Aren't we just trading owners?

"Future next gen S2000 owner" (future-next-gen-s2000-owner) 01/10/2018 at 09:32 • Filed to: None

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This is more of a hypothetical/philosophical question than anything. More after the jump. For your time.

If you eliminate dealerships but introduce factory stores that provide information on authorized repair centers, handle test drives, answer questions, and help facilitate builds and financing coupled with regional warehouses to handle common specs, aren’t they functionally equivalent to dealerships? If you move to that model, have you really eliminated dealerships or just changed owners?

random001 > Future next gen S2000 owner 01/10/2018 at 09:42

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Well, it centralizes everything, which removes competition, so it’s not really the same thing?

Noah - Now with more boost. > Future next gen S2000 owner 01/10/2018 at 09:43

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I think its a marketing tool for Tesla, they have just turned their dealership system into a selling point.

MasterMario - Keeper of the V8s > Future next gen S2000 owner 01/10/2018 at 09:43

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Yes, but most people see it as an improvement since the factory is directly in control of the dealer. If you have a recurring problem with a car now and the dealer can’t seem to fix it they just say, “talk to (insert manufacturer here)“.

Plus you would probably get more of a fixed pricing and not have to deal with the whole scammy feel to dealerships we do now.

crowmolly > Future next gen S2000 owner 01/10/2018 at 09:46

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If you move to that model, have you really eliminated dealerships or just changed owners?

No, you haven’t, but it’s a refactoring of the dealership model.

There’s certainly a need for a dealership in and of itself- where you can go to learn about the cars, place an order, get servicing done, etc.

The problem (as I see it) is the moldy fungus that’s been allowed to take over at a lot of places. We all know the bullshit- dealer adjusted markups, wacky inflatable tube men, mailing you “keys” to win a prize, letters saying they will give you a good trade-in “need cars like yours on the lot”, etc, etc.

The scummy behavior is what has to go. If you can clean that off and end up with dealerships that are run pretty well and are consistent in experience the consumer mindset would change. This would probably mean that the manufacturer gets a lot more control in the dealership day-to-day.

Future next gen S2000 owner > random001 01/10/2018 at 09:47

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With nationwide dealerships becoming more prevalent, are we not already moving in that direction?

random001 > Future next gen S2000 owner 01/10/2018 at 10:06

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But they’re still privately owned, so there’s competition. When’s the last time you saw a discount, or a negotiation in a Tesla dealership?

Future next gen S2000 owner > random001 01/10/2018 at 10:17

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I’m not sure the nationwide dealerships are privately owned, but either way your point is about discounts and negotiations.

Some brands do have fixed prices, I think Saturn tried it. Carmax has fixed prices. There is no reason to think that if the stores were owned by Ford or GM that they wouldn’t offer discounts. Most manufacturers offer factory rebates to move volume to keep their factories running.

True their wouldn’t be discounts between Ford dealerships, or Chevy dealerships as there is now. You can negotiate a lower price. On the flip side, when you eliminate the middleman -dealerships - you eliminate the profit they generate, which could lead to reduced prices.

Textured Soy Protein > Future next gen S2000 owner 01/10/2018 at 10:18

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In theory the manufacturers would not engage in some of the more common, scummier behavior practiced by independent dealerships. Stuff like: 

Trying to sell you on a monthly payment rather than a price of a car.

Acting like they’re doing you a favor by lowering a price when they’re only applying a standard rebate that everyone gets.

Pushing overpriced bullshit extras like service contracts and paint sealant.

Lowballing the shit out of trade-in offers then encouraging people to roll over negative equity from their trade-ins to new loans they can’t afford.

random001 > Future next gen S2000 owner 01/10/2018 at 10:44

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Agreed on most points.

Future next gen S2000 owner > Textured Soy Protein 01/10/2018 at 10:46

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I doubt #1 and #4 would go away if sales were still done in person at all. People generally live month to month and it is a huge sticking point for the vast majority of people. #4 will still continue to happen where used cars are sold. The offers could get worse if the manufacturers only sell new cars and kick all used cars to auction. This might happen but there is more profit in used cars, so maybe? If the manufacturers realized the profits from #3, will they willing forego that practice?

Maxima Speed > Future next gen S2000 owner 01/10/2018 at 11:26

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Dealerships are a prime example of cronyism, when states forbid a company from selling cars directly to consumer, they are saying “you have to sell your cars to our buddies (car lots), who are going to make your product more expensive and get rich selling your product. Its a disgusting scam. That being said there is a place for dealerships, a manufacturer may only want to build 1 car store in a state, but a dealership could start up to provide product in an area the car manufacturer isn’t interested in investing in.

Textured Soy Protein > Future next gen S2000 owner 01/10/2018 at 14:49

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“In theory”