NADA Is Terrified of Tesla 455
cartechboy writes It's no secret that the National Automobile Dealers Association has been trying to block Tesla from selling cars directly from consumers, but to date, it has been defeated countless times in many states. Now NADA put out a release and promotional video touting the benefits of dealer franchises, something Tesla has shunned. NADA mentions price competition, consumer safety, local economic benefits, and added value.
Speculation... (Score:5, Insightful)
While possibly true, it's complete speculation to tie this to Tesla.
But hey, Tesla gets page views.
Re:Speculation... (Score:5, Insightful)
How is it not tied to Tesla? All cars in the US are sold at dealerships, well at least all cars you don't put together yourself that you order from the back of a magazine. Tesla rolls in recently and is the ONLY one not using dealerships. Why would the NADA have to start pimping themselves if people never had an option not to use a dealer? Car dealers are SCUM. They are leaches. Their goal is nothing but to separate you from as much money as they can. Remember that the next time you are sitting at a salesmans desk that is out in the open on the sales floor with a lot of hustle and bustle around, people walking by and they are playing music over the speakers in the showroom relatively loud. There is a reason they do those two things and its not for your benefit. Ask them why that ONE car stock number 7782 that was advertised for 12,888 is not in stock and why the advertised price on another car is $15,800 but that assumes every rebate that you cant possibly get and $5000 down and then another $1000 for a doc fee plus a delivery change of $781. It's not 15,800. Why not just advertise it on your site or the paper for $1000 and add a $18,000 deliver charge? What's the difference? Again they are SCUM. People only kind of like dealers that only do most of those things, it is relative. That is sad. If you like a dealer, it is because you got ripped off and you didn't even know it.
Helping the local jobs and economy argument is bullshit. If that was the case, let's create dealerships for everything and we will all be rich, all have jobs, and be debt free. Same as the RIAA/MPAA arguments. Money does not grow on trees and people do not have a limitless supply. People would spend the money they spent at a dealer somewhere else, possibly at another local store with local employees. Cars still need to be repaired and parts bought for them, that will still happen with or without a dealership.
Re:Speculation... (Score:5, Funny)
Re:Speculation... (Score:5, Funny)
Re:Speculation... (Score:4, Insightful)
Look.
Go to the "internet fleet sales" and get a bid from your local dealers.
For example, I got 19500, 20000, 22000, and 23500.
I went in, did the car deal in 2 hours and I was done.
Could I have gotten the car deal for 19200? Sure. I have a friend who REVELS in doing this. He will spend 3 to 4 hours negotiating with the salesman and then the manager. They think they have him trapped in a room with them-- but actually he has THEM trapped in a room with him. After four hours, he'll still negotiate over the last 12 to 17 bucks. And usually win.
Dealers serve a purpose. They need a reasonable profit.
If you seriously want to buy a car amazon style and not get the support of a dealer then more power to you. You may be like my friend (only in a different way).
Car dealers are just people and they need to earn a living too. And most car sales people earn average or slightly above average incomes.
But seriously "Internet sales" for the win. Get a bid, no negotiating. You walk in and THAT'S the price you will get. No ripoffs... no talking to the manager.
Re:Speculation... (Score:5, Interesting)
I actually went in with a bid from Truecar, and the dealer claimed that the price they quoted included discounts I wasn't eligible for. Never mind that they asked the eligibility questions online and I answered them correctly. I'm sure they violated their agreement with Truecar and what they did was illegal, but I wasn't about to try to fight it especially since they were in another state.
Still, I got a price much better than I probably could have negotiated. I thought the price they actually quoted was too good to be true, but I figured I was better off starting at a price 30% below sticker and having them talk me up, than starting at sticker price and having to talk them down. I got the price I figured was fair in the first place. I just felt dirty walking out all the same.
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If they serve a purpose, they deserve a reasonable profit. For the life of me, I cannot see what that purpose is. Perhaps you can enlighten us.
