I stumbled into this (full document after the jump) at the GM Heritage Center site, a letter from Oldsmobile to all its dealers clarifying the retail price discounts. They’re pretty healthy, compared to what one might expect nowadays, especially since the internet and so much transparency about invoice vs. MSRP pricing on cars. Today’s dealers live mainly on profits from service and used cars.
The base discount from list price was 21% for the mid0sized models, and 25% for all of the full-sized ones. 2% was held back, to be earned by the dealers based probably on various incentive plans and such.
Of course the real question is how close to MSRP buyers were paying back then. I know what it was in the case of my father: 100%. Haggling was just not his thing. And I suspect that was the case with a lot of other folks. One would hear of discounts, but how big and widespread they were was another story. Dealers made the bulk of their profit on new car sales, and most fought hard to not discount too much. At least not until the economy started tanking… Does anyone know what kind of discounts were common?
NADA, the dealer’s association, recently released their annual report on dealer’s finances. Total net pre-tax profits held steady at 2.2%, a very modest rate. So much for “stealerships”. It averaged to a bit over a million dollars per dealer. Gross profits from new car sales, as a percentage of selling price, averaged 3.42%, or $1,144 per car. Used car sales gross profits, as a% of sales price, were 12.23, or $2,372 per car sold.
According to an analysis at autonews.com, net profit for dealer’s service departments were nine time higher than their new car departments, and five time higher than their used car departments.
Well at least W.J. Buxton was “Very Truly Yours”.
I can’t imagine seeing that in business correspondence today. Everyone is far too uptight for anything beyond “sincerely.”
I think if Mr. Buxton pulled that stunt today, he’d be walking out the front doors in handcuffs charged with sexual harassment or violating someone’s safe space.
david, stahp. false equivalency. you’re undermining gender equality. how is it fair a woman still gets paid less than a man?
Hmm. Trolling or sarcasm? (I never mentioned gender).
And you know this how…?
It must differ throughout the country, I’m a lawyer and every firm I’ve worked at signs formal letters “Very truly yours” over the lawyer’s full name signed and printed. The only exception was my family’s firm, where the senior partner signed letters to close, longtime clients, “Best personal regards” and would sign only his first name, though his full name still was printed. But law’s a conservative profession…we still send letters, for one.
Orrin’s description is also still used in banking. I also liked the W.J. this allowed keeping one’s Christian name for one’s friends, not mere business associates. It would be hard to get away with that now.
The lawyer’s that handled mom’s estate used “very truly yours” on everything (I just looked). I can’t tell much about the signature, but probably was whole name.
My boss used to cross out the formal Dear Dr. Whoever and write their first name in. I thought it made the secretary look bad.
I will affirm Orrin as to my own experience with formal letters from the law firms where I have practiced.
That 2% was called dealer hold back. All domestic manufacturers did it. It too was a profit boost at year end. Still do. Even when a dealer is screaming about getting a car at invoice price, they still make profit from dealer hold back. Of course today I have no clue what the percentages are.
The hold back for GM is 3%. However, unless the dealers pay cash up front for their inventory, this 3% covers interest charges to some degree (or not). My CTS was new, but had been sitting around for a year before I bought it. I haggled over the price too.
From the dealer’s perspective, the worst kind of customer:
1. Buy new, in cash, with pre-negotiated multi-dealer comparison shopped Internet pricing (which often results in a non-local dealer)
2. Keep the car a long time.
3. Never go back for service (DIY routine maintenance of a reliable make).
Or in my case, never buy a new car again. Last new one I bought was back in 92. Their out of my price capability now. Plus I simply don’t like em. I never buy used vehicles from dealers anymore either.
In your case, you are not a customer, so can’t be the “worst kind of customer” 🙂
Yup, I’ll give ya that.
The worst kind of customer is the invisible one.
+1…new cars just aren’t very lust inspiring, except for a certain few which are priced so high that it kind of negates the interest…and why pay somebody else profit for a used car which you can buy from the owner? the value of the limited warranty is less than the extra profit you pay….
My CTS goes to the dealer for service, which was included in the list price until the warranty expires.
You described me. 🙂
+1. I only bought one brand new vehicle, my truck in 2004. I got it for what I wanted, but the month long fight for my price (worked at the dealership) is something I won’t go through again. I doubt I will buy brand new again, and anything used will probably be private party. My dealership visits nowadays are limited to safety recalls(such as airbag inflator’s) outstanding on the used cars I buy.
