Dealers Supposedly Don't Want to Sell EVs!

[Kamuelaflyer]

We see a lot of the no EV's by dealers out here. The dealers here are angry about the MSRP mandate because "things are different here." At the moment, all but one Ford dealer in the state has an $8,000 ADM for both Lightning's and MME's. No, that's not a typo. They think that's how it should be. MSRP? Yeah, good luck. They're angry about the requirement for a battery lift, they're angry that they had to put in L2 chargers almost 3 years ago, they're angry they have to have an EV tech, and they're angry they need to have a DCFC. Plus, some are now refusing to service any vehicle (ICE or BEV) not purchased through them regardless of the reason -- including folks who moved here with the cars. And the islands with just one dealer? Yeah, tough luck.

There is no advantage to the dealership model as far as I can see. Just terminate the franchise agreements and sell direct. Just get rid of them.

18 months waiting for the one dealer on this rock to do the Glass Recalls. They'll never do the HVBJB recalls. Why should they? They just ignore Ford and sell F150s and police SUVs at a stupid markup.

Sponsored

 

[JohnFoxeSheets]

Heck, some are still suspicious that *other* buyers DID get a better price on their Tesla.

FWIW, it's my understanding that Tesla referral codes can result is significant savings off a new Tesla.

 

[Auto Motive]

I haven't personally as far as pure EVs, but this wouldn't surprise me even a little bit in many portions of the country. EVs in dealerships have a lot working against them:
1. Salespeople typically have less possible commission, Ford for example with their set invoice/MSRP pricing leaves a lot less to make than selling a high margin F-150 to the right buyer.

2. Salespeople CAN be extremely lazy and aren't interested in learning enough about the tech to properly sell it, and by extension believe that they will have better luck selling a known vehicle. When we were shopping for our C-Max Energi back in 2016, the salesman didn't even know the C-Max had a battery, and tried to steer us towards an Explorer. Better margins, and something he knows he can sell in his sleep. Again, not saying all are lazy, but I have run into it enough to imagine it comes up a lot with EVs. Also they may have personal biases against EVs and just prefer they not sell if they can still sell something else.

3. Dealerships want service money. Most dealerships make more on service, by a significant margin, than new car sales. We are coming up to 10k miles on our MME, no repair service visits, and the car is bugging me to bring it in for "maintenance" which will mainly just be tire rotation. My F-150 on the other hand brings them plenty in oil changes and other fluid checks, some of which the MME has, but not nearly as much. So they might behind the scenes encourage their salespeople to push more ICE vehicles.

Those are just the top of mind items that would impact more dealers. They can afford to do this and still sell some EVs to keep the OEM happy since it isn't expected that most new car sales are EVs. They try to nudge people to the high maintenance ICE vehicles knowing that they will still get people coming in that aren't leaving with anything but an MME or EV6 or whatever.

Dealers love to quote new rotors and brakes required at every inspection. Light bulbs replacements are another must sell. Tires, 12v battery , exhaust systems, wheel bearings the list never ends. Every dealer in our area has very negative reviews mainly State mandatory yearly insp.

Agree'd but it's not really "our government" it actually the largest lobbying organization in the country (Auto Dealers) who pushes their will through government over the people and over consumers. It's truly an issue and these types of bans need to be removed.

Change every state law for ev to be sold directly to consumers on line. We did this with the 2021 GTPE which was easy, pain free and didnt take more than 30 minutes. Problems came up at the dealership to complete paperwork. 2 hours never do it again. Our 2023 tesla model y AWD long range took 15 minutes paid on my phone and in and out of showroom in 30 minutes. Very professional staff showed specifics to drive car home.
Wonderful experience and yes we will be taking a test drive in Jan in a model X. 3rd ev so I will be selling my 06 Jeep 7 seat Commander 50000 miles like new. Last 2 years only used for family trips and out to dinner. Maybe 900 miles.
Both thr GTPE and model Y are excellent ev and recommended to friends. These are keepers for us at 75.

 

[Guss-E 2021]

Such a complicated issue. The franchise laws are a big part of what are protecting the dealers. I have to imagine small business job protection plays at least some part in why those laws still exist. There are 1,161,873 people employed in the New Car Dealers industry in the US as of 2022. (IBISWorld).

I hate dealers too but my actual job is largely about supporting small business and small business job creation. I don't at all like the idea of people being put out of work. Of course it happens (Blockbuster, Kodak). Ideally, I'd like to see the old dealership model morph into something that fits with the times (online shopping, subscription models, etc.).

I am not defending dealerships nor am I exonerating them. You simply can't paint with such a large brush. Even the article cited comments from dealerships that were supportive of the transition.

