The Car Thread

[LETSGOBROWNIES]

I don’t even see the markups as “just trying to grab some cash”.  I honestly think a lot of these dealerships are probably at the point of needing them to stay in the black. 
 

Dealerships by me that have typically had hundreds of cars on the lot now how dozens, and that’s used and new combined.   If you can’t make money on volume, you’re going to have to start scalping folks tbh.

[Matts4313]

So, as I mentioned to @ET80, I was in HOU to buy rims for the gladiator this weekend. I got kinda carried away and ordered the following:

Insane Audio JL3001 Head Unit
Amp Kit
Amp
Sub
Speakers

Front camera for trails

Dash/passenger cam for accidents

Rockrail/drop steps

Tailgate toolboxes, driver and passenger

Interior trim pieces with orange accents

Rubicon Rims and Tires (already picked up this weekend)
Paint & accessories for rims and tires

Door removal bolts
Extra mirrors for when doors are off

Bedliner kit

Stubby antenna

Grab Handles

LED head lights

Custom decal package - retro scrambler style. 

Got started on the Rims, here is the progress so far. 

https://i.ibb.co/vqKc7JM/20211004-170757.jpg

 

Edited October 4, 2021 by Matts4313

[Tugboat]

On 9/30/2021 at 12:29 PM, Matts4313 said:

Update for those following at home. Sold the F150 and found out the Gladiator is still ~60 days until delievery. I cant go 60 days without a car, so I took a gamble.

I just bought a 2021 Ram 1500 Lonestar for $39k out the door (all fees/taxes). The sticker price was $45k. I am betting that I can trade this in for $39k+ in 2 months and have some additional equity. 

 

Lets see what happens 😬

That thing got a HEMI?

On 9/30/2021 at 1:39 PM, MrDrew said:

I see the part in bold first.

Look to se who made the post, and see the avatar.

Feel better about looking for a hybrid wagon.

You should get a Dodge Magnum.  You can unload them from both ends!!!  And they've got a HEMI!!!

[Tugboat]

On 9/30/2021 at 1:45 PM, Matts4313 said:

Not going to lie, the ram is extremely nice inside. Not that the F150 was a slouch, but this Ram is more decked out by far. Drives amazing. I can see why people love them.

 

The 1500 Rams really do drive more nicely, in the sense of being "more carlike" than anything else in the segment (aside from the previous gen Nissans that hung on for way too long).  They're pleasant, smooth, easy.  It's kinda weird.  And it makes for a strange jump, when their HD pickups drive probably the most commercial/farm vehicle-like in that segment.

 

But people do love Rams.  Become diehards.  Right up until they have a catastrophic experience with one.  And then sometimes still just go back for more, for some reason.

 

On 9/30/2021 at 2:31 PM, Matts4313 said:

One other note - The Ram car sales person confirmed the same thing that the Jeep Gladiator car salesman (different dealership) said:

Starting October 1, FCA (Jeep/Ram/Etc) are suspending most affiliate discounts, most of their consumer rebates and increasing pricing roughly ~$2k per a vehicle to compensate for the chip shortage. 

So while a 2021 right now is $39k after discounts, the 2022 will be $47k with very little to no discounts offered. Which is why I am ~85% sure I am going to make a profit on this deal. 

 

No way!!!  Two FCA salespersons told you the same thing!!!???  It's almost like perhaps, they might even maybe be in cahoots.  Via a general FCA sales directive.  That sales managers have passed down to their people on the floor.  Or it could be completely coincidental.  Two salespeople saying the same thing is pretty rigorous research.

 

On 9/30/2021 at 5:26 PM, MrDrew said:

While it all sounds good in theory, the dealership is in the profit business. You said sticker was $45k, and they sold it for $39k all in. They still made a profit. So if they gave you what KBB says, they'd have to sell it for more than new sticker. Even if they brought it in for what you paid, they'd have to sell it for at least new sticker. So if you're a dealer, and you know you have to turn a profit, do you buy that truck for $40k? They don't. They also don't pay full BB, unless they're adding onto the price of what you're buying. They may show you that you're getting the price you want, but you're paying full price for the new one. Even with a chip shortage, it's really hard to sell that new of a car because the value isn't there over new. If you want a better idea of what you'll actually get, see what CarMax is paying. That will be closer than KBB. 

And also..

https://www.cars.com/vehicledetail/dd446022-f713-4e42-99ef-e6b82fac5427/

Yeah.  Dealerships really aren't in the business of losing money.  They're in the business of moving cars off the lot.  They're not going to pay more money for the vehicle they just sold you, a couple months later.  Or even give you any sort of "equity" in trade-in.

 

The one thing that can fudge up the market though, is a car/truck that's been sitting on the lot for a while and not selling, as it starts to approach the end of the year.  Idk about dealership agreements in the US tbh...but up North, dealerships for certain brands have to "buy out" those vehicles that are still sitting on their lot.  Which impacts the way they can finance them, among other things.  Means the end-buyer still gets kinda screwed on a bunch of things, but makes them a lot more willing to "deal" on a vehicle.  That cash outlay also obvious impacts their ability to order the new units they want for 2022.  There's a point at which it's more profitable to just move the truck for next to zero $$$ while it's still "current year" than keep it on the lot.  And hope that you can sell the new truck you replace it with for more.