Forgot that I do get $12.95 oil change and inspection coupon once a year for my Titan, and do bring it to the dealership I bought it from (one mile away) for that. Last year they had a brake flush special and I had them do that, did the needed coolant change, air filter and AC microfilter at home. This year got a 15% discount coupon for Nissan factory battery, and it’s 12 year old original is starting to crank a little slow, so will be replaced this month with an original from the dealership.
That probably describes a big chunk of Corolla/Camry/Prius buyers.
Yep, that’s me.
Although the only time I go to the dealer for service is for warranty-related work, factory recalls, or when the independent shop can’t handle a specialty repair (usually computer-related).
I tend to keep my cars for 10-12 years, make monthly “payments” to myself in order to save up and pay cash for the next car.
Agreed, NEVER go to the dealer for anything but warranty work, and hope that you don’t have to do that. I managed once with a 2000 Dodge Ram 1500, I drove out of the dealer and never went back.
No kidding dealer profit on cars today is extremely small. And at least at my dealer, salesperson’s percentage of the commission is only 20%, which could be as little as a few hundred bucks. The real profit is made in selling add-ons during financing such as glass-coat, tire and wheel protection, etc.
Yup. Around here every new car has “fitted floor mats” for $175 as a dealer add on. I almost got into a fist fight with a salesman once when I picked em up and handed them to him saying ” I don’t need these”. He puffed up and got in my face. And so I got right into his as well.
And to listen to some people in these forums, you’d think the dealer is gouging $10k per car out of them. Bottom line, some people aren’t happy unless the dealer loses money on their deal. As if that’s going to happen.
I traded my ATS for the CTS. They sold the ATS within a month (less I think) for at least the price that I got for it (and most likely more). Cadillac had good incentives on the CTS, which I bought at the end of the model year. The CTS was a year old at the time, so the interest on it would have added up, but they should have been happy to see it go. They did not get any 2015’s in as inventory, and the 2016’s have been lower end models (Luxury and performance trim levels). I think they are being a lot more careful about what Cadillac’s they stock.
Here they are Syke, A while ago my sister was looking for a replacement for her Camry, my BIL offered her a XR6 Falcon for 21K retail was 43K but he could get one at cost, trouble was my sis drove one, hated it and bought a Vectra it got totalled so then finally accepted a Mazda 6 2.5 sport at mates rates she still has it and loves it.
That’s probably a throwback to the days when dealers were reaping huge profits from new car sales, like this document shows. Also, treat the customer like trash and it comes back to bite you.
Gotta sell that Trucoat…
Exactly!!
Reminds me of the last time my wife bought a new car, back in ’00. The dealer brought in two attractive girls to try and sell the paint protection, rust protection and seat fabric protection. They tried really hard – until I drew their attention to our 11-year-old trade-in (same make), which had none of the above, and still looked showroom.
Exactly – my potential trades (I end up giving them to my kids) usually look pretty good after 10 or more years and I never buy any of that stuff. I live in salt and snow country, but keep my vehicles clean and waxed.
$150 for nitrogen-filled tires. Yes, really. That same dealership applied tint to the windows of every car they stocked as soon as they came off the truck and proceeded to charge the customer $300 for it.
A Cadillac CTS MSRP of $66,175 has an invoice (KBB) of $61,911. This does not include the 3% hold back. If the salesperson can bamboozle the customer into list price, the markup could be $6200+ .
…which is just under 10%, which would then represent a mark up less than one third of the general retail industry margin. Percentage wise, its only fair….
My memory is a bit cloudy as dad would talk trade-ins and deals with me any time I asked, but never really went heavily into the dollars and cents of each deal (then again, we’re talking a 12-13 year old, my mind wasn’t quite working on that wavelength yet). I don’t remember dad talking much about discounting, if there was any dickering around it was on the value of a trade-in. There would be end of year sales where prices would be dropped to clear out remaining stock, but otherwise, I remember the sticker as being the word of God. And you didn’t have all that back room finance crap to go thru.
Of course, back then your talking 12-24 payments, maybe 36, and you had to put a pretty good nut down on the car to even get financing.
Yes, if there is a trade-in, they the dealer is talking about the difference, mainly how much is your trade-in worth against the list price. Incentives are added in as cash.
I tried selling some of my cars, but never got anywhere with that except the Corvettes. Both Corvettes took a bit of time, but I had more than one interested guy on the 86.
Luxury cars always had lotsa profit. In 79 the price spread between msrp and dealer cost on my Lincoln was almost $3000. A Fairmont, about $900. When I get home tommorow I’ll post a confidential price list I got off ebay last month that shows the spread on a 70 Maverick.
1967 prices:
Falcon $2167 list, $1762 invoice.