My first impression of my dealership was a good one. They seemed willing (if not exactly excited) to be a Model E business. That has definitely changed. I will no longer recommend them for Mach-E or Lightning sales. There are four Ford dealers within 20 miles of my house. One of them, the one close to my office and from who my girlfriend bought her Maverick Hybrid, gave off a much friendly BEV vibe.

They have far more electric Fords on the lot. When I asked about future DCFC, the person I spoke knew the salient information (number of chargers, peak kW, etc.) He said they had already purchased the units and are now just waiting on the infrastructure work (put it out to bid). Reading the facial ticks at my dealership, it is clear they just want to sell gas pick up trucks. The guys at what I'll call my girlfriend's dealer, were generally positive and enthusiastic.

If a specific dealership, for a specific brand doesn't want to sell BEVs, fine. There were always be another dealer and/or brand that will be happy to. Despite what the headlines are pushing, there is still demand for BEVs. Don't confuse someone not wanting or being capable of taking out a $50K+ car loan as someone who does not want a BEV. I want a Lucid Air Sapphire, I just can't afford one. But I do want one.

I believe Q3 BEV sales growth was 50%. This is down from nearly 80% YOY. So yes sales volume had declined but rates have also gone up over the past 12 months. Also, if my investment portfolio went from 80% to 50% growth, yah, well, I'd still feel pretty darn good about that.

 

[Ghost Ryder]

My understanding is that traditionally, dealers made most of their money on the service side and not the sales side. Seeing how EVs do not require much service if any (other than recalls), and most OEMs are pushing for a fixed MSRP sales policy, I don't see how dealers will stay in business.

 

[Ghost Ryder]

We see a lot of the no EV's by dealers out here. The dealers here are angry about the MSRP mandate because "things are different here." At the moment, all but one Ford dealer in the state has an $8,000 ADM for both Lightning's and MME's. No, that's not a typo. They think that's how it should be. MSRP? Yeah, good luck. They're angry about the requirement for a battery lift, they're angry that they had to put in L2 chargers almost 3 years ago, they're angry they have to have an EV tech, and they're angry they need to have a DCFC. Plus, some are now refusing to service any vehicle (ICE or BEV) not purchased through them regardless of the reason -- including folks who moved here with the cars. And the islands with just one dealer? Yeah, tough luck.

There is no advantage to the dealership model as far as I can see. Just terminate the franchise agreements and sell direct. Just get rid of them.

18 months waiting for the one dealer on this rock to do the Glass Recalls. They'll never do the HVBJB recalls. Why should they? They just ignore Ford and sell F150s and police SUVs at a stupid markup.

That dealer has a monopoly on the island. And not much you can do about it.

 

[Maquis]

My understanding is that traditionally, dealers made most of their money on the service side and not the sales side. Seeing how EVs do not require much service if any (other than recalls), and most OEMs are pushing for a fixed MSRP sales policy, I don't see how dealers will stay in business.

My brother spent his entire career at a dealership. Started as a mechanic, then sales (not long), then service manager, finally parts manager. He always tools me that the profits all the while he was in the business were split pretty evenly between sales (new and used), parts, and service. He retired 5 years ago, but I doubt it’s changed much.

Edit - EVs will change that mix, but to what degree, I really don’t know.

 

[heisnuts]

FWIW, it's my understanding that Tesla referral codes can result is significant savings off a new Tesla.

Any Tesla owner can give out a referral code to someone looking to buy a Tesla. The buyer gets $500 off the purchase of a Model 3 or Model Y as well as 3 months of free Full Self Driving from Tesla. If the buyer is purchasing a Model X or Model S they get $1,000 off and FSD for 3 months free. You have to use the referral code given to you from the Tesla owner when you put in your original order/reservation. You cannot apply it after you submit your order.

The Tesla owner gets Tesla points that can be redeemed for things free supercharging, subscriptions, Tesla raffles, etc. I used a referral code to get $500 off my M3P, and my one referral to a friend got me 500 miles free supercharging and 2 free years of full connected services (full internet in the car). If any of you need a referral code, you can always ask me and I can get you one .

 

[Ghost Ryder]

My brother spent his entire career at a dealership. Started as a mechanic, then sales (not long), then service manager, finally parts manager. He always tools me that the profits all the while he was in the business were split pretty evenly between sales (new and used), parts, and service. He retired 5 years ago, but I doubt it’s changed much.

Edit - EVs will change that mix, but to what degree, I really don’t know.

