How are some of these dealerships even keeping the lights on?

[mrsilv04]

Yesterday, I visited a rural Indiana Chevy dealer who had 2 (two) new Chevys. And neither of those vehicles was a vehicle that just anyone would buy. One was a 2500 HD LTZ pickup... crew cab, long box, diesel.... $72,500 sticker The other was a 6.2 liter Camaro... $55,000 sticker. They'll need the right person to sell either one of those. In addition, they had only 4 used vehicles.

Last time I was by here (pre-pandemic), their entire lot was full of vehicles. A lot that is one block deep by a half block wide.

I'm not sure how a number of these dealers are even keeping the lights on at this point. And I realize that this is happening everywhere.

 

[dishdude]

They're making a lot more per transaction!

 

[Tdbo]

Basically sticker or above.
I am glad that I bought our Pilot last year.
Last time I looked, the dealer we purchased from had NONE.
However, one could buy a Accord EX for $400.00 off sticker.
Not a good time to buy (unless one absolutely has to.)

 

[atikovi]

Parts and service.

 

[Kestas]

I believe they make more money from warranty repair than from car sales.

 

[tmorris1]

I believe they make more money from warranty repair than from car sales.

There sure seems to be a lot of that on new vehicles. It has to cost the manufacturers a lot of money with all these expensive warranty repairs. They need to build them right to begin with.

 

[CKN]

There sure seems to be a lot of that on new vehicles. It has to cost the manufacturers a lot of money with all these expensive warranty repairs. They need to build them right to begin with.

Ford hasn't had a successful COMPLETLEY NEW vehicle launch for years. Each one -from the Explorer to the Bronco has had serious issues right off the assembly line.

 

[Speedy3861]

My Honda dealer has 2 cars on the lot, everything on order is already sold.

 

[atikovi]

Ford hasn't had a successful COMPLETLEY NEW vehicle launch for years.

What do you expect with the demise of newspapers, magazines and commercial TV. How are some people supposed to even know a new model even exists?

 

[GMFan]

I imagine they’re keeping the lights on by selling every car they get from the factory above sticker before it even arrives on the truck. Also dealer service, repairs, warranty work, etc.

 

[tmorris1]

What do you expect with the demise of newspapers, magazines and commercial TV. How are some people supposed to even know a new model even exists?

There is this new thing called the internet now. You can also read your newspaper, magazines, and watch commercials on it.

 

[tmorris1]

Ford hasn't had a successful COMPLETLEY NEW vehicle launch for years. Each one -from the Explorer to the Bronco has had serious issues right off the assembly line.

Even the F-150 which has been around for years. I have had an engine replaced and some other small things done to my 2019.

 

[bdcardinal]

Fixed ops (parts and service) keep the lights on and the doors open. Also more money is made profit wise on a used car than a new one. Ford warranty now pays us cost+90.89% which is usually higher than MSRP. We have cut back significantly on selling collision (newsflash thanks to insurance there is no/minimal profit for parts suppliers) and focus more on the back shop since that is where the majority of the net profit is made.

 

[atikovi]

There is this new thing called the internet now. You can also read your newspaper, magazines, and watch commercials on it.

Yes Capt. Obvious but unless you're specifically looking for a Ford you probably won't see a specific ad for one. Most people block or tune out ads. Few deliberately watch commercials. With a paper or magazine, most people go page by page so they can't miss an ad.

 

[Scuder]

When I was selling oil to dealerships, we had programs meant to help service departments generate traffic. In times of poor car sales out front, the business done out back can make the difference in staying open.

 

[tmorris1]

Yes Capt. Obvious but unless you're specifically looking for a Ford you probably won't see a specific ad for one. Most people block or tune out ads. Few deliberately watch commercials. With a paper or magazine, most people go page by page so they can't miss an ad.

That has nothing to do with the number of warranty claims though. If I am looking for a vehicle, I would research the manufacturer's websites that I was interested in to see what is available, read reviews, look at related forums, go talk to a dealer, and then make my decision.

 

[mightymousetech]

Yesterday, I visited a rural Indiana Chevy dealer who had 2 (two) new Chevys. And neither of those vehicles was a vehicle that just anyone would buy. One was a 2500 HD LTZ pickup... crew cab, long box, diesel.... $72,500 sticker The other was a 6.2 liter Camaro... $55,000 sticker. They'll need the right person to sell either one of those. In addition, they had only 4 used vehicles.

Last time I was by here (pre-pandemic), their entire lot was full of vehicles. A lot that is one block deep by a half block wide.

I'm not sure how a number of these dealers are even keeping the lights on at this point. And I realize that this is happening everywhere.

The service dept keeps the lights on and salaries paid. Car sales just give the service dept something to work on, and now people won’t be able to replace that vehicle that needs $10k in repairs. We are doing just fine.

 

[MNgopher]

Seems to be some misconception that sales of new cars is what makes dealerships money... Reality is that parts/service and used car sales are much more the profit centers day to day...

The new cars sales are important as they feed the other two parts, but it isn't the place where most dealers make their coin...

 

[PimTac]

What do you expect with the demise of newspapers, magazines and commercial TV. How are some people supposed to even know a new model even exists?

Lexus is going to announce the introduction of their LX600 on Wednesday. I saw that on the internet.

 

[atikovi]

Lexus is going to announce the introduction of their LX600 on Wednesday. I saw that on the internet.

Well, I'm on the internet pretty often and didn't see that. If they had an ad in the Washington Post I would have seen it unless it was in the sports section.