Lincoln $5795 list, $4406 invoice.
Thunderbird $4603, $3560
Ford $2496, $1921 (custom sedan 6)
A basic 1967 Oldsmobile 98 sedan $4009 list, $3077 invoice. A 2% hold back would make the dealer cost right at $3000. Shipping was not included in any of these prices.
Predatorial relationships abound in the car industry between assemblers & suppliers, dealers & assemblers, and dealers & buyers.
Car dealers must hate us: we pay cash, do our homework, own for a long time, and walk out if we don’t like it.
According to “The Machine that Changed the World,” Japanese practices have been very different & not just between factory & suppliers, though perhaps it’s changed since Japan’s financial crash. For example, salesmen keep tabs on the local population of current & potential customers, probably to a degree intolerable to Americans. Is the family having a baby? Time to start reminding them of family car offerings.
My sister bought a 74 Capri that was near new from a Lincoln – Mercury dealership. Every few years they would send her a letter reminding her that they would appreciate the chance to sell her another new car.
They weren’t pushy about it, and I have often thought it was a practice other dealerships should have emulated.
When I bought my 76 Pinto and 2 years later wanted to trade it for a Zephyr 2 door, the salesman/owner of the dealership told me it had only been 2 years, I should wait another year or two before trading in the Pinto.
My mother in law in Minnesota drives a Fiesta, and got a letter last year from the dealer, suggesting that there was high demand for used Fiestas, and so she should bring it in and see what a good deal they could give her as a trade-in.
I used to get those when I was driving Civics. Now that I recently registered a “new” car (a 2009 P71 Crown Victoria) I get tons of letters from folks wanting to sell me an extended warranty.
Co – incidentally, I want to trade my CV at some point for a new Fiesta. I had a 1980 Fiesta and want a new one, but in this area, with 5 Ford dealers, there’s only 1 Fiesta with a manual transmission that isn’t an ST.
I get those all the damn time from the Kia dealership where we bought the car, and also from local Kia dealerships. High Demand for Forte Koups! Top dollar paid!
No there’s not. There is never high demand for coupes of any kind except for maybe when the model is brand new. They just want the chance to get you in the door, give you a lousy trade-in value, and get you into a new model.
I’d like to know more about your 76 Pinto. I had one I bought from the original owner for $400 in 12/98. Drove it until a wiring fire took it out in 10/05. I still miss that car. What were they like new? Mine was stone reliable in spite of its age. Still had its original muffler for instance. Mine was the wagon. Pretty well optioned out. Had AC, tint, protection group ( which included the deluxe bumper group), light group, AM radio, convenience group ( which included interval wipers), roof rack ( without air deflector), and power steering. He had also had dealer installed cruise control put on. Bet not too many people can say they had cruise on a Pinto since it was not a RPO option. I’ll post some pics of it when I get home. Oh yeah, it was the 2.3/4-speed.
Heres my 76 Pinto Marti Report.
First Pic from 02.
And other pics.
These earlier, chromed steel big bumper cars look much better than the later aluminum bumper version.
Agreed.
Wow…today I was in a meeting, one block away from the building that used to house the dealership where your car was originally delivered, and I often get the oil changed in both of my Fords at the successor dealership (Springdale Ford, which is part of the Lewis group).
Haven’t heard of Bobby Hopper Ford in years. As is the case just about everywhere in the US, most of the dealerships in NW Arkansas are now owned by a large, regional “family” of dealerships.
And by the way, the I-49 tunnel between I-40 and Fayettteville is named for Bobby Hopper, who later went on to serve as a state highway commissioner.
That’s cool as hell buzzdog!
1968 over here you still went on a waiting list for a new car, my Dad had a brand new 68 HK Holden kingswood wagon it got shunted in the back and severely damaged still mobile however and with some red plastic over the rear lights passed a WOF, it took almost a year to acquire the parts to repair it, once repaired it was worth much more than purchase price so it got sold and another new wagon appeared in the driveway a 69 HT, appart from the colour, upholstery pattern, badge placement it was hard to see any difference but it had voided bush suspension for a better ride according to Dad, found out for myself later in life HKs with metal bushed suspension handle better and ride ok anyway.
60% and 12 payments on passenger cars was the law then over here, commercials had 36 month terms which led to some ingenuity on the part of dealers with certain models and why we have Viva and Avenger vans when the UK parent companies never produced such cars. Haggling the sticker price? yeah nar the next guy in the queue has cash and willing to lay it down.
Forgive my ignorance, but why were cars in such short supply?
Import quotas imposed by our government, it began after WW2 to restrict the amount of money flowing out of the country.