Re:Speculation... (Score:4, Insightful)
Their purpose is to earn a reasonable profit, for any definition of "reasonable" that translates to "as much as I can get away with".
This is capitalistic economics: "What the market will bear".
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If they serve a purpose, they deserve a reasonable profit. For the life of me, I cannot see what that purpose is. Perhaps you can enlighten us.
Overcharging for maintenance, and conveniently collecting large numbers of scummy sales droids into one location where they can normally be avoided.
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A central, local point of contact.
A specialist in the legal issues around buying a car.
Mechanics trained in a particular brand of car supported by a shop with the proper tools and materials.
Live, human customer service.
A central, local place to buy accessories for the car.
Someone to keep track of maintenance and remind me when it's time so I don't overlook it and damage the car.
Someone local to do recall repairs if they are needed.
Someone I can trust more than "Rick" at the local garage to have standard pri
Re:Speculation... (Score:5, Interesting)
What part of this CAN'T you get if the manufacturer runs the showroom?
Re:Speculation... (Score:4, Interesting)
For people who hate negotiating, your method is probably best. But, even the quotes you received were likely gamed by the dealers giving them. Dealers don't work in a vacuum...they know the other dealers, and know what numbers you'll be able to get from them. If you think about it for a moment, the dealer that quoted 23500 would go out of business if he was constantly being undercut by his brethren. So, by giving customers these quotes, they make the customer feel like a winner, and often will take turns.
As for your negotiator friend, you need to consider the value of your own time. I'm generally in the same boat as him, but I won't try to squeeze them for the last $100...it's just not worth my time. Once the dealership has spent several hours with you, they've already made an investment in time. Walking away from a deal after hours, isn't something they ever want to do.
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If they actually provide a service that people need, then why are they so afraid of direct sales? It seems to me that, like home realtors, car dealerships ought to be perfectly capable of functioning in a mixed market.
Re:Speculation... (Score:5, Insightful)
Firstly, I don't think car dealerships should be legally protected. So we are in agreement on this point.
However....
Best Buy should have been perfectly able to function in a mixed market. But instead people use them as a show room- look at the products, and then buy online.
The second is probably a better model. Customers test drive and look at the cars at a dealership and then buy them from the non-dealerships. And then probably try to get support from the dealerships.
The same thing is true for crafting and several other fields. The biggest thing we lose is customer service. Man- you look at the shows from the 50's and customer service levels were 10x what they are now. Department stores literally had an employee at every counter.
By squeezing out the profits- we lose customer service and employment opportunities. It's like the reverse of a virtuous cycle. The end is everything automated and online with very few humans. I don't see what's going to stop it.
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Customers test drive and look at the cars at a dealership and then buy them from the non-dealerships. And then probably try to get support from the dealerships.
This is not an issue with regard to Tesla. There are no dealerships, so the only company you can get test drives from is Tesla themselves.
Likewise support and service comes from Tesla. I believe they use local third parties in some cases to deliver their service. But it's Tesla themselves that you are dealing with.
Altogether a far better experience than scummy dealerships.
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You could also try a car buying service, such as the free one that AAA offers. You specify what you want, and the service goes out and finds the car. And because it was bought through the conventional network, you can still get dealership service in your town after the purchase.
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Lol-- not quite.
He could get the same car I got for $19,000 for $18,673 for four hours of his life.
He starts at a higher price- negotiates through the "no haggle price" and that last $17 is at the end.
Plus-- he's not doing it to save money. He's doing it because haggling like that is one of the most entertaining things he can imagine doing. He loves every minute of it. He even haggles for his brother's cars so he can do it more often.
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Re:Speculation... (Score:5, Insightful)
Nobody is saying that there can't be franchised dealerships. If that is the way a company wants to organize its distribution chain, fine..
The issue is that car dealers, slimebags that they are, are trying to use the legal system to force all businesses, whether they want to organize that way or not, to follow that model.
