Didn't see this one coming...

[Blown_By_You]

SO - too soon to start begging for an "R" allocation?

I'll have an R for sale.

Sent from my VS987 using Tapatalk

 

[13COBRA]

That's just one of the ways "funny money" works. I bet your books were still in the black at the end of that month and for the year.

Saying you took a "loss" on a car doesn't tell the whole story. You have inventory. You have to move inventory. You have a bottom line to meet. You meet the bottom line.

If you sell a Fiesta at a 50% discount then sell a GT350 with a $15K markup, where did you "lose" money? The bottom line will still say you turned a profit. Dealerships have played that word game for decades. Take a "loss" on one car and not budge on a different car in inventory. It always offsets. That's why I don't buy the "we're taking a loss on this one" line.

Correct, my books are very much in the black. However, we did lose money on that vehicle and so many throughout the year that I would hate to go back and count them.

Say I lost money on 200 new cars. Hell, say I lost only $100 on every one of them. That means I "lost" $20k. I do lose it, because I had the opportunity to hold on to the vehicles and not realize the lost until it's sold.

Make sense?

Wow for you to question his business without knowing him or his area or his books is bold.

Let put it this way a gentleman once stated that every year he ran his Scottsdale dealership they took a loss on new car sales every single year he owned the dealer.
The margins on new car sales are very low and once you factor in below msrp/invoice pricing, carrying costs, interest, advertising, sales, financing, dealer prep, utilities, land costs the margins are even lower.

Luckily new car sales is only one piece of the revenue stream for dealerships. And no 2 $20k adm sales do not make up the difference of selling 1k cars near invoice.

70% of dealers across the country lose money in he new car department every year.

At the end of the day, two $20k ADM deals wouldn't even be remembered on my books, and I'm not even a mega dealer.

 

[GT Premi]

...

I have no doubt that Chevy lost money on the Z28, but I don't think that was planned, they just screwed up and mis judged the market.

I do doubt Chevy lost money on the Z28. Correct me if I'm wrong, but manufacturers don't sell cars to dealerships at a discount, do they? They priced it wrong, but I don't think they lost money on them at the end of the day. Dealerships just weren't able to capitalize on it at the price Chevy put on it. That brings me to an interesting thought. Chevy priced the Z28 at $75K and couldn't sell it. Ford priced the GT350R at $63K, and it can't even be bought for less than $80K+. The new ZL1 is selling with discounts right out of the box. Are halo Mustangs that much more desirable than halo Camaros, or does the Shelby name still have that much cachet?

I'm not disappointed that the ZL1 is discounted. I've always said I wouldn't trade my GT500 for anything, but the new ZL1 presents a compelling argument!

...

Say I lost money on 200 new cars. Hell, say I lost only $100 on every one of them. That means I "lost" $20k. I do lose it, because I had the opportunity to hold on to the vehicles and not realize the lost until it's sold.

Make sense?

...

Yes, that makes sense, and I'm aware of those idiosyncrasies. When it comes to money, though, I only like to look at the bottom line because that's the only thing that matters in the grand scheme. After all is said and done, dealerships aren't losing money. Sure, you may not be realizing all the potential cash for every transaction, but when it's time to balance the books, you aren't "losing" money. I think a better way to put it is that you "missed" some opportunities on some transactions.

 

[13COBRA]

Yes, that makes sense, and I'm aware of those idiosyncrasies. When it comes to money, though, I only like to look at the bottom line because that's the only thing that matters in the grand scheme. After all is said and done, dealerships aren't losing money. Sure, you may not be realizing all the potential cash for every transaction, but when it's time to balance the books, you aren't "losing" money. I think a better way to put it is that you "missed" some opportunities on some transactions.

There are PLENTY of dealers that lose money every year. In my 20 group (20 different dealerships, including me) there are 7 that lost money every month last year.

 

[ON D BIT]

I do doubt Chevy lost money on the Z28. Correct me if I'm wrong, but manufacturers don't sell cars to dealerships at a discount, do they? They priced it wrong, but I don't think they lost money on them at the end of the day. Dealerships just weren't able to capitalize on it at the price Chevy put on it. That brings me to an interesting thought. Chevy priced the Z28 at $75K and couldn't sell it. Ford priced the GT350R at $63K, and it can't even be bought for less than $80K+. The new ZL1 is selling with discounts right out of the box. Are halo Mustangs that much more desirable than halo Camaros, or does the Shelby name still have that much cachet?

I'm not disappointed that the ZL1 is discounted. I've always said I wouldn't trade my GT500 for anything, but the new ZL1 presents a compelling argument!



Yes, that makes sense, and I'm aware of those idiosyncrasies. When it comes to money, though, I only like to look at the bottom line because that's the only thing that matters in the grand scheme. After all is said and done, dealerships aren't losing money. Sure, you may not be realizing all the potential cash for every transaction, but when it's time to balance the books, you aren't "losing" money. I think a better way to put it is that you "missed" some opportunities on some transactions.

Who do you think provides the $20k discount to sell the z28? It's sure not the dealer.
A gm dealer buys the z28 at 65k looking to get 75k msrp. When it does not sell gm has to offer the dealer incentives to mice the vehicle. The dealer then passes the incentive on to the dealer. So instead of gm selling the z28 at 65k dealers buy it at 45k after everything is said and done.

 

[VRYALT3R3D]

I believe when an OEM sells a car to the dealer, from the OEM's perspective(and on their books) the car is "sold." Obviously not to the end user of course. A dealer can lose money but it is not prevalent to assume OEMs lose money on cars for the sake of a sale.

 

[13COBRA]

I believe when an OEM sells a car to the dealer, from the OEM's perspective(and on their books) the car is "sold." Obviously not to the end user of course. A dealer can lose money but it is not prevalent to assume OEMs lose money on cars for the sake of a sale.

False.

GM is notorious to giving huge "rebates" or "discounts" on vehicles to move them...the rebates cost the manufacturer.

 

[natedog_1959]

The GM Dealer in Dowagiac MI still has a 2015 Z/28 new on the lot for $57k and change!

http://www.cwimberleygm.com/Vehicle...et-Camaro-2dr_Cpe_Z/28-Dowagiac-MI/2423739463

 

[GT Premi]

That's a good deal, but I think they're still going to have a hard time selling it. I didn't realize how much improved the 6th gen Camaro interior is over the 5th gen. Not to mention, for just a few K more, you can have yourself an updated ZL1. They might end up either having to sell it at auction or sending it to the crusher and charging it off.

 

[ON D BIT]

GM is charging it off with the the 20k+ rebate. The z28 has been this price for the last year. One of the members here got one.
Where have you been?

 

[Zemedici]

GM is charging it off with the the 20k+ rebate. The z28 has been this price for the last year. One of the members here got one.
Where have you been?

This , not to mention they've been doing the same shit to C7s for almost a year I imagine.