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Are Car Dealers a Business Worth Keeping? (vox.com)
schwit1 writes: An opinion piece at Vox argues that "car dealers are awful," and the efforts to protect them against direct sales from Tesla and other manufacturers are misguided. "Buying a car involves going from dealer to dealer, each of whom has his own inventory. One guy only has blue paint. The other guy doesn't have the blue paint, and also only has dark gray seats. And each has his own fake sticker prices and complicated cash-back offers. It's no wonder 83 percent consumers say they would rather skip the haggling, and a third of people say doing taxes is less annoying than working with a car dealer.
But it's not just the hassle. State bans on direct sales turn out to cost consumers an enormous amount of cash. It's an enormous problem, and it warrants a federal solution. Cars are the most expensive consumer product that the typical consumer buys. And while it may seem obvious that cars are expensive due to the material and labor required to build them, the logistics of distributing cars is actually a very expensive part of the process. Research by Eric Marti, Garth Saloner, and Michael Spence has concluded that as much as 30 percent of the cost of a car is the cost of distribution.
But it's not just the hassle. State bans on direct sales turn out to cost consumers an enormous amount of cash. It's an enormous problem, and it warrants a federal solution. Cars are the most expensive consumer product that the typical consumer buys. And while it may seem obvious that cars are expensive due to the material and labor required to build them, the logistics of distributing cars is actually a very expensive part of the process. Research by Eric Marti, Garth Saloner, and Michael Spence has concluded that as much as 30 percent of the cost of a car is the cost of distribution.
most cars sold are sold by dealerships owned by large chains that span counties or states. you might call them regional businesses, but very few of them are small enough to be considered local.
Having lived in the US previously, I much prefer the Norwegian (and most of the EU) model where you go online or to a dealer and figure out exactly which car you want:
Engine, paint, transmission, seats etc, then you haggle a bit about the price and order it, with delivery a number of weeks later.
In the US it seemed dealers really needed to be able to deliver a car TODAY, not tomorrow or next week.
Personally I ordered a Tesla 4WD model a few days ago, for delivery in the beginning of March.
The main difference from my last car was in the fixed sticker price: No haggling about rebates, just a simple take it or leave it offer.
The main reason for getting a Tesla here in Norway is of course our incredibly high import duties and taxes on regular cars (a car with a V8 engine would probably cost 2.5 to 3 times as much as in the US), while a Tesla has no import duties, no sales tax, no road fees and lots of free parking & charging. In a couple of years they have stated that the relative subsidies for zero emission vehicles will get a cap, so only smaller cars will be able to take full advantage.
Terje
"almost all programming can be viewed as an exercise in caching"
My wife and I have used a gimmick where we go into the dealership together and I do all the talking with the salesdroid and she only acts minimally interested in the process, like the car is for me and she's just along for the experience.
Once we've sorted out what we want to buy and have some kind of researched invoice price, we switch roles. I quit saying anything at all and she starts negotiating with the salesdroid.
It really fucks with their head and they don't negotiate well. My wife is kind of an ass-kicker in negotiations to begin with and this gives her a huge psychological advantage. One guy kept trying to talk to me and she got pissed at him and yelled at him for not talking with the person she was actually negotiating with.