Dealers getting in the way

[Mach1E]

The Dealer model has been broken for years. You probably didn't notice, but in the Tesla version... there is no dealer. Yes, we've had a "good" dealer in the past. And, probably to their surprise, we stuck with them. But there has to be a certain amount of trust. My wife's favorite Range dealer just dropped the trust part. (She's now using an independent). And for the poster who said there was a very long wait for Tesla, that should tell you something. To Ford's credit (and their smarts) they stepped up with a real world EV, and the world has noticed. Not so sure about their dealers.

With Tesla, what do you call the showroom that has the cars in it, the salespeople that tell you about the car, the people that help you test drive, the people that help with financing and accessories, the service department and the people who help with your trade in?

Because doesn’t Tesla have all of those things? They may be disjointed and not all in one place and owned directly by Tesla, but it sure quacks like a dealership.

Sponsored

 

[BMT1071]

With Tesla, what do you call the showroom that has the cars in it, the salespeople that tell you about the car, the people that help you test drive, the people that help with financing and accessories, the service department and the people who help with your trade in?

Because doesn’t Tesla have all of those things? They may be disjointed and not all in one place and owned directly by Tesla, but it sure quacks like a dealership.

They aren't franchises. That's the key difference. Ford has a slew of independent businesses selling their cars. Hence the vast difference in customer experiences. Tesla directly owns all of their dealer locations and therefore has control of how deals go down.

 

[Mach1E]

They aren't franchises. That's the key difference. Ford has a slew of independent businesses selling their cars. Hence the vast difference in customer experiences. Tesla directly owns all of their dealer locations and therefore has control of how deals go down.

I know, and that’s pretty much my point. People act like it’s something special and all it really is is better quality control on customer service.

You could get rid of the franchise model and still get crap service.

Or you could keep the franchise model and get great service.

The opposite could also be true.

I just don’t believe that there is something inherently wrong with a franchise model. Plenty of businesses and industries have franchises with good service. Plenty have direct sales with crap service too.

A simple fix was mentioned above: change how you pay salespeople. No need to throw the baby out with the bath water. I prefer to have lots of local dealers with new and used cars in stock to test drive and buy without a wait.

 

[one5460]

With Tesla, what do you call the showroom that has the cars in it, the salespeople that tell you about the car, the people that help you test drive, the people that help with financing and accessories, the service department and the people who help with your trade in?

Because doesn’t Tesla have all of those things? They may be disjointed and not all in one place and owned directly by Tesla, but it sure quacks like a dealership.

Except no high-pressure sales people on commission and it's totally optional since you can do most if not all of it online, even the financing. You also go in knowing what the car is going to cost with all the options. They'll even match the interest rate of another bank in many cases.

And many people choose home delivery rather than going to a 'dealer'. Huge difference.


Traditional dealers are there to make money off the uninformed and they'll lie and cheat to do it. The 'friendly' sales guy will lie right to your face with a smile. Unless you understand their profit structure, know someone, or are willing to haggle for hours or days or weeks, you're more than likely going to get raked over the coals.

 

[BMT1071]

I know, and that’s pretty much my point. People act like it’s something special and all it really is is better quality control on customer service.

You could get rid of the franchise model and still get crap service.

Or you could keep the franchise model and get great service.

The opposite could also be true.

I just don’t believe that there is something inherently wrong with a franchise model. Plenty of businesses and industries have franchises with good service. Plenty have direct sales with crap service too.

A simple fix was mentioned above: change how you pay salespeople. No need to throw the baby out with the bath water. I prefer to have lots of local dealers with new and used cars in stock to test drive and buy without a wait.

Sales people don't set prices. Commissioned employees may give you the hard sell but management is who determines the price. Most dealers pay a flat fee per unit on new car sales. Commission on gross profit only comes into play on used car sales.

 

[Mach1E]

Except no high-pressure sales people on commission and it's totally optional since you can do most if not all of it online, even the financing. You also go in knowing what the car is going to cost with all the options. They'll even match the interest rate of another bank in many cases.

And many people choose home delivery rather than going to a 'dealer'. Huge difference.


Traditional dealers are there to make money off the uninformed and they'll lie and cheat to do it. The 'friendly' sales guy will lie right to your face with a smile. Unless you understand their profit structure, know someone, or are willing to haggle for hours or days or weeks, you're more than likely going to get raked over the coals.

Again, the difference is the customer service you are getting.