The reason for this is quite clear (at least to me it is), and it has nothing, absolutely nothing to do with any altruistic purpose (keeping costs down, protecting the customer, or some such bullshit). Its all about using the force of government to protect their racket. They realize, quite accurately, that Tesla's model would threaten to remove a lot of the zero-value-add profit that gets extracted by the dealer from the consumer.
It's not a hard point to understand, unless you are determined not to understand it.
Re:Speculation... (Score:5, Interesting)
While possibly true, it's complete speculation to tie this to Tesla.
But hey, Tesla gets page views.
Not really. Tesla doesn't really have the volume (or the low end offerings) to eat the dealerships' bread and butter(except possibly some relatively niche outfits who used to sell a lot more ~100k ICE vehicles to techies made good); but they have been extremely aggressive about 100% company-owned and operated sales locations, and have skirted the laws in various ways ("Information centers" that look sort of like a dealership except that the staff are forbidden to sell you anything, just show you stuff and you can go use that computer over there to buy online if you want...) in states where the dealerships have purchased protective legislation.
Barring a radical overthrow of the automotive order, Tesla isn't personally going to terminate dealerships; but if their model holds up, persuades lawmakers, survives in court in more hostile states, etc. it can be copied pretty much verbatim by any manufacturer that cares to.
And the NADA can't exactly be ignorant of how...beloved...a traditional industry it is that they represent. Merely seriously proposing that we could eliminate car dealers, in our time!, probably excites more people than fancy electric cars do. This isn't one of those "Upstart company disrupts traditional business right in the face, laughs" situations where hand-wringing moralists write books about the moral decline and inevitable decadence of our civilization occasioned by the hardships of the traditional business.
Re:Speculation... (Score:5, Insightful)
Tesla's 3rd generation car is supposed to be a mass market vehicle that may disrupt the "automotive order" if Musk manages to build it. The giga battery factory he is looking for a home for is a critical component since it is critical to have enough affordable batteries for a mass market electric car.
Tesla today wont disrupt NADA, but Tesla in a few years very well may, they know it, so they are trying to nip it in the bud.
Re:Speculation... (Score:5, Insightful)
Barring a radical overthrow of the automotive order, Tesla isn't personally going to terminate dealerships; but if their model holds up, persuades lawmakers, survives in court in more hostile states, etc. it can be copied pretty much verbatim by any manufacturer that cares to.
In fact, the ones that they fear is not tesla, but China. If Tesla opens the door this way, then the Chinese companies will come to America in exactly the same fashion.
Re:Speculation... (Score:5, Funny)
In fact, the ones that they fear is not tesla, but China. If Tesla opens the door this way, then the Chinese companies will come to America in exactly the same fashion.
Given the product quality and level of support provided by Chinese manufacturers -- if American dealers can't compete against that, then they really don't have any reason to exist.
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This is exactly the same sort of rubbish that we heard when the first Japanese cars started arriving.
Re:Speculation... (Score:5, Informative)
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This is exactly the same sort of rubbish that we heard when the first Japanese cars started arriving.
Different cultures. Don't assume that just because they are neighbors, Japanese products and Chinese products have the same potential. Japan has a long history and culture of quality and craftsmanship, and these are values which show in their products and services. In Japan people do a good job for the sake of doing a good job. I'm not as familiar with China but when I traveled there, I constantly felt hustled and that people were trying to take advantage of me. Their culture will gladly screw you ov
Re:Speculation... (Score:5, Informative)
With what, fucked-over old VWs (well, licensed copies) with non-matching front and back halves? They don't have anything else that will pass the crash tests.
Volvos will be made in China and exported to the US beginning next year.
Re:Speculation... (Score:5, Insightful)
Indeed, I moderately dislike Tesla generally and Elon Musk specifically, and I'm neutral on both electric cars and luxury cars. Nevertheless, I'm cheering myself hoarse for Tesla in this fight. I'd cheer equally for just about anyone who would make a similar effort to reduce the amount of sliminess involved in car purchases.
