Author Topic: Car Employee pricing (Read 413 times)

Gunslinger · « **on:** August 10, 2005, 10:01:00 PM »

Ok so I keep seeing these commercials and I'm perturbed. Mostly because at this financial juncture in my family's finances I cannot afford a new car, but also at the industry.

The big car manufacturers are offering all sorts of pricing discounts to lure new buyers but isn't this a sign that they should just lower prices all together. I mean if they are showing strong profits why price new cars so high? After the recession of 9/11 they had enticing financing incentives to lure new buyers, now they lower prices to lure new buyers. With record profits shouldn't this just show they that their prices are too high to begin with?

Isn't the person getting screwed the most the "employee"? After all he no longer get's a discount, he pays what everyone else does.

doobs · « **Reply #1 on:** August 10, 2005, 10:27:04 PM »

I work for a GM dealership, its the same deal in a new wrapper.
Any consumer off the street is entitled to know the tissue(dealer cost) if asked, the Employee discount is 1000.00 more than the tissue price. Any consumer can ask for this price, even before this ad campaign. And would ususally get it.

So if the consumer is paying 1000.00 under the cost of the Tissue,
you may ask how do they make money. Well the Dealer gets whats called a holdback, usually between 2 to 5 grand depending.

And your right the people paying for this are not the GM factory workers, but the Franchised dealer employees. I cringe every time I hear a program like this because I know it will, hit me directly in the Wallet. And no I'm not a salesman(g-d forbid).

But yes I'm being screwed on many levels, by GM.

And as a dealer for Gm you'd be suprised to hear my main competition is GM, as they now sell parts to whosale distributers
cheaper than they do to myself. The wholesale distributers then sell to my customers cheaper than I can buy it from GM.

I keep telling the dealer principle that there has to be Franchise agreement laws being broken there.

Gunslinger · « **Reply #2 on:** August 10, 2005, 10:36:11 PM »

I usually buy used so I don't have to bite the depreciation so I guess this is good for me. More people buying new means more quality used available. Of course I have to pay off the wife's mustang first.

GtoRA2 · « **Reply #3 on:** August 10, 2005, 10:40:19 PM »

get a Rubicon Guns!

You won't regret it.

doobs · « **Reply #4 on:** August 10, 2005, 10:45:13 PM »

Gun right now used is the way to go. our dealer doesn't know what to do with all the newer used cars we have on the lot.

But I warn you of this or inform. There is a huge markup in used cars on a dealer lot. If ya see a used car for say 15 grand they gave the owner only 8 to 10 grand.

Wolfala · « **Reply #5 on:** August 10, 2005, 11:12:28 PM »

Hey Gunny,

What happened to your engine?

Lazerus · « **Reply #6 on:** August 11, 2005, 03:00:01 AM »

Deleted.

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Lazerus · « **Reply #7 on:** August 11, 2005, 04:33:54 AM »

Quote

Originally posted by doobs
Any consumer off the street is entitled to know the tissue(dealer cost) if asked, the Employee discount is 1000.00 more than the tissue price. Any consumer can ask for this price, even before this ad campaign. And would ususally get it.

So if the consumer is paying 1000.00 under the cost of the Tissue,
you may ask how do they make money. Well the Dealer gets whats called a holdback, usually between 2 to 5 grand depending.

I went back and re-read your post. What you're calling the 'tissue' cost is invoice, not employee pricing. The employee price is listed as 'GMS' on the invoice, up on the right hand side about 3/4 of the way up from the bottom. On every GM invoice. Like I said before, the discount below invoice is based on a percentage. Yes the dealership has holdback. That is what GM is cutting out with the employee pricing. It's not $1000 more than invoice, it's anywhere from $500 to over $2000 less than invoice.

If you can't get good accurate information in the dealership that you work for, contact me. I'l be more than happy to talk to and supply you with anything you want to know.

Just so ya know, I can pull an invoice, the real thing, not some estimate off Edmunds, for any vehicle that GM makes.

By the way, what's your average profit margin in the parts department that you work for??

doobs · « **Reply #8 on:** August 11, 2005, 09:12:24 AM »

by more lazs I meant a 1000 more off the tissue, not adding to tissue. I also know that GMS is emplyee discount. Been in dealship for 17 years and have bought many cars here.
I see how my grammer skills are lacking and can be misinterepted.

As for Gross profit, we run around 32-42 %

street markup 67% goes as low as 8% for fleets like Hertz.

Chairboy · « **Reply #9 on:** August 11, 2005, 09:46:02 AM »

'Employee Pricing' is still too much because of the depreciation body-slam.

New cars are for the rich and the financially misguided. After buying a $45,000 car, don't forget to continue your lotto ticket investment strategy!

In regards to lowering the prices, that'd be bad business. A century of sales experience shows that people are willing to pay a bundle for a new car, and you do your shareholders a disservice if you turn into a communist 'car sharing' company that 'just tries to cover costs'. Making money is good, and it generates good churn for the economy.

NEWSFLASH: Expect to continue paying as much for a new car as your parents paid for their house, there's no evidence of fiscal responsibility on the horizon.

ChickenHawk · « **Reply #10 on:** August 11, 2005, 11:14:37 AM »

I always buy my cars from private individuals. Some might think that's risky because the car doesn't come with a warrenty, but if you buy from a dealer, getting ripped off is a guarantee.

DoctorYO · « **Reply #11 on:** August 11, 2005, 12:49:54 PM »

How bout GM just build a better product.. it will sell itself....

Oh thats too easy..

Employee discount is a gimick to get you to the car dealer..

Though i did use it recently to bash another Import dealer over the head though so wtg GM....

DoctorYo

PS GM has recently been rated junk status if your interested in their stock.. FYI.... No correlation to its recent gimicks..

REP0MAN · « **Reply #12 on:** August 11, 2005, 12:52:54 PM »

just make sure you pay for it......

Gunslinger · « **Reply #13 on:** August 11, 2005, 02:50:07 PM »

Quote

Originally posted by DoctorYO
How bout GM just build a better product.. it will sell itself....

Oh thats too easy..

Employee discount is a gimick to get you to the car dealer..

Though i did use it recently to bash another Import dealer over the head though so wtg GM....

DoctorYo

PS GM has recently been rated junk status if your interested in their stock.. FYI.... No correlation to its recent gimicks..

but it's not just GM doing this most of the other "majors" are joining in as well

Wolf,

I replaced the engine in the jeep about 2 years ago. The tranny is still leaking and vibrating but it works. The jeep is just getting old and doesnt have A/C.

I'd like to get a rubicon, in fact I'd own one right now if my wife didn't get her car last spring. The jeep is paid for so thats that.

indy007 · « **Reply #14 on:** August 11, 2005, 05:13:53 PM »

Hmm, at Toyota stores it's $500 over invoice for new, $250 over invoice for used. However, you had better be able to look it up for yourself. Just last week watched one of the Make Ready people get taken for an extra $2k. Couldn't do anything about it, the salesman is a relative of the dealer principal.