cliffy1

This post does have a little truth to it, but only a little. The "hidden" money is called holdback and delivery assistance money. There is no holdback on Scions and its only 2% on Toyotas. This isn't hidden because you can look it up on Edmunds. The delivery assistance money is hidden and is 1% of the base invoice of the car. This is money that goes to the dealer to cover certain expenses associated with prepping the car for sale. For instance, the xA and tC are shipped without the side view mirrors on it and the xB is shopped without the lower portion of the bumper. The shop must install these and the DAP money helps the dealer compensate for this.

As to incentives, there are none on a Scion. From time to time, Toyotas will have dealer incentives but they generally range from $300 to $700 on specific models that are selling slowly. Dealers generally use this to sell the car cheaper. At the moment, there are no dealer incentives on any Toyota.

Money coming back to the dealer is not profit. Its income. That is balanced against expenses before a profit is determined. A dealer takes the sale price minus invoice to get a "gross profit" figure. They then add any additional income like DAP, holdback and incentives and subtract out advertising expenses, commissions, salaries, average variable expenses, average floorplan interest and other costs to the dealer beofre profit is determined.

Finally, let me address the issue of finance company "kick backs." Its not a kickback. Its a fee. We arrange a loan, process the paperwork, record a lien and handle the legal disclosures. In exchange for this, the bank pays us a fee. On tier 1 and 2 customers, that fee is $325. On the lower tiers, its $250. Again, that is income, not profit until the expenses are taken out.

Just for a frame of reference, on Toyotas, the average "gross profit" on all cars generally runs in the $1500 to $2000 per car range, depending on the dealer. For Scions, that figure is a bit under $1000 nationally. That includes money made in finance and accessories. It does not include the DAP nor the variable expenses associated with the sale.

xA_Factor

Sorry, I was lumping the dealer and actual purchasing customer into one catagory when I said "retail customer". I guess I should have clarified that. The dealership is TMS's "customer".

When it gets that far down stream from manufacturing, it's all the "retail" side to me.

cliffy1

LOL. Anybody who can lump the dealer and customer into the same box has an office with a good view. Glad to have ya' haging around the forum.

Velheru

On the production side, each vehicle cost is different. Just depends on how the shop ran. OT in production is one of the biggest costs in production. A seinna rolls of the line every 73 seconds, but each one spends about 8 hours in the shop from body weld to paint to assembly. If the shop is running poorly that can go up to 8.5 hours or more per vehicle, sometimes pushing 10 hours. If it is a OT vehicle than it cost a whole lot more to make than one that was made in 8 hours. As for the plastic components being made cheap in China, most of the plastic (Instrument Panel, Door Panels, etc.) are made in house at the manufacturing plant, so they arent as cheap as one would expect. Another thing is that most of the components made by suppliers on property or close to it, especially in Japan. At Toyota City you will see a plant surrounded by factories that make the seats, mount tires, and so on. Therefore these parts cant be produced at super low price and quality chinease factories.

Tomas

When it comes to a VERY rough 'bottom line' on how much it costs a manufacturer to make their average vehicle, has anyone bothered to take a manufacturer's year end statements of profit and loss as a starting point?

If "manufacturer A" made 100,000 cars, sold whatever smaller number of them to their distribution chain for $2,000,000,000, and $50,000,000 was their end of year profit, that means they averaged a profit of $500 per car...

That would mean that THOSE cars averaged a total cost of $15,000 each to "make" counting all the expenses of running the company and taking care of customer problems, crashing "x" cars for various governments (and for their own testing), and those somehow "spoiled" in manufacture, shipping, or whatever, and turned back into raw materials.

Anyone have any 'raw' figures for Toyota vehicle manufacturing? Scion?

bB2NER

Scion/Toyota Corp. are making profits on the Scion line. I would guess around 2-3 K per unit. There is more profit there than just what the invoice price is trying to lead you to believe.

xA_Factor

Nope.......no office for me. I'm ground-level production.