If you think you are getting a better price/deal by paying a full set fixed price from Tesla………

But hey, Ford seems to have figure the “trick” out as well.

Just look at how many people are HAPPY to pay full MSRP for a Mach E. And they didn’t even need to haggle!

Yes, the buying experience is much easier (and somehow more enjoyable) when no discount is available nor offered. Not sure if it’s voodoo magic, hypnotism or a Jedi mind trick, but people seem to be happier with the business model that results in paying a higher fixed price.

 

[BMT1071]

Again, the difference is the customer service you are getting.

If you think you are getting a better price/deal by paying a full set fixed price from Tesla………

But hey, Ford seems to have figure the “trick” out as well.

Just look at how many people are HAPPY to pay full MSRP for a Mach E. And they didn’t even need to haggle!

Yes, the buying experience is much easier (and somehow more enjoyable) when no discount is available nor offered. Not sure if it’s voodoo magic, hypnotism or a Jedi mind trick, but people seem to be happier with the business model that results in paying a higher fixed price.

I don't know that that's true. There has been much gnashing of teeth on here about paying sticker price.

 

[Mach1E]

Sales people don't set prices. Commissioned employees may give you the hard sell but management is who determines the price. Most dealers pay a flat fee per unit on new car sales. Commission on gross profit only comes into play on used car sales.

The managers may have “final say” but the salespeople do the negotiation to try to get people to pay the most $$ possible. And that’s the no fun part.

I spent years doing advertising for car dealers. I saw the buying process over and over on a daily basis.

Things people don’t realize-
There’s very little margin on new cars and tons on used. People haggle harder on new vehicles when there is much more wiggle room on used.

 

[trutolife27]

The managers may have “final say” but the salespeople do the negotiation to try to get people to pay the most $$ possible. And that’s the no fun part.

I spent years doing advertising for car dealers. I saw the buying process over and over on a daily basis.

Things people don’t realize-
There’s very little margin on new cars and tons on used. People haggle harder on new vehicles when there is much more wiggle room on used.

yep well written.
The profits are in used cars and dealer add ons, and warranty plans.

It is a double-edged sword. If it's a fixed price and you order it, the days of seeing many different vehicles with all the different options before buying will be gone. But dealer haggling and so on will be gone.

The new vehicle ordered by the dealer has a price they get built-in when it is sold. All are different. The longer it sits the less money they get from the manufacturer. Rebates and incentives are always on vehicles that are not selling well and they just need to move them off the lot. A.K.A. the Audi E-Tron sale when Audi was having a problem moving them in north America.

In 2017 before the switch and change over for the ford escape. That august any escape on the lot already had 6,000 off in incentives plus could use the a,x, or z plan. Also military 500 cash for the first responder. plus 0%.

So If you are someone who likes to find deals and wait and have big savings, well those days will start to trickle away, as manufacturers see all the money they are wasting with incentives.

But the other side here is the price you want it easy out the door, here is your car way is nice also.
I mean what if everything we purchased was like tesla. I don't think we all would be happy with that. Cell phone, items for the house, don't we all shop around for the best deals?

Tesla wants you to think that is the best way for business but really competition and over-supply is better always for the consumer market.

If you think the tesla way is so great next time you order a pizza from papa John's or eat out. Don't try a promo code or coupons. Just pay the price listed and smile right? ?

 

[one5460]

Again, the difference is the customer service you are getting.

If you think you are getting a better price/deal by paying a full set fixed price from Tesla………

But hey, Ford seems to have figure the “trick” out as well.

Just look at how many people are HAPPY to pay full MSRP for a Mach E. And they didn’t even need to haggle!

Yes, the buying experience is much easier (and somehow more enjoyable) when no discount is available nor offered. Not sure if it’s voodoo magic, hypnotism or a Jedi mind trick, but people seem to be happier with the business model that results in paying a higher fixed price.

Well, it's the buying experience we're talking about. However, in regards to pricing, it's tough to compare across makes without knowing cost to manufacture, profit margins etc.

Same make and model? Sure paying under MSRP is preferrable.

Across makes, how do know that fixed price doesn't already include the savings passed on to the buyer from not having a middle man?

Also, the time and frustration haggling with a dealer has a cost too, IMO.

 

[Mach1E]

Well, it's the buying experience we're talking about. However, in regards to pricing, it's tough to compare across makes without knowing cost to manufacture, profit margins etc.

Same make and model? Sure paying under MSRP is preferrable.

