. They need to make money so each deal seems like a battle of wits until both parties get to the "happy line".

I've lived in 16 states and have had over 50 new cars since 1970 and only once did I ever have a dealer that I couldn't deal with. Service people were told to do whatever to disguise a problem, never fix it. Other than that I have had good vehicles and was always willing to work with service when necessary to get my resolve.

I doubt that I'm the only "blessed" one!

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