Vintage Ad: This Is Why Cars Aren’t Sold Like Frozen Peas – Or Are They?

I didn’t intend to jump in the fray with Daniel Stern’s comment about why cars aren’t sold like frozen peas, meaning the price is clearly marked and there’s no room for negotiation. But when I ran across this vintage ad last night, it brought home the fact that car prices are inherently elastic, due fluctuations in supply and demand. Hence discounting, or as is currently very common, markups above MSRP. These are the realities in such a dynamic market.

I’m sure Daniel knows this, and his ire is more targeted at the actual purchasing process. But the price of frozen peas aren’t exactly frozen either.

They’re going to vary quite considerably depending on whether one is buying a small package at Whole Foods or a big one at Costco. And of course the price of peas fluctuates with the market, just as cars do. It’s just a reflection of the free market we have adopted. Are you annoyed that you missed the sale on frozen peas?

Just a few years ago, trucks typically sold for some $10k less than MSRP. In the current supply-constrained market, they’re now often selling for $10k over MSRP.

The retailing of cars is changing, albeit slowly. And although Tesla claims to not ever give discounts, the list price of their cars fluctuates constantly, depending on demand and other factors. Prices for the Model 3 and Y have been raised seven(!) times since the beginning of the year. Everybody plays the game of supply and demand.

Not surprisingly, a bit of online comparison shopping, just like I would do if I were buying a car, shows that Walmart has the best deal on frozen peas: $1.00 per pound.

Speaking of cheap food, I was at Costco last winter, and 10 lb bags of Idaho potatoes were selling for $1.50. I thought it was a misprint on the sign. But no, they really were 15 cents a pound. I remember paying that much for them back in the 1970s.