When I was selling Datsuns in 1974 the markup on basic cars was approx. $200 – $100 margin in radio, so every car had a radio.
“Today’s dealers live mainly on profits from service and used cars.”
Is that really true? I’ve lived in Memphis, Tn and now Jacksonville, Florida and in both cities dealers charge “documentation fees” on all car/truck sales….new and used. I’ve seen “documentation fees” as LOW as only $200 and as high as $900, but I’m guessing that really high end dealerships charge over $1,000 if the USED car dealership I visited about a year ago that charged $800 is any indication.
(The part that ticks me off about this fee is that it’s not advertised, and can be as little or as much as a dealership desires….there’s no laws to regulate it.)
Add to that, dealers are now “asking” customers to buy into “market-based pricing”. If you aren’t familiar with that, the dealership charges a non-negotiable price that they say they arrived at after convassing their competition’s prices.
My dealer has not charged for paperwork. Some dealers here do I think. $50 would not be unreasonable, otherwise walk out, unless of course the deal was way under invoice.
In California the doc fees are set to a maximum by State law. Of course all dealers do charge that maximum. In general, when I started buying or shopping new cars, in the early ’80’s, it seems all dealers here posted additional dealer markup. So any haggling was merely to get back closer to list. We paid below list for our ’93 Corolla, but only because it was a wagon with stick shift and no AC, in Novemebr after the ’94’s were already on the lot. First car I felt I could really pay an invoice-based price was our 2001 VW, walking in with Internet pricing info.
Doc fees are limited to $80 in California, due to past abuses by dealers giving a lowball headline price then slapping on ridiculous fees.
doc fee of $495, if I remember correctly, on the last car I purchased (buyout of a lease). I protested but was told it was non-negotiable, and it had been a good enough car that I wasn’t going to walk away over $500. But it is a ridiculous amount for a fee that they charge just because they can. Regulation is sorely needed, I think.
Local (defunct) Ford dealer was trying to clear out some back row specials around 1999. One was a very clean 76 Granada 2-dr. Advertised price – $50.00! Being a somewhat poor teenager, I had to check it out. Turns out there was a $150.00 Doc fee. Considering the price of the car and the fact no title is required for a car that age here in NH, I found that absurd. They held firm on that fee however, and lost the sale. VERY shortly after that I found it crushed flat in a nearby salvage yard.
Oh hell man, a 76 Granada is worth $200. You shoulda grabbed it. I’d have doubled your money for it.
My first ever new car, a ’69 Nova, listed for $2,500 and with the help of my dad I got a $250 discount off the sticker price. 10% was pretty standard at the time and it seemed this is what you could usually expect from the new car dealers. Of course end of the year leftovers would get you more of a discount and some hot models had none at all. For many years Hondas and Toyotas sold at full sticker, although they now discount. Strictly a supply and demand affair it seems.
My last new car was a 2011 Acura MDX that listed for $47,000. Got $4,700 off the sticker, ironically the same 10% that I received 42 years earlier.
I guess the profit getting squeezed out of new car sales is just like the profit getting squeezed out of so many other retail businesses today. The days of a small town dealer making a living retailing 20 or 30 new cars a year is long gone.
That spread is astonishing. It really speaks to the commodification of the car as a discretionary purchase item – of course different financing structures comes into play as well but the tired but true trope of the car as appliance is borne out by this shift in margin.
I recall working for a Holden dealer around 10 years ago, all the sales staff could talk about was finding Mazda3 models for the second hand lot. As soon as one landed it was sold, lower sticker than new but pretty much whatever margin the dealership wanted.
The two discounts reveal a rational pattern. The dealer expected to make more profit on the models bought by older customers, and less profit on younger customers. In other words, he sacrificed a little to sell Your Son’s First Oldsmobile, and trusted Your Father’s Tenth Oldsmobile to be loyal.
One thing I don’t think I’ve seen mentioned here as a profit center is the extended warranty. When I last bought a new vehicle (Ford F-150) in the spring of 2013, I was put over a torture rack (almost literally) in the warranty sales department. I don’t buy new vehicles very often, and my wife was with me, so I had a pretty difficult time putting a stop to it.
He started the warranty at around $4,000 for some forgotten term of years and up to 100,000 miles. The terms didn’t change, but the cost dropped by over 50% to under $2,000 – in other words he was initially pitching me over $2,000 in pure dealer profit.
He was selling a third party warranty. When I looked up the company later, its reputation was kinda crappy at best. Suspecting that, part of my no thank you was that third party warranties usually have a poor reputation. The salesman jumped right in and said the dealer itself would back it if there was a problem. Not being a complete idiot, I pointed out the minor problem that he couldn’t seem to put that in writing.
