When the new corvette came out the general requested that the dealers not add additional dealer markup as the new models hit the show room. The thought was that those that didnt follow GMs request would not recieve the invintory that was to come their way. Well that didn't work either. Many dealers have the idea that they will make the max on each sale and it won't matter how many cars they get. Now it is time for the Zo6 we'll see. If Toyota or any other manufacturer tell there dealers what price to sell there cars at the FTC(Federal Trade Commision) would be all over them. The last I new We in this country live by the Golden Rule..... The one with the Gold Makes the rules. That goes for anyone buying anything< if you have the gold you make the rule. How many car dealers are out there

 

The dealer can sell the Scion for whatever they want to, Toyota has said that to be in compliance with pure price we have to offer the same price to every customer. All aspects of the sale have to comply with the Scion covenent which states that we must have a clearly posted menu with price of the car, accessories, interest rates, extended warranties, insurance products, and dealer fees. It also states that dealers can only give one offer for a trade in ( this one is of course broken all of the time by dealers due to the fact that it is impossible to prove that another price was offered). If a dealer is caught breaking this rule they will lose 30% of their inventory. I have actually recieved extra inventory due to nearby dealers losing theirs.

Dealers also must post their menu on their website. A copy of the website menu (which is dated) must be placed in the dealer folder and then audited later by an auditor from Scion. If I wanted to sell the Scion for over the MSRP or discount it I have every right to, as long as every customer gets that same deal. If I wanted to throw in a free accessory I can do that as long as every customer gets the same treatment. Right now I have no reason to discount the car. I am selling every Scion I get at least two weeks before it comes in, so why would I want to make less of a profit on it. It also doesn't make sense to sell over MSRP I don't think its honest first of all and second of all I think it goes against everything that the Scion name stands for.

Blue_Bean lets pretend for a minute that you were in my shoes and you were a Scion dealer. How would you handle selling cars with the stipulations that we have when it comes to Scion?

 

Ok let’s pretend....
I am sure that you have a bean counter on hand. You should know what the costs are just to keep your doors open. After figuring the cost you pay for each car minus holdbacks and floor plan deals and dealer fees. you add the best case profit of lets say 10% any company would enjoy that amount of profit. Now you have to average that over the entire car line. Trucks, Vans and SUVs are very high profit makers. Brings the price of a little scion down quit a bit.
Look at it our way
Dealers have fees $400 to $650 in fees already printed on the purchase agreement
Add the $900 you already admitted to making on each car.
Add manufacturer’s incentives (hold backs and such)
$700 protection plans.
Money made from bank deals and financing
I have no problem with making a profit, employing others and supporting the communities we live in. But I do have a problem with anyone telling me that this is the price and it is set and that is it no recourse. If I can't buy what I want for the price that I am willing to pay then I will go elsewhere. Thats the American Way

 

If you don't see the value in a car I wouldn't expect you to buy it. A customer buys a car when the value exceeds the price. With Pure Price I am not selling a price I am selling the car which is a little different from the standard car sales matrix. Here is where you are wrong on your numbers...

1) My dealership has a $50 Doc fee, that is the only dealer fee and it pays for the title work to be done.

2) Yes the average is $900 which includes an average of $1700 in accessories and all finance and insurance profit.

3) There is no holdback on Scions....Zero...no in any way shape of form (this is on Scion only not Toyota) and we never EVER have dealer incentives on Scions. This is all in the Scion Covenent

4) If you mean extended warranty by protection plans I have already included that in the average $900 profit. We also don't add "undercoating" and such or cars a empty when we sell them

5) Again the average $900 is including all back end profit

I just wanted to make those points clear. Keep in mind that the Scion sales process is geared to a younger market of car buyers. This is how they wanted to buy cars and it is a system that is working very well. See my earlier post about how pure price does benifit most Scion buyers (not all).

 

I thought profit was the american way? If you want the american way go buy a domestic.

 

If your dealership does as you say, No add on dealer fees and such then it is unique to say the least. Good luck to you and I hope that you sell a bunch of cars. Yours is the exception

Mike

 

Actually, his dealership is similiar to the rest of us Scion dealerships following the Scion Covenant.

We can price it however we want, add whatever fees we want, discount it however we want, etc, etc. BUT (and it's a big one) we MUST post ALL prices, discounts, additional fees, etc, etc CLEARLY in the showroom AND on our website. That way, EVERYONE pays the same amount for the Scion over a certain time period (different over different regions).

If anyone has encountered a dealership who haggles in any capacity on the Scion transaction anywhere, that dealer sucks, and and is polluting the system for the rest of us. Bust him, so we can get more cars here at the compliant dealerships!

The system (Pure Pricing, The Scion Promise) works! You watch - within 5 years, the auto industry will be going this way ACROSS THE BOARD. You think that GM, Ford, and DCX had great sales during the 'employee pricing' debacle cause of the price? WRONG!! The reason why is was so successful was NO HAGGLE PRICING. FINALLY!! What a concept! Let's go BUY something. Not, let's go haggle for hours over something!

LATER

 

Pure Price was a definite plus for me. I hope that Toyota/Scion continues this practice. I have never cared for the dickering game.