Ordering vs buying off the lot

[mightymousetech]

You've got yourself in a bad spot. If you can't buy a new car any other way will you never buy another new car? Will you ruin your event of a lifetime if you do it again? Will you have 2 lifetime events?

Seriously I know someone who did that with a Volvo and had a great time. I doubt going to Flint Michigan to pick up our new truck would have been the same experience.

Guess my next new car will have to be a Porsche, or an i4.

 

[97prizm]

Another big issue is that depending on the manufacturer, sometimes they send batches of vehicles that won't sell in certain markets. When I worked at a Lexus dealership we had two base model IS200's. Now for some reason Lexus only offered them with an 8 speed automatic and rear wheel drive. If they designed it like alot of BMW'S with a 50/50 weigh balance it wouldn't be a huge problem. They sat for a year unmoved on the lot. A dealership in Florida called and wanted them. If Lexus had sent them to a market with demand the first time it would have made more sense.

 

[JustN89]

Another big issue is that depending on the manufacturer, sometimes they send batches of vehicles that won't sell in certain markets. When I worked at a Lexus dealership we had two base model IS200's. Now for some reason Lexus only offered them with an 8 speed automatic and rear wheel drive. If they designed it like alot of BMW'S with a 50/50 weigh balance it wouldn't be a huge problem. They sat for a year unmoved on the lot. A dealership in Florida called and wanted them. If Lexus had sent them to a market with demand the first time it would have made more sense.

There's a very high probability that those two vehicles were ordered by that dealerships New Car Sales Manager, or equivalent. As to why, well it could be for a number of reasons. Cheap, base model cars bring customers in. Dealerships like to have a handful of really cheap cars that they can advertise at low prices, bring people in, and then flip them to other units that have more amenities (ie: higher profit margin). Cheap, new cars are also great options for dealing with customers who have questionable credit scores and/or are upside in their current cars. It can sometimes be easier to get customers approved on newer cars that cost more over cheaper, used cars. Cheap new cars are great at that as well. Rambling aside, it may not have been Lexus just sending inventory to a dealership randomly. The cars most likely were requested by management.

 

[Job]

"Instead of a 75-day or more supply of vehicles, Ford is targeting a 50 days’ supply. To help manage this, Farley wants to move the company more to an order-based system instead of customers buying vehicles off a dealer lot. It will help lower discounts from the automaker and allow Ford to better manage its production, he said."

https://www.cnbc.com/2021/12/31/five-ways-2021-may-have-forever-changed-the-auto-industry.html

“Help lower discounts” (Farley talking to investors earlier in the year), is not the same as your interpretation, “ keep prices up”, and “virtually eliminating discounts.”
Not long agoToyota was saying not big on EV, now they say the opposite.
It is just talking, doesn’t mean much of anything until it happens. The next day they may say something else.

 

[ryster]

“Help lower discounts” (Farley talking to investors earlier in the year), is not the same as your interpretation, “ keep prices up”, and “virtually eliminating discounts.”
Not long agoToyota was saying not big on EV, now they say the opposite.
It is just talking, doesn’t mean much of anything until it happens. The next day they may say something else.

There have been numerous statements from various automakers about their plans to reduce and eliminate discounts moving forward after the "chip shortage" is resolved. Ford, GM, etc. I am not a search engine, you can seek them out and find them if you look hard enough.

Despite the reduced inventory, the automakers have rather enjoyed being able to sell vehicles at full price to maximize their profit margin. They intend to keep that going as long as possible.

All of these companies will say things to encourage their investors they are making forward progress. It's all about the stock price.

 

[JustN89]

Manufacturers can say what they'd like to, but it's the consumer that's going to dictate what happens if we ever come out of this.

Automakers are trying to predict what the future will hold, but no one really knows what the appetite for new cars will be once supply issues are corrected and the used car market begins its trend towards price correction. People may be driven back to the dealer to get new cars as prices come down, certainly. Or they may not be able to because they've spent the last 18 months purchasing cars way above normal market values and are now insurmountably upside down in their loan.

What's the easiest way for dealers to get a customer out of an upside down car loan? Rebates and incentives. Dealers and automakers alike will need them to help correct the damage that's been done in this insane market.

 

[Slow Car Sport Mode]

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.

Yep.

They get built to order and they go out.

Every build has different codes...

 

[Badgerstate]

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.

As someone who has been a Japanese car enthusiast for years, the concept of ordering a new vehicle is very alien to me. The Japanese manufacturers have always operated on the model of building their vehicles with popular option combinations and the dealer trying to find you the car you want if they dont have it on their lot.
Personally, as someone who tends to keep a vehicle until its worn out, I prefer the idea of ordering a new vehicle with the exact options that I want and in the exact color that I want, instead of hoping to find it on a dealer's lot. If Im going to spend the money, Id prefer to get exactly what I want and know that the vehicle was made especially for me.

 

[ammolab]

Sure, cars on the lot cost the dealer money… but your ordered vehicle costs them NOTHING in interest etc. They want to sell the lot car, but it already has the “option“ of interest on it. The car you order has nothing.

I ordered 2 Dodge pickups (pre COVID) The dealer was happy with $50 over invoice both times.

 

[dubber09]

The only time I bought a car I ordered was back in late '96 getting a '97 Jetta, took a couple of months to get it but was $100 over invoice so I was happy.
Canadian lots are slim pickings now, a couple of people I know got their Toyotas and had to order, even then ordering a higher priced car would get them here much faster as cheaper models have more orders and wait list is longer.

 

[SammyChevelleTypeS3]

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 kinda always liked doing my homework on what car we want. Check Dealership advertisements. Drive to a dealership and find one we like. Play the game with the salesman and then buy it. Pick it up the very next day after they prep / detail it.