Later, I also learned that Ford offers an Extended Service Plan (ESP) that the dealer never mentioned. It’s right in the owner’s manual that came with my truck. Looking it up, it seems Ford backs it about as well as they do their 3/36 new car bumper to bumper warranty. I was pretty satisfied with how Ford handled standard claims on my last two new Fords, so I definitely would have been much more willing to consider ESP. Obviously, the dealer didn’t see enough profit in it to bother.
The odd thing about most dealers in my area is that they do a poor job of marketing accessories that a person might actually want. I bought about $1,500 in goodies for my truck: heavy duty rubber floor mats, spray in bed liner, cushioned bed floor mat and a tonneau cover along with some spray protectant to keep the cover black (works pretty good on all the black plastic on my truck).
Only the mats came from the dealer – they have a nifty embossed F-150 logo. The dealer had to special order them. Everything else was aftermarket.
Other than the crappy warranty, the only other thing the dealer offered was a hard sell on under coating. I passed up under coating on my 2002 Dodge Durango. I still have it, and even in rust country I don’t have rust problems. Why the heck would I buy undercoating with new vehicles generally performing well in this area?
Dealers do a lousy job of paying attention to what customers actually want.
In the Los Angeles area, hard sell is on alarm systems. It is of course pre-installed on every car in stock and it was even installed on a factory order Chevy before they called me to pick it up.
They start at $500 or more and if you balk, the F&I person picks up the negotiation. I think that is because F&I takes most of the commission on add-ons, especially extended warranties. I wouldnt pay a dime for the alarm, but tossed them a bone and GMAC financed instead of using my Credit Union. The terms were the same.
At Longo Toyota the story was different. I was writing a check, which I told the salesman in advance over the phone. There was no BS. F&I got me out quick because she was smart enough to not waste her time on someone like me and move on to the next prospect. The warranty offered was not factory, so I passed. Later, I bought the factory extended warranty from another Toyota dealer on the internet and it was 50% off.
Have you ever paid for service on a Cadillac at a dealer? “Stealership” still very much rings true in that regard. Dealer here in town charges a diagnostic fee…their flat rate in order to find out what’s wrong with the car. Last time I was there (maybe 2010 or 2011), it was about $100/hr and I’m sure it’s higher now. Then they charge book labor rate for the fix no matter what. So if the repair books at 4 hrs but it only takes them 2 to fix it, you’re still on the hook for $400 plus the hour or so for them to figure out what’s wrong.
My boss, about 16-17 years ago, had a ’92 or ’93 Deville. Same dealer, even back then, charged her $700 to replace 2 tranny cooler lines and change the fluid and filter. This same service at a competent non-dealer shop in 2016 is $250-300 at the most. I avoid dealers at all cost, shop the lowest price online when I need dealer parts and now do as much as I can myself. Paying for dealer service, in the words of “Half Baked,” is like “running backwards through a corn field.”
I have had the exact opposite experience at a local (large) Honda dealer. My daughter recently got a low-mile 98 Civic from a family member. The dealer was extremely reasonable for the dreaded Honda timing belt & water pump service. Then, when they goofed up and did not do the oil change and general inspection I asked for, they committed to doing a free oil change next time. Also, when the inspection revealed a failing idler pulley, they also replaced that – for free!
This has been a 180 degree spin from most of my experience in service departments of dealers for U.S. brands.
Similar to my recent dealer experiences as well. The Honda dealer was very competitive when my Pilot was due for the timing belt replacement. And, when I needed a new battery for the MDX last winter I first went to Sears, thinking I would get a Die Hard for a decent price. When the Sears guy told me he was totally booked that day, on a lark I went to the nearby Acura dealer. Not only was I waited on immediately, I got a factory Acura battery for less than the Die Hard. Also enjoyed my Café Latte and various other amenities in their nice lounge.
Dealers make most of their money now on service and they can no longer afford to be non-competitive with indifferent customer treatment. Most dealers now feature free shuttles, pick up, delivery, loaners and nice lounges, while also being price competitive. And when it comes time to sell, nothing impresses a prospective buyer than a folder full of dealer service records.
Funny that. Maybe it’s because my position in life, my financial status, and the realization that I can retire in the next three or four months has a lot to do with what dad made of his life running a Chevrolet dealership; but while I keep a fairly tight reign on my finances, I still prefer to have the dealership do my work. And, for obvious reasons (to rail against it would be at least a bit hypocritical), I don’t begrudge my local dealership from making a few bucks off of me.