I can see how dealers can make a decent amount on used car sales as they control both how much they paid for the trade in as well as how much they sell it for, but as far as new, I heard that on avg, dealers only make around 2k on each new car sold. Doesn't seem like a lot for all the work and cost associated with it.

 

[Ghost Ryder]

Any Tesla owner can give out a referral code to someone looking to buy a Tesla. The buyer gets $500 off the purchase of a Model 3 or Model Y as well as 3 months of free Full Self Driving from Tesla. If the buyer is purchasing a Model X or Model S they get $1,000 off and FSD for 3 months free. You have to use the referral code given to you from the Tesla owner when you put in your original order/reservation. You cannot apply it after you submit your order.

The Tesla owner gets Tesla points that can be redeemed for things free supercharging, subscriptions, Tesla raffles, etc. I used a referral code to get $500 off my M3P, and my one referral to a friend got me 500 miles free supercharging and 2 free years of full connected services (full internet in the car). If any of you need a referral code, you can always ask me and I can get you one .

I think you can also use the credit to buy a home charging station.

 

[Mach1E]

I can see how dealers can make a decent amount on used car sales as they control both how much they paid for the trade in as well as how much they sell it for, but as far as new, I heard that on avg, dealers only make around 2k on each new car sold. Doesn't seem like a lot for all the work and cost associated with it.

If you want to figure out where the $$ is made in the car business, just look around at what exists.

Tons of stand alone service shops.

Tons of stand alone parts stores.

Tons of stand alone used car stores.

Tons of stand alone finance shops (credit unions).

Zero stand alone new car dealerships that don’t do the above things.

And in the EV world?

Zero stand alone EV parts stores.
Zero stand alone EV service shops.
Not sure on stand alone EV used car dealers, but probably close to zero.

Pretty obvious where the $$ isn’t made as well.

 

[Auto Motive]

My understanding is that traditionally, dealers made most of their money on the service side and not the sales side. Seeing how EVs do not require much service if any (other than recalls), and most OEMs are pushing for a fixed MSRP sales policy, I don't see how dealers will stay in business.

Agree and hope they all sink. Never a good experience ever! Biggest complaint was price as advertised not what you pay. Its always higher by thousands. Then comes to service with high labor rates and parts they tell you are worn and needs replacing which isnt the case. Displacing car dealers would be the best thing for the consumer.

 

[Ghost Ryder]

If you want to figure out where the $$ is made in the car business, just look around at what exists.

Tons of stand alone service shops.

Tons of stand alone parts stores.

Tons of stand alone used car stores.

Tons of stand alone finance shops (credit unions).

Zero stand alone new car dealerships that don’t do the above things.

And in the EV world?

Zero stand alone EV parts stores.
Zero stand alone EV service shops.
Not sure on stand alone EV used car dealers, but probably close to zero.

Pretty obvious where the $$ isn’t made as well.

All good points. Amazing how much advantages EV manufacturers (Tesla/lucid/rivian) over traditional OEM. Not being saddled with dealerships got to be worth a few thousands on every car sold.

 

[Mach1E]

Agree and hope they all sink. Never a good experience ever! Biggest complaint was price as advertised not what you pay. Its always higher by thousands. Then comes to service with high labor rates and parts they tell you are worn and needs replacing which isnt the case. Displacing car dealers would be the best thing for the consumer.

Maybe, maybe not.

They’re an all in one shop where they’re willing to service, trade in, finance, test drive and sell you a new one because they make enough money on the small stuff that it adds up to do it all in one conveniently located local place.

If they all disappeared and were replaced by independent shops…… it WILL cost you more $$ and it WILL be way less convenient to piece meal this process.

I don’t love the dealer experience, but it seems like a necessary evil.

Kinda like how I hate shopping at Walmart, but the low prices and convenience are too hard to pass up.

But if you would rather run around town trying to get the best deal for your trade in, try to find a trustworthy mechanic, a good finance rate and then finally just pay a fixed no-haggle (higher) price for your new car. More power to ya.

It’s hard enough to get the dealer to service your EV. I can’t imagine what an independent mechanic would charge!

To me that’s seems like a way worse model for the consumer.

 

[Mach1E]

All good points. Amazing how much advantages EV manufacturers (Tesla/lucid/rivian) over traditional OEM. Not being saddled with dealerships got to be worth a few thousands on every car sold.

For sure.

That’s why Tesla has the highest profit margin in the industry.

Which also means they didn’t pass that savings on to the consumer.

Except maybe finally this year, but we shall see how long the low prices last if they succeed in squeezing the competition out. They raised prices the last few years just as fast as they lowered them this year.

Not sure if Lucid or Rivian will exist in 5 years though.

Sponsored