Re:Speculation... (Score:5, Funny)
But without the sliminess of dealerships, how will we keep the engines lubricated? Sure, we can change the oil regularly, but we all know that even many years later it's still mostly the final remnants of salesman slime that really keep your engine running smoothly. Just look at how many cars, and other goods for that matter, break down as soon as the warranty expires and the last traces of salesmanship finally evaporate. Coincidence? I think not.
Re:Speculation... (Score:5, Funny)
Comment removed (Score:4, Informative)
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If you consider BMW niche, then yes.
If I walk round my office car park, I see more Teslas parked here than BMWs. Considering the number of years that BMW has been selling cars, that' s pretty amazing. In all fairness, I should mention that the Tesla factory is just a few miles up the road, so I live in prime territory for Tesla.
Re:Speculation... (Score:5, Insightful)
I have heard Elon Musk speak on this. His basic proposition is that he has never had a positive dealership experience and he has rarely met anyone that has had a positive dealership experience.
It is a fairly compelling argument.
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I have boughten a total of 3 cars in my life. First was a brand new car and the salesman was your typical slimeball. 2nd car was from a used car salesman fairly slimy. Third guy was fantastic. But he wasn't a salesman, he was more of a general manager. I only got to him by word of mouth. But I was in and out of the dealership in less than 45 minutes and saved a bunch of money
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boughten?
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Boughten [oxforddictionaries.com] is perfectly cromulent.
<grammar police>That site lists it as an adjective. He used it as a verb. I don't think that qualifies as cromulent in that case.</grammar police>
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How dare he spend time and effort and money to resolve a problem he's personally experienced?
I'm sure there are millions of customers satisfied by their experiences at dealerships. They did just fine so it's clearly just him having an unreasonable expectation. maybe it's a childhood trauma manifesting itself and causing him not to properly appreciate the dealerships. It's totally unreasonable - and obviously should be explicitly illegal - that Elon dare make a change to this. I mean...think of the child
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Never buy from a man in a suit. A large portion of what you are paying for is the suit.
We should have a choice (Score:4, Insightful)
There will always be a need for car dealerships, but there is no good reason to ban direct sales. This is pure rent-seeking behavior. The dealerships should position themselves as Tesla's partners in buying/selling used Teslas and in repairs.
Re:We should have a choice (Score:5, Interesting)
Re:We should have a choice (Score:5, Insightful)
They are only crying because this a market they don't have cornered.
Actual competition is terrifying to "free market capitalists".
No it's not. It's terrifying to cronies who use crony capitalism to keep a grip on their markets through government "regulation".
Re:We should have a choice (Score:5, Informative)
So, you realize that his person meant crony capitalists when he put free market capitalists in quotes, right?
--PM
Re:We should have a choice (Score:4, Informative)
265 miles isn't far enough for you? You also get *free* charging at their stations.
Re:We should have a choice (Score:4, Interesting)
I've had two cars most of my serious adult life, so it wouldn't be a concern for me, personally (I'd simply take a gasoline powered vehicle on a cross-country trip, which I've done on several occasions).
For a cross-country trip, though, yeah, 265 miles isn't far enough. That's about four hours of driving versus the 400 mile range of a typical gasoline car giving about six hours of driving. And it only takes a few minutes to fill up, and you don't have to plan which gas station you use. So for a lot of people, the idea of making a cross-country trip in a Tesla is still disadvantageous versus a traditional automobile.
Tesla is shiny, and I want one. It would serve 80% of my driving needs. I still require a different capability vehicle for the rest of my needs/wants, though.
Re: We should have a choice (Score:3)
You realize that range was chosen quite intentionally to suit road trips.
Drive 4 hours and hit a supercharger station. 20 minute "refill" while you use the restroom, stretch your legs, etc. and back on the road. Rinse and repeat. You can find a hotel along the way that'll let you plug in overnight, and away you go.