Yeah, their hourly rate is more expensive than the non-dealer shop. For starters, take a look at that roof over the head of each establishment. Obviously, the dealer has a lot more to pay for. And yes, when you find an excellent independent shop, you’re in hog heaven. I’ve often noticed that in those descriptions, nobody ever mentions all the shops that didn’t make the cut until they find that God’s Gift to Auto Repair.
Above all, I’ve been very blessed with an attitude that car ownership is something more than squeezing the nickle until the buffalo screams. I probably wouldn’t find car ownership pleasurable in the slightest if I insisted on spreadsheeting everything. I’ll save that attitude towards my general income and home ownership. Cars are pleasure for me, even if I drive is awfully damned mundane.
No doubt, my dealings with our current Kia dealer are a bit more expensive than if I found some independent shop. However, I do factor in that they customer service they give the wife and me is at a level that I haven’t seen since I quit driving BMW’s and dealing with Richmond BMW (a very good outfit, by the way), and there’s the added advantage that the dealership is located 1/2 mile from my place of employment, making service calls incredibly easy. If it’s sunny, I throw one of my folding bicycles in the vehicle. If it’s a rainy day, the dealership gives me a ride to work, and will pick me up when the car is done.
Do it yourself? Sorry, I’m an excellent bicycle mechanic. Beyond that, I factor in my limitations and pay someone else to do it.
The dealer is not necessarily THE ENEMY. You just avoid the ones who operate on that attitude.
I agree with you about dealer service on all points made.
I’d add that while I’ve had some opportunities with good independent shops, the dealers have the best parts access, have specific factory training, and have typically seen the same issues on the same cars many times – you can’t beat experience like that.
The result is that I usually get the correct diagnosis and repair on the first shot. I find that valuable.
Another bonus with dealers is that they have access to manufacturer Technical Service Bulletins. My recently out of warranty F-150 starting shifting oddly on the 1-2 shift, and the dealer flashed the computer at no charge – problem solved. The only in warranty problem I had with my truck was power folding mirrors that started occasionally operating erratically when wet. It was hard to duplicate problem, the dealer flashed some module and problem solved. I don’t see an independent shop being capable of this.
My wife recently drove our 2005 Ford Freestyle several hundred miles away from home, and the water pump gave out. The Denver area Ford dealer got her in and out on the same day on a Saturday. The disruption to her trip was minimal and the warranty is transferable to our local dealership.
On the other hand, I entrusted the same car from new to a local chain of tire stores for its first three years of oil changes. The power steering started groaning in hot weather. The dealer diagnosed it has having been topped off with the wrong fluid, flushed out the system and all was well. I did talk to the tire store manager, and he didn’t care.
Since then, I drive the few extra miles and get my oil changes at the dealership. With an online coupon, its usually one of the best deals I can find.
I’ve got 3 older cars that range from 24 to 28 years in age. Dealers are simply out of the question when owning cars this old not only from an affordability standpoint but mainly from a parts standpoint. No shop carries a Twilight Sentinel control module for a ’92 Fleetwood anymore but I was able to find an NOS one on eBay and replaced it myself. I checked with 2 Nissan dealers after I got my ’87 Maxima wagon (the 4th Maxi I’ve owned over the years) and both were quoting about a grand for timing belt and water pump…about half of what the car cost me to begin with. Even the independent shop I normally use was around $7-800. Genuine Nissan parts were only about $250 (new tensioner, WP, belt and cam seals) by comparison so I used my FSM and did it myself.
I do think there’s a time and a place for a dealer and with a new or newer car, that’s an appropriate option…those receipts do look good to a buyer down the line. I’ve used them in the past when I’ve had newer cars so I’m not fully against them either. But whether or not I use them in the future will always depend on the car itself and if I trust the dealer.
Syke, which Kia dealership do you take yours to, if you don’t mind my asking? (If you don’t want to call them out by name, just mention which area/suburb it’s in). I’ve visited two out of the three in the Richmond metro area, but only once for small things each time, so I haven’t really had enough experience to make one my go-to service location.
For oil changes and state inspections I tend to use Richmond Ford for both cars because their service department stays open until 8 PM. It’s on my way home from work, it’s done while I wait, and their prices are reasonable. But for anything model-specific (like the 60K service which is starting to loom on the horizon) it goes back to an actual Kia service deparment.
Pearson Kia on West Broad, just west of the traffic light at Parham. We’ve been dealing with them since Maggie got her somewhat riced-out Kia Spectra (they had no problems dealing with a mildly modified car), and I was impressed with the straightforward behavior towards her. None of the, “let’s see what we can take this chick for” that I’ve seen at too many garages. Last year when I picked up the Sedona van, I continued to work with them and have been really happy with the results.
