Tread lightly dealer benefits

[ВџУМεΆј℮℮℗]

I am not sure this is the correct section for this. But how does the dealer benefit from accepting the tread lightly affiliate program? Is what I quoted from a previous post a few years ago true?
"The dealer gets 2% of invoice back on a tread lightly discount, if you negotiate below invoice without mentioning the tread lightly discount, you can get the dealer to split that with you and knock another 1% off the price."

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[dgoodhue]

The dealer gets an additional 2% of invoice from FCA. So if Invoice is 50K, the dealer gets an additional $1000. Buyer gets $500 off, the dealer get an additional $500 profit. If the dealer never has the TL certificate code, the dealer does not get the $1000 or additional $500 in profit.

 

[dalema]

The dealer gets an additional 2% of invoice from FCA. So if Invoice is 50K, the dealer gets an additional $1000. Buyer gets $500 off, the dealer get an additional $500 profit. If the dealer never has the TL certificate code, the dealer does not get the $1000 or additional $500 in profit.

Is this for affiliate pricing, or just specific to TL? I had assumed the same.

 

[FinnCustomKnives]

Maybe I am a bit too care free but the specifics of the deal didn't really matter to me much. With the TL affiliate pricing, our dealer honored 8% under invoice(12.9% under MSRP), had a low DOC, and got us a better rate than what Jeep was offering. Walking out the door at 47k on a 54k MSRP JLURD made us happy as a clam.

 

[ToothMechanic]

I am not sure this is the correct section for this. But how does the dealer benefit from accepting the tread lightly affiliate program? Is what I quoted from a previous post a few years ago true?
"The dealer gets 2% of invoice back on a tread lightly discount, if you negotiate below invoice without mentioning the tread lightly discount, you can get the dealer to split that with you and knock another 1% off the price."

I asked the dealer I went with, does a lot of the below invoice/online sales.

He said that they do in fact actually pay invoice pricing and thus lose money on the car. But that there are all types of kickbacks that they end up making money.

He said they get money from FCA for tread lightly, they get $150 if you finance with Chrysler Capital, obviously they get a much bigger kickback with dealer financing, and apparently the biggest/main thing is some kind of subsidy that FCA gives the dealer for ordering new wranglers. Something to do with how long the vehicle would likely sit on the lot otherwise.

 

[dgoodhue]

I asked the dealer I went with, does a lot of the below invoice/online sales.

He said that they do in fact actually pay invoice pricing and thus lose money on the car. But that there are all types of kickbacks that they end up making money.

He said they get money from FCA for tread lightly, they get $150 if you finance with Chrysler Capital, obviously they get a much bigger kickback with dealer financing, and apparently the biggest/main thing is some kind of subsidy that FCA gives the dealer for ordering new wranglers. Something to do with how long the vehicle would likely sit on the lot otherwise.

I think the sales guy left out a few numbers; they aren't losing money. Yes the FCA initially charges them invoice.

They get a dealer holdback which for FCA is 3% of MSRP when the vehicle is sold.

With tread lightly it is another 2% below invoice or a little over 5% when combined with Holdback.

Most dealers charge a documentation fee which is 100% profit or mostly profit. (My dealer includes $35 inspection sticker with the document fee).

Dealers get a floor plan assistance. I don't know what FCA number is but it is 2% of invoice for Subaru. This intended to pay for interest the day a car is on the lot. For order vehicles this basically 100% profit if the buyer picks it up immediately.

I know Subaru gives the dealer another $200 for advertising and another $75 for gas. (obviously gas is not free if the dealer supplies a full tank) I don't know if FCA has something similar.

There are other factory sale incentives which are constantly changing as well which obviously help high volume dealers.

If you do the math the typical 5% below invoice has a dealer making about $2000 or so on a typical Wrangler without additional incentives. It may seem like a lot but the sales person usually has a minimum commission of $250, the sale manger gets a cut, finance guy gets cut if you finance/lease, etc they pay employees to prep the vehicle for sale, building, utilities, and other overhead support.

 

[Ocog2181]

Join Access Fund. It's only $50 and you get a free T shirt. Same affiliate discount.

 

[viper88]

Tread Lightly is a great program. You can also check and see if your employer is a Affiliate.

https://www.fcausaffiliates.com/

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