People have already made coast to coast road trips in a tesla. Sure, it requires a bit more forethought than a petrol-mobile. But it's certainly possible.
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What about those of us who cannot charge the vehicle at our own premises? On street parking, pavement between the road and the car, no guarantee of a parking space outside the house etc etc.
Re: We should have a choice (Score:4, Informative)
It's not a solution for everyone.
Here most cities welcome no-smog cars so they cooperate with anyone who wants to have an electric car. Often if you buy an electric car (and have no driveway or somesuch to park it) the city will restrict a parking spot right in front of your house to electric only and allow the charger installing company to rip up the sidewalk to install the thing. In some cases they even pay for the electricity.
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Driving for 6 hours without a significant break (30 minutes minimum) is not safe. You may think you can handle it, but endless studies have shown that tiredness has a similar effect to drink driving. For the sake of an extra 30 minutes on your trip you should really make a proper stop on that journey.
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Well for those long distance trips catch a sleeper on a train and rent on location, hell with high speed rail, oh wait the Republicans killed those, I was going to say you wouldn't even need the sleeper, just a seat and luggage space and quicker than the car without all of the fuss of a plane.
Re:We should have a choice (Score:4, Interesting)
How often do you think most people drive "coast to coast"?
My wife's car is four years old and has never been more than 100 miles away from home. And since she shares a birthday and ethnicity with Nikolai Tesla, she's bugging me about wanting to get one. She'd be the perfect customer for one if we had that kind of coin to throw around. Which we don't. And if we did, I'd be angling for an Audi R8. Say, do they make a hybrid Audi R8?
Re:We should have a choice (Score:5, Insightful)
"There will always be a need for car dealerships,..."
Yes, because we just love to give cuts to as many people as possible for our purchases.
I remember fondly the days when we couldn't buy computers, hairdryers, video recorders and even luggage containers in a supermarket, because those needed 'special' vendors with 'secret' knowledge.
forewarned is forearmed (Score:4, Insightful)
But everyone knows what that conveys, even the dealers themselves:
Of course, this divides ranks with the dealership community itself, as the old guys close to retirement are going to continuing milking their cash cow by any means available, as the younger guys start to worry about their long term futures when the backlash strikes, which the old guys are doing nothing whatsoever to abate sooner rather than later.
They say that society is "only" three square meals from anarchy. That's a lot, actually. I estimate that the fraternal order of the car dealership is only two snifters of brandy and one Cuban cigar's worth of suggested forbearance away from king-sized flop house crossfire.
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From my (admittedly quick and unscientific) sampling of the owner forums, stories involving technical trouble almost always end with some Tes
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I remember fondly the days when we couldn't buy computers, hairdryers, video recorders and even luggage containers in a supermarket, because those needed 'special' vendors with 'secret' knowledge.
As a matter of fact, yes I do fondly remember my first computer dealer because they actually knew shit and helped me put together as well as upgrade several of my first PCs. I spent a ton of my money there and didn't regret one cent of it.
Dealers absolutely can add value to the system. It's just that most don't, and sadly too many consumers shoot for the cheapest price so aggressively that good dealers go out of business and the scum survives, and it's getting ridiculous. Have you bought crap online recentl
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no need at all for them.
order your electric car online with drivers license and insurance policy number taken during checkout, delivery person drives to your home, takes video of you and them checking out the condition of everything, and then they take taxi or shuttle or whatever back to warehouse.
Local Dealerships (Score:5, Funny)
Wow, local dealerships sound AWESOME!
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What a joke. Check out my local dealership here in Texas: http://www.penskeautomotive.co... [penskeautomotive.com]
Bet they're local to quite a few people in the US. And Germany. And Italy. And the UK. And Puerto Rico.
Slow News Day? (Score:2, Funny)
So far it seems that NADA has happen.
