Sorry in advance for the long winded post...Exactly. A local GM dealer that specializes in performance vehicles has 6-7 Charger Hellcats and a few Challengers too. All selling for 78-79,995 and some are not even new. Unreal. I'm curious to know the actual transaction price as their asking prices are always sky high.
I looked at a 14 Z/28 from the same place with 10k miles and non factory Toyo T1 tires. They wanted 61k. You can get a 4-5k mile car for 55K.
I had a recent conversation with a GM from a different dealership than the one I'm currently working with and patiently waiting for my GT350 from.
I asked him why is it that only in the Automobile industry do we see such a practice of price gouging when it comes to new models in spite of the announced MSRP netting a pretty good profit margin already?
He then blurted out something about customers always thinking the salesmen are the worst and how they make the experience horrible when they come in expecting any car on the lot for invoice or less. He claimed that the stereotypes are perpetuated by the cheap customers always coming in and beating up on the salesmen to get prices well below MSRP. I kid you not...he said this.
I reminded him the Vehicle was not his or the dealership owners, that only the bank note was theirs and a responsibility to pay for it and in the dealerships best interest to move the product sooner than later(there was a moment of awkward silence) I think he actually had to think about that and realized I was right. i then Let him know that Jim Owens and Jamal Hameedi already announced publicly as spokesmen for FORD that the car would be surprisingly affordable. Which is completely opposite of his quest to ADM the vehicle prices into the same territory as other cars that are traditionally not considered affordable but now would be considered as options because of his selling tactic. I added that the entire experience and that stereotype is predicated on the fact that the buyer never knows what the best price is and never leaves knowing if they truly got the best price. And the Seller can set any price they want based on the boundaries set by the volume levels they commit to in advance of being floor inventoried by the Manufacturer.
He said that he has a right to charge more than the standard 7% margin on a Specialty Vehicle. And his examples to that argument was that if the Diamond industry can charge 800% and the Furniture industry can charge 800% markups on their products then its acceptable for him to markup on this vehicle.
Then I schooled him on the principles of both industries he attempted to use as his case argument.
1. The Diamond is a harvested product not a manufactured product. The harvesting process can be done by a dedicated individual prospector or by a larger consortium in a mining operation where all the employees harvest the product for them. The difference being the product is theirs to set a price on to the cutters and resellers who then own those diamonds and set their prices based on size weight clarity and the precision of the cut which determine the price that the final diamond that is subjectively priced. If however we were able to recreate the process of making that same quality diamond in a manufacturing process then the prices would be drastically dropped since the masses now have this available to them and the harvesting process is no longer required...However, Diamonds are not a purchase of practical use such as a vehicle they are a purchase of vanity.
2. The Designer furniture market caters to the wealthy and hand built furniture demands prices which are also subjective based on what the designer and the craftsman believe they are worth for their time and skills. However, there are only so many permutations of a sofa or couch or armchair and once the initial design is made there are plenty of manufacturing facilities that can and will mass produce that same design and mirror the quality and look and feel for far less than the designers can compete with. Therefore offering the rest of us the choice to buy the same thing for far less than wholesale designer hand crafted furniture. The key being a mass produced manufactured process.
To which I added, if you want to use examples to compare selling your car to then you need to look at manufactured goods. Which when they come off the assembly line typically sell in a retail environment for list prices as suggested by the manufacturer.
So, I then told him to go speak to the owner of this dealership and ask him if making the sale or making the customer is more important. He was speechless and did not have an answer about what the owner would think.
In fact I had to contact the owner right in front of him and got the answer he was afraid to hear. (being that I do research ahead of any large purchase I already had the contact information of the owner) If MSRP would make me a customer then that is what the car would sell for if I'm a serious buyer. So as of today I now have two dealers and two cars waiting for me to buy them.
The GT350R is likely mine if I want it, too. So I have to think about this and perhaps call the owner again. In any case the GM was more interested in a sale at that moment and less interested in a customer for life. What the owner got was that customer for life.
See how that works salespeople...
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