 

I honestly have no idea how that works, with the "chip shortage" right now.  But the whole thing has seemed to be hitting Ford a lot harder than anyone else.  So...

[Matts4313]

2 hours ago, Tugboat said:

That thing got a HEMI?

 

yup

1 hour ago, Tugboat said:

No way!!!  Two FCA salespersons told you the same thing!!!???  It's almost like perhaps, they might even maybe be in cahoots.  Via a general FCA sales directive.  That sales managers have passed down to their people on the floor.  Or it could be completely coincidental.  Two salespeople saying the same thing is pretty rigorous research.

cmon man, ive obviously done more research than that. and, as I posted like ~12 hours later, they were telling the truth. 

1 hour ago, Tugboat said:

Yeah.  Dealerships really aren't in the business of losing money.  They're in the business of moving cars off the lot.  They're not going to pay more money for the vehicle they just sold you, a couple months later.  Or even give you any sort of "equity" in trade-in.

Exactly.

Though your next sentence is wrong, because dealer across the country are buying used cars back for more than they sold.

1 hour ago, Tugboat said:

The one thing that can fudge up the market though, is a car/truck that's been sitting on the lot for a while and not selling, as it starts to approach the end of the year. 

Yeah, I mentioned this to Drew (hold backs, lot credits) and he ignored it completely.

1 hour ago, Tugboat said:

Idk about dealership agreements in the US tbh...but up North, dealerships for certain brands have to "buy out" those vehicles that are still sitting on their lot.  Which impacts the way they can finance them, among other things.  Means the end-buyer still gets kinda screwed on a bunch of things, but makes them a lot more willing to "deal" on a vehicle.  That cash outlay also obvious impacts their ability to order the new units they want for 2022.  There's a point at which it's more profitable to just move the truck for next to zero $$$ while it's still "current year" than keep it on the lot.  And hope that you can sell the new truck you replace it with for more.

 

I honestly have no idea how that works, with the "chip shortage" right now.  But the whole thing has seemed to be hitting Ford a lot harder than anyone else.  So...

I think thats because Ford has 2 new highly popular models. 

[Tugboat]

15 minutes ago, Matts4313 said:

yup

cmon man, ive obviously done more research than that. and, as I posted like ~12 hours later, they were telling the truth. 

Exactly.

Though your next sentence is wrong, because dealer across the country are buying used cars back for more than they sold.

Yeah, I mentioned this to Drew (hold backs, lot credits) and he ignored it completely.

I think thats because Ford has 2 new highly popular models. 

 

 

 

 

Degens from uptown, always muddin' in their HEMIs tho.

Edited October 5, 2021 by Tugboat

[Matts4313]

https://www.businessinsider.com/how-jeeps-climb-vertical-rock-crawl-walls-2021-9?utm_source=reddit.com

[scar988]

On 10/5/2021 at 7:46 AM, Tugboat said:

No way!!!  Two FCA salespersons told you the same thing!!!???  It's almost like perhaps, they might even maybe be in cahoots.  Via a general FCA sales directive.  That sales managers have passed down to their people on the floor.  Or it could be completely coincidental.  Two salespeople saying the same thing is pretty rigorous research.

Yeah.  Dealerships really aren't in the business of losing money.  They're in the business of moving cars off the lot.  They're not going to pay more money for the vehicle they just sold you, a couple months later.  Or even give you any sort of "equity" in trade-in.

The one thing that can fudge up the market though, is a car/truck that's been sitting on the lot for a while and not selling, as it starts to approach the end of the year.  Idk about dealership agreements in the US tbh...but up North, dealerships for certain brands have to "buy out" those vehicles that are still sitting on their lot.  Which impacts the way they can finance them, among other things.  Means the end-buyer still gets kinda screwed on a bunch of things, but makes them a lot more willing to "deal" on a vehicle.  That cash outlay also obvious impacts their ability to order the new units they want for 2022.  There's a point at which it's more profitable to just move the truck for next to zero $$$ while it's still "current year" than keep it on the lot.  And hope that you can sell the new truck you replace it with for more.

I honestly have no idea how that works, with the "chip shortage" right now.  But the whole thing has seemed to be hitting Ford a lot harder than anyone else.  So...

In the US, they don't have to. But a lot of times they do because it allows them to have rental fleets for the service departments. Chip Shortage has hit a lot of Japanese makes too really hard. Because Japanese makes are all really made in the US. 

[scar988]

For reference on my credentials, I sold cars for 5 years, then I did collections for 2 years on vehicles and credit cards, now I do loan origination primarily for vehicles (about 90% of what I have done the last 4 years is vehicle loans). So, I have a lot of knowledge about this particular subject and the market and how it works. So if y'all have any questions, especially about the finance or the dealer aspect of things, please let me know.