Change is coming for car dealers (Score:5, Insightful)
So the dealers have alot of money, alot of friends and will do what they can to gum up the works for (or kill) Tesla and what it represents if they can. JMHO...
Re:Change is coming for car dealers (Score:5, Informative)
Re:Change is coming for car dealers (Score:5, Funny)
pendant
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I think you mean "pedant"
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Re: Change is coming for car dealers (Score:5, Funny)
Mormon.
No such thing as maintenance free car (Score:2)
Electric cars need tires. Electric cars need brakes. Electric cars will have safety recalls. Electric cars can be in accidents. Electric cars can be broken into.
I don't claim to know much about electric cars, but if it has moving parts it will be need to be serviced at some point.
I don't think you thought your post through.
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Safety recall fixes have to be done at a dealership. Like when GM issues a recall for the ignition switch that can catch a car on fire.
No they don't. That's just mostly how the current companies handle it. Safety recalls have happened with Tesla. They've simply used company techs to do the work by picking the vehicle up from your house/work if the fix can't be done on the spot, sometimes delivering a loaner vehicle.
Also, much like repair shops working with lots of insurance companies, there's nothing except laws preventing a car manufacturer from simply paying any qualified shop for doing the work.
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...electric cars don't have alot of things that car dealers make money with ... . Alot of dealerships make much of their profits from such things, ... . So the dealers have alot of money, alot of friends ...
Just between you and me, "alot" is not a word, although it could be a misspelling of the verb "allot". In this case, you mean "a lot" (two words), as in many. As for style, it may have been deliberate, but generally it's distracting when a word or phrase is needlessly repeated so often in just a few sentences, especially when there is so much else to choose from, e.g. "many", "plenty of", "large numbers of", "(is/are) flush with (cash)", "lots of", etc.
But, now that you have my attention, I agree with y
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Tesla can do all that right now. All they need to do is place a generator on a trailer and tow it with them.
I know what you meant though. And with Tesla opening up the charging patents and trying to get a standard going, it won't be long before you won't need the trailer. Well, it will still be long but not in my life time probably went out the window.
Now, I'm not a Tesla fan by any means. At least not until I heard that they were working to solve some of my biggest complaints about EVs by actually sharing
Everyone loves car dealers! (Score:5, Funny)
Oh, jk.
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You'd have to buy their phone first. To take a picture of the car you want to buy.
Benefits (Score:5, Funny)
Talk about a tall order! (Score:5, Funny)
Imagine being the marketing team that had to make car dealers seem like a good thing to have!
Tesla's Mars Mission (Score:2)
Cool science fiction opportunity here is that when we colonize Mars we get to have a Mars vs Earth civil war. My bet is on Mars winning. Time for a hollywood movie deal!!
Another multiverse version of Elon Musk develops a slew of super-viruses under his manufacturing plants in a deep-core Earth super lab. His 2020-ish journey to Mars assembles a team of top candidates for population of Mars now that he has perfected his global terraforming technology. Musk detonates super-virus technology as soon as his crew
Irony (Score:2)
NADA mentions price competition, consumer safety, local economic benefits, and added value.
Yes, the "added value" of $500 for a $2 3M spray on the seats, and $1500 for an underbody treatment that often isn't even applied.
Yes, those dealers sure know how to extract value. I almost bought a Toyota once. But I couldn't get one that didn't have $5000 or more of unwanted markup for such scams. Gulf States Toyota Distributors should have been taken down for fraud and such. But NADA and others support such unethical and borderline illegal practices. And demonize Tesla.
"price competition"? (Score:2)
Isn't price competition based on who has the lowest dealer markup?
Doesn't eliminating the dealer franchise also eliminate dealer markup?
Wouldn't we all be buying the same wholesale price?
That being the case, how is price competition (in this case!) a good thing?
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p>Wouldn't we all be buying the same wholesale price?
No, we'd be buying at retail, so the price is by definition the retail price.