Big plus was the day Maggie’s car’s radiator sprung a leak. Given the age and value of the car, they immediately suggested a rebuilt unit rather than new, at something like 1/3rd of the cost.
Late this year, we’re talking new car (replacing Maggie’s) and since we’ve been really happy with the Kias we have, they’re definitely on the list.
Thanks for the info! Being that my sample size of a single visit was low, it’s always good to have firsthand recommendations. We may also be in the market for something new in the next year or so, as something with 4 doors would be more convenient than the Koup. My wife really likes the looks of the new 2017 Sportage so that will probably start at #1 on the list of contenders, given the good experience we’ve had with the current Forte.
“[S]queezing the nickle [sic] until the buffalo screams…”
I’ve never heard that one. A hearty chuckle was had over here. I’m definitely stealing that line.
I’ll check with my dad, but I think any discounts were well under 10%. I do recall him talking with a friend who ran a men’s store about clergymen expecting a 10% discount off the bat for both cars and suits.
Even then, back in the 50s, service, parts and used car sales carried higher margins than new car sales. As noted above, cars have become more commoditized and pricing more transparent, but even back then, new cars were the most commoditized thing a dealer sold. As my dad told me, his biggest competitors weren’t the Ford and Chevy dealers in town, they were the seven other Plymouth franchises within a 15-mile radius.
My dad’s biggest competitor was Marhefka Chevrolet in Windber, PA (the next town over from Johnstown), not Bingler Ford in Johnstown (or Leitenberger’s Plymouth, for that matter).
Yeah, dad didn’t care for clergymen either, and our own parish priest was the worst. However, his particular hatred was schoolteachers who were THE cheapest, most money-grubbing, pound-out-the-negotiations-past-the-point-of-exhaustion to save an addition $5.00. And it really didn’t help when one of his worst teacher customers ended up as my 6th grade teacher.
That was back in the days when being a teacher was an almost criminally underpaid but incredibly honorable profession. No, I’m not overstating that. Back in the 50’s and earlier, being a teacher meant you were SOMEBODY. Who was broke most of the time. Nowadays, its just a decently paid union job.
Here’s the Maverick Price List.
And the second page.
These early ones, being simple machines, seem to lack a few options like hd suspensions and floor shift. No power steering was pretty glaring. Wonder what the blazer striped seat looked like? Under $2000 is quite a value for a real car though.
Here’s a pic from the brochure.
Spectacular, well worth the $52. I also love how they lit the edge of the dash to make it so futuristic.
They got power steering in December 69 when the 250 was added to the powertrain. First mention I have of it is in a Dec 19, 1969 price list.
So many of these early compacts and subcompacts went to young women, heading into the workforce after education, that I would have offered it from the get go. The imports were not yet offering it, and power steering could have been a deciding factor for more than a few buyers.
$80 diff between the auto and the unicorn semi-auto. Seems a lot for a valve body.
Also, I’m surprised that heater delete was still offered, as it was always my understanding
that it wasn’t possible after ’67 due to federal safety standards, since a defroster is a safety item, and it’s pretty hard to have one without a heater core.
I may be wrong, but I think the semi auto was a misprint. All references to it disappear after the August 69 sales brochure and owners manual. Heater delete was usually for Hawaii bound cars.
I think Paul did establish that the Semi-Automatic actually got offered on that Maverick (however briefly)–though I sure never saw one: https://www.curbsideclassic.com/blog/fords-torque-drive-copy-cat-1970-maverick-semi-automatic-transmission-is-there-one-left-in-the-world/
The other reason discounting probably wasn’t that deep back in the 50s – if not the 60s – is that many people still ordered their cars versus buying off the lot. So dealers faced less floor planning pressure to shift inventory, and buyers had less leverage with which to make a good deal.
Also keep in mind that, during those pre-computer, much less pre-Internet, days the average customer had no idea how the franchise dealership model worked. Yeah, back in mid-1965 I understood floor planning, holdback, factory incentives, etc. I grew up in a dealership, and my knowledge was not readily available.
Plus, until 1958, the customer didn’t even know what the price of the car was when they walked into the showroom floor. Yeah, the print ads may have specified a base price, but that was ‘suggested’ and the individual dealer decided how much he wanted for that car. And it took a federal law to put a stop to that. Plus, as you said, most people before the 80’s ordered their cars. My ’82 Dodge Omni was the first time I’d bought a car straight off the dealer lot, and I don’t think I’ve special ordered a car since.