[MrDrew]

So it sounds like that there really isn't a chip shortage, it's that car manufacturers have been using an old product that's hard to make now, and won't update to the new standards because the current setup is proven.

https://jalopnik.com/i-asked-experts-why-carmakers-cant-just-transition-to-n-1847739665

This is probably going to be a long fight, and it's going to come down to the car makers way overpaying for the old chips, or the chip makers giving a great deal on the new stuff so it's worth it for the car makers to upgrade. Nobody will want to do either.

[Matts4313]

5 hours ago, scar988 said:

For reference on my credentials, I sold cars for 5 years, then I did collections for 2 years on vehicles and credit cards, now I do loan origination primarily for vehicles (about 90% of what I have done the last 4 years is vehicle loans). So, I have a lot of knowledge about this particular subject and the market and how it works. So if y'all have any questions, especially about the finance or the dealer aspect of things, please let me know.

Has the introduction of Vroom/Carvana changed how you do business with loans? I assume they do in house financing. 

Its a fascinating time to buy cars right now if you can dedicate the time and energy. Not just with the chip shortage, but with dealerships nationwide that are transitioning from to old car buying model to new digital only car sales (the Carvana method). Where I order my Jeep in Tennessee, they do 8% off of invoice + current incentives no matter how you spec it. Which means if you have the time and energy, there is a built in delta between the buying from a "wholesale" lot and what prices are in local markets. 

Its not just this jeep though, the same thing has happened with a Ford Maverick dealer in Pennsylvania (4% below invoice, which translates to roughly 7% below MSRP), a ford Bronco dealer in NC ($1k below invoice). It an entirely different world than being a slave to your local dealership.

 

 

[scar988]

2 hours ago, Matts4313 said:

Has the introduction of Vroom/Carvana changed how you do business with loans? I assume they do in house financing. 

Its a fascinating time to buy cars right now if you can dedicate the time and energy. Not just with the chip shortage, but with dealerships nationwide that are transitioning from to old car buying model to new digital only car sales (the Carvana method). Where I order my Jeep in Tennessee, they do 8% off of invoice + current incentives no matter how you spec it. Which means if you have the time and energy, there is a built in delta between the buying from a "wholesale" lot and what prices are in local markets. 

Its not just this jeep though, the same thing has happened with a Ford Maverick dealer in Pennsylvania (4% below invoice, which translates to roughly 7% below MSRP), a ford Bronco dealer in NC ($1k below invoice). It an entirely different world than being a slave to your local dealership.

 

 

Carvana and Vroom will accept my financing with no issues and I work at a somewhat small regional credit union in GA/AL doing primarily car loans. 

 

Those "Below invoice" numbers are really just invoice - hold back. 

[Matts4313]

2 hours ago, scar988 said:

Those "Below invoice" numbers are really just invoice - hold back. 

Absolutely. Its all a gimmick because invoice (and MSRP) are essentially fake numbers at this point. Invoice is not actually the cost of a car, but another new game that dealerships play. 

 

My point wasnt really that - it was the fact that there are dealerships now going public with a set price that any person can get no matter how good they are at negotiation. It swings some power back to the consumer.  I went to 3 dealerships in Austin with the offer from the Tennessee dealer. All three laughed at me and told me to order from that dealership

So I did. 

Edited October 8, 2021 by Matts4313

[scar988]

12 hours ago, Matts4313 said:

Absolutely. Its all a gimmick because invoice (and MSRP) are essentially fake numbers at this point. Invoice is not actually the cost of a car, but another new game that dealerships play. 

 

My point wasnt really that - it was the fact that there are dealerships now going public with a set price that any person can get no matter how good they are at negotiation. It swings some power back to the consumer.  I went to 3 dealerships in Austin with the offer from the Tennessee dealer. All three laughed at me and told me to order from that dealership

So I did. 

Invoice isn't really a fake number. The holdback that comes is normally to help offset the storage costs of a vehicle being on your lot for 8 months. But if you sell it within a couple of days of getting it from the factory, it doesn't really matter. 

 

Dealerships have been doing that for years though. I know it seems weird to hear, but when I was at AutoNation in 2014, we were doing that stuff. And that's 7 years ago.

[Matts4313]

8 minutes ago, scar988 said:

Invoice isn't really a fake number. The holdback that comes is normally to help offset the storage costs of a vehicle being on your lot for 8 months. But if you sell it within a couple of days of getting it from the factory, it doesn't really matter. 

 

Dealerships have been doing that for years though. I know it seems weird to hear, but when I was at AutoNation in 2014, we were doing that stuff. And that's 7 years ago.

I meant fake as in the number is massaged. The goal for many years was to "get to invoice" pricing. So a while back, manufactures and dealers started raising the invoice price to compensate. 

 

Based on my understanding of the history of the car market - this changed over happened in the the 90's/early 00's.