As to whether it's the same price for everyone depends on whether the manufacturer wants to haggle like dealers do or go with a fixed price a la Saturn. A fixed price is more likely though. Otherwise you'd end up paying for what amounts to an in-house dealership employing the people who did the haggling.
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Yes, in this case it would be retail, by definition. I think we're getting tied up in terminology. It's only called wholesale with other car companies because consumers can't buy from the company directly -- the purchase must be done from a middleman, at a brick and mortar store, with usually a pretty large number of employees. All that ultimately adds overhead costs plus dealer profit margin, which is why the car costs more than if you (could) buy it from the manufacturer.
In the case of Tesla, you *are*
I have no interest in a Tesla (Score:2)
Broken window fallacy (Score:2)
PDF.js is being dog slow at rendering the PDF. So first I had a look at the article on The Car Connection. "Fiercely compete for your business" just means that Chevy, Ford, and the like have failed to compete with Tesla. "Create good-paying local jobs" sounds like a broken window fallacy [wikipedia.org]. "and significant tax revenue for local communities" is true whether or not the factory owns the dealer, as the local branch of a factory-owned dealer likewise pays property, income, and sales tax. "If automakers themselve
Re:Broken window fallacy (Score:4, Insightful)
"Local dealers will be there for consumers in good times and bad."
Yep, I bought a car 6 years ago from a dealer. They closed down 5 years ago as soon as the "GFC" hit.
I probably would have been a little sad, except they were ass holes to me as soon as I drove it off the lot.
Buying a car (Score:5, Interesting)
..in the traditional sales system is not a thing that most people enjoy
Some people falsely believe they are "players" but they still get screwed
Most people are "sheep" and they get screwed faster and harder
I am not a master negotiator..I just want a car at a fair price
I always feel like a lamb in a roomful of tigers when I deal with a traditional car dealer
I'm a really good engineer, and I have many other talents..but cutthroat negotiation is not one of them
I really, really want a better system
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No, I'm pretty sure that, on average, it will last you about 3 years less.
Just one purchase away (Score:2)
Won't there still be a need for dealers, and aren't all the video's arguments still valid, for used cars?
manucturer dealers could be worse (Score:5, Insightful)
Most things are not sold directly by the manufacturer but by retailers. The variety of things that can be bought is too large to have a seperate store for each manufacturer out there, its nice to have product catagories in one place. With smaller objects of lower value, it seems this is strongly preferred. Cars are a very large, expensive item so there is more of a tendancy to have stores that specialize in just them. This sort of reduces the natural retailer/manufacturer seperation.
The fact is dealers do provide added value, however. The value comes from of course, the lot, of being able to actually see a car before you buy it. The cost of running this will be there whether the manufacturer runs the lot, or whether an independent dealer does. The market does operate to regulate prices for dealers, since its a part of the car price, it can be argued that having independent dealers may give people more choice regarding who has a more efficient lot operation.
Many aspects of the dealership people find unpleasant will still be there with a manufacturer run dealership. One of them is the credit checks for the loans. Bargaining is not necessarily exclusive to independent dealers but could also occur at a manufacturer dealer. A lot of the qualities of the independent dealer will still be there with a manufacturer dealer, therefore. Since you have no choice of dealers to work with, it could even be worse.
Maybe people should have the option of a direct buy from a manufacturer, but, a manufacturer locking out independant dealers from providing an alternative is also not a great idea. The vertical integration could be anti-competive and lead to overly monopolistic qualities.
Dealers could help themselves here (Score:3)
That isn't to say Tesla will solve all these problems (I'd be especially worried about the cost of servicing what's essentially a computer on wheels), but at least they charge a price and you know what you're getting. No negotiations. No oily salesman pitching stuff you don't need.
Re:Could the Tesla circle jerk be any more open? (Score:4, Insightful)
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First I heard that ride sharing services were challenging the escort business.
Are these ride sharing services over Craigslist, perchance?
