friendinthebusiness
12-02-2006, 02:11 AM
"Why did That dealer lie to me! He is a cheat! He said he gave me his best price, but I found the same car cheaper at another lot! Typical salesman! You can't trust any of them!
Why can't all the Dealers be honest and sell the car for the same low price?!
ANSWER
For the buyer's own protection. Price fixing (collusion, racketteering, mail fraud, monopoly - prosecutors have many angles to charge with) are felonies punishable by fines and prison for the dealer. The customer would be dissatisfied too. How can the car buyer determine their own opinion of the best price if all the prices are the same.
Yes, all new models have a federaly mandated MSRP (Manufacturer's Suggested Retail Price) on the window, the "sticker price." The Federal regulations wisely recognize different parts of the country will have different costs to operate a business so even MSRP will vary from area to area for the same equal model. Because it is a "suggested" price from the company that built the car, not a monopolized price that you are forced to pay, MSRP is not price fixing.
Like ALL RETAIL BUSINESSES IN THE USA, a Car Dealer must eventually make a Profit, if not, they lose their investment and GO OUT OF BUSINESS. A retail establishment must at some point show the IRS profit or it is not a retail establishment, rather, a tax dodging shelter for the owners, and the Feds will close the doors via tax liens and fines if the business hasn't went bankrupt or shaped up already. That is not an ascertion. It is federal law.
What Shoppers truly dislike and experienced dealer recognize is the uncertainty of car buying in a free market culture evolved from the car industry itself. The Automobile, being so ingrained into the American idea of what is considered success or failure, cool or not cool, practical or pretentious, smart or stupid, forces a car buyer to put their will, goodness, honesty, and everything else they say they believe to the test, all at once.
The experienced dealer has learned to help the shopper navigate a process that forces logic and irrationality to exist simultaneously. Where else would a consumer agree to buy $25,000 of plastic and shiny metal that, after spending 5 or 6 years making payments adding up to $32,000, will then make them the proud owner of an outdated machine that needs another $2500 in repairs to stay running. To add insult to injury, being outdated and worn out, the insurance company will only give $5500.00 when it gets totaled out by a deer...
Fortunately for our economy, as well as our monthly bills, consumer vanity almost always wins. Vanity is one of the highest forms of emotional joy and it won't let anger at its decision ruin its party, so the anger, guilt, frustration, all are taken out on the Dealer, but we love our customers anyway. As a matter of fact, we couldn't live without them. Its how we as Dealers handle the Buyers uncertainties that satisfy them: but that is another post.
Why can't all the Dealers be honest and sell the car for the same low price?!
ANSWER
For the buyer's own protection. Price fixing (collusion, racketteering, mail fraud, monopoly - prosecutors have many angles to charge with) are felonies punishable by fines and prison for the dealer. The customer would be dissatisfied too. How can the car buyer determine their own opinion of the best price if all the prices are the same.
Yes, all new models have a federaly mandated MSRP (Manufacturer's Suggested Retail Price) on the window, the "sticker price." The Federal regulations wisely recognize different parts of the country will have different costs to operate a business so even MSRP will vary from area to area for the same equal model. Because it is a "suggested" price from the company that built the car, not a monopolized price that you are forced to pay, MSRP is not price fixing.
Like ALL RETAIL BUSINESSES IN THE USA, a Car Dealer must eventually make a Profit, if not, they lose their investment and GO OUT OF BUSINESS. A retail establishment must at some point show the IRS profit or it is not a retail establishment, rather, a tax dodging shelter for the owners, and the Feds will close the doors via tax liens and fines if the business hasn't went bankrupt or shaped up already. That is not an ascertion. It is federal law.
What Shoppers truly dislike and experienced dealer recognize is the uncertainty of car buying in a free market culture evolved from the car industry itself. The Automobile, being so ingrained into the American idea of what is considered success or failure, cool or not cool, practical or pretentious, smart or stupid, forces a car buyer to put their will, goodness, honesty, and everything else they say they believe to the test, all at once.
The experienced dealer has learned to help the shopper navigate a process that forces logic and irrationality to exist simultaneously. Where else would a consumer agree to buy $25,000 of plastic and shiny metal that, after spending 5 or 6 years making payments adding up to $32,000, will then make them the proud owner of an outdated machine that needs another $2500 in repairs to stay running. To add insult to injury, being outdated and worn out, the insurance company will only give $5500.00 when it gets totaled out by a deer...
Fortunately for our economy, as well as our monthly bills, consumer vanity almost always wins. Vanity is one of the highest forms of emotional joy and it won't let anger at its decision ruin its party, so the anger, guilt, frustration, all are taken out on the Dealer, but we love our customers anyway. As a matter of fact, we couldn't live without them. Its how we as Dealers handle the Buyers uncertainties that satisfy them: but that is another post.