Ordering vs buying off the lot

[64bawagon]

I keep hearing rumblings that the domestic auto makers are trying to move the customers to order their new vehicle vs selling stock units off the lot. The vast majority of vehicles I have bought new were ordered so that I got all the things I wanted and didnt pay for things I didnt (like wheel locks and pinstriping)
Although I dont see the wisdom of losing an impulse buy I do see where the lower inventory costs would appeal to dealers. I think the dealer purchase and delivery model has been forever changed.

 

[JustN89]

A dealer will almost always prefer to stock inventory on the lot and sell that. You are losing the impulse buy, which is a vast majority of car sales anyhow, but you're also losing the markup you get from getting unsold new inventory to which you can customize and sell as packages. Also, inventory is a great marketing tool. Especially on the used car side, but new cars can be great for marketing as well.

OEMs would prefer to go to orders because it's the best way to deal with supply shortage issues. They also would get out of dealer arrangements where they are required to supply XX number of each model to their dealer network, having to pay incentives to sell lower demand models, etc. It makes a lot of sense for them.

Customers will always be divided on this. They will overwhelmingly support the idea of being able to custom order their vehicle, but historically would balk at having to pay more for the car than what they could get on the lot. The customer always wants to eat their cake and have it, too. Nowadays, everyone is paying stupid prices for cars, so maybe the tides have changed, however. Watching people pay $30k for a Civic EX-L is insane, yet they're doing it.

 

[Leo99]

I keep hearing rumblings that the domestic auto makers are trying to move the customers to order their new vehicle vs selling stock units off the lot. The vast majority of vehicles I have bought new were ordered so that I got all the things I wanted and didnt pay for things I didnt (like wheel locks and pinstriping)
Although I dont see the wisdom of losing an impulse buy I do see where the lower inventory costs would appeal to dealers. I think the dealer purchase and delivery model has been forever changed.

I assume this is how it works in Europe and elsewhere. I've not seen many lots loaded with cars in my travels to Asia or Europe. Just a small showroom and a few cars on the lot. Unless they keep inventory out in the country somewhere.

 

[supton]

Saw an article about this "build to order" this morning. The article mentioned that this is actually quite common over in Europe, and that it didn't seem to work here (I already forgot all the details, short attention span).

I know there are those who just won't accept this: to them, they HAVE to knock something off the price in order to feel like they got any sort of a good deal. But we have seen a bit of a rise in the places where the price is what it is on the sticker, no negotiating. Will the tide turn? no idea.

 

[Danno]

The big catch is that in a lot of cases you can't order vehicles with the options you would want - manufacturers are restricting options such as, no pano roof, no advanced cruise, no heated seats.
I'm interested in a Canyon, heated seats are not available to order. Might be available for order Dec 2002.
At our dealership we have new vehicles with reduced options, and newer, lightly used vehicles with all the options.

 

[Propflux01]

Most of what I see on lots are the bare bones, or slightly above models. Then they add the "market and supply adjustment", and then you end up paying top of the line price, for a bottom line car. or, you can just go get really raped in the used car section, paying-over-new-priced for vehicles with 4/5 of its life already gone.

 

[mightymousetech]

Saw an article about this "build to order" this morning. The article mentioned that this is actually quite common over in Europe, and that it didn't seem to work here (I already forgot all the details, short attention span).

I know there are those who just won't accept this: to them, they HAVE to knock something off the price in order to feel like they got any sort of a good deal. But we have seen a bit of a rise in the places where the price is what it is on the sticker, no negotiating. Will the tide turn? no idea.

All BMWs are "build to order". They are either spec'd by the customer, or the dealership. The mothership assigns us allocations, to be built on specific days and times. Either a customer buys one of those allocations and builds it as they want, or the dealership builds it the way they want.

 

[demarpaint]

I order new cars, so I get exactly what I want. After having sold cars I'd rather not have my new car test driven by potential customers, moved several times by lot monkeys beating the s--t out of them while waiting to be sold, etc. I'm paying for a new car I want a new car.

 

[JustN89]

Most of what I see on lots are the bare bones, or slightly above models. Then they add the "market and supply adjustment", and then you end up paying top of the line price, for a bottom line car. or, you can just go get really raped in the used car section, paying-over-new-priced for vehicles with 4/5 of its life already gone.

Factory ordering is no guarantee to get around the "market adjustments" that dealerships are charging. So long as the OEMs allow it (and they currently do), many dealerships will attach a market adjustment charge on factory ordered vehicles as well. Doesn't mean all dealers do, but a lot of them currently are in this environment.

Also, that's a bit of a flawed generalization of dealership's inventory. Yes, there will be many base trims of each model on the lot, but you'll often have just as many upper trims of each model as well. For example, looking at Honda (which is easy because of their lower number of trim levels), Honda likes to see an inventory level that looks something like this- 33% LX, 33% EX-L, and the rest would be mixes of EX, Touring/Elite (if available), LX-S ,etc. It's the middle trims that many customers don't purchase. There could be lots of reasons for that, but salesmen are trained to sell value, and it's not hard to sell things like leather seats, heated seats, etc for only $2500 more (or better yet, $40ish/month). Customers generally know that they either want the bare bones models, or they know that they'll pay more for creature comforts and are easily persuaded to buy more creature comforts than they originally intended to.