Re:Could the Tesla circle jerk be any more open? (Score:4, Funny)
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The margins for dealer sold cars are HUGE, thousands and thousands of dollars in commission for the better sales guys per car. Now imagine if Tesla ruined that market made cars cheaper for everybody.. of course these guys are scared of Tesla, if they are a success doing this nobody will want to use a dealer and the price of all cars will go down so they lose out on that margin.
Uh, Tesla wouldn't be making anything cheaper for consumers. They'd Apple it up and charge comparatively more, while keeping all the profits to themselves.
Re:Its the margins they are scared of losing. (Score:5, Insightful)
They'd Apple it up and charge comparatively more, while keeping all the profits to themselves.
Good. Tesla spends far more than most companies on R&D, and healthy profits will allow them to continue doing that.
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The margins are huge. Part of the thing dealers love is preying on people who just don't know about buying a car. Either a full sticker priced sale, or dealer add ons that are insane such as $2000 running boards are a great way to make money off a sucker. Just one item like that can be much more then the normal profit made on a car.
It took me a week to buy my last vehicle. I felt dirty and angry after several of my purchase attempts because I was quite clear on the phone before visiting what I wanted an
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'Everyone' hates the car dealership, and I do too. But, in my recent, personal experience, they have provided me the benefit of price competition. I needed to lease a car and found the lowest price I could find. I then simply called the 'Internet Department' at each of the local dealerships for this particular model, and just asked if they could beat that price. One guy said he could, and I went to him. I don't know if this is possible with purchasing a Tesla. Can different dealerships set their own prices, or, since the dealership is the manufacturer, is the price the same across any 'dealership' within a given geographical area?
Don't know. Can your boss set your salary on a whim after asking a bunch of random strangers what he should pay you?
Re:My Anecdotal Evidence (Score:5, Insightful)
You are looking at this from the wrong point of view. The way you should be looking at is, if you ALSO had the option of calling up Ford or GM or whoever your car maker was directly, and asking THEM if they could beat the dealer's price, could they? Of course they could, they make the damn car.
The idea that dealers create pricing competition for cars is total baloney because dealers don't make cars in the first place, they just mark them up and sell them. Ford competes with Honda and GM, they don't compete with Honda dealers and GM dealers. The thing that keeps the features and functions progressing for Ford while keeping costs low is not their dealer network, it is competition from other auto makers. The only competition dealers are having is who can mark up your car the least.
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The only competition dealers are having is who can mark up your car the least.
don't you have that backwards? the competition is to see who can get away with marking it up the most. it's an endless quest to find new ways to screw the customer.
Re:My Anecdotal Evidence (Score:5, Insightful)
'Everyone' hates the car dealership, and I do too. But, in my recent, personal experience, they have provided me the benefit of price competition. I needed to lease a car and found the lowest price I could find. I then simply called the 'Internet Department' at each of the local dealerships for this particular model, and just asked if they could beat that price. One guy said he could, and I went to him. I don't know if this is possible with purchasing a Tesla. Can different dealerships set their own prices, or, since the dealership is the manufacturer, is the price the same across any 'dealership' within a given geographical area?
The problem is, all the different prices you got were different amounts of markup from the manufacturer's price. You settled for the least amount of markup you could find. I suspect that all of them would be more expensive than buying directly from the manufacturer, which in the case of Tesla, you essentially are.
It only seems like a good deal in comparison to worse deals, not because it's actually a good deal.
"You paid WHAT!!" "But it's ok honey, it was 50% off! Think of the money we saved!"
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I find car dealers are a great resource.
They're a good place to go to test drive cars and compare different models in person.
Not a good place to buy cars from though.
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I found my last car online (used card)
I paid over the phone, deposit (subject to independent mechanical inspection report) by credit card, full balance by direct deposit (or I would have had to pay credit card fee)
It was delivered outside my work on the back of a truck nice and clean
Quite happy with it actually. It was much cheaper than buying a similar car in my local city.
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