We can probably credit the Japanese for that one. Toyota lots filled with cars all ready to go had a lot to do with changing the American buyer’s attitude.
Pricing is certainly more transparent for the average buyer today, but I recall that by the ’70s that books were available on how to buy cars and it seems like Consumer Reports would write lengthy treatises on how car pricing worked.
Comparing advertised pricing and holding dealers to it through a comparison process would also give the consumer willing to study a little some advantage.
Yup, I’ve got a bunch of those books from the 70’s as well as factory price lists. Ford had books called “car buying made easier” and “armchair estimator” that gave msrp and what options could be bought and what those options included.
From what older guys have told me window stickers were removed from cars and customers, in the 50’s and 60’s, didn’t know the actual retail price–one guy told me he had no ideal you could custom order a car–the dealers pushed the ones on the lot.
That last part really hasn’t changed.
In my trade The Funeral Rule of 1984 had the same effect on funeral homes that the Monroney legislation had on automobiles…have to have an itemized list of goods and services prices on a standardized-format General Price List. Prior to that, the funeral director had the ability to charge whatever he thought a family could pay…gotta love consumer protection legislation.
This is first time I accompanied my dad when he was buying a new car, in 1965. The dealer came down almost instantly from about $3700 retail to $3200 on an Impala wagon on the lot with normal options, about a 14% discount. He never dealer financed, and there was no undercoating, “Trucoat”, etc. I dont recall the trade-in on the Rambler, but I think that is where the dealer made a profit.
In my experience of dealer buying, I’d go for a manufacturer’s approved scheme for nearly new (less than 1 year old) cars, turned back from lease and manufacturer pool fleets.
My current Fiesta is spec’ed exactly the way I wanted (engine, colour, options, including unusual ones of extra airbags and parking radar), was 8 months old, 2200 miles and less than 70% of list price. Ford will source one for you through the national system. New can’t get close. Previous Focuses (Foci?) were similar.
The dealer told me outright that the only reason they had for selling new Fords was to keep the branding and recognition for used cars and servicing (not warranty repairs – they just don’t happen nowadays).
I learned from my grandfather, who, like Paul’s dad, paid full list (He owned a small store so perhaps it was solidarity) NOT to pay list. My rule of thumb in the 60s, 70s was 10% off on small cars, up to 20% off on large luxury cars. Trucks much less so.
Last new car I bought was in ’88. Toyota truck. List was $10,200. I offered $7400. After several weeks and several phone calls, they accepted my offer. It was a cab and chassis and they couldn’t sell it. That’s 27% off.
The truck is still my daily driver.
My first new vehicle was a truck also. A 87 F150. It was a plain XL trim, which I preferred since I don’t want carpet in a truck, and msrp’d at $9995. 300/granny 4 speed, AC, western mirrors. Digital display 2 (!) speaker AM radio, cruise, and dual tanks. Back then those Ford’s didn’t come with rear bumpers, but the salesman had one at home in his backyard he sold me for $50. Big trailer towing bumper. Best interest rate my 20 yo self could get was 9.9% and my payments were $265 month for 60 months. Worked three minimum wage jobs to pay for it, but after two years it was just too much. My dad used it and his 81 F100 on trade for the POS 88 Suburban I’ve talked about on here before. I’ll post some pics here tommorow.
One funny story came out of it. I got my first paid vacation in June 87. On the Friday I was leaving town, I turned onto a street and it died. Could not get it to restart. So I called the Ford house, they sent a wrecker and brought it back. This was about an hour before the dealership closed and the mechanics weren’t really doing anything so they pushed it into the service area and about 5 of em clustered around the engine bay. One of em said “let’s check the fuel pressure”. So they went to get the gauge. Ford had put the Schrader valve way in the back and the mechanics were having some trouble getting the gauge threaded on. Finally one of them said ” ok, try it”. When I turned the key, in the airspace between the hood and cowl, all I saw was a sheet of flame and 5 mechanics disappeared faster than if you had edited them out of a film. One frame they’re there, next they’re gone! So there I am, abandoned….sitting in my 87 Ford…, which is on fire…in the service department…thinking “crap, now I’m going to lose my vacation because I don’t have a ride!”. But in a couple of seconds they came back with fire extinguisher’s and put it out. One of the smartasses said ” yup, your fuel pressures ok”. Only damage done was a melted vacuum hose (which they replaced) and some carbon on the underside of the hood. For some reason we tried it again, without the pressure gauge, and it started right up. And for the next year and a half I owned it, it never broke down again.