Across makes, how do know that fixed price doesn't already include the savings passed on to the buyer from not having a middle man?

Also, the time and frustration haggling with a dealer has a cost too, IMO.

If you think cars are hard, you should try shopping for a new boat.

Some manufacturers sell at MSRP.
Some have NAP (national advertised pricing).
Most have a highly inflated MSRP and then don’t advertise prices at all. You have to negotiate a random discount from MSRP that varies from 10% to 35% off.

And there’s no true car price or any standard to figure out what a good price or deal is on a particular boat and model.

Basically pricing is a hot mess.

 

[SpaceEVDriver]

Well, it's the buying experience we're talking about.
...
Also, the time and frustration haggling with a dealer has a cost too, IMO.

This.

Imagine going to an Apple Store, choosing an iPhone, and then having the person behind the register tell you there's an upcharge because it's a popular model; there's also a required etching of their store's location on the back of the phone; you have to purchase the yellow case for it; and they have also installed a dozen advertising apps that they were paid to install by their "partners." The Apple Store two towns over usually doesn't require the etching or yellow case, only has three bloatware apps, has a smaller upcharge, but also includes a cheap screen protector that leaves a residue when you take it off. Or, if you're lucky, there's a store four hours away that doesn't add any upcharge or add extra junk, but to get there you have to take a day off work.

I'd much rather have the "Best Buy" model where I can use the internet to research and narrow down possible choices. When I'm ready to look in person, there's a showroom where I can go test drive, compare possible choices, then purchase for the price as advertised. Or, perhaps ThinkGeek or Amazon has the same option for a little cheaper (not counting shipping charges), but I have to wait a week to have it delivered.

Instead, I have to spend a lot more time researching each potential dealer and try to determine how sketchy that dealer is and try to figure out if they're going to add garbage and ADM to my vehicle, if they're going to try to keep me there longer by not returning my driver's license, etc., etc., etc.

 

[bp99]

This.

Imagine going to an Apple Store, choosing an iPhone, and then having the person behind the register tell you there's an upcharge because it's a popular model;

Several years ago when Apple couldn't meet demand and iPhones were the big craze, if you failed to get one standing in line on release day, your option was paying someone a huge markup on e-Bay. It's all supply and demand.

TVs are another example. The price is highly regulated by the manufacturers. All the big box stores/Amazon sell at the same price and have the same sales. They're not allowed to advertise below MSRP (or current sale price). But, if you go to a smaller chain or independent store, you can haggle and get a decent discount. Kitchen appliances are the same way. You mention the Best Buy model. They were notorious for pushing the highest margin products as well as heavy up-selling of extended warranties and over priced accessories.

It's not just the auto industry. Consumers need to be diligent. People need to find the stores/dealers that are honest and straight forward. And a lot of it comes down to convenience. There's often a price for quick and easy. Not saying it's right, but it's reality.

Direct sales aren't always better. Manufacturers don't always have great customer service or support. On an expensive item, there's no one to be an advocate for you if something goes wrong and you can't get through the phone tree of the company or contact someone higher up that can go beyond a canned script. A lot of car dealers have done a lot to give the industry a bad name. There's no doubt about that.

 

[Scrannel]

Each Tesla "showroom" is just that, a place where you can go look at the new cars. As I understand it, some (I think one near me) allow test drives. There is no 'lot' filled with used cars; no service. No one trying to sell you anything.

Completely separate (I believe in almost if not all cases) from the "showrooms" are the service centers. You can either make a service appointment with the app or, depending on the work, a service person will come to your home. For example, if the 12v battery tanks, they'll come to your home and replace.

There are no sales people. There is no dealer. You cannot buy a Tesla from a showroom. Probably, and I'm guessing, someone in a showroom can show you how to order on line.

Tesla Stores: What Are They and How Are They Different Than Dealerships? - The News Wheel

 

[Scrannel]

Best dealer story in a long time: Chevrolet has currently issued a "recall" on ALL Bolts, including the 2022 model. Chevrolet warned dealers (initially) that these cars could not be driven. However, they didn't tell dealers they couldn't SELL the cars. So, several of them did, even though the customers couldn't drive them off the lot. They told the customers not to worry, a fix was coming: "...but in the short term we’re trying to eliminate the risk of a fire until LG can offer defect-free batteries." Said GM spokesperson Dan Flores. Hey, who needs to drive their car anyway?

Sponsored