SBAD

but the quarterly/annual Porsche sales numbers say something different don’t they? Volumes are relatively normal, it’s just the cars are all bought before they arrive. That is a boon for dealers in that they don’t need to carry inventory. Or so it seems .

M3Inline6

Porsche is raising prices significantly for the next model year to capitalize on the money people are willing to pay (…since they see dealers making a lot of money). My local dealer told me to get a ‘22 Macan that I inquired about before the MY23’s are in the system because the price increase is substantial. I was also informed that after June/July, the dealer has ZERO cars coming in because of the chip and wiring harness issues. ADM is here to stay [unless you know someone] for the foreseeable future. Ford has been doing the ADM thing for at least 7-8 years, and the Raptors and high performance Focus cars continued to sell.

shrimp money

But you must realize there are more people now. The younger generation have more avenues to generate tens of thousands in income a month now. You don’t need to wait until you’re 70 to afford a 911 anymore.

nyca

No one needs the dealer networks anymore. What service do they even provide, other than marking up the cars over MSRP? It's time for the "great reset" in the auto sales business, the states need to change their franchising laws to allow direct manufacturer sales to consumers, like Tesla does, and collapse these worthless dealer sales networks. Porsche aside since its a niche brand that caters to the wealthy, the only thing these dealer networks are doing now is helping to destroy the US middle class.

M3Inline6

No thanks!

manifold danger

Maybe I'm ignorant, so please help educate me (a link to good reference material would actually be great).... but WHY?

As far as I can tell, dealers are not doing consumers any favors in this market, especially if they're tacking on $40k in "market adjustment" fees to what the manufacturer would charge if bought direct. If this is expected to continue, please tell me why you are so opposed to it? Because you love the free coffee and energy bars?

nyca

My BMW dealer did away with free food, except water, in the service waiting area. So they aren't even giving people that anymore. The Tesla sales model has to be the future, these corrupt state franchise laws stand in the way. If most cars sold by 2030 are going to be EVs anyway, who even needs the dealer service networks - when there isn't anything to service on the cars.

slc4s

anecdotally its been probably 18 months since i've seen an "in stock" car that felt like a spec I would buy. In the last 2 weeks I've seen 3. A GT3T, high spec C2S, and a GTS. They all had markups obviously but I was tempted. One had a 20k ADM and I got excited but then it also had another 25k of dealer add-ons that were total BS.... Wholesale prices on used cars are starting to fall a bit. So SOME signs that the market is softening a tiny bit. I could see the interest rate increases causing some to back out on their orders as well. Not saying its going to turn quickly but I could see ADMs in a more reasonable range 6 months from now...

Drew46

The market clearing price for a car is the market clearing price - regardless of where all the profit goes. What makes any of us think that eliminating the dealer reduces the market clearing price and puts that cash in our pocket as opposed to the market clearing price staying about the same and the extra profit going to the manufacturer? Granted, manufacturers are not going to implement ADMs, but they will likely adopt the Tesla model of much more frequent changes in MSRP where they effectively build the "market adjustment" into the price. I just don't see eliminating the dealership ending up improving my experience or resulting in much of that cost savings benefiting the consumer.

Carlo_Carrera

Exactly. We have only ourselves to blame.

3rdpedal

Yeah. If only people would stop overpaying for homes, the market wouldn't keep going up and up with bidding wars. And consequently my house wouldn't be worth as much to sell.

Drew46

If only people would stop overpaying for stocks. . . . . oh, wait, I take that back.

dhirm5

Especially in the auto market. Have we *ever* seen a market like this in autos?

I'm used to it in real estate - and only real estate, tho I'm sure there are categories of things I don't get involved in which have similar; art, watches, maybe?

shrimp money

Are we over paying, or is our money just worth less?

JRoach

VW is leaning on the Agency Model in the EU. I wouldn't be surprised to see that in the US soon if not already (ID models from VW?). That would fix the ADM but not the supply issue.
Supply issue was inevitable...if not covid it would have been a tsunami, war, whatever. Really more of an issue with management and business resumption after an event like covid.