 

[Job]

Aren’t the cars all ordered? Dealers order what they feel will sell. I doubt the big dealership showroom model is going away. I do like to browse the stock and look the product over. I guess a few samples would do. Since there is nothing stopping the mega dealer from ordering hundreds of cars I don’t think it will change soon. The car on the lot ready to go can be much better for the buyer, especially with no trade.

 

[DwightFrye]

I was very pleased to be able to order a new Jaguar and go right down the menu and order it exactly the way I wanted. I didn't mind waiting 3 months. The salesperson and dealership had to spend a minimum amount of time with me, they basically just transmitted the order that I configured on the Jaguar website to the factory and took my deposit.

The bad news was that there was no negotiating. Their position was that the price would be MSRP, however if there were any factory incentives at the time of delivery, they would be cheerfully applied. I got lucky and there was a 0% / 60 month financing deal or a $10,000 rebate for cash when I took delivery.

I wouldn't hesitate to buy another vehicle with that method. Especially since there was very little inventory to choose from within 1000 miles. On a new vehicle that I plan on owning for a long time, getting it exactly the way I wanted it outweighed getting a discount for compromising and buying a car off the lot.

 

[CKN]

Aren’t the cars all ordered? Dealers order what they feel will sell. I doubt the big dealership showroom model is going away. I do like to browse the stock and look the product over. I guess a few samples would do. Since there is nothing stopping the mega dealer from ordering hundreds of cars I don’t think it will change soon. The car on the lot ready to go can be much better for the buyer, especially with no trade.

Sometimes vehicles are shoved down the Dealer's throat by the manufacturer. Then the factory has to come up with incentives to move them. That's where the whole system is messed up. Stopped assembly lines are not good for the manufacturer-because many costs don't stop if production takes a halt.

 

[JustN89]

Aren’t the cars all ordered? Dealers order what they feel will sell. I doubt the big dealership showroom model is going away. I do like to browse the stock and look the product over. I guess a few samples would do. Since there is nothing stopping the mega dealer from ordering hundreds of cars I don’t think it will change soon. The car on the lot ready to go can be much better for the buyer, especially with no trade.

Varies from OEM to OEM. Many operate under a "wish list" type system where you tell your regional rep what you would like in the next month's shipment, and they fulfill it as they can. This wish list can include how much of each model, colors, trim levels, etc. Priority is assigned to dealerships based on volume, number of 5* reviews, how often the dealership hits manufacturer sales invectives, amongst other things. The higher priority your dealership is, the higher chance you have of getting your wish list fulfilled. Obviously, this isn't the only way to distribute inventory, but it's a common one across OEMs.

 

[wpod]

I buy off the lot . I have never orders a car and with a lot car you can take it for a long test drive to see how it feels. Drive with a buy.

 

[Chris Meutsch]

I would much rather order something vs. prowling a lot.
But either my 4Runner will outlive me, or I will outlive it. It's the last vehicle I will purchase.

 

[Kestas]

My pet peeve is when the manufacturer bundles optional equipment where the features have no relation to each other.

 

[chainblu]

I've sometimes wondered about ordering a new vehicle. Yes, you do get the exact vehicle you want, but wouldn't you also give up some (or all) haggling leverage?

 

[slacktide_bitog]

If I ever bought a new car, I'd order it exactly the way I want rather than buying off the lot. That's the biggest advantage of buying new.

 

[AZjeff]

Yes, you do get the exact vehicle you want, but wouldn't you also give up some (or all) haggling leverage?

Which is more important? Buying a vehicle right now that's close to what you want and haggling or buying a vehicle that's exactly what you want and maybe not getting quite the deal you might have on a lot vehicle, and having to wait for it to come in?

I've only ordered one vehicle, last year, and it was the only way to get the truck we wanted. Ordered 12/31/20 took delivery 5/26/21 after a couple of setbacks from GM that in other times might have made me walk. The trade in value in this crazy market might have been close to whatever deal I might have made in normal times so it didn't hurt too much and they didn't tack on "added dealer profit" or other dealer add-on crap.

 

[CKN]

Which is more important? Buying a vehicle right now that's close to what you want and haggling or buying a vehicle that's exactly what you want and maybe not getting quite the deal you might have on a lot vehicle, and having to wait for it to come in?

I've only ordered one vehicle, last year, and it was the only way to get the truck we wanted. Ordered 12/31/20 took delivery 5/26/21 after a couple of setbacks from GM that in other times might have made me walk. The trade in value in this crazy market might have been close to whatever deal I might have made in normal times so it didn't hurt too much and they didn't tack on "added dealer profit" or other dealer add-on crap.

There are no free items on the MSRP. Example- vehicle has a $1,500.00 sunroof. Sales man tells me he will discount the vehicle $1,500.00 (for the sunroof). Because the price of the vehicle was $1,500.00 higher I am still paying for it. Because I could have haggled $1,500.00 a vehicle without a sunroof. I don't buy options I don't want-unless there is no choice (and there often isn't a choice w/how option packages work).