Saturn advertised no-haggle pricing for a while. But not all car dealers went to that business model. Either the haggling must be profitable to the dealer, enough customers must actually like it, or both.
I suspect that some customers think they can get a better deal haggling with a car dealer than they actually can (kind of like the way some large percentage more than 50 of drivers think they’re above average drivers). I think that’s why the business model where you haggle over car prices survives.
So… In that example, if “switching brands” could mean choosing public transportation instead rather than buying a new vehicle altogether. I don’t mind that idea so much, actually. If car manufacturers go under and dealerships aren’t around to sell new cars, maybe we’ll finally get some much needed change.
It sucks on a human scale to see people lose their jobs, but IMHO the car industry has been righteously screwed up for awhile, from start to finish.
As a society, we brought this mess on ourselves which was probably inevitable sooner or later. While I don’t have a lot of sympathy for the industry and society in general for letting this happen, I do feel bad for the people who have to suffer because of such short sightedness.
I seethe 1950’s auto dealership model as failing…mostly because of the Internet and just-in-time factors. First, there is no need to maintain a large stock of vehicles-you can order a car and get it in 4-6 weeks. Second, you can research your car on-line, far better and faster than going to a dealership. Third, salesmen that are knowledgible about the product they sell will never have a problem-its the guys who are clueless who will. Right now, the industry is moving toward smaller numbers of very large “megadealers”. These firms generate more cash, so they can weather downturns. Alas, the small dealer is not going to survive…but that s a fact of life…businesses grow, eveolve, and die. How many people lament the passing of the family farm…or the small sweatshop factory? I don’t.
I guess this is slightly off topic, but I still don’t get why dealerships need to close on the say so of the Big 3, or why the Big 3 even want dealerships to close in the first place.
GM sells cars to the dealers who then sell them to the public, right? So if a dealer does a crappy job of selling cars, they’re going to go out of business. And if they do a great job, they’re going to stay in business. So why would you need the producer of the product to come in and start evaluating everything and mucking up the whole capatalistic system already in place?
Does it cost GM money to keep its dealerships open? If so, what? They’re not paying the salaries of the dealership’s employees, the dealership is. They’re not paying the commissions to the sales staff. The dealership is.
Is it that more dealerships means more production? Well what’s the problem there? More production means more sales! Unless a dealership isn’t selling enough, in which case…well, see the begining of this post. They’ll naturally go out of business anyway.
While I’m not happy about anyone losing their job, I do want to point out to those of you talking about having to drive 50 miles to a dealership that not all areas are like that. There are 3 Honda Dealerships within 15 miles of me right now, 3 Saturn dealerships, 4 Chrysler, a 6 Ford dealerships. So yeah, a bit much. I place a lot of the blame on the companies. Why would you let a First Team Honda and a Hall honda open up 2 miles from each other? While I don’t understand all the intricacies of the auto industry, I have to believe that the big companies have some say in who is an authorized dealer. So it’s their own damn fault.
Yeah, I was going to mention that too. A phonebook search turns up 426 new car dealerships in my city. That’s excluding places that only sell used cars. They are grouped together in clusters of 3 to 5 about every 2 or 3 miles in every direction around here. It’s seriously just ridiculous.
Exactly. What I’m hoping is that it will be a short-term suck, that will lead to an industry reboot that moves more toward a more long-term sustainable system (that may or may not include actual automobiles).
I feel the same way. Maybe it helps that I’ve never bought a car from a dealership and never had to deal with car salesmen, but I am sorry for them and everyone else who’s losing their job in this economy.
Me, too. Yeah, there are plenty of sleazeballs in their ranks, but I’ve known a few car dealers who were truly nice people who just happened to be into cars and suited for selling them.
I have to feel sorry for them. My dad used to be a car salesman until he retired in the 90’s, so this hits too close to home for me to not feel sorry for them.
There are car salespeople who are decent people (or at least there used to be one of them).
I’d like to have sympathy, but I have to get approval from my manager. You just sit here, and I’ll go in and talk to him.
<Fake conversation ensues.>
Good news!
Which is why they never should have closed down that independent typewriter repair service in my neighborhood!
Businesses closing is a cyclical process. I have no sympathy for auto dealers closing down. It sucks, but it’s better than arbitrarily keeping a business open that shouldn’t remain open.
Nobody said anything about selling at a loss. Most car makers need to average a certain amount of profit per car sold in order for their business model to work. Say that average is $500 per car. If they make $700 on one car, then they can afford to sell another for $300 to someone else. Hopefully, they’ll make additional money on financing and service work on the one they sold more cheaply.
Yeah, but then they’re set up as slimeballs because they charge you for ‘engraving the vin on the windows’.
What they need is: The price for the car is the price for the car, no matter where you buy it. The price of your trade in is the price calculated by a disinterested third party (KBB bluebook)
Nothing else. No Markup, no undercarriage treatment, no advertising fees, no bullshit.
I can’t seem to find it now, but I read about a site that matches up dealers and potential clients. Clients can shop around and print out a ‘guaranteed price certificate’ or something that the dealer has to honor. Great if you hate haggling, I guess.
There are places to go, both online and in person, where you can buy cars without haggling. Or you can do about 30 minutes worth of research and buy your car quickly and cheaply. I don’t mind either method.
But haggling is what GETS us here. Do you haggle for milk? Do you haggle for…well, actually, I’m running out of examples because things like houses and healthcare and buying tires, there IS some haggling involved.
