Unreasonable Dealer Markups

[pt's21]

Our credit union is advertising up to 120% of msrp on new and 120% of Kelly Blue Book on used.

Wow, That means I could afford to get a GT500 off the lot. Just wish I could afford the payment !

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[Atlas1]

Our credit union is advertising up to 120% of msrp on new and 120% of Kelly Blue Book on used.

Wow. The number of people that are going to be slaves to auto debt must be growing exponentially. Thanks for this info. I was not aware banks were doing this.

 

[ORRadtech]

Will a bank even loan someone that much over the cars value? I would think you would have to pay that markup in cash if you were looking to finance the whole car.

Banks might not but Ford credit might.
To my mind financing the adm isn't much different than having a trade-in upside down and rolling that into a new car loan. And that's been pretty standard practice for quite a while at any number of dealers/brands.

 

[dx2]

2021 Mach 1. Just got this email today…
—
Good morning. The mach 1 We have available is $15k over sticker. We do also have 2 otheres that are $10k over sticker.

Xxx
Russ Milne Ford Inc.
New and Pre-Owned Vehicle Sales
—

Ford can’t do crap about the dealers. These folks are in their backyard. Lol.

Isn't Tesla selling cars to customers directly without involving the dealerships ? Why won't that work the same way for the traditional brands ?

 

[Hillsndale]

Isn't Tesla selling cars to customers directly without involving the dealerships ? Why won't that work the same way for the traditional brands ?

I don't remember specifics, but some if not most states (or maybe federal?) had passed laws years ago preventing direct to consumer sales of cars, I would guess lobbied by the dealers associations. Sorry, I don't remember how Tesla got around that. I'm sure the big auto companies could either get around it or lobby to get it changed again.

Edit: Just found this 2015 FTC article: https://www.ftc.gov/news-events/blo...-consumer-auto-sales-its-not-just-about-tesla

 

[Atlas1]

I don't remember specifics, but some if not most states (or maybe federal?) had passed laws years ago preventing direct to consumer sales of cars, I would guess lobbied by the dealers associations. Sorry, I don't remember how Tesla got around that. I'm sure the big auto companies could either get around it or lobby to get it changed again.

Edit: Just found this 2015 FTC article: https://www.ftc.gov/news-events/blo...-consumer-auto-sales-its-not-just-about-tesla

I just assumed they got around it because their products are more closely related to toasters than automobiles

 

[FreePenguin]

Isn't Tesla selling cars to customers directly without involving the dealerships ? Why won't that work the same way for the traditional brands ?

waiting for the future of ALL commerce to be shipped to your house. brb mustang 25k EcoBoost, 30k gt, 50k electric.

click, click, 500 shipping, click. bought. be there in 1 month.

carmazon.com lol

 

[Blwnsmoke]

The guy next to me with a bigger pocket is the better audience. If I can’t buy the adm then I look at a cheaper car. That guy with loaded wallet really should be priority.

it sucks, but if they weren’t selling, adm’s wouldn’t be a thing. I’m not excusing them. But … if I was a dealership, I’d do the same. Market the car for what people are paying: willing to pay.

Why? Ford doesn't make a penny more then what they invoice the dealer for. Ford wants customers to have a good experience and come back for more. ADMs do NOTHING positive for Ford.

 

[Saxgod]

Isn't Tesla selling cars to customers directly without involving the dealerships ? Why won't that work the same way for the traditional brands ?

They do. Even in those states they can’t. (Texas). I have one to go with my Shelby.

 

[Strokerswild]

Wow. The number of people that are going to be slaves to auto debt must be growing exponentially. Thanks for this info. I was not aware banks were doing this.

That is such a bad idea it makes my head spin. For all involved....

 

[FreePenguin]

Why? Ford doesn't make a penny more then what they invoice the dealer for. Ford wants customers to have a good experience and come back for more. ADMs do NOTHING positive for Ford.

ford isnt paying their bills or employees wages etc. the dealership is, unless I am incorrect. so the larger the dealership profits, better the bonuses or more money the dealership gets to improve buildings or their personal lives.


dealerships still have other dealerships to compete with, if a dealership is too greedy and lets another dealer sell a car at a lower price because their ADM was higher, thats their fault. customers also have the ability to shop at lowest place.

competition is good, but also a smart consumer is good.

 

[Atlas1]

That is such a bad idea it makes my head spin. For all involved....

I guess it’s a natural progression from the 10 year auto loan to this. Insanity!

 

[FreePenguin]

Our credit union is advertising up to 120% of msrp on new and 120% of Kelly Blue Book on used.

wait, are you saying they are approving 120% of msrp for loans?! omg.

 

[pt's21]

dealerships still have other dealerships to compete with, if a dealership is too greedy and lets another dealer sell a car at a lower price because their ADM was higher, thats their fault. customers also have the ability to shop at lowest place.

competition is good, but also a smart consumer is good.

This only works if dealerships choose to compete. Dealerships in my area "network". They advertise vehicles that are in their network - not on their lot. My guess is they all agree on markup.

As an example - The dealership I purchased my '21 from has one Mustang on the lot, but advertises 23 to be available.

 

[Stage_3]

wait, are you saying they are approving 120% of msrp for loans?! omg.

2022 GT500,.............here I come!!!
LOL

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